Southern District of New York

False claims in the healthcare industry cost every American.  Today, a unanimous jury found Omnicare, the country’s largest long-term care pharmacy, liable for fraudulently dispensing drugs without valid prescriptions to elderly and disabled people in assisted living facilities and other residential long-term care facilities.  After a four-week trial, the jury found that Omnicare billed Medicare, Medicaid, and TRICARE for over three million false claims resulting in $135,592,814 in damages.  Under the federal False Claims Act, the Government is entitled to three times the amount of these assessed damages, or $406,778,442, plus statutory penalties to be determined by the Court.  This is one of the largest damages verdicts rendered by a jury in a False Claims Act case.  The jury also found CVS Health Corporation, Omnicare’s parent, liable for causing Omnicare to submit false claims.  I thank the women and men of our Civil Division for continuing to pursue those who seek to exploit the healthcare system.  I also thank the U.S. Department of Health and Human Services and the Department of Defense for their support and assistance throughout this case.

Jay Clayton, the United States Attorney for the Southern District of New York, and Edward Gallashaw, the Acting Inspector in Charge of the New York Division of the United States Postal Inspection Service (“USPIS”), announced today charges against MICHEAL PENA, HARRINGTON DELAHOZ, JOSHUA GUTIERREZ, and JAYSEN DORSEY.  The defendants are charged with conspiracy to commit bank fraud and wire fraud and aggravated identity theft.  PENA and GUTIERREZ were arrested this morning.  GUTIERREZ will be presented later today before U.S. Magistrate Judge Barbara Moses.  PENA will be presented before U.S. Magistrate Judge Daniel C. Irick in the Middle District of Florida.  DELAHOZ and DORSEY remain at large.   

U.S. Attorney Jay Clayton said: “As alleged, Micheal Pena and his co-defendants orchestrated a massive, multimillion-dollar scheme to steal innocent victims’ money.  The defendants obtained real checks, including from the mail, forged the checks, falsified identities, sold the checks to others, and took advantage of multiple financial institutions.  The defendants’ fraudulent scheme affected real people and the millions of Americans who rely on the United States banking system and the United States mail.” 

USPIS Acting Inspector in Charge Edward Gallashaw said: “These individuals allegedly devised a scheme to steal checks from the U.S. Mail and then, in some cases, sell the personal identifiable information on these stolen checks via an encrypted messaging platform to colluding individuals. They furthered their scheme by altering the payee and amount originally written on these checks, stealing from the unsuspecting public. Let today’s arrest serve as an example for those trying to make quick money while financially preying on the American public, Postal Inspectors will put an end to your criminal enterprise. We will vigorously pursue you and bring you to justice for your illegal acts against our customers and the Postal Service. We are thankful for the United States Attorney’s Office for the Southern District of New York for their dedication on this case.”

According to the allegations contained in the Complaint:[1]

From at least in or about April 2023 up to and including at least in or about October 2024, PENA, DELAHOZ, GUTIERREZ, and DORSEY carried out a national scheme to sell more than $53 million in stolen checks and fraudulently alter stolen checks that they then deposited at various financial institutions.  As part of that scheme, PENA operated and used a channel on a particular messaging platform, which went by the moniker “White House Vibez” and had thousands of subscribers, to sell checks that had been stolen from the U.S. Postal Service. Below is an image that was posted on White House Vibez on or about February 19, 2024, depicting what appears to be numerous pieces of stolen mail and checks and advertising a forthcoming batch of checks for sale.

Purchasers of checks were directed to send payments to several accounts on a popular mobile payment platform, at least two of which were set up by GUTIERREZ and DELAHOZ using false identification. Along with the stolen checks, purchasers were also sometimes offered personal identifying information of the victim-payors of the stolen checks.  As an example, below is a check posted for sale, and listed as sold, on White House Vibez, along with an offer to sell the social security number and date of birth of the victim-payor.  

Additionally, during this period, PENA, DELAHOZ, GUTIERREZ, and DORSEY deposited hundreds of thousands of dollars in stolen checks at various financial institutions, including checks that had been previously posted for sale on White House Vibez.  Before such checks were deposited, they were “washed,” which is a process by which the payee’s information and amount on the check are removed and rewritten to reflect another payee’s identity and amount. The defendants flaunted their success on White House Vibez, posting images of check deposit receipts and large cash withdrawals.

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PENA, 26, formerly of Woodridge, New Jersey; DELAHOZ, 46, of Bronx, New York; GUTIERREZ, 30, of New York, New York; and DORSEY, 28, of New York, New York, are each charged with conspiracy to commit bank fraud and wire fraud, which carries a maximum sentence of 30 years in prison, and aggravated identity theft, which carries a mandatory minimum sentence of two years in prison.

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Clayton praised the outstanding investigative work of the USPIS.

This case is being handled by the Office’s General Crimes Unit.  Assistant U.S. Attorney Varun A. Gumaste is in charge of the prosecution.

The charges contained in the Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.  

[1] The charges contained in the Complaint are merely accusations and the defendants are presumed innocent unless and until proven guilty.

Jay Clayton, the United States Attorney for the Southern District of New York and Christopher G. Raia, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”) announced today the arrest of SAMUEL GONZALEZ, a former teacher at an acting school in New York City.  GONZALEZ is charged with distributing and possessing child pornography, including videos depicting the sexual abuse of infants and toddlers.  GONZALEZ will be presented later today before U.S. Magistrate Judge Barbara Moses.

U.S. Attorney Jay Clayton said: “As alleged, Samuel Gonzalez distributed a large volume of child pornography, including images of sexual abuse of children as young as a few months old.  The lasting scars from the horrific abuse of children are deeply troubling to all New Yorkers.  Together with our partners, we will relentlessly pursue those who victimize children and prosecute them to the fullest extent of the law.”

FBI Assistant Director in Charge Christopher G. Raia said: “Samuel Gonzalez allegedly distributed thousands of pornographic images of infants and minors to an undercover federal agent over a brief period.  Gonzalez’s alleged actions grossly disregarded the victims’ welfare and repeatedly violated their privacy by sharing this twisted material.  The FBI is deeply committed to preventing crimes against children and will continue to apprehend any individual who supplies these explicit images.”   

According to the allegations contained in the Complaint:[1]

GONZALEZ is an actor, dancer, theater producer, and former teacher at an acting school in New York City.  In or about January 2023 and April 2023, GONZALEZ used an online messaging application to send links containing over 1,500 files of child pornography to a federal law enforcement agent acting in an undercover capacity.   In addition, in or about June 2023, federal agents executed a judicially-authorized search warrant of GONZALEZ’s apartment.  Pursuant to that warrant, federal agents seized and searched GONZALEZ’s phone and laptop, which were found to contain over 80 unique files of child pornography, including videos and images of infants and prepubescent adolescents who had not attained 12 years of age.

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GONZALEZ, 31, of Brooklyn, New York, is charged with one count of distribution of child pornography, which carries a mandatory minimum sentence of five years in prison and a maximum sentence of 20 years in prison.  GONZALEZ is further charged with one count of possession of child pornography, which carries a maximum sentence of 20 years in prison.

The statutory maximum potential sentence in this case is prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.

Mr. Clayton praised the outstanding investigative work of the FBI and the FBI/New York City Police Department Child Exploitation and Human Trafficking Task Force. 

This case is being handled by the Office’s General Crimes Unit.  Assistant U.S. Attorneys Katherine Cheng and Diarra M. Guthrie are in charge of the prosecution.

The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty. 

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.

Jay Clayton, the United States Attorney for the Southern District of New York, and Christopher G. Raia, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that HAJI NAJIBULLAH, a/k/a “Najibullah Naim,” a/k/a “Abu Tayeb,” a/k/a “Atiqullah,” a/k/a “Nesar Ahmad Mohammad,” pled guilty to hostage taking and providing material support for acts of terrorism resulting in death in connection with NAJIBULLAH’s role in the hostage taking of an American journalist and two Afghan nationals in Afghanistan and Pakistan in 2008 and 2009, and his leadership of Taliban fighters who carried out attacks on U.S. servicemembers in Afghanistan between 2007 and 2009, resulting in the deaths of American soldiers.  NAJIBULLAH pled guilty today before U.S. District Judge Katherine Polk Failla.

U.S. Attorney Jay Clayton said: “Haji Najibullah was a Taliban commander who committed acts of terrorism against U.S. servicemembers and civilians in Afghanistan. His vicious acts of terrorism included taking hostage multiple civilians and providing material support for attacks that resulted in the deaths of brave Americans.  Najibullah committed his crimes in Afghanistan over 15 years ago, and now faces justice in an American courtroom.  Today’s guilty plea serves as an emphatic reminder that this Office, and our law enforcement partners, will aggressively pursue those who harm Americans through acts of terror, no matter where in the world they may be, and no matter how long it may take to achieve justice for their victims.  I thank the career prosecutors of this Office, and our dedicated partners, for their work in holding Najibullah accountable for his heinous crimes.”

FBI Assistant Director in Charge Christopher G. Raia said: “For years, the FBI New York JTTF and our law enforcement partners tirelessly sought justice for the hostage taking of civilians, and also for the deaths of United States service members at the hands of Taliban fighters under Najibullah’s command.  These terrorist attacks demonstrated utter disregard for humanity, and Najibullah finally admitted to his role in these premature deaths of our citizens.  Today’s plea emphasizes the FBI New York JTTF’s unwavering resolve to disrupting all acts of terrorism and ensuring any individual who targets our country will be held accountable.”

As alleged in the charging instruments, court filings, and statements in the public record:

Between approximately 1996 and 2001, the Taliban controlled Afghanistan and harbored and supported terrorists, including terrorists involved in perpetrating the September 11, 2001, terrorist attacks on the U.S.  After losing power in approximately October 2001 as a result of the U.S. and NATO-led invasion of Afghanistan, the Taliban engaged in a deadly insurgency campaign to regain control of the country.  Beginning in the early 2000s, as part of that campaign of violence, the Taliban conducted numerous suicide bombings, targeted killings, assassinations, improvised explosive device (“IED”) attacks, paramilitary ambushes, and hostage takings against the then-government of Afghanistan, U.S. military forces and their NATO and Afghan partners, and American civilians in Afghanistan.

Between in or around 2007 and 2009, NAJIBULLAH served as a Taliban commander in Afghanistan’s Wardak Province, which borders Kabul.  During that time, Taliban fighters under NAJIBULLAH’s command carried out deadly attacks against American and NATO troops and their Afghan allies, using, among other things, suicide bombers, automatic weapons, IEDs, and rocket-propelled grenades (“RPGs”) and other anti-tank weapons and explosives, including against U.S. military helicopters. 

For example, on or about June 26, 2008, Taliban fighters under NAJIBULLAH’s command ambushed and attacked a U.S. military convoy in the vicinity of Wardak Province, Afghanistan, with IEDs, RPGs, and automatic weapons, killing three U.S. Army servicemembers: Sergeants First Class Matthew L. Hilton and Joseph A. McKay, and Sergeant Mark Palmateer, and their Afghan interpreter. Several other servicemembers were also injured in the attack.  

In or about November 2007 and September 2008, NAJIBULLAH participated in two videorecorded interviews with a French reporter in Afghanistan.  NAJIBULLAH and fighters under his command discussed how they targeted American and French troops—including a specific attack they conducted against French troops in or around August 2008.  They also identified a particular location where they had used IEDs and anti-tank weaponry to destroy American military vehicles.  During the interview, NAJIBULLAH further demonstrated how to operate a rocket-propelled grenade launcher to shoot troops guarding checkpoints and boasted that fighters under his command were ready to fight the “holy war,” including that they were “ready to be suicide bombers” and “put on a belt and blow themselves up if we ask them.”  In September 2008, in the French reporter’s presence, NAJIBULLAH and fighters under his command attacked and destroyed an Afghan National Police outpost using automatic weapons and rockets.

On or about November 10, 2008, NAJIBULLAH and other Taliban fighters took hostage an American journalist (“U.S. Hostage-1”) and two Afghan nationals who were assisting U.S. Hostage-1 (together with U.S. Hostage-1, the “Hostages”) at gunpoint in Afghanistan.  Shortly thereafter, NAJIBULLAH and his co-conspirators forced the Hostages to hike across the border from Afghanistan to Pakistan, where NAJIBULLAH and his co-conspirators detained the Hostages.  For the next approximately seven months, NAJIBULLAH and his co-conspirators held the Hostages captive in Pakistan.  NAJIBULLAH and his co-conspirators forced the Hostages to make numerous calls and videos seeking help, in an attempt to compel ransom payments and the release of Taliban prisoners by the U.S. Government.

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NAJIBULLAH, 49, pled guilty to providing material support for acts of terrorism resulting in death, which carries a maximum sentence of life in prison, and to hostage taking, which also carries a maximum sentence of life in prison.  

The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Clayton praised the outstanding efforts of the FBI’s New York Joint Terrorism Task Force, which principally consists of agents from the FBI and detectives from the New York City Police Department.  He also thanked the New York and New Jersey Port Authority Police, the Department of Defense, and the Counterterrorism Section of the Department of Justice’s National Security Division for their assistance with this investigation, as well as the Ukrainian authorities and the Justice Department’s Office of International Affairs for their assistance in the arrest and extradition of the defendant.

This prosecution is being handled by the Office’s National Security and International Narcotics Unit.  Assistant U.S. Attorneys Sam Adelsberg, Jacob H. Gutwillig, and David J. Robles are in charge of the prosecution, with assistance from Trial Attorney Jennifer Burke of the Counterterrorism Section.

Jay Clayton, the United States Attorney for the Southern District of New York, announced that MOHANAD AL-ZUBAIDI and SHAKER SALEH MOHAMMED HAUTER were both sentenced to three years in prison for operating an unlicensed money transmitting business that was responsible for illicitly moving more than $65 million between the United States and countries in the Middle East, including Yemen, Turkey, Iraq, the United Arab Emirates, and Jordan.  AL-ZUBAIDI and HAUTER previously pled guilty on January 15, 2025, before U.S. District Judge P. Kevin Castel, who imposed yesterday’s sentence.

U.S. Attorney Jay Clayton said: “Mohanad Al-Zubaidi and Shaker Saleh Mohammed Hauter ran an underground financial network that illegally transferred tens of millions of dollars between the United States and the Middle East. The sentences imposed yesterday send a clear message that those who operate these unlawful financing networks will be held accountable.”

According to the Indictment, plea agreements, and statements made in court:

Between in or about 2018 through at least in or about 2022, AL-ZUBAIDI and HAUTER operated an unlicensed money transfer business that was responsible for illicitly moving more than $65 million between the U.S. and countries in the Middle East. AL-ZUBAIDI and HAUTER facilitated hundreds of illicit money transfers, with each transfer ranging from thousands to hundreds of thousands of dollars. For the illicit transactions they completed, AL-ZUBAIDI and HAUTER typically earned a commission of between one and six percent of the total amount transferred. To facilitate these illicit transfers, AL-ZUBAIDI and HAUTER worked with other members of an international network of money brokers to transfer money through an informal money transmitting system known as “hawala,” which is frequently used by money launderers and other criminals to transfer criminal proceeds abroad.

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In addition to the prison terms, AL-ZUBAIDI, 37, of Piscataway, New Jersey, and HAUTER, 52, of the Bronx, New York, were both sentenced to two years of supervised release and ordered to pay forfeiture of $385,000 and $430,000, respectively.

Mr. Clayton praised the outstanding investigative work of the Internal Revenue Service Criminal Investigation and U.S. Postal Inspection Service.  Mr. Clayton also recognized the assistance of U.S. Customs and Border Protection.

The prosecution of this case is being handled by the Office’s General Crimes Unit.  Assistant U.S. Attorneys Matthew J. King and Amanda C. Weingarten are in charge of the prosecution.

Jay Clayton, the United States Attorney for the Southern District of New York, announced that EUGENE WILLIAM AUSTIN, JR., a/k/a “Hugh Austin” (“AUSTIN”) was sentenced today to 18 years in prison.  AUSTIN was convicted following a jury trial in September 2024 of conspiracy to commit wire fraud, conspiracy to commit money laundering, and conspiracy to commit interstate transportation of stolen property.  The defendant’s son, BRANDON AUSTIN (“BRANDON”), was previously sentenced to four years in prison in connection with his role in the scheme.  U.S. District Judge P. Kevin Castel imposed both sentences.

U.S. Attorney Jay Clayton said:  “For years, Hugh Austin was the leader of a fraud and money laundering scheme that stole more than $12 million from more than two dozen victims.  Austin involved his own son in his crimes, working with him to rip off victims and spending investor money on personal expenses, like luxury hotels.  Thanks to the work of the career prosecutors of this Office and our law enforcement partners, Austin will now be held accountable for the harm he caused to individual investors and others.”      

As reflected in the evidence presented at trial and other public filings:

AUSTIN was the leader of a scheme with his son BRANDON and others to steal money from entrepreneurs, investors, and other victims by fraudulently offering to, among other things: serve as a broker for sales of large quantities of cryptocurrency; provide short-term investments in cryptocurrency for purportedly high returns; and secure investors for startups and other small businesses from their network of high net worth individuals.  AUSTIN also frequently sought personal loans from friends and acquaintances in connection with AUSTIN’s purported cryptocurrency and investment businesses, falsely promising to pay lenders back with interest.  In each instance, investors and lenders lost their money.  AUSTIN and BRANDON frequently spent investors’ funds on personal expenses, including airline travel, luxury hotels, restaurants, shopping, as well as nominal payments to victims to prolong the scheme.  In total, AUSTIN and BRANDON have caused more than $12 million in losses to more than two dozen victims. 

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In addition to the prison term, AUSTIN, 62, of Port Jefferson, New York, was sentenced to three years of supervised release and ordered to forfeit $6,062,564 and pay restitution in the amount of $12,662,564.

Mr. Clayton praised the outstanding investigative work of Homeland Security Investigations.

The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorneys Olga I. Zverovich, Matthew Weinberg, and Andrew K. Chan are in charge of the prosecution, with assistance from Paralegal Specialists Chanel-Ashley Foster, Frank Mastroianni, and Christine Woods.

I am honored to serve as United States Attorney for the Southern District of New York, alongside the women and men of the U.S. Attorney’s Office, an institution synonymous with excellence and integrity.  I would like to thank President Trump and Attorney General Bondi for this remarkable opportunity.  Along with the talented prosecutors of this Office and our law enforcement partners, I look forward to protecting public safety, combatting fraud, particularly on the elderly and most vulnerable, ensuring the integrity of our financial system, and defending our national security. Finally, I want to thank Acting United States Attorney Matthew Podolsky for his leadership and service.

U.S. Foreign Terrorist Organization MS-13 leader Yulan Andony Archaga Carías, also known as “Alexander Mendoza” and “Porky,” 43, is the highest-ranking member of MS-13, a U.S.-designated Foreign Terrorist Organization (FTO), in Honduras and was previously charged in 2021 in a superseding indictment in the Southern District of New York with racketeering, narcotics trafficking, and firearms offenses. Archaga Carías, a Honduran national, was subsequently placed on the FBI’s 10 Most Wanted Fugitives List, the DEA’s Most Wanted Fugitives List, and U.S. Immigration and Customs Enforcement Homeland Security Investigations (ICE HSI)’s Most Wanted Fugitives List. The Department of State’s Bureau of International Narcotics and Law Enforcement Affairs is offering a reward under the Transnational Organized Crime Rewards Program (TOCRP) of up to $5 million for information leading to his arrest and/or conviction in any country.

“This terrorist leader can no longer be allowed to live free as MS-13’s evil devastates communities in America and throughout the western hemisphere,” said Attorney General Pamela Bondi. “If you can contribute information leading to his arrest – come forward now.”

Archaga Carías remains at large. If you have information, please contact the FBI by email at [email protected], or via WhatsApp at +1-832-267-1688. If you are outside the United States, you may also contact the nearest U.S. Embassy or Consulate. If you are in the United States, you may also contact the local FBI, DEA, or HSI office in your city. Only tips sent to U.S. Government will be considered for reward.

“Dismantling and ultimately eliminating MS-13 continues to be one of the FBI's highest priorities, and we're not stopping until that mission is complete,” said FBI Director Kash Patel. “Alongside our dedicated law enforcement partners, the FBI will find Archaga Carías — a terrorist whose reign of terror at the helm of MS-13 is coming to an end.”

“With MS-13 now officially designated as a Foreign Terrorist Organization, the rules have changed — and so has the mission,” said DEA Acting Administrator Derek Maltz. “Archaga Carías isn't just a fugitive — he's a foreign terrorist waging war on innocent Americans through murder, trafficking, and terror. Let me be clear: under this Administration, we will dismantle MS-13 piece by piece—and anyone protecting him will fall with him. A $5 million is on the table. Turn him in. End this threat.”

A co-defendant, David Campbell, aka “Viejo Dan” and “Don David,” a Honduran national, is currently in custody in the United States facing the charges contained in the superseding indictment. In addition to Archaga Carías and Campbell, the superseding indictment charges three other MS-13 leaders, Juan Carlos Portillo Santos also known as “Juancy;” Victor Eduardo Morales Zelaya also known as “Cuervo;” and Jorge Alberto Velasquez Paz also known as “Chacarron,” with racketeering, narcotics trafficking, and firearms offenses. Portillo Santos, a Honduran national, is in custody in Honduras serving a lengthy prison sentence. Morales Zelaya and Velasquez Paz, both Honduran nationals, remain at large. The case is assigned to U.S. District Court Judge Gregory H. Woods for the Southern District of New York.   

“MS-13 remains one of the most dangerous criminal organizations in the world, and the recent designation of MS-13 as a Foreign Terrorist Organization underscores this reality,” said Acting U.S. Attorney Matthew Podolsky for the Southern District of New York. “This Office, working closely with our law enforcement partners, will continue to investigate, prosecute and track down MS-13’s leadership, no matter where in the world they may be hiding.”

As alleged in the superseding indictment previously unsealed in Manhattan federal court, Mara Salvatrucha, commonly known as MS-13 is a transnational criminal and foreign terrorist organization that engages in acts of violence, including murders, kidnapping, and assaults, extortion, and large-scale drug importation and distribution throughout Central America and the United States. Archaga Carías is the highest-ranking member of MS-13 in Honduras. As the leader and highest-ranking member of MS-13 in Honduras, Archaga Carías is in charge of, among other things, the gang’s drug trafficking operations, ordering and coordinating acts of violence, including numerous murders, and the laundering of drug proceeds. MS-13’s drug trafficking operations led by Archaga Carías include the processing, receiving, transporting, and distributing of multi-ton loads of cocaine shipped through Honduras and into the United States.

“President Trump has been very clear — we will not allow criminal groups and their members like Porky to threaten Americans,” said Senior Bureau Official F. Cartwright Weiland of the Department of State’s Bureau of International Narcotics and Law Enforcement Affairs. “We will work with our international partners to find these criminals wherever they may be hiding.”

Archaga Carías and other MS-13 members and associates acting at his direction also provided protection to drug trafficking organizations (DTOs) engaged in transporting multi-ton loads of cocaine through Honduras and destined for the United States. Archaga Carías contracted out members of MS-13 as “Sicarios,” or hit men, to DTOs for payment. Members of MS-13 committed numerous murders for hire for DTOs trafficking cocaine through Honduras to the United States. Archaga Carías and MS-13 also supplied DTOs with firearms, including machineguns, that were received from El Salvador, Nicaragua, and elsewhere. Archaga Carías also ordered multiple murders of rival gang members and drug trafficking competitors in Honduras, as well as other members of MS-13 whom Archaga Carías believed had been disloyal to the gang.

Campbell was one of the principal suppliers of cocaine and weapons, including machineguns, to MS-13. As an associate of MS-13 and close confidant of Archaga Carías, Campbell planned and coordinated retaliatory acts of violence with Archaga Carías, and assisted MS-13 and Archaga Carías in establishing businesses to launder the gang’s drug proceeds. Campbell and MS-13 used businesses they owned or controlled to launder drug proceeds, including through banks in the United States.

Morales Zelaya was a national leader of MS-13 in Honduras and a close associate of Archaga Carías. Morales Zelaya coordinated the gang’s drug trafficking business, acts of violence (including murders) against rivals, and the movement of proceeds from the gang’s illicit activities.

Portillo Santos was a high-ranking member of MS-13 in Honduras who reported to Morales Zelaya. Portillo Santos was responsible for leading MS-13 in one of the largest sectors in Honduras, which included the distribution and movement of large shipments of cocaine, acts of violence (including murders and kidnappings) of rival gang members, and contract murders carried out against rival drug dealers. Campbell, 58, of Honduras, is currently in Federal Bureau of Prisons (FBOP) custody facing the charges in the superseding indictment. Portillo Santos, 36, of Honduras, is currently in custody in Honduras on local charges. Archaga Carías, 43, and Morales Zelaya, 50, of Honduras, remains at large.

If convicted, Archaga Carías faces a maximum penalty of life in prison and a mandatory minimum penalty of 40 years in prison. The minimum and maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.

Joint Task Force Vulcan (JTFV) and the Southern District of New York’s National Security and International Narcotics Unit are handling the case. Assistant U.S. Attorney David J. Robles and Special Assistant U.S. Attorney Christopher Eason, and Trial Attorney Jacob Warren of the National Security Division’s Counterterrorism Section are in charge of the prosecution.

This case was brought by JTFV, which was created in 2019 to destroy MS-13 and now expanded to target Tren de Aragua and is comprised of U.S. Attorney’s Offices across the country, including the Southern District of New York; Eastern District of New York; the District of New Jersey; the Northern District of Ohio; the District of Utah; the District of Massachusetts; the Eastern District of Texas; the Southern District of Florida; the Eastern District of Virginia; the Southern District of California; the District of Nevada; the District of Alaska; and the District of Columbia, as well as the Department of Justice’s National Security Division and the Criminal Division. Additionally, the FBI; DEA; HSI; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the U.S. Marshals Service; and the FBOP have been essential law enforcement partners and spearheaded JTFV’s investigations.

This case is part of Operation Take Back America and an Organized Crime Drug Enforcement Task Force (OCDETF) operation. Operation Take Back America is a nationwide initiative that marshals the full resources of the Department of Justice to repel the invasion of illegal aliens, achieve the total elimination of cartels and transnational criminal organizations, and protect our communities from the perpetrators of violent crime. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.

The charges contained in the superseding indictment are merely accusations. All defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

Moments ago, a unanimous jury convicted Nadine Menendez for her critical role in a corruption and foreign influence scheme involving her husband, convicted former Senator Robert Menendez. Nadine Menendez and Senator Menendez were partners in crime. Over the span of five years, Nadine Menendez agreed to accept and accepted all sorts of bribes – including gold bars, cash, a Mercedes-Benz convertible, and a no-show job – all in exchange for the Senator’s corrupt official acts. Together, Nadine Menendez and the Senator placed their own interests and greed ahead of the interests of the citizens the Senator was elected to serve. Today’s verdict sends the clear message that the power of government officials may not be put up for sale, and that all those who facilitate corruption will be held accountable for their actions. I thank the career prosecutors of this Office and the special agents of the Federal Bureau of Investigation and Internal Revenue Service—Criminal Investigation for their unwavering commitment to this case, and for their extraordinary efforts in ensuring that justice was done.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced today that a jury returned a guilty verdict against SHYMELL EPHRON, a/k/a “Shy,” on two counts of enticement of a minor to engage in unlawful sexual activity, one count of conspiring to distribute methamphetamine and cocaine, and two counts of distributing methamphetamine to a minor, in a trial before U.S. District Judge Margaret M. Garnett.  EPHRON is scheduled to be sentenced on September 19, 2025.

Acting U.S. Attorney Matthew Podolsky said: “As a unanimous jury found, Shymell Ephron lured two runaway teenagers back to his apartment in Harlem, where he repeatedly raped and sexually abused them for five days while plying them with methamphetamine and alcohol.  Thanks to the FBI and the NYPD, the girls were eventually found and returned to their parents.  I commend these young women for the bravery they showed by testifying at trial.  This Office is committed to keeping the children of New York City safe from sexual predators, and thanks to the hard work of the career prosecutors of this Office and our law enforcement partners, the support of victim services specialists of this Office, and the willingness of the victims to speak up, Ephron has now been convicted for his egregious conduct and will face justice for the harm he caused.” 

As reflected in the evidence presented at trial:

Between approximately May 2024 and July 2024, EPHRON worked with others to distribute narcotics, including methamphetamine and cocaine, in Times Square and other locations in New York City.  On or about May 17, 2024, EPHRON approached two teenage girls in Times Square while he was selling drugs.  The girls had run away from home.  EPHRON convinced the two girls to follow him to his residence in Harlem, where they stayed with EPHRON for several days.

EPHRON engaged in multiple acts of forcible rape, forcible touching, sexual abuse, and illegal sex with a minor while the girls were staying in EPHRON’s apartment.  EPHRON repeatedly provided the girls with methamphetamine, marijuana, and alcohol.  EPHRON also provided a cellphone to the girls to monitor their whereabouts, communicate with them about narcotics, and to persuade, induce, and entice them to return to his apartment each night so he could engage in unlawful sex with them.  Law enforcement agents with the Federal Bureau of Investigation (“FBI”) and the New York City Police Department (“NYPD”) eventually rescued the two girls and returned them to their parents.

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EPHRON, 35, of New York, New York, was convicted of two counts of coercion and enticement of a minor, each of which carries a mandatory minimum sentence of 10 years in prison and a maximum potential sentence of life in prison; one count of narcotics conspiracy, which carries a maximum potential sentence of 20 years in prison; and two counts of distributing narcotics to a minor, each of which carries a mandatory minimum sentence of one year in prison and a maximum potential sentence of 40 years in prison.

The mandatory minimum and maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as the sentencing of the defendant will be determined by a judge.

Mr. Podolsky praised the work of the FBI’s Westchester Safe Streets Task Force and the NYPD.  Mr. Podolsky also thanked the New York State Police and the Yorktown Police Department for their assistance in the investigation.

This case is being handled by the Office’s Violent & Organized Crime Unit.  Assistant U.S. Attorneys Ryan W. Allison, Lisa Daniels, Michael R. Herman, and Andrew W. Jones are in charge of the prosecution.

Note: A copy of the Anti-Tren indictment can be found here.

Today, two superseding indictments were unsealed charging 27 individuals currently or formerly associated with the designated foreign terrorist organization Tren de Aragua (TdA) with racketeering conspiracy, sex trafficking conspiracy, drug trafficking conspiracy, robbery, and firearms offenses. The first superseding indictment (the “TdA Indictment”) charges six alleged members of TdA. The second superseding indictment (the “Anti-Tren Indictment”) charges 19 alleged members of “Anti-Tren,” a splinter faction comprised of former TdA members, along with two additional associates of Anti-Tren. Of the 27 defendants, 21 are in federal custody, including 16 who were already in federal criminal, immigration, or state custody and five who were arrested last night and today in operations in New York and other jurisdictions.

“As alleged, Tren de Aragua is not just a street gang – it is a highly structured terrorist organization that has destroyed American families with brutal violence, engaged in human trafficking, and spread deadly drugs through our communities,” said Attorney General Pamela Bondi. “Today’s indictments and arrests span three states and will devastate TdA’s infrastructure as we work to completely dismantle and purge this organization from our country.”

“Today, we have filed charges against 27 alleged members, former members, and associates of Tren de Aragua, for committing murders and shootings, forcing young women trafficked from Venezuela into commercial sex work, robbing and extorting small businesses, and selling ‘tusi,’ a pink powdery drug that has become their calling card,” said Acting U.S. Attorney Matthew Podolsky for the Southern District of New York.  “Today’s Indictments make clear that this Office will work tirelessly to keep the law-abiding residents of New York City safe, and hold accountable those who bring violence to our streets.”“Tren de Aragua is one of the most dangerous gangs in the country, and the NYPD has taken significant action to shut down their operations in New York City,” said New York City Police Department (NYPD) Commissioner Jessica S. Tisch.  “For the first time ever, TdA is being named and charged as the criminal enterprise that it is. This isn’t just street crime—it’s organized racketeering, and this gang has shown zero regard for the safety of New Yorkers. As alleged in the indictment, these defendants wreaked havoc in our communities, trafficking women for sexual exploitation, flooding our streets with drugs, and committing violent crimes with illegal guns.  Thanks to the dedicated members of the NYPD and the important work of our federal partners, their time is up.”

According to the allegations contained in the Indictments:

The TdA Indictment

TdA is a criminal organization that operated throughout New York City, including the boroughs of the Bronx and Queens, as well as internationally in Venezuela, Peru, and elsewhere. The purposes of TdA included:

• Preserving and protecting the power and territory of TdA and its members and associates through acts involving murder, assault, robbery, other acts of violence, and threats of violence, including acts of violence and threats of violence directed at former members and associates of TdA who associated with a splinter organization known as Anti-Tren.
• Enriching the members and associates of TdA through, among other things:
  • The unlawful smuggling of individuals, including young women from Venezuela, into Peru and the United States;
  • The sex trafficking of young women (whom members and associates of TdA often refer to as “multadas”) who had been unlawfully smuggled into Peru and the United States;
  • The trafficking of controlled substances, including a mixed substance called “tusi” that contains ketamine; and
  • Armed robberies.
• Keeping victims and potential victims in fear of TdA and its members and associates through threats and acts of violence.
• Promoting and enhancing TdA and the reputation and activities of its members and associates.
• Providing assistance to members and associates of TdA who committed crimes for and on behalf of TdA, such as lodging and interstate transportation for members and associates of TdA to flee prosecution.
• Protecting TdA and its members and associates from detection and prosecution by law enforcement authorities through acts of intimidation, threats, and violence against potential witnesses to crimes committed by members of TdA.

Members and associates of TdA transported “multadas” from Venezuela into Peru and the United States in exchange for debts that the “multadas” would pay back to TdA by engaging in commercial sex work. Members of TdA enforced compliance among “multadas” by, among other things:

• Threatening to kill “multadas” and their families,
• Assaulting “multadas,”
• Shooting or killing “multadas,” and
• Tracking down and kidnapping “multadas” who tried to flee.

Members of TdA also committed and conspired, attempted, and threatened to commit, acts of violence, including acts involving murder and assault, to protect and expand TdA’s criminal operations; resolve disputes within TdA; to retaliate against rival organizations, including Anti-Tren; and to maintain control over sex trafficking victims. TdA members and associates also trafficked controlled substances, committed robberies, and obtained, possessed, trafficked, and used firearms and ammunition.

The TdA Indictment charges Jarwin Valero-Calderon, also known as “La Fama,” 29; Samuel Gonzalez Castro, also known as “Klei” and “Kley, ” 28; Eferson Morillo-Gomez, also known as “Jefferson” and “Efe Trebol,” 20; Brayan Oliveros-Chero, 28; Sandro Oliveros-Chero, 25; and Armando Jose Perez Gonzalez, also known as “Biblia,” 30, (the “TdA Defendants”) with conspiring to participate in the TdA racketeering enterprise. Various of the TdA defendants are also charged with participating in offenses relating to drug trafficking, carjacking, robbery, and extortion, as well as firearms offenses. This case is assigned U.S. District Judge Denise L. Cote for the Southern District of New York.

If convicted of racketeering conspiracy, Valero-Calderon, Gonzalez Castro, Morillo-Gomez, Brayan Oliveros-Chero, Sandro Oliveros-Chero, and Perez Gonzalez face up to life in prison. If convicted of drug trafficking conspiracy, Valero-Calderon, Brayan Oliveros-Chero, Sandro Oliveros-Chero, and Perez Gonzalez face up to 20 years in prison. If convicted of carjacking conspiracy, Valero-Calderon, Gonzalez Castro, and Morillo-Gomez face up to five years in prison. If convicted of carjacking, Valero-Calderon, Gonzalez Castro, and Morillo-Gomez face up to 15 years in prison. If convicted of Hobbs Act robbery, Valero-Calderon, Gonzalez Castro, and Morillo-Gomez face up to 20 years in prison. If convicted of firearm use, carrying, and possession, Valero-Calderon, Gonzalez Castro, and Morillo-Gomez face up to life in prison with a mandatory minimum sentence of seven years in prison. If convicted of attempted Hobbs Act extortion, Valero-Calderon, Gonzalez Castro, and Morillo-Gomez face up to 20 years in prison. If convicted of firearm use, carrying, and possession – conspiracy, Valero-Calderon, Gonzalez Castro, Morillo-Gomez, Brayan Oliveros-Chero, and Sandro Oliveros-Chero face up to 20 years in prison. If convicted of possession of ammunition by an illegal alien, Brayan Oliveros-Chero faces up to 15 years in prison. If convicted of possession of a firearm and ammunition by an illegal alien, Sandro Oliveros-Chero faces up to 15 years in prison. If convicted of firearm use, carrying, and possession, Perez Gonzalez faces up to life in prison with a mandatory minimum sentence of five years in prison. If convicted of possession of a firearm and ammunition by an illegal alien, Perez Gonzalez faces up to 15 years in prison.

The Anti-Tren Indictment

Anti-Tren is a criminal organization almost exclusively comprised of former members and associates of TdA. Anti-Tren operated throughout New York City, including the boroughs of the Bronx and Queens, and in New Jersey, and elsewhere. Like TdA, the purposes of Anti-Tren included:

• Preserving and protecting the power and territory of Anti-Tren and its members and associates through acts involving murder, assault, other acts of violence, and threats of violence, including acts of violence and threats of violence directed at members and associates of TdA.
• Enriching the members and associates of Anti-Tren through, among other things:
  • The unlawful smuggling of individuals, including women and girls from Venezuela, into the United States;
  • The sex trafficking of “multadas” who had been unlawfully smuggled into the United States;
  • The trafficking of controlled substances, including “tusi”; and
  • Armed robberies.
• Keeping victims and potential victims in fear of Anti-Tren and its members and associates through threats and acts of violence.
• Promoting and enhancing Anti-Tren and the reputation and activities of its members and associates.
• Providing assistance to members and associates of Anti-Tren who committed crimes for and on behalf of Anti-Tren, such as lodging and interstate transportation for members and associates of Anti-Tren to flee prosecution, or bail money for members or associates of Anti-Tren who are detained.
• Protecting Anti-Tren and its members and associates from detection and prosecution by law enforcement authorities through acts of intimidation, threats, and violence against potential witnesses to crimes committed by members of Anti-Tren.

Like TdA, Anti-Tren engaged in human smuggling and sex trafficking of “multadas,” into the United States in exchange for debts that the “multadas” would pay back by engaging in commercial sex work. And like TdA, members of Anti-Tren enforced compliance among “multadas” by, among other things:

• Threatening to kill “multadas” and their families,
• Assaulting “multadas,”
• Shooting or killing “multadas,” and
• Tracking down and kidnapping “multadas” who tried to flee.

Members of Anti-Tren also committed and conspired, attempted, and threatened to commit, acts of violence, including acts involving murder and assault, to protect and to expand Anti-Tren’s criminal operations, resolve disputes within Anti-Tren, to retaliate against rival organizations, including Tren de Aragua, and to maintain control over sex trafficking victims. Anti-Tren members and associates also trafficked controlled substances, committed robberies, and obtained, possessed, trafficked, and used firearms and ammunition.

The Anti-Tren Indictment charges Reinaldo Rafael Gonzales-Valdez, also known as “Mariguana” and “Marijuana,” 41; Jose Manuel Guerrero-Zarate, also known as “Mantequilla,” 29; Jose David Valencia-De La Rosa, 27; Johan Carlos Mujica-Urpin, also known as “Sobrino,” 27; Luis Jose Velasquez-Hurtado, also known as “Chito,” 30; Stefano Said Pachon-Romero, 21; Guillermo Freites Velazquez, 26; Jesus David Barrios Garcia, also known as “Morocho,” 27; Giovanny Valentin Blanco Luciano, also known as “Cachorrito,” 20; Anderson Jesus Duran Berroteran, also known as “Cachorro, ” 22; Roiman Noe Bello Ferrer, 37; Luis Miguel Rodriguez-Tapia, 25; Mario Andres Pereda, also known as “Cara de Hombre,” 44; Anderson Smith Zambrano-Pacheco, 26; Yeferson Alejandro Prieto Galviz, also known as “Flaco T” and“Flacote,” 24; Jhonkennedy Bravo-Castro, also known as  “Negrito,” 27; Yender Maykier Mata, 36; Kellen Alejandro Jaspe Bustamante, 20; and Luis Andres Bello-Chacon, also known as  “Care de Peo,” 31 (the “Anti-Tren Defendants”) with conspiring to participate in an Anti-Tren racketeering enterprise. Various of the Anti-Tren Defendants, along with co-defendants Wilfredo Jose Avendaño Carrizalez and Carlos Gabriel Santos Mogollon, are also charged with participating in offenses relating to sex trafficking, conspiracy to import and harbor aliens, drug trafficking, obstruction of justice, and firearms offenses. This case is assigned U.S. District Judge Mary Kay Vyskocil of the Southern District of New York.

If convicted of racketeering conspiracy, Gonzales-Valdez, Guerrero-Zarate, Valencia-De La Rosa, Mujica-Urpin, Velasquez-Hurtado, Pachon-Romero, Freites Velazquez, Barrios Garcia, Blanco Luciano, Duran Berroteran, Bello Ferrer, Rodriguez-Tapia, Pereda, Zambrano-Pacheco, Prieto Galviz, Bravo-Castro, Maykier Mata, Jaspe Bustamante, and Bello-Chacon face up to life in prison. If convicted of sex trafficking conspiracy, Gonzales-Valdez, Guerrero-Zarate, Valencia-De La Rosa, Mujica-Urpin, Velasquez-Hurtado, Pachon-Romero, Freites Velazquez, Barrios Garcia, Duran Berroteran, Rodriguez-Tapia, Pereda, Zambrano-Pacheco, and Bravo-Castro face up to life in prison. If convicted of alien importation and harboring for immoral purpose – conspiracy, Gonzales-Valdez, Guerrero-Zarate, Valencia-De La Rosa, Mujica-Urpin, Velasquez-Hurtado, Pachon-Romero, Freites Velazquez, Barrios Garcia, Duran Berroteran, Rodriguez-Tapia, Pereda, Zambrano-Pacheco, and Bravo-Castro face up to five years in prison. If convicted of drug trafficking conspiracy, Gonzales-Valdez, Guerrero-Zarate, Mujica-Urpin, Freites Velazquez, Barrios Garcia, Blanco Luciano, Duran Berroteran, Prieto Galviz, Maykier Mata, Jaspe Bustamante, and Bello-Chacon face up to 20 years in prison. If convicted of firearm use, carrying, and possession, Gonzales-Valdez, Guerrero-Zarate, Mujica-Urpin, Freites Velazquez, Barrios Garcia, Blanco Luciano, Zambrano-Pacheco, Prieto Galviz, Maykier Mata, Jaspe Bustamante, and Bello-Chacon face up to life in prison with a mandatory minimum sentence of five years in prison. If convicted of obstruction of justice, Velasquez-Hurtado faces up to 20 years in prison. If convicted of unlicensed dealing of firearms, Pachon-Romero faces up to five years in prison. If convicted of possession of a firearm and ammunition by a fugitive from justice and illegal alien, Zambrano-Pacheco, faces up to 15 years in prison. If convicted of possession of a firearm and ammunition by an illegal alien, Bravo-Castro, Avendaño Carrizalez and Santos Mogollonface up to 15 years in prison.

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Attorney General Bondi and Acting U.S. Attorney Podolsky praised the outstanding investigative work of HSI and NYPD. They also thanked the Arapahoe County District Attorney’s Office in Colorado; the Aurora Police Department in Aurora, Colorado; the New York/New Jersey Regional Fugitive Task Force of the U.S. Marshals Service (USMS); the HSI National Gang Unit and New York Human Intelligence Division; ICE’s Enforcement and Removal Operations New York; the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF); and the New York City Crime Analysis Center at the New York/New Jersey High Intensity Drug Trafficking Area.

This case received significant support from Joint Task Force Vulcan (JTFV), which was created in 2019 to eradicate MS-13 and now expanded to target Tren de Aragua, and is comprised of U.S. Attorney’s Offices across the country, including the Southern District of New York; the Eastern District of New York; the District of New Jersey; the Northern District of Ohio; the District of Utah; the District of Massachusetts; the Eastern District of Texas; the Southern District of Florida; the Eastern District of Virginia; the Southern District of California; the District of Nevada; the District of Alaska; the Southern District of Texas; and the District of Columbia, as well as the Department of Justice’s National Security Division and the Criminal Division.  Additionally, the FBI; DEA; HSI; ATF; USMS; and the Federal Bureau of Prisons have been essential law enforcement partners with JTFV.

This case is part of Operation Take Back America, a nationwide initiative that marshals the full resources of the Justice Department to repel the invasion of illegal immigration, achieve the total elimination of cartels and transnational criminal organizations (TCOs), and protect our communities from the perpetrators of violent crime. Operation Take Back America streamlines efforts and resources from the Department’s Organized Crime Drug Enforcement Task Forces (OCDETFs) and Project Safe Neighborhood (PSN). In February 2025, Tren de Aragua was designated a Foreign Terrorist Organization.

Assistant U.S. Attorneys Jun Xiang, Kathryn Wheelock, and Timothy Ly of the U.S. Attorney’s Office for the Southern District of New York’s Violent and Organized Crime Unit are in charge of the prosecution.

The charges contained in the superseding indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York; Pamela Bondi, the Attorney General of the United States; Kristi Noem, the Secretary of the Department of Homeland Security (“DHS”); Todd M. Lyons, the Acting Director of U.S. Immigration and Customs Enforcement ("ICE"); and Jessica S. Tisch, the Commissioner of the New York City Police Department (“NYPD”), announced today two Superseding Indictments charging 27 individuals currently or formerly associated with the designated foreign terrorist organization Tren de Aragua (“TdA”) with racketeering conspiracy, sex trafficking conspiracy, drug trafficking conspiracy, robbery, and firearms offenses.  The first Superseding Indictment (the “TdA Indictment”) charges six alleged members of TdA.  The second Superseding Indictment (the “Anti-Tren Indictment”) charges 19 alleged members of “Anti-Tren,” a splinter faction comprised of former TdA members, along with two additional associates of Anti-Tren.  Of the 27 defendants, 21 are in federal custody, including 16 who were already in federal criminal, immigration, or state custody and five who were arrested last night and today in operations in New York and other jurisdictions.

Acting U.S. Attorney Matthew Podolsky said: “Today, we have filed charges against 27 alleged members, former members, and associates of Tren de Aragua, for committing murders and shootings, forcing young women trafficked from Venezuela into commercial sex work, robbing and extorting small businesses, and selling ‘tusi,’ a pink powdery drug that has become their calling card.  Today’s Indictments make clear that this Office will work tirelessly to keep the law-abiding residents of New York City safe, and hold accountable those who bring violence to our streets.”

Attorney General Pam Bondi said: “As alleged, Tren de Aragua is not just a street gang – it is a highly structured terrorist organization that has destroyed American families with brutal violence, engaged in human trafficking, and spread deadly drugs through our communities.  Today’s indictments and arrests span three states and will devastate TdA’s infrastructure as we work to completely dismantle and purge this organization from our country.” 

ICE Acting Director Todd M. Lyons said: “We are at the forefront of efforts to identify, disrupt and dismantle transnational criminal gangs like Tren de Aragua from operating in our cities and around the world.  I commend the members of our New York-based Homeland Security Investigations Violent Gang Task Force; without their efforts these indictments wouldn’t be possible.  Together with our partners, ICE HSI is committed to addressing the threats posed by illicit narcotics, weapons and human smuggling networks, and ensuring these violent criminals are prosecuted to the maximum extent of the law.”

NYPD Commissioner Jessica S. Tisch said: “Tren de Aragua is one of the most dangerous gangs in the country, and the NYPD has taken significant action to shut down their operations in New York City.  For the first time ever, TdA is being named and charged as the criminal enterprise that it is.  This isn’t just street crime—it’s organized racketeering, and this gang has shown zero regard for the safety of New Yorkers.  As alleged in the indictment, these defendants wreaked havoc in our communities, trafficking women for sexual exploitation, flooding our streets with drugs, and committing violent crimes with illegal guns.  Thanks to the dedicated members of the NYPD and the important work of our federal partners, their time is up.”

According to the allegations contained in the Indictments:[1]

The TdA Indictment

TdA is a criminal organization that operated throughout New York City, including the boroughs of the Bronx and Queens, as well as internationally in Venezuela, Peru, and elsewhere.  The purposes of TdA included:

• Preserving and protecting the power and territory of TdA and its members and associates through acts involving murder, assault, robbery, other acts of violence, and threats of violence, including acts of violence and threats of violence directed at former members and associates of TdA who associated with a splinter organization known as Anti-Tren.
• Enriching the members and associates of TdA through, among other things:
  • The unlawful smuggling of individuals, including young women from Venezuela, into Peru and the U.S.;
  • The sex trafficking of young women (whom members and associates of TdA often refer to as “multadas”) who had been unlawfully smuggled into Peru and the U.S.;
  • The trafficking of controlled substances, including a mixed substance called “tusi” that contains ketamine; and
  • Armed robberies.
• Keeping victims and potential victims in fear of TdA and its members and associates through threats and acts of violence.
• Promoting and enhancing TdA and the reputation and activities of its members and associates.
• Providing assistance to members and associates of TdA who committed crimes for and on behalf of TdA, such as lodging and interstate transportation for members and associates of TdA to flee prosecution.
• Protecting TdA and its members and associates from detection and prosecution by law enforcement authorities through acts of intimidation, threats, and violence against potential witnesses to crimes committed by members of TdA.

Members and associates of TdA transported “multadas” from Venezuela into Peru and the U.S. in exchange for debts that the “multadas” would pay back to TdA by engaging in commercial sex work.  Members of TdA enforced compliance among “multadas” by, among other things:

• Threatening to kill “multadas” and their families,
• Assaulting “multadas,”
• Shooting or killing “multadas,” and
• Tracking down and kidnapping “multadas” who tried to flee.

Members of TdA also committed and conspired, attempted, and threatened to commit, acts of violence, including acts involving murder and assault, to protect and expand TdA’s criminal operations; resolve disputes within TdA; to retaliate against rival organizations, including Anti-Tren; and to maintain control over sex trafficking victims.  TdA members and associates also trafficked controlled substances, committed robberies, and obtained, possessed, trafficked, and used firearms and ammunition.

The TdA Indictment charges JARWIN VALERO-CALDERON, a/k/a “La Fama”; SAMUEL GONZALEZ CASTRO, a/k/a “Klei,” a/k/a “Kley”; EFERSON MORILLO-GOMEZ, a/k/a “Jefferson,” a/k/a “Efe Trebol”; BRAYAN OLIVEROS-CHERO; SANDRO OLIVEROS-CHERO; and ARMANDO JOSE PEREZ GONZALEZ, a/k/a “Biblia” (the “TdA Defendants”) with conspiring to participate in the TdA racketeering enterprise.  Various of the TdA Defendants are also charged with participating in offenses relating to drug trafficking, carjacking, robbery, and extortion, as well as firearms offenses.  This case is assigned U.S. District Judge Denise L. Cote.

The Anti-Tren Indictment

Anti-Tren is a criminal organization almost exclusively comprised of former members and associates of TdA.  Anti-Tren operated throughout New York City, including the boroughs of the Bronx and Queens, and in New Jersey, and elsewhere.  Like TdA, the purposes of Anti-Tren included:

• Preserving and protecting the power and territory of Anti-Tren and its members and associates through acts involving murder, assault, other acts of violence, and threats of violence, including acts of violence and threats of violence directed at members and associates of TdA.
• Enriching the members and associates of Anti-Tren through, among other things:
  • The unlawful smuggling of individuals, including women and girls from Venezuela, into the U.S.;
  • The sex trafficking of “multadas” who had been unlawfully smuggled into the U.S.;
  • The trafficking of controlled substances, including “tusi”; and
  • Armed robberies.
• Keeping victims and potential victims in fear of Anti-Tren and its members and associates through threats and acts of violence.
• Promoting and enhancing Anti-Tren and the reputation and activities of its members and associates.
• Providing assistance to members and associates of Anti-Tren who committed crimes for and on behalf of Anti-Tren, such as lodging and interstate transportation for members and associates of Anti-Tren to flee prosecution, or bail money for members or associates of Anti-Tren who are detained.
• Protecting Anti-Tren and its members and associates from detection and prosecution by law enforcement authorities through acts of intimidation, threats, and violence against potential witnesses to crimes committed by members of Anti-Tren.

Like TdA,  Anti-Tren engaged in human smuggling and sex trafficking of “multadas,” into the U.S. in exchange for debts that the “multadas” would pay back by engaging in commercial sex work. And like TdA, members of Anti-Tren enforced compliance among “multadas” by, among other things:

• Threatening to kill “multadas” and their families,
• Assaulting “multadas,”
• Shooting or killing “multadas,” and
• Tracking down and kidnapping “multadas” who tried to flee.

Members of Anti-Tren also committed and conspired, attempted, and threatened to commit, acts of violence, including acts involving murder and assault, to protect and to expand Anti-Tren’s criminal operations, resolve disputes within Anti-Tren, to retaliate against rival organizations, including Tren de Aragua, and to maintain control over sex trafficking victims.  Anti-Tren members and associates also trafficked controlled substances, committed robberies, and obtained, possessed, trafficked, and used firearms and ammunition.

The Anti-Tren Indictment charges REINALDO RAFAEL GONZALES-VALDEZ, a/k/a “Mariguana,” a/k/a “Marijuana”; JOSE MANUEL GUERRERO-ZARATE, a/k/a “Mantequilla”; JOSE DAVID VALENCIA-DE LA ROSA; JOHAN CARLOS MUJICA-URPIN, a/k/a “Sobrino”; LUIS JOSE VELASQUEZ-HURTADO, a/k/a “Chito”; STEFANO SAID PACHON-ROMERO; GUILLERMO FREITES VELAZQUEZ; JESUS DAVID BARRIOS GARCIA, a/k/a “Morocho”; GIOVANNY VALENTIN BLANCO LUCIANO, a/k/a “Cachorrito”; ANDERSON JESUS DURAN BERROTERAN, a/k/a “Cachorro”; ROIMAN NOE BELLO FERRER; LUIS MIGUEL RODRIGUEZ-TAPIA; MARIO ANDRES PEREDA, a/k/a “Cara de Hombre”; ANDERSON SMITH ZAMBRANO-PACHECO; YEFERSON ALEJANDRO PRIETO GALVIZ, a/k/a “Flaco T,” a/k/a “Flacote”; JHONKENNEDY BRAVO-CASTRO, a/k/a “Negrito”; YENDER MAYKIER MATA; KELLEN ALEJANDRO JASPE BUSTAMANTE; and LUIS ANDRES BELLO-CHACON, a/k/a “Care de Peo” (the “Anti-Tren Defendants”) with conspiring to participate in an Anti-Tren racketeering enterprise.  Various of the Anti-Tren Defendants, along with co-defendants WILFREDO JOSE AVENDAÑO CARRIZALEZ and CARLOS GABRIEL SANTOS MOGOLLON, are also charged with participating in offenses relating to sex trafficking, conspiracy to import and harbor aliens, drug trafficking, obstruction of justice, and firearms offenses.  This case is assigned U.S. District Judge Mary Kay Vyskocil.

*                *                *

A chart containing the names, ages, charges, and maximum penalties for the defendants is set forth below.

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Podolsky praised the outstanding investigative work of Homeland Security Investigations (“HSI”) and NYPD.  He also thanked the Arapahoe County District Attorney’s Office in Colorado; the Aurora Police Department in Aurora, Colorado; the New York/New Jersey Regional Fugitive Task Force of the U.S. Marshals Service (“USMS”); the Homeland Security Investigations National Gang Unit and New York Human Intelligence Division; U.S. Immigration and Customs Enforcement’s New York Enforcement and Removal Operations; the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”); and the New York City Crime Analysis Center at the New York/New Jersey High Intensity Drug Trafficking Area.

This case received significant support from Joint Task Force Vulcan (“JTFV”), which was created in 2019 to eradicate MS-13 and now expanded to target Tren de Aragua, and is comprised of U.S. Attorney’s Offices across the country, including the Southern District of New York; the Eastern District of New York; the District of New Jersey; the Northern District of Ohio; the District of Utah; the District of Massachusetts; the Eastern District of Texas; the Southern District of Florida; the Eastern District of Virginia; the Southern District of California; the District of Nevada; the District of Alaska; the Southern District of Texas; and the District of Columbia, as well as the Department of Justice’s National Security Division and the Criminal Division.  Additionally, the FBI; DEA; HSI; ATF; USMS; and the Federal Bureau of Prisons have been essential law enforcement partners with JTFV.

This case is part of Operation Take Back America, a nationwide initiative that marshals the full resources of the Justice Department to repel the invasion of illegal immigration, achieve the total elimination of cartels and transnational criminal organizations (TCOs), and protect our communities from the perpetrators of violent crime. Operation Take Back America streamlines efforts and resources from the Department’s Organized Crime Drug Enforcement Task Forces (OCDETFs) and Project Safe Neighborhood (PSN). In February 2025, Tren de Aragua was designated a Foreign Terrorist Organization.

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant U.S. Attorneys Jun Xiang, Kathryn Wheelock, and Timothy Ly are in charge of the prosecution.

The charges contained in the Indictments are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

The Tren de Aragua Indictment

COUNT

CHARGE

DEFENDANTS

MAX. PENALTIES

1

Racketeering

conspiracy

18 U.S.C. § 1962(d)

JARWIN VALERO-CALDERON,

     a/k/a “La Fama,” 29;

SAMUEL GONZALEZ CASTRO,

     a/k/a “Klei,” 

     a/k/a “Kley,” 28;

EFERSON MORILLO-GOMEZ,

     a/k/a “Jefferson,” 

     a/k/a “Efe Trebol,” 20;

BRAYAN OLIVEROS-CHERO, 28;

SANDRO OLIVEROS-CHERO, 25; and

ARMANDO JOSE PEREZ GONZALEZ,

           a/k/a “Biblia,” 30

2

Drug trafficking conspiracy

21 U.S.C. §  846

JARWIN VALERO-CALDERON,

     a/k/a “La Fama,”

BRAYAN OLIVEROS-CHERO,

SANDRO OLIVEROS-CHERO, and

ARMANDO JOSE PEREZ GONZALEZ,

           a/k/a “Biblia”

3

Carjacking conspiracy

18 U.S.C. § 371

JARWIN VALERO-CALDERON,

     a/k/a “La Fama,”

SAMUEL GONZALEZ CASTRO,

     a/k/a “Klei,” 

     a/k/a “Kley,” and

EFERSON MORILLO-GOMEZ,

     a/k/a “Jefferson,” 

     a/k/a “Efe Trebol”

4

Carjacking

18 U.S.C. § 2119

JARWIN VALERO-CALDERON,

     a/k/a “La Fama,”

SAMUEL GONZALEZ CASTRO,

     a/k/a “Klei,” 

     a/k/a “Kley,” and

EFERSON MORILLO-GOMEZ,

     a/k/a “Jefferson,” 

     a/k/a “Efe Trebol”

5

Hobbs Act robbery

18 U.S.C. §§  1951 and 2

JARWIN VALERO-CALDERON,

     a/k/a “La Fama,”

SAMUEL GONZALEZ CASTRO,

     a/k/a “Klei,” 

     a/k/a “Kley,” and

EFERSON MORILLO-GOMEZ,

     a/k/a “Jefferson,” 

     a/k/a “Efe Trebol”

6

Firearm use, carrying, and possession

18 U.S.C. §§  924(c)(1)(A)(i) and (ii), and 2

JARWIN VALERO-CALDERON,

     a/k/a “La Fama,”

SAMUEL GONZALEZ CASTRO,

     a/k/a “Klei,” 

     a/k/a “Kley,” and

EFERSON MORILLO-GOMEZ,

     a/k/a “Jefferson,” 

     a/k/a “Efe Trebol”

Life in prison

Mandatory minimum sentence of 7 years in prison

7

Attempted Hobbs Act extortion

18 U.S.C. §§  1951 and 2

JARWIN VALERO-CALDERON,

     a/k/a “La Fama,”

SAMUEL GONZALEZ CASTRO,

     a/k/a “Klei,” 

     a/k/a “Kley,” and

EFERSON MORILLO-GOMEZ,

     a/k/a “Jefferson,” 

     a/k/a “Efe Trebol”

8

Firearm use, carrying, and possession – conspiracy

18 U.S.C. §  924(o)

JARWIN VALERO-CALDERON,

     a/k/a “La Fama,”

SAMUEL GONZALEZ CASTRO,

     a/k/a “Klei,” 

     a/k/a “Kley,” and

EFERSON MORILLO-GOMEZ,

     a/k/a “Jefferson,” 

     a/k/a “Efe Trebol”

9

Firearm use, carrying, and possession – conspiracy

18 U.S.C. §  924(o)

BRAYAN OLIVEROS-CHERO, and

SANDRO OLIVEROS-CHERO

10

Firearm use, carrying, and possession

18 U.S.C. §  924(c)(1)(A)(i) and 2

BRAYAN OLIVEROS-CHERO, and

SANDRO OLIVEROS-CHERO

11

Possession of ammunition by an illegal alien

18 U.S.C. §§  922(g)(5) and 2

12

Possession of a firearm and ammunition by an illegal alien

18 U.S.C. §§  922(g)(5) and 2

13

Firearm use, carrying, and possession

18 U.S.C. §§  924(c)(1)(A)(i) and 2

ARMANDO JOSE PEREZ GONZALEZ,

           a/k/a “Biblia,”

Life in prison

Mandatory minimum sentence of 5 years in prison

14

Possession of a firearm and ammunition by an illegal alien

18 U.S.C. §§  922(g)(5) and 2

ARMANDO JOSE PEREZ GONZALEZ,

           a/k/a “Biblia,”

The Anti-Tren Indictment

COUNT

CHARGE

DEFENDANTS

MAX. PENALTIES

1

Racketeering

conspiracy

18 U.S.C. § 1962(d)

REINALDO RAFAEL GONZALES-VALDEZ, 

     a/k/a “Mariguana,” 

     a/k/a “Marijuana,” 41;

JOSE MANUEL GUERRERO-ZARATE,

     a/k/a “Mantequilla,” 29;

JOSE DAVID VALENCIA-DE LA ROSA, 27;

JOHAN CARLOS MUJICA-URPIN,

      a/k/a “Sobrino,” 27;

LUIS JOSE VELASQUEZ-HURTADO,

     a/k/a “Chito,” 30;

STEFANO SAID PACHON-ROMERO, 21;

GUILLERMO ENRIQUE FREITES-VELAZQUEZ, 26;

JESUS DAVID BARRIOS GARCIA,

     a/k/a “Morocho,” 27;

GIOVANNY VALENTIN BLANCO LUCIANO,

     a/k/a “Cachorrito,” 20;

ANDERSON JESUS DURAN BERROTERAN,

     a/k/a “Cachorro,” 22;

ROIMAN NOE BELLO FERRER, 37;

LUIS MIGUEL RODRIGUEZ-TAPIA, 25;

MARIO ANDRES PEREDA,

     a/k/a “Cara de Hombre,” 44;

ANDERSON SMITH ZAMBRANO-PACHECO, 26;

YEFERSON ALEJANDRO PRIETO GALVIZ,

     a/k/a “Flaco T,” 

     a/k/a “Flacote,” 24;

JHONKENNEDY BRAVO-CASTRO,

     a/k/a “Negrito,” 27;

YENDER MAYKIER MATA, 36;

KELLEN ALEJANDRO JASPE BUSTAMANTE, 20; and

LUIS ANDRES BELLO-CHACON,

    a/k/a “Care de Peo,” 31

2

Sex trafficking conspiracy

18 U.S.C. § 1594(c)

REINALDO RAFAEL GONZALES-VALDEZ, 

      a/k/a “Mariguana,” a/k/a “Marijuana,”

JOSE MANUEL GUERRERO-ZARATE, 

      a/k/a “Mantequilla,”  

JOSE DAVID VALENCIA-DE LA ROSA,

JOHAN CARLOS MUJICA-URPIN, 

      a/k/a “Sobrino,”

LUIS JOSE VELASQUEZ-HURTADO,

      a/k/a “Chito,”

STEFANO SAID PACHON-ROMERO, GUILLERMO FREITES VELAZQUEZ,

JESUS DAVID BARRIOS GARCIA, 

      a/k/a “Morocho,”

ANDERSON JESUS DURAN BERROTERAN,        a/k/a “Cachorro,”

LUIS MIGUEL RODRIGUEZ-TAPIA,

MARIO ANDRES PEREDA, 

      a/k/a “Cara de Hombre,”

ANDERSON SMITH ZAMBRANO-PACHECO, and

JHONKENNEDY BRAVO-CASTRO,

      a/k/a “Negrito”

3

Alien importation and harboring for immoral purpose – conspiracy

18 U.S.C. § 371

REINALDO RAFAEL GONZALES-VALDEZ, 

      a/k/a “Mariguana,” a/k/a “Marijuana,”

JOSE MANUEL GUERRERO-ZARATE, 

      a/k/a “Mantequilla,” JOSE DAVID VALENCIA-DE LA ROSA,

JOHAN CARLOS MUJICA-URPIN, 

      a/k/a “Sobrino,”

LUIS JOSE VELASQUEZ-HURTADO,

      a/k/a “Chito,”

STEFANO SAID PACHON-ROMERO, GUILLERMO FREITES VELAZQUEZ,

JESUS DAVID BARRIOS GARCIA, 

      a/k/a “Morocho,”

ANDERSON JESUS DURAN BERROTERAN,        a/k/a “Cachorro,”

LUIS MIGUEL RODRIGUEZ-TAPIA,

MARIO ANDRES PEREDA, 

      a/k/a “Cara de Hombre,”

ANDERSON SMITH ZAMBRANO-PACHECO, and

JHONKENNEDY BRAVO-CASTRO,

      a/k/a “Negrito”

4

Drug trafficking conspiracy

21 U.S.C. §  846

REINALDO RAFAEL GONZALES-VALDEZ,

      a/k/a “Mariguana,” a/k/a “Marijuana,”

JOSE MANUEL GUERRERO-ZARATE, 

      a/k/a “Mantequilla,”  

JOHAN CARLOS MUJICA-URPIN, 

      a/k/a “Sobrino,”

GUILLERMO FREITES VELAZQUEZ,

JESUS DAVID BARRIOS GARCIA, 

      a/k/a “Morocho,”

GIOVANNY VALENTIN BLANCO LUCIANO, 

      a/k/a “Cachorrito,”  

ANDERSON SMITH ZAMBRANO-PACHECO,

YEFERSON ALEJANDRO PRIETO GALVIZ,        a/k/a “Flaco T,” a/k/a “Flacote,”

YENDER MAYKIER MATA,

KELLEN ALEJANDRO JASPE BUSTAMANTE, and

LUIS ANDRES BELLO-CHACON, 

      a/k/a “Care de Peo”

5

Firearm use, carrying, and possession

18 U.S.C. §§ 924(c)(1)(A)(i) and 2

REINALDO RAFAEL GONZALES-VALDEZ,

      a/k/a “Mariguana,” a/k/a “Marijuana,”

JOSE MANUEL GUERRERO-ZARATE, 

      a/k/a “Mantequilla,”  

JOHAN CARLOS MUJICA-URPIN, 

      a/k/a “Sobrino,”

GUILLERMO FREITES VELAZQUEZ,

JESUS DAVID BARRIOS GARCIA, 

      a/k/a “Morocho,”

GIOVANNY VALENTIN BLANCO LUCIANO, 

      a/k/a “Cachorrito,”  

ANDERSON SMITH ZAMBRANO-PACHECO,

YEFERSON ALEJANDRO PRIETO GALVIZ,        a/k/a “Flaco T,” a/k/a “Flacote,”

YENDER MAYKIER MATA,

KELLEN ALEJANDRO JASPE BUSTAMANTE, and

LUIS ANDRES BELLO-CHACON, 

           a/k/a “Care de Peo”

Life in prison

Mandatory minimum sentence of 5 years in prison

6

Obstruction of justice

18 U.S.C. §§ 1512(c) and 2

LUIS JOSE VELASQUEZ-HURTADO,

      a/k/a “Chito,”

7

Unlicensed dealing of firearms

18 U.S.C. §§   922(a)(1)(A) and 2

8

Possession of a firearm and ammunition by a fugitive from justice and illegal alien

18 U.S.C. §§ 922(g)(2) and (5), and 2

9

Possession of a firearm and ammunition by an illegal alien

18 U.S.C. §§  922(g)(5) and 2

JHONKENNEDY BRAVO-CASTRO,

           a/k/a “Negrito,”

10

Possession of a firearm and ammunition by an illegal alien

18 U.S.C. §§  922(g)(5) and 2

WILFREDO JOSE AVENDAÑO CARRIZALEZ, 26; and

CARLOS GABRIEL SANTOS MOGOLLON, 31

[1] The charges contained in the Indictments are merely accusations and the defendants are presumed innocent unless and until proven guilty.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced that NICOLE TORRES, an elected district leader in the Bronx and former employee of the New York City Board of Elections, (the “NYC-BOE”), pled guilty today to conspiracy to commit extortion and mail fraud for illegally demanding payments from Bronx residents in exchange for selecting those individuals as poll workers and for agreeing with others to falsify documents to make it appear that certain individuals had worked as poll workers when they had not.  TORRES pled guilty before U.S. District Judge Mary Kay Vyskocil.

Acting U.S. Attorney Matthew Podolsky said: “For five years, Nicole Torres abused her position of public trust as an elected official and City employee by taking bribes and falsifying records in connection with the selection and placement of poll workers in the Bronx.  Today’s plea highlights this Office’s commitment to rooting out corruption in local government, and to protecting the integrity of poll workers and our elections.”

According to the allegations contained in the Indictment:

From at least 2019 through at least 2024, TORRES was a district leader for New York’s 81st Assembly District in the Bronx, New York.  In addition, from at least 2016 through at least 2024, TORRES was an employee of the NYC-BOE.  While working at the NYC-BOE, TORRES had, at times, been responsible for ensuring that poll workers were paid for their work during early voting and election day. TORRES abused her power as a district leader and a NYC-BOE employee to engage in two illegal schemes. 

First, from at least 2019 through August 2024, TORRES agreed to require and required Bronx residents to pay a sum of money, usually $150, either to her or to a local organization (the “Bronx Organization”) in exchange for TORRES selecting those individuals as poll workers for upcoming elections.  Both the Bronx Organization and TORRES profited from the scheme.  TORRES personally obtained at least approximately $28,000 in illegal payments.  TORRES received the payments, often in the amount of $150, through mobile payment applications, money orders, and checks.  In certain instances, TORRES received money orders or checks that were written out to the Bronx Organization, and TORRES altered the payee line on those money orders or checks to say “Nicole Torres” so that she could deposit that money into her personal bank account. 

Second, from at least 2018 through August 2024, TORRES agreed to falsify the Forms Booklet—which is a NYC-BOE record in which poll workers record their attendance at a particular poll site—to make it appear that certain individuals (the “NoShow Poll Workers”) worked as poll workers during early voting and election day when, in truth and fact, and as TORRES well knew, those individuals did not work on those dates.  TORRES often worked with coordinators who oversaw the Forms Booklets at specific poll sites.  These coordinators signed in No-Show Poll Workers in the Forms Booklets, frequently at TORRES’s direction. TORRES and her coconspirators then received the salaries for the NoShow Poll Workers—sometimes through the mail—and split the fraudulently obtained salaries among themselves.  Based on her participation in the scheme, TORRES personally obtained at least approximately $36,000 in fraud proceeds.   

*               *                *

TORRES, 44, of the Bronx, New York, pled guilty to one count of conspiracy to commit extortion under color of official right and one count of conspiracy to commit mail fraud, which each carry a maximum sentence of 20 years in prison.

The maximum potential sentence is prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.  TORRES is scheduled to be sentenced by Judge Vyskocil on July 8, 2025. 

Mr. Podolsky praised the outstanding investigative work of the Federal Bureau of Investigation and the New York City Department of Investigation. 

The case is being handled by the Office’s Public Corruption Unit.  Assistant U.S. Attorneys Benjamin M. Burkett and Rebecca T. Dell are in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced that GHISLAINE BARRIENTOS, a former corrections officer, was sentenced today to six months in prison, to be followed by six months of home detention, for her participation in a scheme to accept bribes in exchange for smuggling narcotics and other contraband into Rikers Island.  BARRIENTOS previously pled guilty before U.S. District Judge Gregory H. Woods, who imposed today’s sentence.

Acting U.S. Attorney Matthew Podolsky said: “Ghislaine Barrientos smuggled drugs and other contraband into Rikers Island in exchange for more than ten thousand dollars in bribes. Barrientos not only abused her position of public trust as a corrections officer, she made Rikers Island less safe for inmates and officers alike.  Corrupt corrections officers have no place in our jail facilities, and this Office will continue to work to rid our jails of those who take advantage of their positions to enrich themselves.”

As reflected in the Complaint, Information, and statements made in court:

BARRIENTOS, a former New York City Department of Correction (“DOC”) correction officer, conspired with others to smuggle contraband, including cocaine, smokeable synthetic cannabinoids (known as “K2”), and food to inmates housed at the Robert N. Davoren Complex on Rikers Island in exchange for thousands of dollars in bribe payments.

*               *                *

In addition to the prison sentence, BARRIENTOS, 37, of Mount Vernon, New York, was ordered to forfeit $11,866.

Mr. Podolsky praised the outstanding investigative work of the Federal Bureau of Investigation and the New York City Department of Investigation.

This case is being handled by the Office’s Public Corruption and Narcotics Units.  Assistant U.S. Attorney Jeffrey Coyle is in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, and Michael Alfonso, the Acting Special Agent in Charge of the New York Field Office of Homeland Security Investigations (“HSI”), announced today the unsealing of an Indictment charging RALPH WALLACE, a/k/a “Chase,” a/k/a “Prize,” with sex trafficking multiple women by force, fraud, and coercion.  WALLACE was arrested this morning in Fort Lee, New Jersey, and will be presented before U.S. Magistrate Judge Sarah L. Cave in Manhattan federal court.  The case has been assigned to U.S. District Judge Lewis J. Liman. 

Acting U.S. Attorney Matthew Podolsky said: “As alleged, Ralph Wallace systematically exploited and abused women, using horrific violence to force women to engage in prostitution against their will.  Together with our law enforcement partners, we will relentlessly pursue those who engage in sex trafficking.  If you have been a victim of the alleged crimes perpetrated by Wallace, we urge you to come forward by contacting 1-877-4-HSI-TIP.”

HSI Acting Special Agent in Charge Michael Alfonso said: “This defendant’s arrest signals the beginning of a long journey toward freedom for women who for years have endured unimaginably cruel violence and abuse.  Today’s charges are a direct result of these victims’ continued strength, despite Ralph Wallace’s alleged inhumane treatment and manipulation.  I thank them for their bravery when faced with the unknown, and pledge that HSI New York and our law enforcement partners will do everything in our power to ensure justice is served.” 

According to the allegations contained in the Indictment:[1]

Between at least in or about 2021 and in or about 2025, WALLACE, a self-declared “pimp,”  recruited multiple women to engage in commercial sex for his personal benefit and enrichment.  WALLACE took nude photographs of the women and posted advertisements.  He instructed the women how to dress, how to act, and how much to charge and then he took all of the proceeds.

On multiple occasions, including when women did not want to engage in commercial sex, WALLACE used violence and coercion to force them to continue doing so.  This included, for example, beating, punching, choking, and dragging women on multiple occasions.  WALLACE also withheld from the women money for basic necessities, such as food and toiletries, unless they agreed to continue engaging in commercial sex on his behalf.

*                *                *

WALLACE, 36, of the Bronx, New York, is charged with two counts of sex trafficking by force, fraud, or coercion, each carrying a mandatory minimum sentence of 15 years in prison and a maximum sentence of life in prison, and one count of transportation to engage in prostitution, which carries a maximum sentence of 10 years in prison.   

The minimum and maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Podolsky praised the outstanding investigative work of the HSI New York/New York City Police Department Human Trafficking Task Force.

If you believe you are victim of a crime perpetrated by WALLACE, please contact HSI at [email protected] or via their mobile tip-line at 1-877-4-HSI-TIP and reference this case.

This case is being handled by the Office’s Civil Rights Unit in the Criminal Division.  Assistant U.S. Attorneys Madison Reddick Smyser and Getzel Berger are in charge of the prosecution.

The charges contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

[1] The charges contained in the Indictment are merely accusations and the defendant is presumed innocent unless and until proven guilty.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, and Christopher G. Raia, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today an Indictment charging ALBERT SANIGER, the former Chief Executive Officer of Nate, Inc. (“nate”), with engaging in a scheme to defraud investors and prospective investors of nate by making false and misleading statements about nate’s use of proprietary AI technology and its operational capabilities. 

Acting U.S. Attorney Matthew Podolsky said: “As alleged, Albert Saniger misled investors by exploiting the promise and allure of AI technology to build a false narrative about innovation that never existed. This type of deception not only victimizes innocent investors, it diverts capital from legitimate startups, makes investors skeptical of real breakthroughs, and ultimately impedes the progress of AI development. This Office and our partners at the FBI will continue to pursue those who seek to harm investors by touting false innovation.” 

FBI Assistant Director in Charge Christopher G. Raia said: "Albert Saniger allegedly defrauded investors with fabrications of his company's purported artificial intelligence capabilities while covertly employing personnel to satisfy the illusion of technological automation. Saniger allegedly abused the integrity associated with his former position as the CEO to perpetuate a scheme filled with smoke and mirrors. The FBI will continue to investigate any business owner who withholds material information to encourage additional investments." 

According to the allegations contained in the Indictment:[1]

In or about 2018, SANIGER founded nate, an e-commerce company that launched the nate app. SANIGER marketed the nate app as a universal shopping cart app that simplified online shopping by enabling users to “skip the checkout” on retail website by reducing the checkout process to a “single tap.” For example, if a consumer found a pair of sneakers that they wanted to purchase on a particular e-commerce site, the user could buy the sneakers by opening the nate app and clicking “buy.” The nate app purported to take care of the remainder of the checkout process through AI: selecting the appropriate size, entering billing and shipping information, and confirming the purchase.

Nate distinguished itself from other e-commerce companies and apps through a single defining feature: the ability to intelligently and quickly complete retail transactions across all e-commerce sites through the use of AI technology. SANIGER repeatedly told investors and the public that the company’s app used proprietary AI technology to autonomously complete online purchases on behalf of users.

Based on representations about nate’s use of AI, SANIGER solicited investments from venture capital firms. In pitch materials transmitted to investors, SANIGER touted the company’s use of AI and represented that nate was “able to transact online without human intervention.” As prospective investors conducted due diligence, SANIGER repeatedly represented that—except for certain “edge cases” in which the AI failed to complete a customer transaction—the nate app was fully automated based on AI.

In reality, nate did not use AI to autonomously navigate the checkout process of e-commerce websites and complete purchases on behalf of users. While SANIGER had acquired AI technology from a third party and hired a team of data scientists to develop it, nate’s AI never achieved the ability to consistently complete e-commerce purchases. As SANIGER knew, at the time nate was claiming to use AI to automate online purchases, the app’s actual automation rate was effectively zero percent. SANIGER concealed that reality from investors and most nate employees: he told employees to keep nate’s automation rate secret; he restricted access to nate’s “automation rate dashboard,” which displayed automation metrics; and he provided false explanations for his secrecy, such as the automation data was a “trade secret.”

In truth, nate relied heavily on teams of human workers—primarily located overseas—to manually process transactions in secret, mimicking what users believed was being done by automation. SANIGER used hundreds of contractors, or “purchasing assistants,” in a call center located in the Philippines to manually complete purchases occurring over the nate app. In or about the fall of 2021, with the busy holiday shopping approaching, and despite his numerous prior representations that nate did not use bots (or “dumb bots”, as he referred to them), SANIGER directed nate’s engineering team to develop “bots” to automate some transactions on the nate app.  After creating the bots, nate used bots in addition to the manual teams to complete purchases that were purportedly being completed by AI technology.

SANIGER raised more than $40 million from multiple investors based in part on his representations to investors about nate’s development and deployment of AI.

*                      *                      *

SANIGER, 35, of Barcelona, Spain, is charged with one count of securities fraud, which carries a maximum sentence of 20 years in prison, and one count of wire fraud, which also carries a maximum sentence of 20 years in prison. 

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Podolsky praised the outstanding investigative work of the Special Agents from the FBI.  Mr. Podolsky also thanked the U.S. Securities and Exchange Commission, which has filed a parallel civil action. 

The case is being handled by the Office’s Securities and Commodities Fraud Task Force and the Complex Frauds and Cybercrime Unit, and Assistant U.S. Attorneys Nicholas W. Chiuchiolo, Alexandra Messiter, and Sarah Mortazavi are in charge of the prosecution.

The charges contained in the Indictment are merely accusations and the defendant is presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the descriptions of the Indictment constitute only allegations, and every fact described should be treated as an allegation.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced that HERMAN CALVIN BRIGHTMAN, a/k/a “Nazir Griffiths,” a/k/a “Nazir Luckett,” was sentenced today to 10 years in prison for repeatedly stalking and assaulting several women he met online while posing as a nurse.  BRIGHTMAN previously pled guilty to traveling in interstate commerce to commit a crime of violence and sending interstate threats.  U.S. District Judge John P. Cronan imposed today’s sentence.

Acting U.S. Attorney Matthew Podolsky said: “Herman Brightman preyed on women he met through online dating websites. By posing as a nurse, Brightman earned the trust of his victims, and then stalked, assaulted, and threatened them. With today’s lengthy prison sentence, Brightman can no longer inflict pain or fear in his victims. I commend the brave women who spoke out against Brightman to ensure that he was held accountable for his crimes.”

As alleged in the Indictment and statements made in public filings and public court proceedings:

From at least January 2022 through September 2023, BRIGHTMAN used social media platforms such as Facebook and the dating application Hinge to meet, and occasionally date, women under false pretenses. Specifically, BRIGHTMAN often used an alias, created false identities for himself, and posed as a nurse or nurse practitioner working at New York City-area hospitals.  To convince women of his lies, BRIGHTMAN sent pictures and videos of himself wearing scrubs and lab coats, some examples of which are included below:

Shortly after he began dating his victims, BRIGHTMAN began to act violently towards them, especially when they attempted to end the relationship.  Court filings detailed how BRIGHTMAN brutalized at least four such women.

In July 2022, BRIGHTMAN traveled from New Jersey to the Bronx, where he brandished a knife at a woman (“Victim-1”) and her minor child, after Victim-1 decided to break up with him.  BRIGHTMAN then forced Victim-1 and her child to travel from Westchester County to BRIGHTMAN’s home in New Jersey.  Upon arriving at BRIGHTMAN’s residence, BRIGHTMAN threatened Victim-1 if she tried to escape.  Eventually, Victim-1 was able to call 911, and police officers arrived and freed her and her child from BRIGHTMAN’s apartment.

In August 2023, BRIGHTMAN brutally attacked and held at knifepoint a Queens woman he had been dating (“Victim-2”).  The attack occurred inside Victim-2’s home, and BRIGHTMAN threatened to use the knife to “gut” Victim-2 “like a fish.”  BRIGHTMAN also bound Victim-2’s hands and attempted to tape Victim-2’s mouth.  Approximately one week after this incident, Victim-2 ended her relationship with BRIGHTMAN. In the 24 hours that followed, BRIGHTMAN called Victim-2 over 20 times, including from private blocked numbers.  During one phone call, BRIGHTMAN repeatedly threatened Victim-2. 

In early September 2023, BRIGHTMAN traveled from New Jersey to the Bronx and lured a third woman he was dating (“Victim-3”) to his car.  While in BRIGHTMAN’s car, BRIGHTMAN forced Victim-3 to call Victim-2.  BRIGHTMAN then punched Victim-3, leaving a bruise on her arm.  When Victim-3 attempted to escape, BRIGHTMAN chased after her and put her in a choke hold.  Victim-3 was eventually able to run into her building and call the police. 

Several days later, BRIGHTMAN confronted Victim-3 while she was waiting for a bus home from work.  During the confrontation, BRIGHTMAN repeatedly asked Victim-3 if she had contacted the police about him.  BRIGHTMAN then followed Victim-3 home, where BRIGHTMAN assaulted her again, pushing Victim-3 to the ground and throwing a traffic cone at her.

In or about late September 2023, BRIGHTMAN traveled to the Bronx and convinced a fourth woman (“Victim-4”), who had previously ended her relationship with BRIGHTMAN, to allow him into her home.  Inside Victim-4’s home, BRIGHTMAN assaulted and strangled Victim-4, leaving her with bruising on her neck.  BRIGHTMAN also repeatedly threatened to kill Victim-4 and watched her while she showered. Victim-4 was discretely able to contact a friend, who eventually arrived at the apartment and helped free her.

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In addition to his prison term, BRIGHTMAN, 31, of New Jersey, was sentenced to three years of supervised release.

Mr. Podolsky praised the outstanding investigative work of the New York City Police Department. 

The case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant U.S. Attorneys Ni Qian, Patrick Moroney, and Elizabeth Daniels are in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced today that CALVIN DARDEN, JR., was sentenced to 151 months in prison by U.S. District Judge Vernon S. Broderick for defrauding former National Basketball Association (“NBA”) players Dwight Howard and Chandler Parsons out of $8 million.  DARDEN was previously convicted at trial of conspiracy to commit wire and bank fraud, wire fraud, bank fraud, conspiracy to launder money, and money laundering.

Acting U.S. Attorney Matthew Podolsky said: “Calvin Darden, Jr., stole millions of dollars from former NBA players and used the money to buy a mansion, a fleet of luxury cars, and expensive artwork.  This conviction—his third—and sentence make clear that severe consequences await those who take advantage of others by fraud.” 

According to the charging documents and other filings and statements made in court:

In the fraud against Howard, DARDEN, JR. deceived Howard into sending him $7 million, purportedly for the purpose of buying the Atlanta Dream (the “Dream”), a team in the Women’s National Basketball Association.  DARDEN, JR. worked with Charles Briscoe, Howard’s agent to perpetrate the fraud.  DARDEN, JR. sent a “Vision Plan” to Howard about the purported purchase of the Dream.  The Vision Plan falsely claimed that a number of celebrities and companies—including Tyler Perry, Issa Rae, Naomi Osaka, Aflac, and Starbucks—had agreed to be advisors to the Dream or to sponsor the Dream after Howard purchased it. In truth and in fact, those individuals and companies had never agreed to be advisors or corporate sponsors to the Dream and many had never even heard of DARDEN, JR. or any purported plan by DARDEN, JR. to purchase the Dream.

DARDEN, JR.’s father (“Relative-1”) is a prominent businessman.  DARDEN, JR. repeatedly impersonated Relative-1 in an attempt to add credibility to his fraud scheme.

DARDEN, JR. directed Howard to send the $7 million to a shell company he controlled, in order to effectuate the purported purchase of the Dream.  DARDEN, JR. then laundered the money through a number of different bank accounts he controlled.  DARDEN, JR. did not spend any money on the purchase of the Dream.  Instead, he spent the money on a $3.7 million mansion, a Rolls-Royce, a Lamborghini, a Porsche, artwork by Jean-Michel Basquiat, and other luxury goods for himself.

Howard learned that he did not in fact own the Dream only when ESPN reported that the Dream had in fact been sold to someone else.

In the fraud against Parsons, DARDEN, JR. deceived Parsons into sending him $1 million, purportedly for the purpose of loaning the money to James Wiseman, a prospect in the 2020 NBA draft.  DARDEN, JR. and Briscoe falsely claimed to know Wiseman, and forged a document stating that Wiseman had agreed that Briscoe would be his agent in order to convince Parsons to send the money.  In truth and in fact, DARDEN, JR. and Briscoe did not know Wiseman and did not send any of the money to Wiseman.  Instead, DARDEN, JR. spent his cut of the fraud proceeds on watches, a Mercedes, and other personal expenses.

DARDEN, JR. was previously convicted of fraud in New York state in 2005.  He was also convicted of fraud in the Southern District of New York in 2015. In the 2015 case, DARDEN, JR. committed frauds involving a purported purchase of Maxim magazine and a purported NBA exhibition game in Taiwan.  In that prior fraud, DARDEN, JR. also impersonated Relative-1 in an attempt to add credibility to his fraud scheme.

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In addition to the prison term, DARDEN, JR., 50, of Atlanta, Georgia, was sentenced to five years of supervised release.   DARDEN, JR. was ordered to forfeit $8,000,000 and a number of other items, including a Lamborghini, a Rolls-Royce, $600,000 of artwork by Jean-Michel Basquiat, and an Atlanta mansion.  DARDEN, JR. was also ordered to make restitution in the amount of $8,000,000.

Mr. Podolsky praised the outstanding work of the Federal Bureau of Investigation. 

The case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorneys Kevin Mead, Brandon C. Thompson, and William C. Kinder are in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced today that JONATHAN DELAURA, a/k/a “Jon Dulak,” was sentenced yesterday by U.S. District Judge Kenneth M. Karas to 485 months in prison for receiving, distributing and possessing child pornography, sending obscene material to a fifteen-year-old boy, and sending that obscene material while being a person required by law to register as a sex offender. DELAURA previously pled guilty on July 1, 2024. 

Acting U.S. Attorney Matthew Podolsky said: “DeLaura possessed large quantities of child pornography and took advantage of a fifteen-year-old child, all while he was required by law to register as a sex offender. This case underscores the urgent need for law enforcement to continue its efforts to protect children from those who prey on them.  As yesterday’s sentencing demonstrates, we will use every tool available to prosecute and punish those who sexually exploit children.” 

According to documents filed in this case and statements made in related court proceedings:

On or about October 7, 2009, DELAURA was convicted, upon a guilty plea, of Sexual Misconduct: Engage in Oral/Anal Sexual Conduct Without Consent, in Bronx County Court.  He was sentenced on December 16, 2009 to a term of 60 days’ in prison and six years’ probation, and he was required to register with the New York State Sex Offender Registry.

In December 2010, following DELAURA’s violation of probation, he was resentenced to a term of one year in prison.  He was released from prison in April 2011.

From at least on or about May 5, 2011, through on or about May 10, 2011, DELAURA received and distributed files containing images and videos of child pornography, in Westchester County, using a file-sharing program. 

In or about November 2011, DELAURA contacted a 15-year-old boy (the “Victim”) in an Internet chat room claiming to be a 17-year-old girl and using the screen name “sillyrabbit.”  After an exchange of messages, DELAURA sent sexually explicit photographs to the Victim. Thereafter, DELAURA met the Victim on two occasions and engaged in sexual activity with him.  On February 2, 2012, when DELAURA tried to meet the Victim for a third time to engage in sexual activity, he was arrested by officers of the Putnam County Sheriff’s Department (“PCSD”).  After DELAURA was arrested, a search warrant was executed at his residence and PCSD officers recovered an iPod, which contained approximately 162 videos containing images of child pornography and approximately 5 still photos of images containing child pornography.  The iPod also contained the sexually explicit photographs DELAURA sent to the Victim.

On February 3, 2012, DELAURA was convicted of two counts of Criminal Sexual Act in the 3rd degree in Putnam County Court and sentenced to a term of 32 months to 8 years in prison.  DELAURA completed that sentence on January 2, 2020, and has been incarcerated on the federal charges since then.

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In addition to the prison term, DELAURA, 50, was sentenced to ten years of supervised release.

Mr. Podolsky praised the efforts of Homeland Security Investigations, the Putnam County Sheriff’s Department, the Yorktown Police Department, the Putnam County District Attorney’s Office, the Westchester County District Attorney’s Office, and the Edison Police Department in New Jersey in connection with this investigation. 

The prosecution is being handled by the Office’s White Plains Division. Assistant United States Attorney Marcia S. Cohen is in charge of the prosecution.   

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced that JERRIN PENA, a/k/a “Rooga,” a/k/a “Perry,” was sentenced yesterday to 25 years in prison for his participation in several acts of violence as a member of the Own Every Dollar (“OED”) gang, including the April 14, 2019, murder of Hector Cruz.  PENA previously pled guilty to racketeering conspiracy, assault with a dangerous weapon, Hobbs Act robbery, discharging a firearm in furtherance of Hobbs Act robbery, narcotics conspiracy, and firearms trafficking.  U.S. District Judge J. Paul Oetken imposed yesterday's sentence.

Acting U.S. Attorney Matthew Podolsky said: “Jerrin Pena, a leader of the violent OED gang, murdered an innocent bystander, Hector Cruz, while trying to shoot at a rival gang member on April 14, 2019.  Then, when in federal custody on these charges, Pena stabbed another inmate in an attempt to kill him. Yesterday’s lengthy prison sentence hopefully brings some measure of comfort to the family of Hector Cruz, and reinforces this Office’s commitment to ending gang violence throughout New York City.”

As alleged in the Indictment and statements made in public filings and public court proceedings:

PENA was a leader of the violent OED gang, a subset of the Trinitarios gang based in and around the Washington Heights area of Manhattan.  The indictments in this case charge 24 members and associates of OED with numerous violent crimes, including five murders and 15 attempted murders.

On April 14, 2019, in the early evening, PENA and others drove to West 135th Street in Manhattan to shoot at members of a rival gang.  PENA exited the car and shot at a rival gang member on West 135th Street and Amsterdam Avenue. He missed the rival gang member, but struck bystander Hector Cruz—then age 57—in the liver. Cruz died of the gunshot wound approximately one month later.

PENA also committed an attempted murder on February 28, 2023, when he and several other inmates stabbed another inmate in the Metropolitan Detention Center; committed a gunpoint robbery of a drug dealer on January 22, 2022, in the vicinity of Riverside Drive and West 145th Street in Manhattan; conspired to traffic more than four kilograms of fentanyl; and trafficked firearms from Pennsylvania to New York.

16 other defendants have previously pled guilty in the case.

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In addition to his prison term, PENA, 23, of New York, New York, was sentenced to five years of supervised release.

Mr. Podolsky praised the outstanding work of the New York City Police Department and the Drug Enforcement Administration.

This case is being handled by the Office’s Narcotics Unit.  Assistant U.S. Attorneys Sarah L. Kushner, Kevin Mead, Ashley C. Nicolas, and Alexandra Messiter are in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, and Christopher G. Raia, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of an Indictment charging RANDY MILLER, former Chairman and President of Legacy Sports, and his son, CHAD MILLER, former CEO of Legacy Sports, with engaging in a scheme to defraud investors of more than $280 million in two municipal bond offerings. RANDY MILLER and CHAD MILLER were arrested today and will be presented tomorrow in the U.S. District Court for the District of Arizona. The case has been assigned to U.S. District Judge Lewis A. Kaplan. 

Acting U.S. Attorney Matthew Podolsky said: “As alleged, Randy Miller and Chad Miller swindled investors out of over a quarter of a billion dollars by selling municipal bonds they knew were backed by forgeries and lies. Municipal bonds fund critical public projects and investors rely on accurate financial disclosures to make informed decisions. This Office is committed to protecting the integrity of the public finance system. When individuals abuse that system and investors’ trust, we will hold them accountable.”

FBI Assistant Director in Charge Christopher G. Raia said: “Fathers and sons have found shared bonds in sports for generation. Randy and Chad Miller allegedly chose to use a planned sports complex as a means to exploit and defraud investors.  The Millers allegedly executed the scheme using fraudulent documents to lie about the status of the proposed project in order to raise hundreds of millions of dollars which they used to enrich themselves.  The FBI will continue to ensure a level playing field by holding fraudsters accountable in the criminal justice system.”

According to the allegations contained in the Indictment:[1]

From November 2019 through May 2023, RANDY MILLER and CHAD MILLER engaged in a scheme to defraud investors in municipal bonds used to fund the development of a major sports complex in Mesa, Arizona called Legacy Park. The defendants worked together and with others to lie to potential bond investors about the interest sports organizations and other potential customers had in using or relocating to Legacy Park. The defendants and their associates forged and altered purported “binding” letters of intent and other documents from those potential customers to make it appear that the customers were committing to holding many events at Legacy Park, with a significant number of spectators, and agreeing to pay large fees – all far beyond what the organizations were considering, if they were considering Legacy Park at all. In some instances, RANDY MILLER and CHAD MILLER signed and directed others to sign customers’ names without the customers’ knowledge or permission. At other times the defendants copied and directed others to copy the signatures of other customers onto the fabricated letters, again without the customers’ knowledge or permission. As part of their scheme, the defendants forged documents on behalf of numerous persons and organizations, including an organization that promotes sports for disabled athletes.

RANDY MILLER and CHAD MILLER presented the fraudulent documents to prospective bond investors and incorporated them into their solicitation materials by claiming that Legacy Park would be 100% occupied at opening and would generate nearly $100 million in revenue in its first year of operations, more than enough to cover the bond payments. 

After the Legacy Park bonds were sold to investors, RANDY MILLER and CHAD MILLER used some of the proceeds to pay for personal expenses such as a home and SUVs. The defendants also paid themselves inflated salaries and withdrew hundreds of thousands of dollars in addition to their salaries.

While the defendants enriched themselves, Legacy Park struggled to survive. The park opened in 2022, but within months failed to generate enough revenue to make the monthly bond payments, and by October 2022 it was in default. On May 1, 2023, the project filed for bankruptcy and was later sold for less than $26 million. Of those proceeds, less than $2.5 million went to repay the approximately $284 million owed to Legacy Park bondholders. Accordingly, because of the defendants’ fraud, bondholders were left with near total losses.

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RANDY MILLER, 70, and CHAD MILLER, 41, both of Phoenix, Arizona, were both charged in the Indictment with one count of conspiracy to commit wire fraud and securities fraud, which carries a maximum term of five years in prison; one count of securities fraud and one count of wire fraud, each of which carries a maximum term of 20 years in prison; and one count of aggravated identity theft, which carries a mandatory minimum sentence of two years in prison.

The mandatory minimum and maximum potential sentences in this case are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge. 

Mr. Podolsky praised the outstanding work of the FBI. Mr. Podolsky also thanked the U.S. Securities and Exchange Commission, which has filed a parallel civil action. 

The case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Courtney L. Heavey and Matthew R. Shahabian are in charge of the prosecution.

[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the descriptions of the Indictment constitute only allegations, and every fact described should be treated as an allegation. 

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced today that BRIAN CORDASCO was sentenced to 20 months in prison for participating in a conspiracy to solicit and receive bribes in his role as a Chief of the New York City Fire Department (“FDNY”) Bureau of Fire Prevention (“BFP”).  CORDASCO previously pled guilty on October 8, 2024, before U.S. District Judge Lewis J. Liman, who also imposed today’s sentence.

Acting U.S. Attorney Matthew Podolsky said: “As a chief of the Bureau of Fire Prevention, Brian Cordasco was entrusted to protect the people of New York City and to fairly represent their interests.  Instead, he repeatedly abused his position of power by expediting fire inspection services for those who paid him thousands of dollars in bribes.  The sentence imposed today sends a clear message that government officials who betray the public trust to line their own pockets will be met with just punishment.”

According to the Indictment, plea agreement, and statements made in court:

From 2021 to 2023, CORDASCO repeatedly abused his position as a Chief of the BFP by participating in a scheme to solicit and receive $190,000 in total bribe payments from a former FDNY firefighter named Henry Santiago, Jr.  In exchange for those bribe payments, CORDASCO used his authority within the BFP to improperly “expedite” BFP inspections and plan reviews for Santiago’s customers.  CORDASCO personally profited $57,000 as part of this scheme.  To carry out this conspiracy, CORDASCO lied to his BFP subordinates to justify otherwise improper expediting requests.  CORDASCO also lied to law enforcement when interviewed about his involvement in the scheme. 

If you believe you have information related to bribery, fraud, or any other illegal conduct by FDNY or BFP employees, please contact [email protected] or (212) 825-2402. If you were involved in such conduct, please consider self-disclosing through the SDNY Whistleblower Pilot Program at [email protected].

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In addition to the prison term, CORDASCO, 49, of Staten Island, New York, was sentenced to two years of supervised release and ordered to pay forfeiture of $57,000 and a fine of $100,000.

Mr. Podolsky praised the outstanding work of the Federal Bureau of Investigation and the New York City Department of Investigation.

The prosecution of this case is being handled by the Office’s Public Corruption Unit.  Assistant U.S. Attorneys Jessica Greenwood, Matthew King, and Daniel H. Wolf are in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced that BRANDON BECKER, the former CEO of CardReady, LLC (“CardReady”), was sentenced today to seven years in prison for operating a credit card laundering scheme in which BECKER and his co-conspirators stole over $19 million based on false promises that they could reduce thousands of customers’ debt burdens. As part of this scheme, BECKER and his co-conspirators created dozens of sham merchant accounts and false merchant applications, defrauding a credit card processing company and federally insured bank into processing victim payments. BECKER previously pled guilty before U.S. District Judge Loretta A. Preska, who also imposed today’s sentence.

Acting U.S. Attorney Matthew Podolsky said: “Over a two-year period, Brandon Becker and his co-conspirators preyed on nearly 20,000 victims who were trying to reduce their debt burdens. Becker tasked co-conspirators at CardReady to recruit straw owners for shell companies, and deceived credit card payment processors into fraudulently processing more than $19 million in stolen funds. With today’s sentence, Becker faces the consequences of this massive fraud, sending the clear message that corporate executives who facilitate fraud will be held accountable for their crimes.”

According to the Superseding Indictment, court filings, and statements made in Court:

BECKER was the CEO of CardReady, a Los-Angeles based company acting as a sales agent in the credit card processing industry.  As part of its business as a sales agent, CardReady found merchants who wanted credit card processing services, and submitted merchant applications on behalf of those merchants to an Independent Sales Organization (“ISO”), referred to in the Indictment as the “New York ISO.”  The New York ISO then evaluated the merchant applications, and referred acceptable merchant accounts for processing up the chain to Payment Processor-1 and to Bank-1.  Bank-1 and Payment Processor-1, in turn, processed payments to merchants for purchases by customers who had used credit cards.

In or about 2012, BECKER negotiated a deal with co-defendant STEVEN SHORT, the former head of Florida-based E.M. Systems & Services LLC and affiliated companies (collectively, “E.M. Systems”).  Under this deal, CardReady would retain approximately one-third of E.M. Systems’ credit card sale transactions in exchange for providing E.M. Systems access to the credit card processing network.  For roughly the next two years, SHORT and telemarketers working in boiler rooms for E.M. Systems cold-called customers and offered services, including debt consolidation and interest-rate reduction, which were prohibited by the applicable guidelines from Bank-1 and other associated processing entities (the “Guidelines”), and which – as BECKER knew – would produce chargebacks from dissatisfied customers far in excess of the number and rate of chargebacks permitted under the Guidelines.

In securing payment card processing for E.M. Systems, BECKER concealed that E.M. Systems was the true underlying merchant.  Instead, BECKER and his subordinates and co-conspirators, created approximately 26 sham merchant companies, each headed by a “signer” (the “Sham Merchants” and the “Sham Merchant Accounts”).  The 26 signers for the 26 Sham Merchants typically had no business of their own, and lacked knowledge of E.M. Systems’ business.  In return for signing the paperwork provided to them, the signers were paid a nominal fee from CardReady. 

BECKER and his co-conspirators prepared and coordinated fraudulent merchant applications for each of the Sham Merchants, through merchant applications that falsely described the Sham Merchants to make them look like legitimate independent businesses and to make it more likely that the associated Sham Merchant Account would be approved for processing by the New York ISO, Payment Processor-1, and Bank-1.  The merchant application for each Sham Merchant also concealed the Sham Merchant’s true association with E.M. Systems.

By steering E.M. Systems’s payment processing through these Sham Merchant Accounts, BECKER accomplished a number of fraudulent purposes.  First, the use of these Sham Merchant Accounts made it possible for E.M. Systems and other high-risk merchants to conceal their identities from Payment Processor-1 and Bank-1 and to maintain payment card processing.  This was particularly relevant, as Payment Processor-1 repeatedly required CardReady to close individual Sham Merchant Accounts because of excessive chargebacks and reports of sales of prohibited services.  BECKER then caused CardReady to quickly replace the closed Sham Merchant Accounts with new Sham Merchant Accounts, precluding Payment Processor-1 from shutting down its processing of E.M. Systems and other high-risk merchants.  Second, the fraudulent processing scheme enabled E.M. Systems and other high-risk merchants to spread out their charges, refunds, and chargebacks across multiple Sham Merchant Accounts.  This enabled them to evade chargeback monitoring programs operated by Bank-1, Payment Processor-1, and the New York ISO.

BECKER’s use of signers to deceive payment processors was not limited to the E.M. Systems scheme. BECKER and his agents and employees at CardReady systematized the recruitment of over 270 signers and the creation of over 800 Sham Merchant Accounts to be used by more than 30 high risk clients other than E.M. Systems between approximately 2012 and 2016, both before and after the E.M. Systems scheme.

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BECKER, 53, of Los Angeles, California, pled guilty on August 30, 2024, to one count of conspiracy to commit wire fraud and bank fraud.  In addition to the prison sentence, BECKER was sentenced to three years of supervised release and ordered to pay restitution in the amount of $1,910,600.05, and forfeiture of $11,405,964.00.

STEVEN SHORT, 48, of Tampa, Florida, pled guilty on August 16, 2022, to one count of conspiracy to commit wire fraud and bank fraud.  On May 2, 2023, SHORT was sentenced to 78 months in prison and three years of supervised release and ordered to pay restitution in the amount of $1,910,600.05 and forfeiture of $8,833,889.69.

Mr. Podolsky praised the work of the Federal Bureau of Investigation and thanked the Federal Trade Commission for its assistance.

This case is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorneys Vladislav Vainberg and Timothy Capozzi are in charge of the prosecution.

“Today, a unanimous jury found Charlie Javice and Olivier Amar guilty of orchestrating a brazen fraud. Javice, the founder and CEO of Frank, falsely claimed that her company had millions of customers when, in reality, it had just a fraction of that number. She and Amar, the Chief Growth Officer, fabricated data, lied to major financial institutions, and sold their business for $175 million. And while Javice and Amar may have thought that they could lie and cheat their way to a huge payday, their lies caught up with them, and they now stand convicted by a jury of their peers in federal court. 

This Office will continue to pursue financial fraud aggressively and hold accountable those who put greed above honesty. I commend the career prosecutors of this Office and our law enforcement partners who worked tirelessly to bring this case to trial and secure today’s verdict. Thanks to their efforts, Javice and Amar will now pay a steep price for their lies. ”

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced today that GORAZD FILIMONOVIC and GASPER URBANC, were sentenced to 10 years and 13 years in prison, respectively, for conspiring to import hundreds of kilograms of heroin into the United States.  FILIMONOVIC and URBANC, who are both Slovenian nationals, were sentenced by U.S. District Judge Gregory H. Woods, before whom they previously pled guilty. 

Acting U.S. Attorney Matthew Podolsky said: “Gorazd Filimonovic, Gasper Urbanc, and their co-conspirators agreed to send a staggering amount of heroin to the United States.  The defendants boasted of their connections to other drug traffickers in Europe, and claimed they had experience in trafficking thousands of kilograms of drugs. But today, all of that comes to an end as Filimonovic and Urbanc will serve lengthy prison sentences. This Office, through its longstanding partnership with the DEA’s Special Operations Division, Bilateral Investigations Unit, will continue to prosecute those who seek to harm our communities by flooding our streets with dangerous drugs.” 

As reflected in the Indictment, other filings, and statements made in court:

From at least November 2020 through approximately April 2021, FILIMONOVIC and URBANC conspired to distribute multi-hundred-kilogram quantities of heroin from Austria and elsewhere for importation into the U.S.

The Drug Enforcement Administration (“DEA”) had been investigating FILIMONOVIC, URBANC, and certain of their co-conspirators since at least 2019, when a Confidential Source (the “CS”) identified URBANC as a significant international cocaine trafficker who was responsible for coordinating drug transportation logistics on behalf of a drug trafficking organization (“DTO”).  In a subsequent series of meetings and electronic communications, confidential sources (the “CSes”) negotiated the purchase of large quantities of cocaine and heroin for distribution in the U.S.  FILIMONOVIC, URBANC, and their co-conspirators explained to the CSes that they had experience in the international trafficking of thousands of kilograms of cocaine and heroin and could act as direct conduits to drug production facilities that they controlled.  FILIMONOVIC, URBANC, and their co-conspirators met with the CSes multiple times throughout the world, including in the Czech Republic, Croatia, Slovenia, and Colombia, to coordinate large-scale drug shipments and to discuss alternative routes as they sought methods to evade law enforcement.

After early discussions regarding a potential cocaine shipment, the parties began discussing large scale heroin shipments.  When a CS expressed interest in kilogram-quantity samples of heroin for potential future drug transactions, URBANC informed the CS that he could provide heroin immediately from multiple locations throughout Europe.  By February 2021, FILIMONOVIC, URBANC, and their co-conspirators agreed to supply the CSes with high-quality heroin to be delivered by the DTO to a location in Austria with the understanding that the heroin would then be flown by the CSes from Europe to New York City for further distribution in the United States.

In March 2021, the parties agreed on a price between €18,000 and €19,000  (approximately $21,600 and $22,800 at the time) per kilogram.  Around this time, FILIMONOVIC and a co-conspirator met with one of the CSes and explained how the heroin would be transported, and that the heroin would be exchanged with the CSes in Graz, Austria.  By April 2021, FILIMONOVIC, URBANC, and their co-conspirators agreed to provide up to 135 kilograms of heroin in segments of approximately 30 to 40 kilograms to the CSes in exchange for approximately €2.6 million (approximately $3.1 million at the time).  During meetings in April 2021 and in ensuing encrypted communications, the CSes showed FILIMONOVIC, URBANC, and their co-conspirators that they had secured payment for the heroin.  The parties continued to discuss the proposed heroin transaction until FILIMONOVIC and URBANC were arrested in Croatia on May 21, 2021.

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Mr. Podolsky praised the outstanding efforts of the DEA’s Special Operations Division, Bilateral Investigations Unit as well as the Slovenia National Bureau of Investigation, the Austrian Federal and State Criminal Police, and the Croatian National Police for their assistance.

This prosecution is being handled by the Office’s National Security and International Narcotics Unit.  Assistant U.S. Attorneys Sam Adelsberg, Matthew J.C. Hellman, and Nicholas S. Bradley, and Special Assistant U.S. Attorney Julie Isaacson are in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced today that PAUL BIELECKI, a/k/a “Paul HRH Saxe-Coburg-Gotha,” a Manhattan-based Franciscan friar, was sentenced to five years in prison for perpetrating a multi-year scheme to obtain donations for a fake medical charity purportedly operating in Beirut, Lebanon.  BIELECKI previously pled guilty to wire fraud on November 11, 2024, before U.S. District Judge Vincent Briccetti, who imposed today’s sentence.

Acting U.S. Attorney Matthew Podolsky said: “Paul Bielecki exploited his position as a friar to defraud hundreds of innocent victims. He faked a charity to rake in hundreds of thousands of dollars, and then used these stolen funds to live the high life. But Bielecki’s days of luxury and lies are over. Let today’s sentence be a lesson to all — if you abuse your position of trust to take advantage of others, you will be held accountable.”

According to the Complaint, Information, public court filings, and statements made in court:

BIELECKI is a friar in the Capuchin Order, a Catholic order of priests and brothers, based out of a friary in New York City.  BIELECKI engaged in a fraudulent scheme related to fake medical clinics he claimed to operate in Lebanon.

Specifically, for nearly a decade, BIELECKI fraudulently raised money from victims by falsely claiming that he operated two medical clinics in Lebanon and was raising money for medicine, medical equipment, baby incubators, food, and an ambulance for those clinics.  BIELECKI also lied to victims by falsely stating that he was a physician, vascular surgeon, cardiac surgeon, and/or general surgeon, who had earned multiple Ph.D. degrees, and by falsely claiming to have been badly injured—and his fake clinics badly damaged—by a widely reported August 2020 explosion in Beirut, Lebanon.

BIELECKI reached victims by fraudulently soliciting donations at church masses and through other church events, by appearing as a guest or through advertisements on radio programs and online podcasts, and through various other means, including campaigns on crowdfunding websites.  Through his scheme, BIELECKI fraudulently obtained more than $560,000 in donations from more than 350 victims for his fake medical clinics.  Despite taking a vow of poverty as a friar in the Capuchin Order, BIELECKI used the donations he fraudulently received to fund lavish personal spending, including first-class travel, a $334.40 per month membership at a luxury gym chain, multiple trips to the Hamptons, numerous meals at high-end restaurants, and aesthetic plastic surgery costing thousands of dollars.

If you believe you are a victim of fraud perpetrated by BIELECKI, please contact Special Agent Sean Smyth, U.S. Attorney’s Office for the Southern District of New York, at (914) 993‑1900 or by following the instructions available at https://www.justice.gov/usao-sdny/report-crime. 

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In addition to the prison term, BIELECKI, 48, of New York, New York, was sentenced to three years of supervised release, ordered to pay forfeiture of $563,448, and ordered to pay restitution.

Mr. Podolsky praised the outstanding investigative work of the Special Agents of the U.S. Attorney’s Office for the Southern District of New York and the Internal Revenue Service – Criminal Division. Mr. Podolsky also thanked the New York Field Office of U.S. Customs and Border Protection for their assistance in the investigation.

This case is being handled by the Office’s White Plains Division.  Assistant U.S. Attorneys Benjamin Levander and Ryan W. Allison are in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced that JUNYI LIU, a/k/a “Jenny,” pled guilty today to one count of conspiracy to commit health care fraud in connection with a scheme to fraudulently bill insurance providers for acupuncture and physical therapy services that were unnecessary or never performed at medical offices in Manhattan, Brooklyn, and Queens.  LIU, a licensed acupuncturist and leader of this scheme, pled guilty before Chief U.S. District Judge Laura Taylor Swain.

Acting U.S. Attorney Matthew Podolsky said: “Junyi Liu led a fraud scheme in which she and her co-conspirators bilked Medicare and other insurers out of millions of dollars by submitting fraudulent claims for acupuncture and physical therapy services.  Liu took advantage of our health care system—and abused her licensing as an acupuncturist—and she now awaits sentencing for her crime. This Office will continue to work with our law enforcement partners to detect and dismantle fraud schemes, including schemes that seek to siphon money from our health care system.”

According to the allegations contained in the Indictment, the plea agreement, and statements made in court:

Between 2018 and 2021, LIU, a licensed acupuncturist, operated medical offices (the “Offices”) from which LIU and her partners fraudulently billed Medicare and other insurance providers (collectively, the “Insurance Providers”) for physical therapy and acupuncture services that were not rendered in the manner represented or not rendered at all.  During the scheme, LIU partnered with other licensed medical professionals, including licensed physical therapists and at least one other licensed acupuncturist (collectively, the “Partners”).  The Partners’ roles in the scheme typically included: allowing the Offices to use their enrollments with the Insurance Providers to submit to the Insurance Providers materially false and fraudulent claims for reimbursement for physical therapy and acupuncture services that were not rendered in the manner represented or were not rendered at all; creating materially false medical documentation, which stated that certain physical therapy and acupuncture services had been rendered, when such services in fact were not rendered in the manner represented or were not rendered at all; and contributing financing for the Offices, including for the payment of cash kickbacks to patients (the “Paid Patients”) to induce those patients to provide their insurance information and receive medically unnecessary and/or non-existent services at the Offices. LIU and certain of the Partners also agreed to give kickbacks, including cash and expensive wine, to employees of Insurance Providers to enable the scheme to continue.

In furtherance of the scheme, LIU employed receptionists, cashiers, marketers, financial and billing personnel, acupuncturists, massagists, and other personnel.  The cashiers distributed tens of thousands of dollars in cash kickbacks to the Paid Patients.  In some instances, these Paid Patients visited the Offices, signed in, and received unnecessary physical therapy and acupuncture services.  In other instances, the Paid Patients visited the Offices, signed a sign-in sheet and other documents, and then left without receiving any services at all.  In yet other instances, the Paid Patients did not visit the Offices at all and instead signed sign-in sheets and other documents brought to them elsewhere. Regardless of whether the Paid Patients received any services or even visited the Offices at all, the conspirators used the Paid Patients’ insurance information to fraudulently bill the Insurance Providers for unnecessary and/or never rendered services.

While LIU and her Partners were defrauding the Insurance Providers of millions of dollars, from April 2020 through September 2021, LIU also engaged in a scheme to obtain COVID-19 unemployment benefits for herself and a family member (the “Family Member”) by fraudulently submitting and causing to be submitted to the New York Department of Labor materially false online applications and certifications for COVID-19 benefits.  Among other things, the applications and/or certifications represented that LIU was unemployed when she continued to operate the Offices for all or nearly all of this period and that LIU’s Family Member was unable to work because of COVID-19 during a five-month period when the Family Member was in China.  In connection with her guilty plea, LIU agreed to pay back the misappropriated COVID-19 unemployment benefits received by her and the Family Member.

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JUNYI LIU, 70, of Great Neck, New York, pled guilty to one count of conspiracy to commit health care fraud, which carries a maximum sentence of 10 years in prison.  As part of her plea agreement with the Government, LIU agreed to pay $23,855,425 in restitution to the Insurance Providers and $40,075 to the New York State Department of Labor.  She additionally agreed to forfeiture of $15,368,171.

In addition to LIU, NOEMI ALGODON, MOHAMED ELMANDOUH, GERARD ESTRELLA, RAMON GARCIA, III, HENLER DATU TAHIL, JONATHAN LAQUI, and MITZY BALDOVINO have also pled guilty in connection with their participation in the health care fraud scheme.   

The maximum potential sentence in this case is prescribed by Congress and provided here for informational purposes only, as the sentencing of the defendant will be determined by a judge.

Mr. Podolsky praised the outstanding investigative work of the U.S. Department of Health and Human Services, Office of Inspector General’s New York Office and the New York Field Office of the Internal Revenue Service, Criminal Investigation.  Mr. Podolsky also thanked the New York State Attorney General’s Medicaid Fraud Control Unit and the U.S. Department of Labor, Office of Inspector General, for their assistance.

This case is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorneys Timothy V. Capozzi and Jerry Fang are in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, and Naomi Gruchacz, the Special Agent in Charge of the New York Regional Office of the Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), announced today that the United States has filed and simultaneously settled a civil fraud lawsuit against COMMUNITY OPTIONS, INC. (“COI”) and COMMUNITY OPTIONS NEW YORK, INC. (“CONY”, and together with COI, the “Defendants” or “Community Options”).

CONY is a New York not-for-profit corporation that, among other things, operates a network of residential and non-residential facilities and programs for adults with developmental or intellectual disabilities throughout the State of New York. As part of its operations, CONY provides Day Habilitation services—which are programs intended to help adults with developmental or intellectual disabilities improve their independence and skills in daily activities. COI is a New Jersey not-for-profit corporation that, among other things, oversees CONY’s operations in New York and provides administrative support, including a centralized billing team that handles CONY’s submission of claims for reimbursement to the New York Medicaid Program. The settlement resolves claims that the Defendants fraudulently billed Medicaid by submitting claims for Day Habilitation services that did not meet applicable requirements, and improperly avoiding the return of overpayments received from the Medicaid program for Day Habilitation services that failed to meet those requirements.

Under the settlement agreement approved today by U.S. District Judge Valerie E. Caproni, the Defendants will pay the U.S. $2,148,540.37 and have admitted and accepted responsibility for certain conduct alleged in the Complaint as further described below. The Defendants have also agreed to pay $2,868,085.74 to the State of New York to resolve the State of New York’s claims, for a total recovery of $5,016,626.11.

In connection with the settlement agreement, the Defendants have also entered into a Corporate Integrity Agreement with HHS-OIG. The Corporate Integrity Agreement requires that the Defendants maintain a compliance program designed to foster adherence to federal health care program requirements and thereby protect the programs, and that they engage an independent organization to review claims they submit to Medicaid to ensure they comply with applicable requirements.

Acting U.S. Attorney Matthew Podolsky said: “Community Options billed Medicaid for services that failed to meet program requirements and retained potential overpayments received from Medicaid when it had an obligation to report and return those funds. Community Options has now admitted and accepted responsibility for its conduct. This Office will continue to ensure that our most vulnerable New Yorkers receive the services they deserve, and that our federal health care programs are protected against fraud and abuse.”

HHS-OIG Special Agent in Charge Naomi Gruchacz said: “Individuals and entities that participate in the federal healthcare system are required to obey the laws meant to preserve the integrity of program funds and the provision of appropriate services to patients. The settlement in this case involves a provider that is responsible for a vulnerable population, for which it should be prioritizing quality services.”

As alleged in the Complaint filed in Manhattan federal court:

In order to receive payment from the New York Medicaid Program for the provision of Day Habilitation services, COI was required to ensure that such services were delivered and documented in compliance with applicable program requirements promulgated by the New York State Office for People With Developmental Disabilities (the “OPWDD Requirements”).

However, between January 1, 2017, and September 13, 2024, (the “Relevant Period”), COI failed to maintain adequate policies concerning the provision and documentation of Day Habilitation services consistent with the OPWDD Requirements and failed to adequately train their employees on compliance with the OPWDD Requirements. As a result, COI’s employees failed to document CONY’s provision of Day Habilitation services in accordance with the OPWDD requirements.

COI understood that they were prohibited from submitting claims for reimbursement to New York’s Medicaid program for Day Habilitation services if the OPWDD Requirements were not met. Nonetheless, COI frequently submitted claims to Medicaid for Day Habilitation services that did not meet these requirements.

COI further understood that, as a provider of services under New York’s Medicaid Program, they were required to report and return identified overpayments to the New York Medicaid Program. During the Relevant Period, COI conducted non-routine reviews that identified their receipt and retention of Medicaid overpayments associated with Day Habilitation services. Nevertheless, COI failed to report and return those overpayments to the New York Medicaid Program.

As part of the settlement, the Defendants admitted and accepted responsibility for certain conduct alleged by the U.S., including the following:

• In order to receive payment from the New York Medicaid Program for the provision of Day Habilitation services, the Defendants were required to ensure that such services were delivered and documented in compliance with the OPWDD Requirements.
• During the Relevant Period, the Defendants failed to maintain adequate policies concerning the provision and documentation of Day Habilitation services consistent with the OPWDD Requirements and failed to adequately train their employees on compliance with the OPWDD Requirements. As a result, the Defendants’ employees failed to document CONY’s provision of Day Habilitation services in accordance with the OPWDD Requirements.
• Nonetheless, the Defendants submitted claims for, and received, reimbursement from the New York Medicaid Program for Day Habilitation services that did not meet OPWDD Requirements.
• CONY was required to report and return overpayments associated with Day Habilitation services that did not meet the OPWDD Requirements to the New York Medicaid Program. Nonetheless, when the Defendants conducted non-routine reviews that identified their receipt and retention of overpayments associated with Day Habilitation services, they failed to report and return those overpayments to the New York Medicaid Program. 

In connection with the filing of the lawsuit and settlement, the Government joined a private whistleblower lawsuit that had been filed under seal pursuant to the False Claims Act.

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Mr. Podolsky thanked both HHS-OIG for its investigative efforts and assistance with the case, and the Medicaid Fraud Control Unit at the New York State Attorney General’s Office for its collaboration in the resolution of this case.

The case is being handled by the Office’s Civil Frauds Unit.  Assistant U.S. Attorney David E. Farber is in charge of the case.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced today the unsealing of a Complaint charging KEVIN WILLIAMS and BYRON WILSON with the robbery of a jewelry store in Hartsdale, New York, on December 16, 2024, in which the defendants stole approximately $1.7 million of jewelry. WILLIAMS and WILSON were arrested this morning in New Jersey, and are expected to be presented this afternoon before U.S. Magistrate Judge Judith C. McCarthy in White Plains federal court.

Acting U.S. Attorney Matthew Podolsky said: “As alleged, Kevin Williams and Byron Wilson, along with their co-conspirators, carried out the violent robbery of a jewelry store in broad daylight. Armed with sledgehammers, the defendants smashed their way in and then plundered the store of about $1.7 million in jewelry, diamonds, and luxury watches, all while innocent customers and employees hid for their safety. Today’s arrests should make clear that if you commit such brazen and dangerous crimes in this District, we will find you and hold you responsible.”

As alleged in the Complaint:[1]

On December 16, 2024, WILLIAMS, WILSON, and their co-conspirators drove a stolen vehicle with a stolen license plate from New Jersey to New York. At around 11:07 a.m., they arrived at a jewelry store in the Westchester Square shopping plaza in Hartsdale, New York, got out of the vehicle, and sledgehammered their way into the store. Once inside, and while innocent customers cowered in fear for their safety, the robbers smashed jewelry display cases and stole around $1.7 million in jewelry, diamonds, and luxury watches. Soon after, they returned to their vehicle with bags of stolen goods and drove back to New Jersey. Surveillance images of the robbery are below. 

Once they arrived in New Jersey, WILLIAMS drove to the Diamond District in New York City, while WILSON returned to their shared residence. A few hours later, WILLIAMS, WILSON, and their co-conspirators took photographs of themselves holding large stacks of cash.

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KEVIN WILLIAMS, 26, and BYRON WILSON, 24, both of Irvington, New Jersey, are charged with conspiracy to commit Hobbs Act robbery and Hobbs Act robbery, each of which carries a maximum sentence of 20 years in prison.

The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.

Mr. Podolsky praised the outstanding work of the Federal Bureau of Investigation’s Westchester Safe Streets Task Force and Newark Field Office, as well as the Nassau County Police Major Case Squad, the Town of Greenburgh Police Department, and the Newark Police Department.

This case is being handled by the Office’s White Plains Division.  Assistant U.S. Attorney Reyhan Watson is in charge of the prosecution.

The charges contained in the Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1]As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, and Louis A. D’Ambrosio, the Special Agent in Charge of the Special Operations Division of the Drug Enforcement Administration (“DEA”), announced that OSCAR HENAO-MONTOYA, a Colombian national, was sentenced today to 24 years in prison for conspiring to import cocaine into the United States.  HENAO-MONTOYA was sentenced by U.S. District Judge Valerie E. Caproni, before whom he previously pled guilty to one count of cocaine importation conspiracy.  Two of HENAO-MONTOYA’s charged co-conspirators, REHINNER MONTOYA-GARCIA and JUAN FELIPE SANTIBANEZ-CARDONA, also previously pled guilty to one count of cocaine importation conspiracy and were sentenced by Judge Caproni to 20 years and 15 years in prison, respectively. 

Acting U.S. Attorney Matthew Podolsky said: “Oscar Henao-Montoya and his co-conspirators sought to send a staggering quantity of cocaine from Colombia to the United States.  Today’s sentence, and those previously imposed in this case, send a clear message that those who seek to traffic cocaine into the United States will pay a steep price for their actions.  This Office, through its longstanding partnership with the DEA’s Special Operations Division, Bilateral Investigations Unit, will hold accountable those who seek to break our narcotics laws and harm our communities, regardless of where in the world they may hide.” 

As reflected in the Indictment, other filings in Manhattan federal court, and statements made in open court:

HENAO-MONTOYA is a Colombian drug trafficker with longstanding familial connections to international cocaine distribution.  HENAO-MONTOYA is the younger brother of Orlando Henao-Montoya, a/k/a “El Hombre Overol,” the former leader of the Norte del Valle Cartel, the notorious drug cartel which operated principally in the Valle del Cauca region of Colombia and rose to prominence in the late 1990s after the Cali and Medellin cartels fragmented. HENAO-MONTOYA’s siblings also include Arcángel Henao Montoya, a/k/a “El Mocho,” Fernando Henao-Montoya, and Lorena Henao-Montoya, a/k/a “La Viuda De La Mafia.”  Together, the Henao-Montoya siblings ran the Norte del Valle Cartel, until Orlando and Lorena were murdered, and Arcángel Henao Montoya was deported from Panama to the U.S. 

Between October 2020 and August 2021, HENAO-MONTOYA and co-conspirators who worked for HENAO-MONTOYA, including MONTOYA-GARCIA and SANTIBANEZ-CARDONA, participated in a series of meetings in Colombia with DEA confidential sources (the “CSes”), who were acting at the direction of the DEA, to discuss their plans to import tons of cocaine into the U.S.  During those meetings, many of which were recorded, HENAO-MONTOYA discussed, among other things, his ability to export large quantities of cocaine from Colombia via control of airstrips (clandestine and overt) and ports in Colombia, as well as his relationships with corrupt members of the Colombian Air Force.  HENAO-MONTOYA and his co-conspirators also discussed various shipping routes to transport cocaine out of Colombia to the U.S. and, specifically, New York.  During certain of the meetings described above, HENAO-MONTOYA and individuals working for HENAO-MONTOYA were armed with firearms.

During meetings with the CSes, HENAO-MONTOYA also discussed his access to and control of cocaine laboratories that could produce over one ton of cocaine, including a laboratory that HENAO-MONTOYA said could produce 2,000 to 3,000 kilograms of cocaine at a time. On one occasion, MONTOYA-GARCIA brought one of the CSes to territory controlled by the Revolution Armed Forces of Colombia (“FARC”), which MONTOYA-GARCIA said was where HENAO-MONTOYA had drug laboratories, and that these laboratories were guarded by FARC members.

To ensure that their plan to import cocaine into the U.S. would be successful, HENAO-MONTOYA and his co-conspirators tested and provided cocaine samples for the CSes.  For example, in October 2020, MONTOYA-GARCIA and SANTIBANEZ-CARDONA provided a one-kilogram sample of cocaine to one of the CSes to test its quality.  After expressing satisfaction with the quality of the cocaine, the CS told MONTOYA-GARCIA and SANTIBANEZ-CARDONA that “the Americans will go crazy in the United States” for the cocaine.  In addition, in April 2021, at HENAO-MONTOYA’s direction, MONTOYA-GARCIA provided an eight-kilogram sample of cocaine to undercover agents working for the Colombian National Police in exchange for approximately $16,000, which was intended to serve as a sample for the contemplated ton-quantity cocaine shipments that HENAO-MONTOYA and his co-conspirators sought to send to the U.S.

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In addition to the prison term, HENAO-MONTOYA, 58, of Colombia, was sentenced to four years of supervised release.

Mr. Podolsky praised the outstanding efforts of the DEA’s Special Operations Division, Bilateral Investigations Unit, as well as the U.S. Department of Justice’s Office of International Affairs and the Narcotic and Dangerous Drug Section’s Office of the Judicial Attaché at the U.S. Embassy in Bogota and the Colombian National Police for their assistance.

This prosecution is being handled by the Office’s National Security and International Narcotics Unit.  Assistant U.S. Attorneys Sam Adelsberg, Matthew J.C. Hellman, David J. Robles, and Chelsea L. Scism are in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced that AUSTIN MORRISHOW pled guilty today to illegally possessing multiple rounds of ammunition in connection with a June 30, 2023, shooting in which MORRISHOW and his co-defendant, CURTIS WHITE, fired multiple shots on a residential street in the Bronx, striking and seriously injuring a five-year-old girl.  MORRISHOW pled guilty before U.S. District Judge Loretta A. Preska, who also presided over WHITE’s guilty plea on February 5, 2025.  

Acting U.S. Attorney Matthew Podolsky said: “On June 30, 2023, Austin Morrishow and his co-defendant, Curtis White, engaged in a brazen act of violence by firing several shots onto a busy residential street in the Bronx. As these shots rang out, panicked bystanders rushed for cover, and one child—a five-year-old girl—was struck by a bullet and seriously injured. Morrishow then tried to evade arrest, but he was tracked down by our law enforcement partners, and now faces time in prison for endangering our city with senseless gun violence.”

According to court filings and statements made in court proceedings:

On June 30, 2023, MORRISHOW, WHITE, and several others were gathered on a residential sidewalk in the Bronx.  After a car engine backfired, MORRISHOW took cover behind a parked vehicle, assumed a shooting stance, and fired several shots from a .40 caliber pistol at three cars idling nearby, which began fleeing from the gunfire.  WHITE ran after the fleeing cars, firing shots from a .380 caliber pistol.

The shots fired by MORRISHOW and WHITE left at least seven .40 caliber shell casings, two .380 caliber shell casings, and two fired bullets in the street, as well as two bullet fragments, bullet holes, and shattered windows in vehicles parked on the street.  One of these shots hit the five-year-old girl sitting in the back of a car, and she was rushed to the hospital.

MORRISHOW was not permitted to possess a firearm or ammunition because of his prior federal conviction for using and carrying a firearm during and in relation to a narcotics conspiracy, and WHITE was not permitted to possess a firearm or ammunition because of his prior state conviction for attempted first-degree assault with intent to cause serious injury with a weapon.

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MORRISHOW, 27, and WHITE, 27, both of the Bronx, New York, each pled guilty to one count of possession of ammunition after a felony conviction, which carries a maximum sentence of 15 years in prison.  MORRISHOW is scheduled to be sentenced on June 25, 2025, and WHITE is scheduled to be sentenced on May 20, 2025.   

The statutory maximum penalty is prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Podolsky praised the outstanding investigative work of the New York City Police Department, and also thanked the Bureau of Alcohol, Tobacco, Firearms and Explosives and the U.S. Marshals Service for their assistance with the investigation.

The prosecution of this case is being handled by the Office’s General Crimes Unit.  Assistant U.S. Attorney Jerry J. Fang is in charge of the prosecution.

A federal jury returned guilty verdicts yesterday on all five counts in the superseding indictment against Rafat Amirov, also known as Farkhaddin Mirzoev, Pᴎᴍ, and Rome, 46, of Iran; and Polad Omarov, also known as Araz Aliyev, Polad Qaqa, and Haci Qaqa, 40, of Georgia. The defendants were convicted of murder-for-hire and attempted murder in aid of racketeering charges, in a trial before U.S. District Judge Colleen McMahon. Amirov and Omarov are scheduled to be sentenced on Sept. 17.

“The Iranian regime’s brazen plot to silence and murder Americans will not be tolerated,” said Sue J. Bai, head of the Justice Department’s National Security Division. “This verdict underscores the Department’s commitment to finding and holding accountable those who threaten our citizens and our freedoms. With the great work of our prosecutors and law enforcement partners, we are now one step closer to justice.”

“For years, the Government of Iran has attempted to silence an outspoken Iranian journalist, author, activist and critic of their regime through any means necessary, including harassment, violence, intimidation, and even attempted murder,” said Acting U.S. Attorney Matthew Podolsky for the Southern District of New York. “Chillingly, the plot to murder this Iranian dissident culminated over 6,000 miles from Iran, on U.S. soil, right here in New York, when a hitman with an AK-47 camped outside her home to kill her. I commend the career prosecutors of this office, and our law enforcement partners at the FBI’s Counterintelligence Division for their tireless work in bringing these defendants to justice. This verdict should send a clear message around the world: if you target U.S. citizens, we will find you, no matter where you are, and bring you to justice.”

“The defendants participated in a brazen plot to kill an Iranian American dissident in New York who criticized the regime in Iran,” said Acting Assistant Director Roman Rozhavsky of the FBI’s Counterintelligence Division. “Thanks to the good work of the FBI and our partners their plan failed. This verdict demonstrates the FBI will not tolerate Iran’s attempts to threaten, silence, or harm American citizens.”

According to court documents, Amirov and Omarov were high-ranking members of an Eastern European organized crime group (the Organization) who worked with other members of the Organization to attempt to kill Masih Alinejad on instructions from high-ranking members of the Islamic Revolutionary Guard Corps (IRGC). Alinejad has previously been the target of plots by the Government of Iran to intimidate, harass, and kidnap her for her work as a journalist, author, and human rights activist who has publicized the Government of Iran’s human rights abuses around the world. As recently as 2020 and 2021, Iranian intelligence officials and assets plotted to kidnap Alinejad from within the U.S. for rendition to Iran in an effort to silence her criticism of the Iranian regime.

After these brazen efforts to kidnap Alinejad from the U.S. failed, the IRGC turned to Amirov and Omarov to locate, surveil, and murder her. Beginning in approximately July 2022, Amirov sent targeting information—which he had received directly from IRGC officials in Iran—about Alinejad to Omarov. In turn, Omarov communicated this information to Khalid Mehdiyev, another member of the Organization who had been residing in Yonkers, New York, so that Mehdiyev could surveil Alinejad and murder her. In turn, Mehdiyev sent photographs and videos of Alinejad’s residence to Omarov, who shared these materials with Amirov and the IRGC officials who orchestrated the plot in Iran. Amirov and Omarov then arranged for a $30,000 cash payment to Mehdiyev, who used a portion of this payment to buy an AK-47 style assault rifle, two magazines, and at least 66 rounds of ammunition; as Mehdiyev boasted in electronic communications, a “war machine” he could use to kill Alinejad.

In late July 2022, Mehdiyev repeatedly traveled to Alinejad’s neighborhood to surveil her. Mehdiyev sent reports of his surveillance to Omarov, who passed them to Amirov. On July 24, 2022, Mehdiyev reported to Omarov from Alinejad’s residence that he was “at the crime scene.” On July 27, 2022, Omarov told Amirov that Mehdiyev was ready to kill Alinejad, writing “this matter will be over today. I told them to make a birthday present for me. I pressured them, they will sleep there this night.”  On July 28, 2022, Mehdiyev sent Omarov a video taken from inside the car that Mehdiyev was driving with the assault rifle and a message reading “we are ready.” Amirov sent an image of the interior of Alinejad’s home to Omarov to be forwarded to Mehdiyev, writing “this is the house where she stays.”  As Omarov continued to update Amirov about Mehdiyev’s readiness, Amirov cautioned Omarov “let him keep the car clean.”  When Mehdiyev subsequently drove from where he was surveilling the residence, he was stopped after a traffic violation and, during a subsequent search of the vehicle, police officers found the assault rifle, 66 rounds of ammunition, approximately $1,100 in cash, and a black ski mask.

After Mehdiyev was arrested and placed into custody, Omarov contacted Mehdiyev’s mother and threatened to kill her and her other son if she did not locate Mehdiyev.

Amirov and Omarov were convicted on five counts: murder-for-hire, which carries a maximum penalty of 10 years in prison (Count One); conspiracy to commit murder-for-hire, which carries a maximum penalty of 10 years in prison (Count Two); conspiracy to commit money laundering, which carries a maximum penalty of 20 years in prison (Count Three); attempted murder in aid of racketeering, which carries a maximum penalty of 10 years in prison (Count Four); and possession and use of a firearm in connection with the attempted murder, which carries a maximum penalty of life in prison and a mandatory minimum penalty of five years in prison (Count Five).

The FBI New York Field Office Counterintelligence-Cyber Division and the New York FBI Iran Threat Task Force are investigating the case, with assistance from the New York City Police Department (NYPD) and the NYPD Intelligence Bureau. The Department of Justice’s Office of International Affairs provided valuable assistance. The Justice Department thanked the authorities in the Czech Republic for their assistance.

Assistant U.S. Attorneys Michael D. Lockard, Jacob H. Gutwillig, and Matthew J.C. Hellman for the Southern District of New York are prosecuting the case with assistance from paralegal specialist Owen Foley and Trial Attorneys Christopher Rigali and Leslie Esbrook of the National Security Division’s Counterintelligence and Export Control Section.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced that a jury convicted CHRISTOPHER REESE, a/k/a “Christopher Eugene Thomas,” yesterday for his participation in a scheme to defraud criminal defendants and their family members out of hundreds of thousands of dollars in legal fees paid to REESE, who is not a lawyer, to perform unlicensed legal services in federal court. REESE, who is already in federal custody in connection with a separate case, will be sentenced on June 26, 2025, by U.S. District Judge Valerie E. Caproni.

Acting U.S. Attorney Matthew Podolsky said: “Christopher Reese committed fraud through his bogus legal practice. He promised his victims that he would get their family members out of prison when he knew he had no way to guarantee that outcome, and induced them into paying him for legal services he knew he wasn’t authorized to provide. As a unanimous jury has now found, Reese’s promises were lies designed to enrich Reese at the expense of his victims. Running an unlicensed law business is a crime, and Reese now faces serious federal prison time for his fraudulent conduct.”

According to the Indictment and the evidence at trial:

For years, REESE ran a scam targeting federal inmates, their family members, and friends. To carry out his fraud scheme, REESE promised favorable results in criminal cases that he could not actually obtain, rendering legal services he was not authorized to provide in exchange for hefty fees. REESE styled himself as a “legal assistant” or “paralegal,” but worked without the supervision of a licensed lawyer and offers services that only a lawyer is authorized to provide, including drafting and submitting legal filings in federal courts. REESE brought in business by promising beneficial outcomes to prisoners and their family members that he cannot guarantee, while knowing—but failing to disclose—that his unlicensed legal practice was illegal.

REESE induced victims—criminal defendants and their family members—to pay him thousands of dollars per legal filing. He did this, for example, by promising that defendants would be “immediately released” based on motions REESE would file in exchange for fees in the thousands of dollars. Sometimes REESE also offered to provide a refund if his motions were unsuccessful; but when they failed, REESE kept the money. And when his fraud succeeded, and inmates or their family members paid REESE his fees, REESE engaged in the unauthorized practice of law, by making a business of drafting and filing legal motions and briefs in federal cases, including cases heard by the U.S. District Court for the Southern District of New York and the U.S. Court of Appeals for the Second Circuit at 40 Foley Square in Manhattan, a federal enclave where New York State’s prohibition on the unauthorized practice of law applies via the Assimilative Crimes Act. 

REESE earned hundreds of thousands of dollars from this scheme. And REESE committed additional crimes in connection with these fraud proceeds. First, REESE was on supervised release in connection with a separate federal criminal case in this District during most of the scheme. And in connection with his supervision, and in order to avoid paying criminal restitution that he owed, REESE made false statements to the U.S. Probation Office. Second, REESE laundered the proceeds of his scheme by using a co-conspirator to engage in financial transactions designed to conceal the source and movement of the fees REESE collected from his victims.

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REESE, 57, of East Meadow, New York, was convicted of wire fraud, which carries a maximum sentence of 20 years in prison; unauthorized practice of law in a federal enclave, which carries a maximum sentence of four years in prison; making false statements to the U.S. Probation Office, which carries a maximum sentence of five years in prison; and conspiracy to commit money laundering, which carries a maximum sentence of 20 years in prison. REESE was found not guilty of conspiracy to commit wire fraud.

The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.

Mr. Podolsky praised the outstanding investigative work of the Special Agents of the U.S. Attorney’s Office for the Southern District of New York. 

The case is being handled by the Office’s White Plains Division. Assistant U.S. Attorneys Josiah Pertz, Kingdar Prussien and James McMahon are in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, and Leslie R. Backschies, the Acting Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that a jury returned guilty verdicts against RAFAT AMIROV, a/k/a “Farkhaddin Mirzoev,” a/k/a “Pᴎᴍ,”  a/k/a “Rome,” and POLAD OMAROV, a/k/a “Araz Aliyev,” a/k/a “Polad Qaqa,” a/k/a “Haci Qaqa,” on all five counts in the Superseding Indictment, which included murder-for-hire and attempted murder in aid of racketeering charges, in a trial before U.S. District Judge Colleen McMahon.  AMIROV and OMAROV are scheduled to be sentenced on September 17, 2025.

Acting U.S. Attorney Matthew Podolsky said: “For years, the Government of Iran has attempted to silence an outspoken Iranian journalist, author, activist and critic of their regime through any means necessary, including harassment, violence, intimidation, and even attempted murder.  Chillingly, the plot to murder this Iranian dissident culminated over 6,000 miles from Iran, on U.S. soil, right here in New York, when a hitman with an AK-47 camped outside her home to kill her.  I commend the career prosecutors of this Office and our law enforcement partners at the FBI’s Counterintelligence Division for their tireless work in bringing these defendants to justice.  This verdict should send a clear message around the world:  if you target U.S. citizens, we will find you, no matter where you are, and bring you to justice.”

FBI Acting Assistant Director in Charge Leslie R. Backschies said: “The convictions of Rafat Amirov and Polad Omarov send a clear message to all foreign governments who violate our laws and attempt to commit violence against Americans — they and their proxies will face justice for any attempt to silence Americans on U.S. soil.  The Iranian government’s shameless conduct and attempt to violate our laws and assassinate a critic of their human rights atrocities will not be tolerated.  The FBI is determined to disrupt any effort by foreign governments to use violence to repress our citizens’ freedoms, here or abroad.”

As reflected in the Superseding Indictment and the evidence presented at trial:

AMIROV and OMAROV were high-ranking members of an Azeri faction of the Russian Mob (the “Organization”) who worked with other members of the Organization to attempt to kill Masih Alinejad on instructions from high-ranking members of the Islamic Revolutionary Guard Corps (“IRGC”). Alinejad has previously been the target of plots by the Government of Iran to intimidate, harass, and kidnap her for her work as a journalist, author, and human rights activist who has publicized the Government of Iran’s human rights abuses around the world.  As recently as 2020 and 2021, Iranian intelligence officials and assets plotted to kidnap Alinejad from within the U.S. for rendition to Iran in an effort to silence her criticism of the Iranian regime.

After these brazen efforts to kidnap Alinejad from the U.S. failed, the IRGC turned to AMIROV and OMAROV to locate, surveil, and murder her.  Beginning in approximately July 2022, AMIROV sent targeting information—which he had received directly from IRGC officials in Iran—about Alinejad to OMAROV.  In turn, OMAROV communicated this information to Khalid Mehdiyev, another member of the Organization who had been residing in Yonkers, New York, so that Mehdiyev could surveil Alinejad and murder her. In turn, Mehdiyev sent photographs and videos of Alinejad’s residence to OMAROV, who shared these materials with AMIROV and the IRGC officials who orchestrated the plot in Iran.  AMIROV and OMAROV then arranged for a $30,000 cash payment to Mehdiyev, who used a portion of this payment to buy an AK-47 style assault rifle, two magazines, and at least 66 rounds of ammunition; as Mehdiyev boasted in electronic communications, a “war machine” he could use to kill Alinejad.

In late July 2022, Mehdiyev repeatedly traveled to Alinejad’s neighborhood to surveil her.  Mehdiyev sent reports of his surveillance to OMAROV, who passed them to AMIROV.  On July 24, 2022, Mehdiyev reported to OMAROV from Alinejad’s residence that he was “at the crime scene.”  On July 27, 2022, OMAROV told AMIROV that Mehdiyev was ready to kill Alinejad, writing “this matter will be over today.  I told them to make a birthday present for me.  I pressured them, they will sleep there this night.”  On July 28, 2022, Mehdiyev sent OMAROV a video taken from inside the car that Mehdiyev was driving with the assault rifle and a message reading “we are ready.”  AMIROV sent an image of the interior of Alinejad’s home to OMAROV to be forwarded to Mehdiyev, writing “this is the house where she stays.”  As OMAROV continued to update AMIROV about Mehdiyev’s readiness, AMIROV cautioned OMAROV “let him keep the car clean.”  When Mehdiyev subsequently drove from where he was surveilling the residence, he was stopped after a traffic violation and, during a subsequent search of the vehicle, police officers found the assault rifle, 66 rounds of ammunition, approximately $1,100 in cash, and a black ski mask.

After Mehdiyev was arrested and placed into custody, OMAROV contacted Mehdiyev’s mother and threatened to kill her and her other son if she did not locate Mehdiyev. 

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AMIROV, 46, of Iran; OMAROV, 40, of the country of Georgia, were convicted on five counts:  murder-for-hire, which carries a maximum sentence of 10 years in prison (Count One); conspiracy to commit murder-for-hire, which carries a maximum sentence of 10 years in prison (Count Two); conspiracy to commit money laundering, which carries a maximum sentence of 20 years in prison (Count Three); attempted murder in aid of racketeering, which carries a maximum sentence of 10 years in prison (Count Four); and possession and use of a firearm in connection with the attempted murder, which carries a maximum sentence of life in prison and a mandatory minimum sentence of five years in prison (Count Five).

Mr. Podolsky praised the outstanding investigative work of the FBI and its New York Field Office Counterintelligence-Cyber Division and the New York FBI Iran Threat Task Force.  Mr. Podolsky also thanked the New York City Police Department (“NYPD”) and the NYPD Intelligence Bureau, as well as the Department of Justice’s National Security Division and the Department of Justice’s Office of International Affairs, for their assistance. Mr. Podolsky also thanked the authorities in the Czech Republic.

This case is being handled by the Office’s National Security and International Narcotics Unit. Assistant U.S. Attorneys Michael D. Lockard, Jacob H. Gutwillig, and Matthew J.C. Hellman are in charge of the prosecution, with assistance from paralegal specialists Owen Foley and Sabrina Jim Munoz, and Trial Attorneys Christopher Rigali and Leslie Esbrook of the Counterintelligence and Export Control Section. 

“Kevin Perez, a/k/a “Kay Flock,” was the leader of a neighborhood street gang known as Sev Side / DOA, and with that gang, he committed a series of gang-motivated shootings.  Perez, a drill rapper, instilled fear across the community with his violent actions, and then threatened rivals, bragged about shootings, and taunted victims in his rap lyrics. But as a unanimous jury has now found, Perez can no longer hide behind his music, and instead will be held to account for his violent crimes. Thanks to the hard work of the career prosecutors of this Office and our law enforcement partners, the cycle of violence that Perez engaged in is over.  This Office remains resolute in its commitment to prosecuting gang members who sow fear and spread violence on our city streets.” 

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York; Leslie R. Backschies, the Acting Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”); and Harry T. Chavez, Jr., the Special Agent in Charge of the New York Field Office of the Internal Revenue Service, Criminal Investigations (“IRS-CI”), announced the unsealing of a four-count criminal Indictment charging SHAN ANAND, NOSAKHARE NOBORE, NICHOLAS PAPPAS, LEONARD UJKIC, SOLOMON ALUKO, a/k/a “D1 ReallyRich,” and JORGE GONZALEZ with a scheme to fraudulently obtain checks and launder the proceeds. Many of the checks were funds provided by the government for COVID-19 relief that the defendants stole before depositing into bank accounts opened using sham businesses or stolen or fake identities. In total, the defendants attempted to steal approximately $80 million and succeeded in depositing approximately $50 million.

Acting U.S. Attorney Matthew Podolsky said: “We allege that the defendants stole tens of millions of dollars in COVID-19 relief and other checks, and even used a ‘Fraud Bible’ containing instructions for committing fraud. This Office will not tolerate the exploitation of programs designed to support the public in times of crisis, and we and our law enforcement partners will hold those responsible to full account.” 

FBI Acting Assistant Director Leslie R. Backschies said: “These six defendants allegedly used sham businesses, stolen, and fake identities to operate a multi-year check fraud scheme, resulting in $50 million in illicit funds being deposited into their accounts. The defendants brazenly attempted to exploit multiple United States government programs in their attempts to illegally enrich themselves. The FBI will continue to ensure fraudsters attempting to lie, cheat, and steal from the Government answer for their crimes in the criminal justice system.”

IRS Special Agent in Charge Harry T. Chavis, Jr. said: “This group of suspects openly communicated about their fraud, taking pride in the multiple schemes that stole nearly $50 million from the American public. They lied and cheated a benefits system meant to help struggling businesses that need it, all while stealing checks from agencies who assist the elderly and veterans. This gang of ‘bag hunters’ will now face justice for multiple charges.  This time, the U.S. government were the hunters, and the arrests in this massive fraud case are ‘in the bag.’”

As alleged in the Indictment:[1]

From 2021 to 2025, the six defendants worked together to steal money from the U.S. government, banks, and individuals. The defendants opened bank accounts using fake or stolen identity information for individuals or businesses, and were assisted in doing so by one of the defendants who was a teller at a major bank. From the inside, he worked to open or alter bank accounts to advance the defendants’ fraud.

The defendants then deposited fraudulently obtained or counterfeit checks into the  accounts. Many of the checks were issued by the U.S. Treasury (the “Treasury”) based on false and fraudulent filings with the Internal Revenue Service (“IRS”) in connection with the Employee Retention Credit (“ERC”) and Qualified Sick Leave Wages (“QSLW”) credit. The ERC is a refundable tax credit for businesses and tax-exempt organizations that had employees during and were affected by the COVID-19 pandemic. Employers must have paid qualified wages to claim the credit. The QSLW credit is a related credit that was also established in response to the COVID-19 pandemic. The defendants did not operate businesses that would have qualified for these credits. The businesses they used to open bank accounts and apply for the credits were fake or sham businesses.

Other Treasury checks passed as part of the defendants’ scheme were payments for different tax refunds, including personal and corporate income tax refunds. Still other Treasury checks were associated with programs at other government agencies such as the Department of Veterans of Affairs and the Social Security Administration. Some of the checks involved in the scheme—both Treasury checks and other business or individual checks—were stolen from the mail or elsewhere. Other checks were partially or completely forged.

Once the checks were deposited, the defendants withdrew the fraudulently obtained funds in cash or transferred them to other banks accounts under their control. Over the course of their scheme, the defendants attempted to obtain approximately $80 million in total. They succeeded in depositing approximately $50 million.

The defendants communicated openly about their fraud. One defendant sent another a video of a screen recording of a document or documents titled “✅ 2021 Fraud Bible ✅”, shown in the following image:

This “Fraud Bible” contained instructions on how to engage in various forms of fraud, including credit card fraud, ATM fraud, and mobile cash transfer fraud.

Since at least 2021, some members of the conspiracy have worn clothing items bearing a logo depicting a sack of money running along with the phrase “Bag Hunter.”

Certain members of the conspiracy wore this logo while engaging in criminal conduct. For example, the following image shows NOBORE withdrawing fraudulently obtained funds while prominently displaying the Bag Hunters logo:

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ANAND, 34, of Queens, New York; NOBORE, 29, of Edgewater, New Jersey; PAPPAS, 28, of Miami, Florida; UJKIC, 44, of Ft. Lauderdale, Florida; ALUKO, 29, of Hackensack, New Jersey; and GONZALEZ, 28, of North Bergen, New Jersey, are each charged with conspiracy to commit wire fraud and bank fraud, which carries a maximum sentence of 30 years in prison; conspiracy to commit money laundering and engaging in a monetary transaction in property derived from specific unlawful activity, which carries a maximum sentence of 20 years in prison; conspiracy to defraud the government, which carries a maximum sentence of 10 years in prison; and aggravated identity theft, which carries a mandatory sentence of two years in prison. 

The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.

Mr. Podolsky praised the outstanding work of the FBI and IRS-CI. Mr. Podolsky also thanked the U.S. Postal Inspection Service and the New York City Police Department for their assistance.

The case is being prosecuted by the Office’s Complex Frauds and Cybercrime and Illicit Finance and Money Laundering Units. Assistant U.S. Attorneys Maggie Lynaugh, Steven J. Kochevar, and Qais Ghafary are in charge of the prosecution.

The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Indictment, and the description of the Indictment set forth herein, constitutes only allegations, and every fact described therein should be treated as an allegation.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced that PAUL ROBERTS, the founder, former Chief Executive Officer, and former Chairman of the Board of Directors of Kubient, Inc., a publicly traded digital advertising technology company, was sentenced today to one year and one day in prison. ROBERTS previously pled guilty to securities fraud for his execution of a scheme to defraud investors and auditors of Kubient, during which he caused Kubient to improperly recognize more than $1.3 million in fraudulent revenue in financial statements at the time of Kubient’s initial public offering and made material misrepresentations about the efficacy of Kubient’s proprietary fraud detection tool, Kubient Artificial Intelligence (“KAI”). ROBERTS’s sentence was imposed by U.S. District Judge Jennifer L. Rochon.

Acting U.S. Attorney Matthew Podolsky said: “Paul Roberts cooked the books. He lied to investors and auditors about his company’s revenue and about his company’s premier product: an AI-powered tool that, ironically, was supposed to detect fraud in the digital advertising industry. This Office is committed to holding corporate executives who defraud the investing public accountable for their crimes.”

According to information in court filings:

From October 2019 through March 2021, ROBERTS knowingly caused Kubient to improperly recognize more than $1.3 million in fraudulent revenue in Kubient’s financial statements, which was over 94% of Kubient’s reported revenue for 2020 at the time of its initial public offering (“IPO”) in August 2020. With his scheme, ROBERTS misled Kubient’s auditors and deceived the investing public about Kubient’s financial condition.

At the core of ROBERTS’s accounting fraud scheme was a fraudulent $1.3 million transaction that ROBERTS arranged between Kubient and another digital advertising technology company (“Company-1”). Kubient and Company-1 agreed to provide certain services to the other for nearly identical fees. For its part, Kubient agreed to use its proprietary fraud detection tool, KAI, to scan data provided by Company-1 and an affiliate for instances of digital ad fraud and then deliver the results of KAI’s findings to Company-1 and its affiliate. Neither Kubient nor Company-1, however, provided the agreed-upon services, yet they still paid each other $1.3 million, which Kubient improperly recognized as revenue.

To conceal his fraudulent scheme, ROBERTS directed Kubient employees to generate fake KAI reports based on made-up metrics and no underlying data at all. ROBERTS used the fake reports to mislead Kubient’s independent certified public accountants (the “Audit Firm”) into believing that Kubient had performed its contractual obligations when, in fact, Kubient had not, so that Kubient could recognize the associated revenue in its financial statements.

ROBERTS repeatedly made material misrepresentations in U.S. Securities and Exchange Commission (“SEC”) filings and in management representation letters submitted to the Audit Firm relating to Kubient’s KAI revenue recognition. ROBERTS also repeatedly made material misrepresentations in SEC filings about the efficacy of KAI in identifying and preventing digital ad fraud, including in connection with Kubient’s initial and secondary public offerings when Kubient was touting KAI as one of the company’s premier products that would differentiate it from its competitors.

Fueled by the misrepresentations about Kubient’s KAI revenue recognition and the efficacy of KAI in identifying and preventing digital ad fraud that ROBERTS made in Kubient’s SEC filings and elsewhere, Kubient raised more than $12.5 million in its IPO in August 2020, resulting in its shares being publicly traded on the Nasdaq stock exchange, and more than $20 million in its secondary public offering in December 2020. Now, Kubient is in Chapter 7 bankruptcy proceedings.

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In addition to the prison term, ROBERTS, 48, of Melville, New York, was sentenced to one year of supervised release.

Mr. Podolsky praised the outstanding work of the U.S. Postal Inspection Service. Mr. Podolsky also thanked the SEC, which filed a civil action against ROBERTS after he pled guilty, for its assistance and cooperation in the investigation.

This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Justin V. Rodriguez is in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced the unsealing of a Complaint charging DIOR JAY-JARRETT with a scheme to defraud a major airline carrier of nearly $70,000 in free or discounted flights by claiming to be on military leave for years after he retired from the U.S. Marine Corps.  JAY-JARRETT was arrested this morning and was presented today before U.S. Magistrate Judge Katharine H. Parker.

Acting U.S. Attorney Matthew Podolsky said: “As alleged, Jay-Jarrett—a federal law enforcement officer who currently serves as a Federal Air Marshal for the Department of Homeland Security—racked up thousands of dollars in free or discounted flights while pretending to be deployed on military missions around the world. He did so while simultaneously swearing an oath to protect and serve the public.  Federal law enforcement officers are responsible for upholding our laws, and they will be held responsible when they break them.”

According to the allegations in the Complaint:[[1]]

JAY-JARRETT served on active-duty in the U.S. Marine Corps from on or about December 9, 2013, until on or about November 29, 2022.  While still on active-duty, on or about October 20, 2021, JAY-JARRETT also began employment as a baggage handler for a major airline carrier (“Airline-1”). After completing approximately one week of training, JAY-JARRETT requested and received from Airline-1 an approximately eight-month period of military leave by submitting falsified documents purporting to be Marine Corps orders for deployment that he in fact had never been issued.

In or about June 2023, JAY-JARRETT again submitted falsified documents to Airline-1 in order to receive another extended, approximately two-and-a-half-year long period of further military leave.  In those documents, JAY-JARRETT claimed to still be in active-duty military service, when in fact he had already retired from the military in or about November 2022. On or about July 17, 2024, JAY-JARRETT again submitted falsified military orders to Airline-1, forwarding the same orders he provided the previous year.

JAY-JARRETT remained on military leave at Airline-1 even when he became a Federal Air Marshal with the Department of Homeland Security in or about October 2022, shortly before he retired from the Marine Corps.  By remaining on supposed long-term military leave at Airline-1, JAY-JARRETT remained entitled to travel benefits including the ability to take unlimited, free flights on Airline-1, alongside ticketed family members or travel companions. From in or about November 2021 through September 2024, JAY-JARRETT took at least 130 such flights at a value of nearly $70,000.

Over the course of the scheme, from at least in or about December 2021 through in or about September 2024, JAY-JARRETT took free first-class flights to Los Angeles, London, San Diego, St. George’s, Las Vegas, and Dublin, and dozens more standard class flights to destinations including Antigua (five times), Aruba (three times), Bermuda (three times), Curaçao (twice), Barbados (twice), Belize (twice), the Grand Caymans (twice), Grenada (twice), Guatemala (twice), and a variety of other destinations including Mexico, Trinidad and Tobago, Peru, Jamaica, Turks and Caicos, the Dominican Republic, and St. Maarten.

On or about September 29, 2024, during an interview with law enforcement officials, JAY-JARRETT admitted, in sum and substance, that he had retired from the Marine Corps in November 2022 without notifying Airline-1 that he had done so, and that he had submitted falsified military orders to Airline-1 stating that he was on military leave even after he had retired from the Marine Corps.

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JAY-JARRETT, 29, of Queens, New York, is charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison.

The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.

Mr. Podolsky praised the outstanding investigative work of the Naval Criminal Investigative Service Northeast Field Office, the Transportation Security Administration – Investigations, the U.S. Customs and Border Protection – New York Field Office, and the Special Agents and Task Force Officers assigned to the U.S. Attorney’s Office for the Southern District of New York.  Mr. Podolsky also thanked the Department of Homeland Security – Office of Inspector General and the Department of Veterans Affairs – Office of Inspector General for their assistance in the investigation.

This case is being handled by the Office’s General Crimes Unit.  Assistant U.S. Attorney Ryan T. Nees is in charge of the prosecution.

The charge contained in the Complaint is merely an accusation and the defendant is presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth below constitute only allegations, and every fact described should be treated as an allegation.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced today that LISA SCHIFF, a Manhattan-based art advisor focused on contemporary art, was sentenced today to 30 months in prison by U.S. District Judge J. Paul Oetken for perpetrating a multi-year scheme in which she defrauded the clients of her art advisory business of approximately $6.5 million in connection with the purchase and sale of approximately fifty-five artworks. 

Acting U.S. Attorney Matthew Podolsky said: “For five years, Lisa Schiff breached the trust of her art advisory clients by diverting millions of dollars to pay her own business and personal expenses, and to fund a lavish lifestyle. Because of Schiff’s lies, and her illusory art advisory scam, Schiff will now serve a substantial sentence in prison.”   

According to the Information, plea agreement, and statements made in court:

From 2018 through May 2023, SCHIFF engaged in a scheme to defraud clients of her art advisory business, Schiff Fine Art (“SFA”) by diverting her clients’ funds—profits from the sale of her clients’ artworks or payments they made to purchase artwork—to pay her own personal and business expenses. SCHIFF advised clients regarding the purchase and sale of artworks and bought and sold artworks on behalf of clients in exchange for a commission. In her role as an art advisor, SCHIFF acted as an intermediary between art galleries and auction houses, and her clients, who were art collectors. Typically, when SCHIFF’s clients bought or sold artworks, payments were routed through SCHIFF’s business, SFA. In addition, when SCHIFF sold artworks on behalf of a client, she often had custody or control of the artworks to coordinate the sale. At times, SCHIFF, through SFA, also sold artwork on consignment on behalf of artists and other galleries.   

Starting in about 2018, SCHIFF began defrauding her clients in two ways: not remitting payments to her clients when she sold their artwork while not disclosing to her clients that their artworks had, in fact, been sold; and not purchasing artworks on behalf of clients despite representing to her clients that she would purchase certain artworks on their behalf using their funds. Instead of using client funds as promised, SCHIFF diverted her clients’ money to pay her business and personal expenses. SCHIFF lied to her clients and galleries in furtherance of her fraud scheme. For example, when defrauding clients in connection with selling their artwork, SCHIFF at times lied to clients, claiming she had not sold the artwork, or the buyer was delayed in making the payment and SCHIFF still had custody of the artwork when, in fact, SCHIFF had sold the artwork, received payment from the buyer, and delivered the artwork to the buyer. When defrauding clients in connection with purchasing artwork on their behalf, SCHIFF lied to galleries from which she was supposed to purchase artwork on behalf clients, blaming delays in payment on clients when, in fact, clients had already paid SCHIFF for the purchase of the artwork and she had diverted the funds for her own use. In 2020, SCHIFF considered admitting to at least two of her victims that she had stolen millions from them, drafting letters of confession to them, but she never sent the letters and instead continued to defraud these two victims and others for three more years. Over approximately five years, SCHIFF defrauded at least 12 clients, one artist, the estate of another artist, and one gallery, collectively, of at least approximately $6.5 million. During her fraud, SCHIFF lived lavishly and incurred substantial debts, which she paid in part using her victims’ diverted funds.

In about May 2023, SCHIFF could no longer conceal her scheme due to mounting debts. SCHIFF confessed to several clients that she had stolen their money.

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SCHIFF, 54, of New York, New York, was sentenced to two years of supervised release. SCHIFF was further ordered to pay forfeiture of $6,408,538.20 and restitution of $9,147,789.26.

Mr. Podolsky praised the outstanding work of the Federal Bureau of Investigation’s Art Crime Team.

This case is being handled by the Office’s Illicit Finance and Money Laundering Unit.  Assistant U.S. Attorneys Cecilia Vogel and Jennifer Ong are in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced that ARIE RANGOTT was sentenced today to 27 months in prison for conspiring to defraud the federal Head Start program, to submit a false document to the federal government, and to obstruct a federal administrative investigation. RANGOTT was convicted following a two-and-a-half-week trial before U.S. District Judge Jennifer H. Rearden, who also imposed today’s sentence. 

Acting U.S. Attorney Matthew Podolsky said:  “Arie Rangott defrauded a vital federal childcare program that aims to serve one of society’s most vulnerable populations. This Office is committed to bringing to justice those who place greed above their responsibility to be stewards of federal funds, and I commend our law enforcement partners and the dedicated team of career prosecutors for their outstanding work.”

According to the Indictment, public court filings, and the evidence presented at trial:

Between 2021 and January 2023, RANGOTT was the shadow executive director of a non-profit entity, Project Social Care Head Start Inc. (“PSCHS”), that operated in the New York City area. The U.S. Department of Health and Human Services (“HHS”), which administers the federal Head Start program, annually granted to PSCHS millions of dollars that were supposed to be overseen by an independent board of directors, to be used exclusively on the Head Start program, and from which earning a profit is prohibited by law. RANGOTT and others conspired to submit numerous fictitious documents to HHS that fraudulently asserted PSCHS had an independent board of directors and had in place controls to guard against fraud, waste, and abuse. In truth, PSCHS had neither an independent board nor sufficient controls in place. RANGOTT and his co-conspirators used their control over PSCHS to impermissibly direct PSCHS’s Head Start funding to for-profit companies owned by co-conspirators through rampant undisclosed self-dealing.

In December 2021, HHS sent a letter to PSCHS detailing several complaints about self-dealing at PSCHS, among other things. In response, RANGOTT and his co-conspirators prepared and submitted to HHS a report that falsely denied the self-dealing and made other misstatements. Then, in August and September 2022, the HHS Office of the Inspector General opened an investigation into related issues at PSCHS. RANGOTT and his co-conspirators agreed to obstruct that investigation by lying to the investigators, coordinating stories, and submitting false documents.

Several of RANGOTT’s co-conspirators have pled guilty and been sentenced. Among others, Martin Handler and Menachem Lieberman, each of whom secretly controlled PSCHS and directed PSCHS to steer federal funds to their own for-profit companies, pled guilty in March 2024, and Martin Handler was sentenced in October 2024 to 58 months in prison. Isidore Handler, who played a significant role in falsifying documents submitted to HHS, pled guilty in September 2023 and was sentenced in December 2024 to 18 months in prison. Lieberman is awaiting sentencing.

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In addition to today’s prison sentence, RANGOTT, 54, of Toms River, New Jersey, was sentenced to two years of supervised release.

Mr. Podolsky praised the outstanding investigative work of the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation, and the HHS Office of the Inspector General. Mr. Podolsky also thanked the U.S. Department of Agriculture Office of the Inspector General and the New York City Department of Investigation for their assistance.

The prosecution of this case is being handled by the Office’s Public Corruption Unit. Assistant U.S. Attorneys Jacob R. Fiddelman, Catherine Ghosh, Stephanie Simon, and Daniel H. Wolf are in charge of the prosecution, with the assistance of Paralegal Specialist Jayda Foote.  

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, and Leslie Backschies, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced the unsealing of a seven-count Indictment charging CARL ERIK RINSCH for engaging in a scheme to defraud a subscription video on-demand streaming service (“Streaming Company-1”) in connection with a planned science fiction television show called “White Horse.”  RINSCH was arrested today in West Hollywood, California, and will be presented later today in the Central District of California.  The case is assigned to U.S. District Judge Jed S. Rakoff.

Acting U.S. Attorney Matthew Podolsky said: “As alleged, Carl Erik Rinsch orchestrated a scheme to steal millions by soliciting a large investment from a video streaming service, claiming that money would be used to finance a television show that he was creating. But that was fiction. Rinsch instead allegedly used the funds on personal expenses and investments, including highly speculative options and cryptocurrency trading. Rinsch’s arrest is a reminder that this Office and our partners at the FBI remain vigilant in the fight against fraud and will bring those who cheat and steal to justice.”

FBI Assistant Director Leslie Backschies said: “Carl Rinsch allegedly stole more than $11 million from a prominent streaming platform to finance lavish purchases and personal investments instead of completing a promised television series. The FBI will continue to reel in any individual who seeks to defraud businesses.”

As alleged in the Indictment:[1]

RINSCH is a film and television writer and director who partially completed a science fiction television show called “White Horse.”  In 2018, RINSCH reached an agreement with Streaming Company-1 in which Streaming Company-1 would both pay RINSCH for the existing episodes of White Horse and also fund completion of the rest of the show.  Between 2018 and 2019, Streaming Company-1 paid approximately $44 million for White Horse.

Between late 2019 and early 2020, RINSCH demanded even more money from Streaming Company-1 to complete White Horse.  Streaming Company-1 ultimately agreed to pay another $11 million, and transferred those funds to a company RINSCH controlled on or about March 6, 2020.  The entirety of those funds was to be spent on the completion of White Horse.

But RINSCH did not use those funds to complete White Horse.  Instead, within days, RINSCH began transferring the funds he received through a number of different bank accounts before consolidating them in a personal brokerage account.  RINSCH then used those funds to make a number of personal and speculative purchases of securities.  His trading was unsuccessful, and in less than two months after receiving $11 million from Streaming Company-1, RINSCH had lost more than half of those funds.

Even after losing most of the $11 million, RINSCH still did not spend the remaining funds he had stolen on White Horse.  Instead, he used the money to speculate on cryptocurrency, and on personal expenses and luxury items, including approximately $1,787,000 on credit card bills; approximately $1,073,000 on lawyers to sue Streaming Company-1 for even more money, and for lawyers related to his divorce; approximately $395,000 to stay at the Four Seasons hotel and at various luxury rental properties; approximately $3,787,000 on furniture and antiques, including approximately $638,000 to purchase two mattresses and approximately $295,000 on luxury bedding and linens; approximately $2,417,000 to purchase five Rolls-Royces and one Ferrari; and approximately $652,000 on watches and clothing.

*               *                *

RINSCH, 47, of Los Angeles, California, is charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison; one count of money laundering, which carries a maximum sentence of 20 years in prison; and five counts of engaging in monetary transactions in property derived from specified unlawful activity, each of which carries a maximum sentence of 10 years in prison. 

The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.

Mr. Podolsky praised the outstanding work of the FBI and Internal Revenue Service - Criminal Investigation. 

The case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Jackie Delligatti, David A. Markewitz, and Kevin Mead are in charge of the prosecution.

The charges contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Indictment, and the description of the Indictment set forth herein, constitutes only allegations, and every fact described therein should be treated as an allegation.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced that JONATHAN MOYNAHAN LARMORE was sentenced today to five years in prison for manipulating the stock price of WeWork, Inc. (“WeWork”) with a fake tender offer designed to fraudulently inflate the value of LARMORE’s own WeWork securities. LARMORE’s sentence was imposed by U.S. District Judge Paul A. Engelmayer, who also presided over a one-week trial after which LARMORE was convicted of one count of tender offer fraud and one count of securities fraud.

Acting U.S. Attorney Matthew Podolsky said: “Jonathan Larmore treated the stock market like a game he could rig to obtain instant riches at the expense of innocent investors. As today’s sentence shows, this Office will continue to advocate for significant penalties against those who manipulate our markets and defraud investors.”

According to the evidence presented in court during the trial:

LARMORE is the former CEO of Arciterra Companies LLC, a real estate investment and management firm. In the fall of 2023, LARMORE perpetrated a scheme to use a false and fraudulent tender offer to manipulate the stock price of WeWork, a co-working space company that was publicly traded on the New York Stock Exchange.

To execute his scheme, LARMORE created a sham real estate investment firm called Cole Capital Funds LLC (“Cole Capital”). LARMORE then spent more than $775,000 buying tens of thousands of cheap, short-dated, out-of-the-money WeWork call options and hundreds of thousands of shares of WeWork common stock. On November 3, 2023, LARMORE published a fake press release announcing that Cole Capital proposed to acquire 51% of all outstanding shares owned by minority shareholders of WeWork at a more-than-700% premium in an all-cash offer worth more than $77 million. At the time, WeWork was on the verge of bankruptcy. The press release itself contained a number of false and misleading claims about LARMORE and Cole Capital, and their ability to carry through with the purported tender offer.

In fact, neither LARMORE nor Cole Capital had the intent or ability to execute the announced tender offer. Instead, LARMORE intended for news of the tender offer to fraudulently inflate WeWork’s share price and, thereby, to increase the value of LARMORE’s newly acquired WeWork call options and shares.

Approximately one minute after LARMORE’s press release about his fraudulent tender offer was published, WeWork’s share price quickly increased during after-hours trading by more than 70% and continued to rise to a high of more than 150% over the stock price prior to the publication of the press release. The WeWork call options LARMORE purchased could have made him tens of millions of dollars with a big enough spike to WeWork’s stock price, but the vast majority of the options expired before LARMORE could publish his manipulative press release. The following Monday, November 6, 2023, WeWork filed for Chapter 11 bankruptcy protection. LARMORE never followed through on his fraudulent tender offer.

*               *                *

In addition to the prison term, LARMORE, 51, of Syracuse, Indiana, was sentenced to three years of supervised release during which the defendant must perform 500 hours of community service.

Mr. Podolsky praised the outstanding work of the Federal Bureau of Investigation. Mr. Podolsky also thanked the U.S. Securities and Exchange Commission, which filed a civil action against LARMORE, for its assistance and cooperation in the investigation.

This case is being handled by the Office’s Securities and Commodities Fraud Task Force.  Assistant U.S. Attorneys Adam S. Hobson, Sarah Mortazavi, and Justin V. Rodriguez are in charge of the prosecution. 

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced the sentences imposed on VAZHA GABADADZE, TEIMURAZ TAVBERIDZE, KAKHA KATSADZE, and DAVIT TIKARADZE for extortion offenses.  The defendants include the leader of a criminal enterprise from the Republic of Georgia and his associates.  The last of the defendants to be sentenced, TAVBERIDZE, was sentenced to 21 months in prison today by U.S. District Judge Jed S. Rakoff after having been convicted on December 9, 2024, following a one-week jury trial.  The remaining three defendants were previously sentenced to terms of prison ranging from 12 to 30 months.

Acting U.S. Attorney Matthew Podolsky said:  “Vazha Gabadadze and his associates threatened to mutilate and kill a victim if he did not provide them with money.  They intimidated the victim, relying on their connections to violent organized crime, to obtain thousands of dollars.  But thanks to the dedication of the FBI and the career prosecutors of this Office, all four defendants have been brought to justice and will serve federal prison time for their crimes.” 

According to the Indictment, public court filings, and statements made in court:

GABADADZE is a crowned “vor v zakone” and the leader of a criminal enterprise from the Republic of Georgia.  A vor v zakone, which is a Russian phrase that translates to “thief-in-law” or “thief within the code,” is part of a fraternal order of criminals that dates back to the time of the czars.  The vor stands at the highest level of Russian and Georgian organized criminal groups.  Traditionally, vory demand and receive tribute from criminals and laypersons, license criminal activity by others, and resolve disputes between members of the criminal community.  Payment demands are enforced by violence and threats of violence.  TAVBERIDZE, KATSADZE, and TIKARADZE each worked under GABADADZE’s supervision and control.

In 2017, in Georgia, GABADADZE approached an individual (the “Victim”) and demanded $15,000, claiming that the Victim’s friend owed GABADADZE the money.  The Victim subsequently moved to the U.S. 

In 2022, GABADADZE followed the Victim to the U.S. and reinitiated the extortion.  GABADADZE and the other defendants pursued, harassed, and threatened to kill and maim the Victim and his family if he did not pay.  Those threats were particularly violent and included, among others, that one or more of the defendants would “break [the Victim’s] spine over his knee,” “peel out [the Victim’s] eyes,” that the Victim would be beaten beyond recognition to his family, and that the Victim’s dead body would be found “when the snow melts.” 

Each of the defendants played a particular role in executing the extortion. GABADADZE was the leader of the scheme and ultimate beneficiary of the extortion payments.  TAVBERIDZE was primarily responsible for pursuing and communicating with the Victim and, in that capacity, personally threatened the Victim and collected extortion funds from the Victim.  KATSADZE managed the collection of the extortion payments, receiving such payments from TAVBERIDZE and passing them along to GABADADZE. TIKARADZE served as GABADADZE’s secretary and threatened the Victim on at least one occasion.  In total, the defendants received approximately $19,000 during the course of the extortion.

*                *                *

GABADADZE and KATSADZE each pled guilty to one count of Hobbs Act extortion.  TIKARADZE pled guilty to one count of conspiracy to commit Hobbs Act extortion. TAVBERIDZE was convicted of one count of conspiracy to commit Hobbs Act extortion and one count of Hobbs Act extortion after trial.  A chart containing the sentences that each of the defendants received is set forth below.

Mr. Podolsky praised the outstanding work of the Federal Bureau of Investigation.  Mr. Podolsky also thanked U.S. Customs and Border Protection and the New York City Police Department for their assistance in the investigation.

This case is being handled by the Office’s General Crimes Unit.  Assistant U.S. Attorneys Getzel Berger, Varun Gumaste, Chelsea Scism, and Daniel Richenthal are in charge of the prosecution.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, and Leslie R. Backschies, the Acting Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that MARCO TULIO FERNANDEZ-RODRIGUEZ, was extradited from the Dominican Republic and arrived in the United States this afternoon. FERNANDEZ-RODRIGUEZ was extradited on murder, narcotics, and firearms charges in connection with an attempted gunpoint robbery of a Mount Vernon, New York, warehouse that sold various unlicensed marijuana and nicotine products. Two people—one employee of the warehouse and one member of the roughly 15-man robbery crew—were shot and killed during the failed robbery attempt.  FERNANDEZ-RODRIGUEZ will be presented tomorrow in White Plains federal court before U.S. Magistrate Judge Andrew E. Krause.

Acting U.S. Attorney Matthew Podolsky said: “As alleged, Marco Tulio Fernandez-Rodriguez and his co-conspirators attempted a violent armed robbery that left two dead in Mount Vernon. The persistence and dedication of our law enforcement partners led to locating the defendant in the Dominican Republic, where he was arrested. This Office and our partners will not rest until every individual responsible for these senseless deaths is brought to justice.”

FBI Acting Assistant Director in Charge Leslie R. Backschies said: “Last year, Marco Tulio Fernandez-Rodriguez allegedly fled the country after participating in a robbery and massive gunfight which culminated in the murder of two individuals. Not only did his alleged involvement contribute to a highly violent episode which threatened the community’s safety, but Fernandez-Rodriguez also attempted to avoid responsibility by running. Today’s extradition and indictment reflects the FBI’s tireless commitment to ensuring all criminals face accountability for their behavior, regardless of where they may hide.”

As alleged in the Complaint unsealed today in White Plains federal court:[1]

On or about March 18, 2024, at approximately 10:00 p.m., two customers arrived at a wholesale warehouse in Mount Vernon that sold unlicensed marijuana products. The two customers placed an order for a large quantity of merchandise from the warehouse, and it took warehouse employees about two hours to prepare their order. A little after midnight, after the customers’ order was prepared, two employees from the warehouse helped the customers carry the boxes containing the customers’ merchandise from the warehouse to the customers’ vehicle. At that point, at least 11 members of the robbery crew—including FERNANDEZ-RODRIGUEZ—got out of a large cargo van that had been parked near the warehouse, many brandishing firearms. Some of the robbers, including FERNANDEZ-RODRIGUEZ, ran over to the two employees and the customers, some pointed firearms at them, and others forced them back inside the warehouse. Other robbers who also got out of the van ran inside the warehouse to steal the merchandise, including marijuana. A still image from video surveillance outside the warehouse is depicted below:

Shortly after the robbers got inside the warehouse, a gunfight broke out between the robbers and a warehouse employee. As a result, the warehouse employee and one of the robbers were killed. The robbers fled the scene, failing to steal anything.

On or about December 4, 2024, FERNANDEZ-RODRIGUEZ was arrested in the Dominican Republic.  To date, 12 individuals have been arrested in connection with this crime.

*                *                *

FERNANDEZ-RODRIGUEZ, 24, a citizen of the Dominican Republic, is charged with one count of murder through use of a firearm, which carries a maximum possible sentence of death or life in prison; one count of firearms use, carrying, and possession, which carries a maximum possible sentence of life in prison; one count of conspiracy to distribute narcotics, which carries a maximum sentence of life in prison; and one count of conspiracy to commit Hobbs Act robbery, which carries a maximum sentence of 20 years in prison.

The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as the sentencing of the defendants will be determined by a judge.

Mr. Podolsky praised the work of the FBI’s Westchester County Safe Streets Task Force and the Mount Vernon Police Department. Mr. Podolsky also thanked the Westchester County District Attorney’s Office, the Westchester County Police Department, the New York City Police Department, the Westchester Real Time Crime Center, the FBI Legal Attaché in Santo Domingo, and the Dominican authorities for their invaluable assistance. The Justice Department’s Office of International Affairs worked with law enforcement partners in the Dominican Republic to secure the arrest and extradition of FERNANDEZ-RODRIGUEZ. 

This case is being handled by the Office’s White Plains Division. Assistant U.S. Attorneys Jared D. Hoffman and Justin L. Brooke are in charge of the prosecution.

The charges contained in the Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the descriptions of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York; Frank A. Tarentino, the Special Agent in Charge of the New York Division of the U.S. Drug Enforcement Administration (“DEA”); Leslie R. Backschies, the Acting Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”); and Jessica S. Tisch, the Commissioner of the New York City Police Department (“NYPD”), announced the unsealing today of an Indictment charging EDWIN CARRASQUILLO, a/k/a “Malo”; HECTOR HERNANDEZ, a/k/a “Hec”; JOSE HERNANDEZ, a/k/a “Nene,” a/k/a “Little”; NATHANIEL MANNING, a/k/a “Tio”; DAMEL MARCUS, a/k/a “Shank”; EDWARDO MORENO, a/k/a “AR”; JERMAINE SAMUELS, a/k/a “Maine”; CHRISTIAN SERRANO, a/k/a “Chris”; JOHNNIE CAPELES a/k/a “Jon Boy”; JAMIL BANKS a/k/a “Mel”; EMILIO BARRERA, a/k/a “Colombia,” a/k/a “E”; JASON RIVERA, a/k/a “Colombo”; HECTOR CEREZO, a/k/a “Red”; JOSUE VARGAS, a/k/a “Leo”; JUAN KUANG, a/k/a “Jo Jo,” a/k/a “Jay,” a/k/a “Blanco”; STEVEN SANTIAGO, a/k/a “Swizz”; VICTOR MENDENG, a/k/a “Cali”; ANGEL VILLAFANE, YADIRA REYNOSO, a/k/a “Yadi”; ERIKA DAWSON; ARIYAN LABELLA, a/k/a “Ari”; DELILAH CARRIEL; ROSEMARIE SANCHEZ, a/k/a “Rosie”; JOHANA ALCANTARA; JUAN CALDERON, a/k/a “Jazzo,” a/k/a “Juanito”; KAREEM SMITH, a/k/a “K”; and CHRISTOPHER MEADOWS with participating in a racketeering enterprise, committing multiple violent crimes in aid of racketeering, including murder, engaging in a continuing criminal enterprise, distributing narcotics, and carrying and using firearms in connection with an armed drug trafficking operation based on Valentine Avenue in the Bronx, New York for well over three decades from 1993 to the present.  CARASQUILLO and ALCANTARA are also charged with the June 25, 2020, murder of Jozei Hullex.

CARRASQUILLO, HECTOR HERNANDEZ, JOSE HERNANDEZ, MANNING, MARCUS, MORENO, BANKS, RIVERA, CEREZO, VARGAS, KUANG, SANTIAGO, MENDENG, VILLAFANE, CARRIEL, SANCHEZ, ALCANTARA, CALDERON, and MEADOWS were previously taken into custody on related charges.  SAMUELS, SERRANO, CAPELES, REYNOSO, DAWSON, LABELLA, and SMITH were arrested either yesterday evening or earlier today.  BARRERA is still at large.  All seven of the defendants arrested yesterday or today are expected to be presented before U.S. Magistrate Judge Robert W. Lehrburger later this afternoon.  The case is assigned to U.S. District Judge Victor Marrero.

Acting U.S. Attorney Matthew Podolsky said: “Today, we have filed charges against twenty-eight alleged members of a violent drug trafficking gang that held an entire neighborhood of this city hostage for over three decades.  On a daily basis, this street crew, including those arrested today, allegedly distributed fentanyl, heroin, cocaine, and crack along several blocks on Valentine Avenue, creating an open-air drug market in the middle of a Bronx neighborhood.  And to protect their territory, they allegedly carried guns, extorted people with substance abuse issues through violence, and attacked rivals and anyone else attempting to weaken their control on their block. This violence resulted in multiple shootings, as well as the murder of Jozei Hullex.  It is a brutal reality that has lasted for far too long.  It ends now.  The streets of this great city belong to its people, and the career prosecutors of this Office will not stop until our streets are returned to the law-abiding people of New York City and their families.”

DEA Special Agent in Charge Frank A. Tarentino said: “Today’s indictment against the Valentine Avenue Crew and its members, shows the commitment the Drug Enforcement Administration and our law enforcement partners have when targeting drug trafficking organizations and individuals who routinely use threats, violence, extortion, robbery, and murder in order to run their criminal enterprise and flood our neighborhoods with illicit and synthetic drugs. The DEA remains committed to ensuring our citizens and communities remain healthy and safe.”

FBI Acting Assistant Director in Charge Leslie R. Backschies said: “For over three decades, these 28 Valentine Avenue Crew members allegedly protected their illicit narcotics distribution scheme and the enterprise’s dangerous reputation through violent gunfights and murder. Their alleged commandeering of a Bronx neighborhood allowed criminality and violence to flourish, threatening the lives of innocent residents. The FBI remains committed to dismantling all criminal organizations that utilize our city as their personal playground to promote illegal racketeering operations and endanger our communities.”

NYPD Commissioner Jessica S. Tisch said: “The Valentine Avenue Crew created immense fear within their community for decades, fueling our streets with senseless gun violence, polluting our sidewalks with deadly poisons, and costing lives through their ruthless gang behavior. These indictments send a clear message: this era of lawlessness ends today. The NYPD remains steadfast in its mission to remove illegal firearms from the hands of criminals—having already seized over 1,000 firearms this year alone—and to dismantle the illicit drug trade they are so often associated with. I commend the relentless NYPD investigators and our law enforcement partners in the FBI, DEA, and the U.S. Attorney’s Office for the Southern District of New York for their unwavering commitment to placing members of organized networks such as these behind bars.”

As alleged in the Indictment:[1]

CARRASQUILLO, HECTOR HERNANDEZ,  JOSE HERNANDEZ, MANNING, MARCUS, MORENO, SAMUELS, SERRANO, CAPELES, BANKS, BARRERA, RIVERA, CEREZO, VARGAS, KUANG, SANTIAGO, MENDENG, VILLAFANE, REYNOSO, DAWSON, LABELLA, CARRIEL, SANCHEZ, ALCANTARA, CALDERON, SMITH, and MEADOWS are charged for their involvement in an armed drug trafficking organization (the “Valentine Avenue Crew”) that took over the block of Valentine Avenue between East 194th Street and East 196th Street in the Bronx (the “Block”) and its surrounding neighborhood.

Since the mid-1990s, for multiple decades, the members and associates of the Valentine Avenue Crew, including the defendants, operated as a drug trafficking gang that was organized in a hierarchal structure and that took over and controlled the Block, working in shifts throughout the day and night to distribute fentanyl, heroin, cocaine, and cocaine base, in a form commonly known as “crack.”  These drugs were often manufactured and packaged elsewhere and then delivered to the Block, where members and associates of the Valentine Avenue Crew, many of whom were typically armed with firearms and other weapons, sold them to a large base of end-user customers.  In control of the sidewalks and the street of the Block, as well as the public spaces of multiple buildings along the Block, the Valentine Avenue Crew and its members and associates, including the defendants, worked freely, creating an open market for drugs, in which they extorted payments, including in-kind sexual acts, from customers through violence and the threat of violence. The members and associates of the Valentine Avenue Crew, including the defendants, also used violence—including multiple shootings—to compete with rival drug traffickers and within the Valentine Avenue Crew itself, principally to maintain dominance over the drug trade on the Block and control of the Valentine Avenue Crew.

On or about June 25, 2020, CARRASQUILLO, one of the leaders of the Valentine Avenue Crew, and ALCANTARA used fentanyl to poison and murder Jozei Hullex, a disfavored member of the Valentine Avenue Crew.

On or about June 25, 2020, CARRASQUILLO, HECTOR HERNANDEZ, JOSE HERNANDEZ, MANNING, MARCUS, and SAMUELS participated in a shootout for control of the Valentine Avenue Crew and in turn the Block.

On or about September 22, 2020, CARRASQUILLO and CEREZO participated in shooting at a rival gang member.

On or about January 1, 2021, CARRASQUILLO, MARCUS, MORENO, and SAMUELS used a chain and one or more firearms to assault a disfavored member of the Valentine Avenue Crew, who was seriously injured and hospitalized following the attack.

In addition, VILLAFANE remains charged for his commission of two non-fatal shootings in Manhattan in July 2020 and January 2021.  Specifically, in or about July 2020, VILLAFANE paid a co-conspirator (“CC-1”) to lure a victim to a location in Manhattan where VILLAFANE attempted to murder the victim over a drug debt, resulting in personal injury to the victim.  Additionally, on or about January 8, 2021, VILLAFANE committed another non-fatal shooting in Manhattan.

*                *                *

A chart containing the names, charges, and maximum penalties for the defendants is set forth below.

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Podolsky praised the outstanding investigative work of the DEA, FBI, and NYPD.  Today’s operation was conducted by the Trident Task Force, a joint task force of the DEA and FBI, among other federal, state, and local law-enforcement authorities, which is working on this case together with the NYPD.

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant U.S. Attorneys Michael R. Herman, Timothy Ly, and Thomas John Wright are in charge of the prosecution.

The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

COUNT

CHARGE

DEFENDANTS

MAX. PENALTIES

1

Racketeering

conspiracy

18 U.S.C. § 1962(d)

2

Conspiracy to commit murder in aid of racketeering

18 U.S.C. § 1959(a)(5)

EDWIN CARRASQUILLO,

a/k/a “Malo,” and

JOHANA ALCANTARA

3

Murder in aid of racketeering

18 U.S.C. §§ 1959(a)(1) and 2

EDWIN CARRASQUILLO,

a/k/a “Malo,” and

JOHANA ALCANTARA

4

Attempted murder and assault with a dangerous weapon in aid of racketeering

18 U.S.C. §§ 1959(a)(3), (a)(5), and 2

EDWIN CARRASQUILLO,

a/k/a “Malo,”

HECTOR HERNANDEZ,

a/k/a “Hec,”

JOSE HERNANDEZ,

a/k/a “Nene,”

a/k/a “Little,”

NATHANIEL MANNING,

a/k/a “Tio,”

DAMEL MARCUS,

a/k/a “Shank,” and

JERMAINE SAMUELS,

a/k/a “Maine”

5

Using or carrying a firearm during and in relation to, or possessing a firearm in furtherance of, a drug trafficking crime

18 U.S.C. §§ 924(c) and 2

EDWIN CARRASQUILLO,

a/k/a “Malo,”

HECTOR HERNANDEZ,

a/k/a “Hec,”

JOSE HERNANDEZ,

a/k/a “Nene,”

a/k/a “Little,”

NATHANIEL MANNING,

a/k/a “Tio,”

DAMEL MARCUS,

a/k/a “Shank,” and

JERMAINE SAMUELS,

a/k/a “Maine”

Life in prison

Mandatory minimum sentence of 10 years in prison

6

Attempted murder and assault with a dangerous weapon in aid of racketeering

18 U.S.C. §§ 1959(a)(3), (a)(5), and 2

EDWIN CARRASQUILLO,

a/k/a “Malo,” and

HECTOR CEREZO,

a/k/a “Red”

7

Using or carrying a firearm during and in relation to, or possessing a firearm in furtherance of, a drug trafficking crime

18 U.S.C. §§ 924(c) and 2

EDWIN CARRASQUILLO,

a/k/a “Malo”

Life in prison

Mandatory minimum sentence of 10 years in prison

8

EDWIN CARRASQUILLO,

a/k/a “Malo,”

DAMEL MARCUS,

a/k/a “Shank,”

EDWARDO MORENO,

a/k/a “AR,”

and JERMAINE SAMUELS,

a/k/a “Maine”

9

Using or carrying a firearm during and in relation to, or possessing a firearm in furtherance of, a drug trafficking crime

18 U.S.C. §§ 924(c) and 2

EDWIN CARRASQUILLO,

a/k/a “Malo,”

DAMEL MARCUS,

a/k/a “Shank,”

EDWARDO MORENO,

a/k/a “AR,”

and JERMAINE SAMUELS,

a/k/a “Maine”

Life in prison

Mandatory minimum sentence of 7 years in prison

10

Narcotics conspiracy

21 U.S.C. § 846

EDWIN CARRASQUILLO,

a/k/a “Malo,”

HECTOR HERNANDEZ,

a/k/a “Hec,”

JOSE HERNANDEZ,

a/k/a “Nene,”

a/k/a “Little,”

NATHANIEL MANNING,

a/k/a “Tio,”

DAMEL MARCUS,

a/k/a “Shank,”

EDWARDO MORENO,

a/k/a “AR,”

JERMAINE SAMUELS,

a/k/a “Maine,”

CHRISTIAN SERRANO,

a/k/a “Chris,”

JOHNNIE CAPELES

a/k/a “Jon Boy,”

EMILIO BARRERA,

a/k/a “Colombia,”

a/k/a “E,”

JASON RIVERA,

a/k/a “Colombo,”

HECTOR CEREZO

a/k/a “Red,”

JOSUE VARGAS,

a/k/a “Leo,”

JUAN KUANG,

a/k/a “Jo Jo,”

a/k/a “Jay,”

a/k/a “Blanco,”

STEVEN SANTIAGO,

a/k/a “Swizz,”

VICTOR MENDENG,

a/k/a “Cali,”

ANGEL VILLAFANE

YADIRA REYNOSO,

a/k/a “Yadi,”

ERIKA DAWSON,

ARIYAN LABELLA,

a/k/a “Ari,”

DELILAH CARRIEL,

ROSEMARIE SANCHEZ,

a/k/a “Rosie,”

JOHANA ALCANTARA,

JUAN CALDERON,

a/k/a “Jazzo,”

a/k/a “Juanito,”

KAREEM SMITH,

a/k/a “K,” and

CHRISTOPHER MEADOWS

Life in prison

Mandatory minimum sentence of 10 years in prison

11

EDWIN CARRASQUILLO,

a/k/a “Malo,”

HECTOR HERNANDEZ,

a/k/a “Hec,”

JOSE HERNANDEZ,

a/k/a “Nene,”

a/k/a “Little,”

NATHANIEL MANNING,

a/k/a “Tio,”

DAMEL MARCUS,

a/k/a “Shank,”

EDWARDO MORENO,

a/k/a “AR,”

JERMAINE SAMUELS,

a/k/a “Maine,”

CHRISTIAN SERRANO,

a/k/a “Chris,”

JOHNNIE CAPELES,

a/k/a “Jon Boy,”

JAMIL BANKS,

a/k/a “Mel,”

EMILIO BARRERA,

a/k/a “Colombia,”

a/k/a “E,”

JASON RIVERA,

a/k/a “Colombo,”

JOSUE VARGAS,

a/k/a “Leo,”

JUN KUANG,

a/k/a “Jo Jo,”

a/k/a “Jay,”

a/k/a “Blanco,”

and STEVEN SANTIAGO,

a/k/a “Swizz”

Life in prison

Mandatory sentence of life in prison for CARRASQUILLO and HERNANDEZ

Mandatory minimum sentence of 20 years in prison for other defendants

12

Murder while engaged in a narcotics conspiracy

21 U.S.C. § 848(e)(1)(A)

EDWIN CARRASQUILLO,

a/k/a “Malo,” and

JOHANA ALCANTARA

Death or life in prison

Mandatory minimum sentence of 20 years in prison

13

EDWIN CARRASQUILLO,

a/k/a “Malo”

Life in prison

Mandatory minimum consecutive sentence 10 years in prison

14

HECTOR HERNANDEZ,

a/k/a “Hec”

Life in prison

Mandatory minimum consecutive sentence 10 years in prison

15

JOSE HERNANDEZ,

a/k/a “Nene,”

a/k/a “Little”

Life in prison

Mandatory minimum consecutive sentence 10 years in prison

16

NATHANIEL MANNING,

a/k/a “Tio”

Life in prison

Mandatory minimum consecutive sentence 10 years in prison

17

DAMEL MARCUS,

a/k/a “Shank”

Life in prison

Mandatory minimum consecutive sentence 10 years in prison

18

EDWARDO MORENO,

a/k/a “AR”

Life in prison

Mandatory minimum consecutive sentence 10 years in prison

19

JERMAINE SAMUELS,

a/k/a “Maine”

Life in prison

Mandatory minimum consecutive sentence 10 years in prison

20

HECTOR CEREZO,

a/k/a “Red”

Life in prison

Mandatory minimum consecutive sentence 10 years in prison

21

Life in prison

Mandatory minimum consecutive sentence 10 years in prison

22

CHRISTIAN SERRANO,

a/k/a “Chris,”

JOHNNIE CAPELES,

a/k/a “Jon Boy,”

JAMIL BANKS,

a/k/a “Mel,”

EMILIO BARRERA,

a/k/a “Colombia,”

a/k/a “E,”

JASON RIVERA,

a/k/a “Colombo,”

JOSUE VARGAS,

a/k/a “Leo,”

JUAN KUANG,

a/k/a “Jo Jo,”

a/k/a “Jay,”

a/k/a “Blanco,”

STEVEN SANTIAGO,

a/k/a “Swizz,”

VICTOR MENDENG,

a/k/a “Cali,”

YADIRA REYNOSO,

a/k/a “Yadi,”

ERIKA DAWSON,

ARIYAN LABELLA,

a/k/a “Ari,”

DELILAH CARRIEL,

ROSEMARIE SANCHEZ,

a/k/a “Rosie,”

JOHANA ALCANTARA,

JUAN CALDERON,

a/k/a “Jazzo,”

a/k/a “Juanito,”

KAREEM SMITH,

a/k/a “K,” and

CHRISTOPHER MEADOWS

Life in prison

Mandatory minimum consecutive sentence 10 years in prison

23

24

Life in prison

Mandatory minimum consecutive sentence 10 years in prison

25

[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced the sentences imposed on former Rikers Island corrections officers JASON SKEET, CHANTAL DE LOS SANTOS, and STEPHANIE DAVILA; former Rikers Island program counselor SHANEQUA WASHINGTON; former Rikers Island contractor KENNETH WEBSTER; and former Rikers Island inmate KRISTOPHER FRANCISCO, each for conspiring to commit honest services wire fraud in connection with their involvement in corruption at Rikers Island.  The last of the defendants to be sentenced, DAVILA, was sentenced to 12 months and a day in prison today by U.S. District Judge Lorna G. Schofield.  The remaining five defendants were previously sentenced to terms of prison ranging from 12 months to 40 months. 

Acting U.S. Attorney Matthew Podolsky said: “The defendants—former Rikers Island employees, a Rikers Island contractor, and an inmate—engaged in corruption on Rikers Island by agreeing to have contraband smuggled into the Rikers Island jail facilities in exchange for tens of thousands of dollars in bribes.  The defendants’ crimes contributed to a dangerous contraband market within Rikers Island, making Rikers Island less safe for inmates and officers alike.  The sentences imposed in this case demonstrate this Office’s commitment to hold accountable those who criminally abuse their positions of public trust and undermine the security of jails for their own benefit.”

According to the Complaints, Informations, public court filings, and statements made in court:

SKEET, DE LOS SANTOS, DAVILA, WASHINGTON, WEBSTER, and FRANCISCO engaged in conspiracies to smuggle contraband, including, among other things, controlled substances—such as fentanyl, marijuana, and synthetic cannabinoids, commonly known as “K2”—cellphones, and cigarettes, into Rikers Island in exchange for thousands of dollars in bribe payments.  Each of the charged conspiracies involved a Rikers Island insider—either a corrections officer, program counselor, or contractor—who was responsible for smuggling contraband into the facility; a co-conspirator outside of Rikers Island who provided the contraband and/or bribe payments to the insider; and an inmate co-conspirator who received the contraband smuggled by the insider.  The inmate who received the contraband from the insider typically sold at least part of the contraband to other inmates inside Rikers Island, in exchange for thousands of dollars in payments to the inmate or the inmate’s co-conspirators. In particular:

From at least January 2020 through June 2022, SKEET, who was then a corrections officer assigned to the Northern Infirmary Command on Rikers Island, smuggled contraband into Rikers Island approximately 100 times in exchange for more than $45,000.

From at least March 2022 through April 2022, WASHINGTON, who was then a program counselor assigned to the Robert N. Davoren Center on Rikers Island, smuggled contraband into Rikers Island in exchange for approximately $13,000.

From at least May 2022 through September 2022, WEBSTER, who was then an employee of a Rikers Island contractor and a former Rikers Island inmate , smuggled contraband into Rikers Island in exchange for more than $64,000.

From at least March 2022 through June 2022, DE LOS SANTOS, who was then a former Rikers Island corrections officer, passed contraband and made bribe payments to WASHINGTON and WEBSTER, so that they would smuggle the contraband to inmates inside Rikers Island.

From at least July 2021 through August 2021, DAVILA, who was then a former Rikers Island corrections officer, passed contraband and made bribe payments to a Rikers Island corrections officer (“CC-1”), so that CC-1 would smuggle the contraband to FRANCISCO inside Rikers Island.

From at least July 2021 through August 2021, FRANCISCO, who was then an inmate incarcerated in the Anna M. Kross Center on Rikers Island, directed DAVILA to provide bribe payments and contraband to CC-1, so that CC-1 would smuggle contraband to FRANCISCO inside Rikers Island.

*                      *                      *

Each of the defendants pled guilty to one count of conspiracy to commit honest services wire fraud.  A chart containing the sentences that the defendants received is set forth below.

Mr. Podolsky praised the outstanding work of the Federal Bureau of Investigation and the New York City Department of Investigation.

The case is being handled by the Office’s Public Corruption Unit.  Assistant U.S. Attorneys Adam Z. Margulies and Jonathan Rebold are in charge of the prosecution.         

Age

31

31

29

47

40

43

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, and Leslie R. Backschies, the Acting Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of a Complaint in Manhattan federal court charging JAMES DINNIGAN, a/k/a “Charlie Ward,” and MARTIN MAUGHAN, a/k/a “Lawrence Rogers,” with conspiracy to commit wire fraud for their participation in a multi-year, multi-state organized construction fraud scheme that targeted at least 24 victims, including numerous elderly and vulnerable victims. MAUGHAN was transferred from state custody to federal custody this afternoon and will be presented today before U.S. Magistrate Robyn Tarnofsky.  DINNIGAN is in federal immigration custody and will be transferred to the Southern District of New York.  

Acting U.S. Attorney Matthew Podolsky said: “As alleged, these defendants and their co-conspirators carried out a brazen scheme to defraud vulnerable members of our community by posing as legitimate home repair contractors and tricking homeowners into paying for thousands of dollars in unnecessary and unwanted home repairs.  Today’s charges should serve as a reminder that this Office and its law enforcement partners are committed to investigating and bringing to justice those who seek to enrich themselves by victimizing vulnerable members of our community.”

Acting Assistant Director in Charge Leslie R. Backschies said: “James Dinnigan and Martin Maughan allegedly enticed prospective consumers with illegitimate home improvement advertisements before intentionally destroying their property to extort unanticipated additional costs. These illegal foreign nationals allegedly laid the foundation to prey upon a vulnerable population across the northeast, ultimately stealing a significant sum from elderly victims. The FBI remains committed to protecting our citizens from any fraudulent company attempting to cement false promises to garner illicit profits.”

As alleged in the Complaint unsealed today in Manhattan federal court:[1]

Between at least in or around October 2023 through at least in or about February 2025, DINNIGAN and MAUGHAN participated in a construction fraud scheme involving dozens of victims in New York, New Jersey, Connecticut, Pennsylvania, and several other states.  Participants in the scheme were usually foreign nationals from Ireland and the United Kingdom who were illegally in the U.S. and falsely posed as legitimate home repair contractors.

The scheme generally proceeded as follows: To get hired by the victims, members of the scheme made false statements to victims about their operation of legitimate home repair businesses, their occupation as contractors or engineers, and about home improvement and construction projects the victims needed to obtain. After being hired, members of the scheme tricked victims into paying for additional unwanted or unnecessary home repairs and other construction, including by purposefully damaging or destroying the victims’ property. The perpetrators of the scheme then forced victims, including through threats, into paying them tens or even hundreds of thousands of dollars. 

DINNIGAN, MAUGHAN, and other perpetrators of the scheme communicated with victims using cellphones and email.  The victims frequently wrote checks and transferred money to bank accounts controlled by members of the scheme, including into an account at a particular financial institution in Manhattan, New York.  The perpetrators of the scheme also operated websites in the names of at least two purported construction companies:  Local Masonry and Construction and Pine Valley Home Improvements, Inc.  Below are screenshots from websites that the perpetrators used to lure victims into the scheme:

The FBI has identified more than two dozen victims—many who are elderly individuals—who have lost at least $1 million as a result of this scheme. 

DINNIGAN entered the U.S. on or about April 4, 2023, using a tourist visa.  A review of relevant records has revealed no known documentation showing that DINNIGAN departed the U.S. as required, or that DINNIGAN applied for and received authorization to legally remain in the U.S.  On or about February 25, 2025, DINNIGAN was encountered by U.S. Customs and Border Protection (“CBP”) in Champlain, New York.

On or about August 9, 2023, MAUGHAN was encountered by CBP officers in the vicinity of Laredo, Texas.  MAUGHAN was subsequently ordered removed from the U.S. to the United Kingdom on or about October 30, 2023.  According to MAUGHAN’s order of removal, he was prohibited from reentering or attempting to reenter the U.S. for a period of five years.  On or about February 7, 2025, MAUGHAN was found inside the U.S. when he was arrested at the Boston Logan International Airport moments before departing on a flight to Dublin, Ireland. 

If you believe that you have additional information about this scheme or if you believe you have been a victim of the defendants or their co-conspirators, please contact the FBI at tips.fbi.gov, and reference this case.

*               *                *

DINNIGAN, 27, of Ireland, and MAUGHAN, 31, of the United Kingdom, are each charged with one count of conspiracy to commit wire fraud, which carries a maximum term of 20 years in prison. 

The maximum potential sentences in this case are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge. 

Mr. Podolsky praised the outstanding investigative work of the FBI’s New York and Philadelphia field offices.  Mr. Podolsky also thanked CBP; U.S. Immigration and Customs Enforcement, Enforcement and Removal Operations; Lower Merion Police Department; Cheltenham Police Department; Bernards Township Police Department; and Lambertville Police Department for their assistance in the investigation. 

The case is being prosecuted by the Office’s Violent and Organized Crime Unit. Assistant U.S. Attorney Brandon D. Harper is in charge of the prosecution, with assistance from paralegal specialist William A. Coleman IV.

The charges contained in the Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact descried therein should be treated as an allegation. 

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York; Sue J. Bai, the Head of the U.S. Department of Justice’s National Security Division; and Leslie R. Backschies, the Acting Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced the unsealing of a two-count criminal Indictment charging 10 defendants with a years-long hacking scheme committed through the Chinese company i-Soon.  At the direction of the People’s Republic of China (“PRC”) government, i-Soon employees hacked and attempted to hack victims across the globe, including a large religious organization in the U.S., critics and dissidents of the PRC government, a state legislative body, U.S. government agencies, the ministries of foreign affairs of multiple governments in Asia, and news organizations. i-Soon’s victims were of interest to the PRC government because, among other reasons, they were prominent overseas critics of the PRC government or because the PRC government considered them threatening to the rule of the Chinese Communist Party.  The 10 defendants remain at large.

Acting U.S. Attorney Matthew Podolsky said: “State-sponsored hacking is an acute threat to our community and national security. For years, these 10 defendants—two of whom we allege are PRC officials—used sophisticated hacking techniques to target religious organizations, journalists, and Government agencies, all to gather sensitive information for the use of the PRC. These charges will help stop these state-sponsored hackers and protect our national security. The career prosecutors of this Office and our law enforcement partners will continue to uncover alleged state-sponsored hacking schemes, disrupt them, and bring those responsible to justice.”

National Security Division Head Sue J. Bai said: “The Department of Justice will relentlessly pursue those who threaten our cybersecurity by stealing from our government and our people. Today, we are exposing the Chinese government agents directing and fostering indiscriminate and reckless attacks against computers and networks worldwide, as well as the enabling companies and individual hackers that they have unleashed. We will continue to fight to dismantle this ecosystem of cyber mercenaries and protect our national security.”  

Acting Assistant Director in Charge Leslie R. Backschies said: “The charges announced today expose the PRC’s continued attempts to spy on and silence anyone it deems threatening to the Chinese Communist Party. As alleged in the indictment, the Chinese government tried to conceal its efforts by working through a private company, but their actions amount to years of state-sponsored hacking of religious and media organizations, numerous government agencies in multiple countries, and dissidents around the world who dared criticize the regime. The FBI will continue to work tirelessly to disrupt our adversaries’ use of emerging technology to silence dissent and undermine the rule of law across the globe.”

As alleged in the Indictment:[1]

The PRC’s Ministry of State Security (“MSS”) had responsibility for the PRC’s domestic counterintelligence, non-military foreign intelligence, and aspects of the PRC’s political and domestic security. The PRC’s Ministry of Public Security (“MPS”) had responsibility for the PRC’s public and political security, including responsibility for law enforcement. To acquire information of interest to the PRC government in a manner that obscured their involvement, the PRC’s MSS and MPS used an extensive network of private companies and contractors in China to conduct unauthorized computer intrusions (“hacks”) in the U.S. and elsewhere.

One of those private companies was i-Soon.  From approximately 2016 through 2023, i-Soon and its personnel engaged in the numerous and widespread hacking of email accounts, cell phones, servers, and websites at the direction of, and in close coordination with, the PRC’s MSS and MPS. i-Soon generated tens of millions of dollars in revenue and at times had over 100 employees.

i-Soon’s primary customers were PRC government agencies.  It worked with at least 43 different MSS or MPS bureaus and charged the MSS and MPS between approximately $10,000 and $75,000 for each email inbox it successfully hacked.

The victims of i-Soon’s hacking included:

• A newspaper based in New York, New York, that publishes news related to China and is opposed to the Chinese Communist Party.
• An additional newspaper based in New York, New York.
• The U.S. Defense Intelligence Agency, an agency within the Department of Defense that specializes in defense and military intelligence.
• The U.S. Department of Commerce and the International Trade Administration, an agency within the Department of Commerce that promotes U.S. exports and defends against unfair trade practices.
• A religious organization based in the U.S. that has thousands of churches and congregations and millions of members.
• A Texas-based organization founded by a prominent critic of the PRC government focused on promoting human rights and religious freedom in China.
• A news service funded by the U.S. government that delivers uncensored domestic news to audiences in Asian countries, including China, and is headquartered in Washington, D.C.
• A state research university in the U.S.
• The New York State Assembly, a part of the legislature of the state of New York.
• A religious leader who lived outside of China and the U.S.
• A newspaper based in Hong Kong, China, that has actively covered the politics of Hong Kong and continues to do so today.
• The foreign ministry of Taiwan.
• The foreign ministry of India.
• The foreign ministry of South Korea.
• The foreign ministry of Indonesia.

In many instances, the PRC government was particularly interested in these victims because they had criticized the PRC government.  In other instances, the PRC government was particularly interested in foreign ministries because those foreign ministries were in communication with the U.S.

In some instances, i-Soon conducted its hacking at the direct request of the MSS or MPS. In other instances, i-Soon conducted hacks on its own initiative and then sold, or attempted to sell, the stolen data to different bureaus of the MSS or MPS.

i-Soon also trained MPS employees how to hack independently of i-Soon and offered a variety of hacking methods for sale to its customers.  i-Soon touted what it called a “industry-leading offensive and defensive technology” and a “zero-day vulnerability arsenal” used to successfully hack computer systems.  One of i-Soon’s products was software called the “Automated Penetration Testing Platform.” i-Soon advertised the platform’s ability to send email phishing attacks, to create files with malware that could provide access to victims’ computers if opened, and to clone websites of victims in order to induce them to submit personal information. An image of the interface for the Automated Penetration Testing Platform is below:

Another of i-Soon’s products was software that allowed the user to gain unauthorized access to online accounts or computer systems by deciphering passwords—also called “password cracking.” This platform was called the “Divine Mathematician Password Cracking Platform.” An image of the interface for the Divine Mathematician Password Cracking Platform is below:

i-Soon also sold software specifically designed to target victim accounts on a variety of computer systems and applications, including Microsoft Outlook; Gmail, the email service provided by Google LLC; the social media network X, formerly known as Twitter; the cellphone operating system Android; and the computer operating systems Windows, Macintosh, and Linux. i-Soon advertised its bespoke software as being able to overcome the unique defenses of these systems.

For example, with respect to Twitter, i-Soon sold software with the capability to send a victim a spear phishing link and then to obtain access to and control over the victim’s Twitter account. The software had the ability to access Twitter even without the victim’s password and to bypass multi-factor authentication. After a victim’s Twitter was compromised, the software could send tweets, delete tweets, forward tweets, make comments, and like tweets. The purpose of this software was to help i-Soon’s customers, including the PRC government, use hacked Twitter accounts to understand public opinion outside of China. For example, the software could be set to keep track of keywords appearing in tweets or messages. i-Soon referred to this software as its “Public Opinion Guidance and Control Platform (Overseas).” An image from the “Public Opinion Guidance and Control Platform (Overseas)” is below:

The 10 defendants charged are WU HAIBO, a/k/a “shutd0wn,” a/k/a “Boss Wu,” a/k/a “吴海波,” the Chief Executive Officer, and leader, of i-Soon; CHEN CHENG, a/k/a “lengmo,” a/k/a “Chief C,” a/k/a “Jesse Chen,” a/k/a “陈诚,” the Chief Operating Officer of i-Soon; WANG YAN, a/k/a “crysolo,” a/k/a “王堰,” the leader of one of i-Soon’s “penetration testing” teams; WANG ZHE, a/k/a “ken73224,” a/k/a “王哲,” the Sales Director of i-Soon; ZHOU WEIWEI, a/k/a “nullroot,” a/k/a “周伟伟,” the leader of i-Soon’s “Technology Research and Development Center”; WANG LIYU, a/k/a “PICNIC350116,” a/k/a “王立宇,” an MPS officer based in Chengdu, China; and SHENG JING, a/k/a “sjbible,” “盛晶,” the defendant, an MPS officer based in Shenzhen, China.

If you have information leading to the identification or location of these 10 defendants, please reach out to the Department of State at rewardsforjustice.net.

*               *                *

HAIBO, 43; CHENG, 40; GUODONG, 32; LI, 31; YAN, 35; ZHE, 44; WEIWEI, 37; LIANG, 28; LIYU, 36; and JING, 36, all nationals of China, are charged with conspiracy to commit computer intrusions, which carries a maximum sentence of five years in prison, and conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison. 

The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.

Mr. Podolsky praised the outstanding work of the FBI.

The case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Ryan B. Finkel, Steven J. Kochevar, and Kevin Mead are in charge of the prosecution.  Trial Attorney Gregory J. Nicosia Jr. of the National Security Division’s National Security Cyber Section provided valuable assistance.

The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Indictment, and the description of the Indictment set forth herein, constitutes only allegations, and every fact described therein should be treated as an allegation.

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, announced today that GREI MENDEZ was sentenced to 45 years in prison for trafficking fentanyl out of a daycare in the Bronx, New York, which resulted in the death of one child and the poisoning of three others.  Mendez pled guilty on October 29, 2024, before U.S. District Judge Jed S. Rakoff, who imposed today’s sentence.  

Acting U.S. Attorney Matthew Podolsky said: “Grei Mendez operated a daycare out of a basement apartment in the Bronx in which large quantities of deadly fentanyl were mixed, packaged, and stored.  She put babies as young as eight months old directly in harm’s way as they slept, played, and ate in a room where over 11 kilograms of fentanyl was hidden underneath their feet, leading to the death of one child and the poisoning of others.  No punishment can make up for a child lost, but today’s sentence sends the message that this Office and our law enforcement partners will work tirelessly to bring to justice anyone who uses children as a shield in the drug trade.”

According to the Complaint, the Indictment, and other documents in the public record:

From at least in or about June 2022 through September 2023, MENDEZ and others conspired to distribute narcotics out of Divino Niño Daycare in the Bronx.  There, MENDEZ and her co-conspirators maintained more than 11 kilograms of fentanyl and heroin in secret compartments, or traps, located underneath the floor tiles in the playroom of the Daycare.    

As a consequence of the drug conspiracy perpetrated by MENDEZ and her co-conspirators, on or about September 15, 2023, four children at the Daycare, all of whom were under three years of age, experienced the effects of poisoning from exposure to fentanyl.  Three of the children were hospitalized.  The fourth child, a 22-month-old boy, died.

*               *                *

In addition to the prison term, MENDEZ, 37, of the Bronx, New York, was sentenced to five years of supervised release. 

Mr. Podolsky praised the outstanding investigative work of the Drug Enforcement Administration (“DEA”), the New York City Police Department (“NYPD”), the Southern District of New York Digital Forensic Unit, the Complex Analytical and Social Media Enhancement Team at the New York/New Jersey High Intensity Drug Trafficking Area, the Organized Crime Drug Enforcement Task Force (“OCDETF”) New York Strike Force, and the U.S. Marshals Service (“USMS”).  Mr. Podolsky also thanked the NY/NJ Regional Fugitive Task Force of the USMS; the USMS Office of International Operations; the USMS for the Southern District of New York; the USMS for the Southern District of Texas; the USMS for the Southern District of California; the USMS Mexico Field Office; the USMS Investigative Operations Division; the DEA New York Strike Force; the DEA Regional Office in Allentown, Pennsylvania; the DEA Regional Office in McAllen, Texas; the DEA Regional Office in Mexico City, Mexico; the DEA Regional Office in Hermosillo, Mexico; the DEA Regional Office in Monterrey, Mexico; the DEA Special Operations Division; the NYPD 52nd Precinct’s Detective Squad; the NYPD Bronx Homicide Squad; the NYPD Laboratory; the Office of International Affairs of the Justice Department’s Criminal Division; the U.S. Attorney’s Office for the Southern District of Texas; the U.S. Attorney’s Office for the Southern District of California; U.S. Customs and Border Protection; and Mexican Federal and State authorities.

This prosecution is part of an OCDETF operation .  OCDETF identifies, disrupts, and dismantles criminal organizations using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.  The OCDETF New York Strike Force provides for the establishment of permanent, multi-agency task force teams that work side-by-side in the same location.  This co-located model enables agents from different agencies to collaborate on intelligence-driven, multi-jurisdictional operations to disrupt and dismantle the most significant drug traffickers, money launderers, gangs, and transnational criminal organizations.  The specific mission of the New York Strike Force is to target, disrupt, and dismantle drug trafficking and money laundering organizations, reduce the illegal drug supply in the United States, and bring criminals to justice.

This case is being prosecuted by the Office’s Narcotics Unit.  Assistant U.S. Attorneys Maggie Lynaugh and Brandon C. Thompson, as well as Special Assistant U.S. Attorney Karl P. Miller of the Office of the Bronx County District Attorney’s Homicide Bureau, are in charge of the prosecution. 

Matthew Podolsky, the Acting United States Attorney for the Southern District of New York, and Derek S. Maltz, the Acting Administrator of the U.S. Drug Enforcement Administration (“DEA”), announced that ITIEL PALACIOS GARCIA, a/k/a “El Playa,” a/k/a “El Compa Playa,” was extradited yesterday from Mexico to the United States.  PALACIOS GARCIA is charged with conspiracy to import cocaine into the U.S., possession of machineguns and destructive devices, and conspiracy to possess machineguns and destructive devices. PALACIOS GARCIA was presented today before U.S. Magistrate Judge Henry J. Ricardo and detained without bail.

Acting U.S. Attorney Matthew Podolsky said: “As alleged, for years, Itiel Palacios Garcia led a violent drug trafficking organization in Mexico that directed vast quantities of cocaine into communities in the United States. Palacios Garcia and his organization allegedly used assault rifles, grenades, and other heavy weapons to protect his drug trafficking territory and to battle drug rivals. This Office and our law enforcement partners stand committed to cutting off the flow of dangerous drugs into our country and bringing international drug traffickers to justice.”

According to the allegations contained in the Complaint, Indictment, and other court filings:[1]

PALACIOS GARCIA was the leader of a drug trafficking organization based in Guerrero, Mexico.  Between at least 2012 and 2020, PALACIOS GARCIA trafficked ton quantities of cocaine, including from Guatemala, that he then transported through his territory and into the U.S.  PALACIOS GARCIA and his co-conspirators used weapons like firearms, assault rifles, and grenades to protect their drug trafficking activities and to fight violent drug wars with rival groups, such as the Los Zetas drug cartel.

For example, in or about 2016, PALACIOS GARCIA and his associates purchased an aircraft, which they used to successfully transport approximately 800 kilograms of cocaine from Colombia to Venezuela, and then from Venezuela to Guatemala, where the cocaine was unloaded and transported by land to Mexico and finally the U.S.  As another example, in or about 2020, PALACIOS GARCIA and his associates organized another plane load of cocaine, which crashed in the El Petén region of Guatemala in or about April 2020. Both pilots died upon impact, and Guatemalan law enforcement authorities recovered approximately 800 kilograms of cocaine from the wreckage.

*               *                *

PALACIOS GARCIA, 42, of Mexico, is charged with: conspiring to import cocaine into the U.S. and to traffic it on board an aircraft registered in the U.S., which carries a mandatory minimum sentence of 10 years in prison and a maximum sentence of life in prison (Count One); possessing machineguns and destructive devices in connection with the importation conspiracy charged in Count One, which carries a mandatory minimum consecutive sentence of 30 years in prison and a maximum sentence of life in prison (Count Two); and conspiring to use, carry, and possess machineguns and destructive devices in connection with the importation conspiracy charged in Count One, which carries a maximum sentence of life in prison (Count Three).

The mandatory minimum and maximum potential sentences in this case are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Podolsky praised the outstanding investigative work of the DEA’s Special Operations Division, Bilateral Investigations Unit and multiple DEA offices throughout Mexico, as well as the assistance of the Office of International Affairs of the Justice Department’s Criminal Division and the U.S. Marshals Service.

This prosecution is being handled by the Office’s National Security and International Narcotics Unit.  Assistant U.S. Attorneys Nicholas S. Bradley, Jane Y. Chong, Sarah L. Kushner, Alexander Li, Daniel G. Nessim, David J. Robles, and Kyle A. Wirshba are in charge of the prosecution.

The charges contained in the Complaint and Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and Indictment, and the description of the other court filings set forth herein, constitute only allegations, and every fact described should be treated as an allegation.