Southern District of New York
Press releases recorded for this federal judicial district.
Profesor Acusado En Relación Con Violación, Agresión Sexual Y Abuso Sexual De Múltiples Víctimas De El SalvadorRead the Press Release
Damian Williams, Fiscal Federal para el Distrito Sur de Nueva York, Iván J. Arvelo, Agente Especial a Cargo de la Oficina de Investigaciones de Seguridad Nacional en Nueva York (“HSI”), y Edward A. Caban, Comisionado del Departamento de Policía de Nueva York (“NYPD”), anunciaron que JORGE ALBERTO RAMOS fue arrestado esta mañana y acusado de inducir y transportar a dos víctimas para desplazarse entre estados y participar en actividad sexual ilícita, así como de traficar y albergar a una tercera víctima. La acusación formal, revelada hoy, alega que desde por lo menos y aproximadamente en 2013, hasta aproximadamente el 2023, RAMOS transportó e instigó, incitó, y persuadió a mujeres a viajar con promesas de una vida mejor, incluyendo oportunidades educativas y de otro tipo, desde El Salvador hasta el Bronx, Nueva York, donde él las violó, las agredió sexualmente y las abusó. Se espera que se presente a RAMOS ante el Juez Auxiliar James L. Cott esta tarde. Este caso se le asigna al Juez del Distrito John G. Koeltl.
Damian Williams, Fiscal Federal, mencionó que “según se alega, en el transcurso de una década, Jorge Alberto Ramos participó en un ardid para violar, agredir sexualmente y abusar sexualmente a múltiples víctimas de El Salvador luego de inducirlas a viajar a los Estados Unidos bajo promesas de una vida mejor. Ramos se aprovechó de mujeres vulnerables y las traficó a Nueva York con el fin de explotar sus cuerpos para su propia satisfacción sexual. Agradecemos y reconocemos a las valientes mujeres que reportaron a Ramos.”
El Agente Especial a Cargo Iván J. Arvelo expresó que “esta acusación formal envía un mensaje contundente de que la agencia de Investigaciones de Seguridad Nacional está comprometida a traer a los depredadores que participan en actos deplorables de violencia sexual, física y psicológica en contra de otros individuos ante la justicia. Según se alega, Jorge Alberto Ramos instigó a varias mujeres a viajar a los Estados Unidos donde las sometió a repetidas violaciones y abuso sexual. La oficina de HSI, Nueva York, junto con nuestros aliados en el Departamento de Policía de la Ciudad de Nueva York, y la Fiscalía Federal de los Estados Unidos para el Distrito Sur de Nueva York, continuarán a mantener nuestra misión para garantizar que nuestras comunidades sean seguras tanto para los residentes como para los visitantes.”
“Se alega que el señor Ramos se aprovechó de mujeres vulnerables, las trajo a los Estados Unidos con promesa de oportunidades y luego las explotó despiadadamente bajo amenazas de deportación, no una vez, sino tres veces. Me siento muy satisfecho de que el Distrito Sur de Nueva York y los detectives del Grupo de Trabajo Anti-Trata de NYPD y de Investigaciones de Seguridad Nacional han investigado este caso de manera exitosa,” dijo el Comisionado de NYPD Edward A Caban.
Si cree que fue víctima de violación, agresión sexual, o abuso sexual cometidos por JORGE RAMOS, por favor comuníquese al 866-347-2423 o a [email protected] y mencione este caso.
Según lo que se alega en la acusación formal revelada hoy en el tribunal federal de Manhattan:[1]
En el transcurso de varios años, entre por lo menos o aproximadamente el 2013, hasta aproximadamente el 2023, JORGE ALBERTO RAMOS instigó, incitó y persuadió a mujeres con promesas de una vida mejor, incluyendo oportunidades educativas y de otro tipo, para viajar desde El Salvador hasta el Bronx, Nueva York, donde las violó, las agredió sexualmente, y las abusó sexualmente. RAMOS captó por lo menos a tres mujeres (“Víctima – 1,” “Víctima – 2,” y “Víctima – 3,” y en conjunto, las “Víctimas”) al expresar su preocupación por ellas y sus familias, y al enviarles regalos y dinero. RAMOS coordinó para que cada una de las Víctimas fuese traficada desde El Salvador hasta los Estados Unidos, incluso les pagó a los traficantes (o “coyotes”) para que transportaran a las Víctimas a través de la frontera estadounidense. RAMOS instigó por lo menos a dos de las Víctimas a que viajaran desde El Salvador hasta el Bronx con el fin de que RAMOS las pudiera obligar a participar en actos sexuales ilícitos con él según se los exigiera.
Una vez que se transportó a las Víctimas a Nueva York, RAMOS trajo a cada una de las Víctimas, respectivamente y en diferentes ocasiones, a su residencia en el Bronx (la “Residencia Ramos”). Una vez en la Residencia Ramos, RAMOS violó, agredió sexualmente y abusó sexualmente a las Víctimas. En el 2016, o aproximadamente en esa fecha, RAMOS violó, agredió sexualmente y abusó sexualmente a la Víctima – 1 el primer día que trajo a la Víctima – 1 a la Residencia Ramos, y RAMOS continuó a hacerlo por varias semanas hasta que la Víctima – 1 huyó de RAMOS. En el 2017, o aproximadamente en esa fecha, RAMOS violó, agredió sexualmente y abusó sexualmente a la Víctima – 2 el primer día que trajo a la Víctima – 2 a la Residencia Ramos, y RAMOS continuó a hacerlo por aproximadamente un mes hasta que la Víctima – 2 huyó de RAMOS. Entre el 2013, o aproximadamente en esa fecha, hasta aproximadamente el 2014, RAMOS violó, agredió sexualmente y abusó sexualmente a la Víctima – 3 en por lo menos tres ocasiones después de llevar a la Víctima – 3 a su residencia. Mientras las Víctimas se quedaron en la Residencia Ramos, RAMOS intentó controlarlas al ordenarles a las Víctimas – entre otras cosas, a que se quedaran dentro de la Residencia Ramos, intentando aislar a las Víctimas de otras personas y amenazándolas con reportar a las Víctimas con oficiales de inmigración para que las deportaran de regreso a El Salvador.
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Se acusa a RAMOS, de 43 años, del Bronx, Nueva York, de dos cargos por instigar a viajar con el fin de participar en actividades sexuales ilícitas, cada cargo conlleva una pena máxima de 20 años en prisión; dos cargos por transporte con el fin de participar en actividades sexuales ilícitas, cada cargo conlleva una pena máxima de 10 años en prisión; un cargo de conspiración con el fin de participar en tráfico de personas y un cargo de tráfico de personas, cada uno de estos cargos conlleva una pena máxima de 10 años en prisión; y un cargo por albergar a una persona indocumentada, lo cual conlleva una pena máxima de 5 años en prisión.
Las penas máximas por ley están estipuladas por el Congreso y se ofrecen aquí con fines informativos únicamente, ya que cualquier condena impuesta al acusado sería determinada por un juez.
El Sr. Williams elogió la excelente labor investigativa de HSI y NYPD.
Esta causa está a cargo de la Unidad de Delincuencia Organizada y Violenta de la Fiscalía. Las Fiscales Asistentes Elizabeth A. Espinosa, Emily A. Johnson, y Jane Kim están a cargo del enjuiciamiento.
Los cargos que aparecen en la Acusación Formal son simplemente acusaciones y al acusado se le presume inocente hasta que se pruebe su culpabilidad.
[1] Como significa la frase introductoria, la totalidad del texto de la Acusación Formal y la descripción de la Acusación Formal aquí expuesta constituyen únicamente acusaciones, y cada hecho descrito debe tratarse como una alegación.
U.S. v. Ramos IndictmentFormer NBA Player Terrence Williams Sentenced to 10 Years in Prison for Defrauding the NBA Players’ Health and Welfare Benefit PlanRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that TERRENCE WILLIAMS was sentenced today by U.S. District Judge Valerie E. Caproni to 10 years in prison for leading a sprawling scheme to defraud the National Basketball Association’s (“NBA”) health and welfare benefit plan out of more than $5 million. WILLIAMS previously pled guilty to conspiracy to commit health care and wire fraud and aggravated identity theft.
U.S. Attorney Damian Williams said: “Williams led a wide-ranging scheme to steal millions of dollars from the NBA Players’ Health and Welfare Benefit Plan. Williams recruited medical professionals and others to expand his criminal conspiracy and maximize his ill-gotten gains. Williams not only lined his pockets through fraud and deceit, but he also stole the identities of others and threatened a witness to further his criminal endeavors. For his brazen criminal acts, Williams now faces years in prison.”
According to the Indictment, public court filings, and statements made in court:
The NBA Players’ Health and Welfare Benefit Plan is a health care plan providing benefits to eligible active and former players of the NBA and their family members. From at least 2017 through at least 2021, TERRENCE WILLIAMS and more than a dozen others engaged in a widespread scheme to defraud the Plan by submitting and causing to be submitted fraudulent claims for reimbursement of medical and dental services that were not actually rendered. Over the course of the scheme, the defendants submitted and caused to be submitted to the Plan false claims totaling at least approximately $5 million.
WILLIAMS orchestrated the scheme to defraud the Plan. WILLIAMS recruited other Plan participants to defraud the Plan by offering to provide them with false invoices to support their fraudulent claims. WILLIAMS’s co-defendants, including a dentist in California and doctors in California and Washington State, provided WILLIAMS with fraudulent invoices that WILLIAMS sent to other co-conspirators. WILLIAMS also recruited non-medical professionals to copy invoices made by medical offices, which WILLIAMS provided to co-conspirators, and which were used to defraud the Plan. WILLIAMS conspired with others to submit fraudulent claims to the Plan in exchange for kickback payments to WILLIAMS of at least $300,000.
To verify that certain services were medically necessary, the Plan sometimes requires participants to provide a letter of medical necessity from medical providers, establishing that necessity of the provided services. WILLIAMS fraudulently created and transferred letters of medical necessity for three co-conspirators.
WILLIAMS also impersonated others in furtherance of the scheme. WILLIAMS pretended to be employees of the Plan’s administrative manager. In one instance, WILLIAMS created an email account designed to appear to be an email account used by the Plan’s administrative manager. WILLIAMS used that account to attempt to frighten a co-defendant so that the co-defendant would re-engage with WILLIAMS and would pay kickbacks to WILLIAMS.
On other occasions, WILLIAMS used another email account he created to threaten another co-defendant — a doctor who created fraudulent invoices for WILLIAMS. WILLIAMS used this email account to pretend to be employees of the Plan’s administrative manager and demand that this co-defendant pay WILLIAMS a “fine” or the “employees” would tell the authorities about the submission of fraudulent invoices. Through these threats and deception, WILLIAMS obtained approximately $346,000 from this particular co-defendant.
In or about April 2022, after WILLIAMS was charged and arrested in this case and while on pretrial release, WILLIAMS texted threats to a witness, including that the witness was “talking way to[o] f[---]ing much,” to “shut the f[--]k up,” and “me spitting in your face is exactly what you’ll see.” Following a motion by the Government on May 6, 2022, as a result of this obstructive conduct, Judge Caproni remanded WILLIAMS.
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In addition to his prison term, WILLIAMS, 36, of Seattle, Washington, was sentenced to three years of supervised release and ordered to forfeit $653,672.55 and to pay restitution in the amount of $2,500,000.
Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Ryan B. Finkel and Daniel G. Nessim are in charge of the prosecution.
Edward Mullins, Former President of NYPD Sergeants’ Union, Sentenced to Two Years in Prison for Stealing Union FundsRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that EDWARD MULLINS, the former President of the Sergeants Benevolent Association (“SBA”), the union that represents all current and former sergeants of the New York City Police Department (“NYPD”), was sentenced today to two years in prison in connection with a scheme to steal hundreds of thousands of dollars from the SBA through the submission of fraudulent expense reports. MULLINS pled guilty on January 19, 2023, before U.S. District Judge John G. Koeltl, who imposed today’s sentence.
U.S. Attorney Damian Williams said: “For years, Edward Mullins abused his position as the head of the SBA to steal hundreds of thousands of dollars from the pockets of hard-working NYPD sergeants. Mullins publicly vowed to protect the interests of the thousands of active and retired sergeants that he represented. But behind the scenes, Mullins stole from the SBA and its members, treating the SBA as his personal piggy bank. In doing so, Mullins disgraced his uniform, broke the law, and undermined the public’s trust in law enforcement. As today’s sentence demonstrates, no one — not even high-ranking union bosses — is above the law.”
According to the Information filed in the case and other filings and statements made in court:
The SBA is the fifth-largest police union in the United States with its headquarters located in lower Manhattan. The SBA’s membership consists of all active and retired sergeants of the NYPD with approximately 13,000 members. From 2002 until October 2021, EDWARD MULLINS served as President of the SBA.
Beginning in 2017, MULLINS devised a scheme to steal hundreds of thousands of dollars from the SBA. MULLINS used his personal credit card to pay for meals at high-end restaurants and to purchase luxury personal items, among other things, and then submitted false and inflated expense reports to the SBA, representing that his charges were legitimate SBA expenditures when, in fact, they were not. MULLINS’s expense reports were fraudulent in at least three ways. First, MULLINS routinely included meals on his expense reports that were not SBA-related. Second, MULLINS routinely inflated the costs of his meals – whether SBA-related or not – thereby taking more money from the SBA. Third, MULLINS took certain expenses from his credit card statements, including clothing and supermarket expenses, and recategorized them as SBA-related meals, thereby obtaining even more money from the SBA.
MULLINS’s fraudulent expenses were paid through the SBA’s Contingent Fund, which was funded primarily through annual dues paid by SBA members. In total, between 2017 and 2021, MULLINS stole at least $600,000 from the SBA through the filing of hundreds of fraudulent expense reports.
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In addition to his prison term, MULLINS, 61, of Port Washington, New York, was sentenced to three years of supervised release and ordered to make restitution to the SBA in the amount of $600,000. MULLINS was also ordered to forfeit $600,000.
Mr. Williams praised the outstanding work of the Federal Bureau of Investigation (“FBI”) and the FBI/NYPD Public Corruption Task Force.
This case is being handled by the Office’s Public Corruption Unit. Assistant U.S. Attorneys Alexandra Rothman and David Robles and are in charge of the prosecution.
College Professor Charged in Connection with Rape, Sexual Assault, and Sexual Abuse of Multiple Victims from El SalvadorRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, Ivan J. Arvelo, the Special Agent in Charge of the New York Field Office of Homeland Security Investigations (“HSI”), and Edward A. Caban, the Commissioner of the New York City Police Department (“NYPD”), announced that JORGE ALBERTO RAMOS was arrested this morning and charged with inducing and transporting two victims to travel interstate to engage in unlawful sexual activity and with smuggling and harboring a third victim. The Indictment unsealed today alleges that from at least in or about 2013 to in or about 2023, RAMOS transported and induced, enticed, and persuaded women to travel with promises of a better life, including educational and other opportunities, from El Salvador to the Bronx, New York, where he raped, sexually assaulted, and abused them. RAMOS is expected to be presented before U.S. Magistrate Judge James L. Cott this afternoon. The case is assigned to U.S. District Judge John G. Koeltl.
U.S. Attorney Damian Williams said: “As alleged, over the course of a decade, Jorge Alberto Ramos engaged in a scheme to rape, sexually assault, and sexually abuse multiple victims from El Salvador after inducing them to travel to the United States with promises of a better life. Ramos preyed on vulnerable women and smuggled them to New York so that he could exploit their bodies for his own sexual gratification. We thank and commend the courageous women who came forward to report Ramos.”
HSI Special Agent in Charge Ivan J. Arvelo said: “This indictment sends a strong message that Homeland Security Investigations is committed to bringing predators who engage in deplorable acts of sexual, physical, and psychological violence against other individuals to justice. As alleged, Jorge Alberto Ramos induced several women into traveling to the United States where he subjected them to repeated rape and sexual abuse at his hands. HSI New York, along with our partners at the New York City Police Department and United States Attorney’s Office for the Southern District of New York, will continue to uphold our mission to ensure our communities are safe for residents and visitors alike.”
NYPD Commissioner Edward A. Caban said: “Mr. Ramos is alleged to have preyed on vulnerable women, bringing them to the United States with the promise of opportunity and then ruthlessly exploiting them under threat of deportation, not once but three times. I am deeply gratified that the Southern District of New York and detectives from the Homeland Security Investigations/NYPD Human Trafficking Task Force have successfully investigated this case.”
If you believe you are a victim of rape, sexual assault, or sexual abuse perpetrated by JORGE RAMOS, please contact 866-347-2423 or [email protected] and reference this case.
According to the allegations in the Indictment unsealed today in Manhattan federal court:[1]
Over the course of several years, between at least in or about 2013 and in or about 2023, JORGE ALBERTO RAMOS induced, enticed, and persuaded women with promises of a better life, including educational and other opportunities, to travel from El Salvador to the Bronx, New York, where he raped, sexually assaulted, and sexually abused them. RAMOS groomed at least three women (“Victim-1,” “Victim-2,” and “Victim-3,” and together, the “Victims”) by expressing concern for them and their families and by sending them gifts and money. RAMOS arranged for each of the Victims to be smuggled from El Salvador into the United States, including by paying fees for smugglers (or “coyotes”) to transport the Victims across the U.S. border. RAMOS induced at least two of the Victims to travel from El Salvador to the Bronx so that RAMOS could force them to engage in unlawful sex acts with him on demand.
Once the Victims were transported to New York, RAMOS brought each of the Victims, respectively and at different times, to his residence in the Bronx (the “Ramos Residence”). Once at the Ramos Residence, RAMOS raped, sexually assaulted, and sexually abused the Victims. In or about 2016, RAMOS raped, sexually assaulted, and sexually abused Victim-1 on the first day he brought Victim-1 to the Ramos Residence, and RAMOS continued to do so for several weeks until Victim-1 fled from RAMOS. In or about 2017, RAMOS raped, sexually assaulted, and sexually abused Victim-2 on the first day he brought Victim-2 to the Ramos Residence, and RAMOS continued to do so for approximately one month until Victim-2 fled from RAMOS. Between in or about 2013 and in or about 2014, RAMOS raped, sexually assaulted, and sexually abused Victim-3 on at least three occasions after bringing Victim-3 to the Ramos Residence. While the Victims stayed at the Ramos Residence, RAMOS attempted to control the Victims by, among other things, ordering the Victims to stay inside the Ramos Residence, attempting to isolate the Victims from other people, and threatening to report the Victims to immigration officials for deportation back to El Salvador.
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RAMOS, 43, of the Bronx, New York, is charged with two counts of inducement to travel to engage in unlawful sexual activity, which each carry a maximum sentence of 20 years in prison; two counts of transportation to engage in unlawful sexual activity, which each carry a maximum sentence of 10 years in prison; one count of conspiracy to engage in human smuggling and one count of human smuggling, which each carry a maximum sentence of 10 years in prison; and one count of harboring an alien, which carries a maximum sentence of five years in prison.
The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant would be determined by a judge.
Mr. Williams praised the outstanding investigative work of HSI and the NYPD.
This case is being handled by the Office’s Violent and Organized Crime Unit. Assistant U.S. Attorneys Elizabeth A. Espinosa, Emily A. Johnson, and Jane Kim 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 constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Ramos IndictmentAttorney Sentenced to Four Years in Prison for Filing Fraudulent Lawsuits Under the Americans with Disabilities ActRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that attorney STUART FINKELSTEIN was sentenced today by U.S. District Judge Paul G. Gardephe to four years in prison in connection with filing hundreds of fraudulent lawsuits pursuant to the Americans with Disabilities Act (“ADA”). FINKELSTEIN previously pled guilty to one count of mail fraud.
U.S. Attorney Damian Williams said: “Stuart Finkelstein, a practicing attorney, filed hundreds of fraudulent lawsuits in which he brought false claims of violations of the Americans with Disabilities Act, which is meant to protect vulnerable members of our community against discrimination. Finkelstein has now been held accountable and is facing prison time for his brazen scheme.”
According to the Indictment and statements made in court filings:
Over the course of six years, FINKELSTEIN filed or caused to be filed nearly 300 fraudulent lawsuits under the ADA. These lawsuits, which were filed in Florida and New York, falsely claimed that the purported plaintiffs (“Victim-1” and “Victim-2”) had authorized the lawsuits and had standing to sue. In reality, Victim-1 and Victim-2 had no idea that FINKELSTEIN had filed lawsuits on their behalf. As a result of FINKELSTEIN’s false representations, FINKELSTEIN caused losses to the places of public accommodation that he sued in excess of $1,500,000 and netted nearly $650,000 for himself. In addition to stealing identities and using the ADA as a vehicle for fraud, FINKELSTEIN made false statements to the courts under oath and sought to obstruct proceedings that could have exposed his scheme.
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In addition to his prison term, FINKELSTEIN, 68, of Davie, Florida, was sentenced to three years of supervised release, fined $200,000, and ordered to forfeit $643,102.60. Restitution will be decided by the Court within 90 days of today’s sentencing.
Mr. Williams praised the outstanding investigative work of the Special Agents from the U.S. Attorney’s Office for the Southern District of New York.
This case is being handled by the Office’s General Crimes Unit. Assistant U.S. Attorney Rushmi Bhaskaran is in charge of the prosecution.
Rhode Island Man Pleads Guilty to Conspiring to Traffic “Ghost Guns” and to Laundering MoneyRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that ROBERT ALCANTARA pled guilty today in Manhattan federal court to conspiracy to traffic firearms and conspiracy to launder money from his firearms trafficking. ALCANTARA conspired to sell more than 100 “ghost guns” to individuals in the Dominican Republic.
U.S. Attorney Damian Williams said: “Robert Alcantara built untraceable ghost guns and conspired to sell more than 100 of them to individuals in the Dominican Republic. Thanks to the work of our law enforcement partners, his brazen gun trafficking scheme has been stopped.”
According to the Indictment and statements made in court proceedings and filings:
On November 20, 2021, ALCANTARA was stopped in his vehicle in possession of kits to build approximately 45 ghost guns. ALCANTARA was interviewed by law enforcement agents and stated that he was planning to turn the 45 kits into working firearms and that he had 50 additional similar ghost guns at his home. A photograph of the 45 seized ghost gun kits is below:
ALCANTARA used his Rhode Island home as a factory to machine ghost gun kits into working firearms. Below is a photograph of his home factory:
After ALCANTARA purchased ghost gun kits and machined them into working firearms, he sold those working firearms in the Dominican Republic. Below are photographs of firearms ALCANTARA sent to buyers in the Dominican Republic to advertise the firearms he had available for sale:
ALCANTARA received payments for the guns he sold in the Dominican Republic and laundered those funds.
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ALCANTARA, 36, of Providence, Rhode Island, pled guilty today to one count of conspiring to traffic firearms, which carries a maximum sentence of five years in prison, and one count of conspiring to launder money, which 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. ALCANTARA is scheduled to be sentenced by Judge Broderick on November 15, 2023, at 2:00 p.m.
Mr. Williams praised the outstanding investigative work of the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Department of Commerce. Mr. Williams also thanked the New York City Police Department, the New York State Police Department, the Providence Police Department, and the U.S. Attorney’s Office for the District of Rhode Island for their assistance in the case.
The case is being handled by the Office’s Narcotics Unit. Assistant U.S. Attorney Kevin Mead is in charge of the prosecution.
Former DEA Task Force Officer Pleads Guilty to Unlawfully Assaulting Individual During ArrestRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Ryan T. Geach, the Special Agent in Charge of the New York Field Office of the U.S. Department of Justice, Office of the Inspector General (“DOJ-OIG”), announced today that DUSTIN GENCO, a former Task Force Officer with the U.S. Drug Enforcement Administration (“DEA”) employed by the Nassau County District Attorney’s Office, pled guilty to depriving an individual (the “Victim”) of his constitutional right to be free from excessive force. On October 20, 2022, GENCO assaulted the Victim while the Victim was restrained in handcuffs. GENCO pled guilty today before U.S. Magistrate Judge James L. Cott. The case has been assigned to U.S. District Judge Arun Subramanian.
U.S. Attorney Damian Williams said: “As he admitted today, Dustin Genco, a former DEA Task Force Officer, violated the constitutional rights of an individual by using excessive force during that person’s arrest. This officer violated his oath and abused his power to deprive the victim of his rights protected by the U.S. Constitution. He now faces the serious consequences of his actions.”
DOJ-OIG Special Agent in Charge Ryan T. Geach said: “No law enforcement officer should ever use excessive force. These charges send a clear message that the Department of Justice Office of the Inspector General will aggressively pursue allegations of excessive force by DOJ law enforcement and its Task Force Officers.”
According to the Information that was filed today in Manhattan federal court as well as other public statements made in court:
On or about October 20, 2022, GENCO was employed as a Task Force Officer with the DEA. GENCO was assigned to assist with the arrest of the Victim. During the arrest, GENCO assaulted the Victim by forcefully kicking the Victim in the chest and stomach area while the Victim was restrained in handcuffs, resulting in injury to the Victim. After the assault, GENCO intentionally misled a federal law enforcement agent about the assault, claiming that the Victim had continued to resist arrest after he was handcuffed. GENCO also failed to truthfully disclose that he had kicked the Victim in the chest and stomach area while the Victim was restrained in handcuffs. As a condition of his guilty plea, GENCO agreed, among other things, to permanently cease and refrain from seeking or obtaining law enforcement employment on behalf of any federal, state, or local entity.
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GENCO, 51, of Seaford, New York, pled guilty to deprivation of constitutional rights under color of law, which carries a maximum sentence of one year 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 defendant will be determined by the judge.
Mr. Williams praised the outstanding investigative work of the DOJ-OIG.
The prosecution is being handled by the Office’s Civil Rights Unit in the Criminal Division. Assistant U.S. Attorney Mitzi Steiner is in charge of the prosecution.
United States Obtains Consent Decree Against Manhattan Wholesale Food Distributor for Storing over 40,000 Pounds of Meat and Poultry in Rodent-Infested WarehouseRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Paul Kiecker, the Administrator of the Food Safety and Inspection Service of the U.S. Department of Agriculture (“USDA-FSIS”), announced that the United States has sued wholesale meat and poultry distributer YA FENG TRADING, INC., its owner and president LINMIN YANG, and its warehouse manager KONG PING NI (collectively, the “Defendants”) for storing more than 40,000 pounds of meat and poultry products in a rodent-infested warehouse and for other conduct violating the Federal Meat Inspection Act (“FMIA”) and the Poultry Products Inspection Act (“PPIA”). The U.S. has simultaneously entered into a Consent Decree with the Defendants, approved by the District Court, which bars YA FENG and YANG from further work under the FMIA and PPIA for a period of three years, requires all the Defendants to comply with the FMIA and the PPIA in any covered work, and imposes significant civil penalties for any future violations. YA FENG ceased operating in December 2022 because of the risk of enforcement action relating to violations at issue in this case.
U.S. Attorney Damian Williams said: “Federal law requires food distributers and retailers to ensure that their products are stored in sanitary, uncontaminated conditions. As this lawsuit illustrates, this Office has no tolerance for actors who ignore their legal obligations at the expense of public health.”
USDA-FSIS Administrator Paul Kiecker said: “Our inspection personnel and investigators are on the job daily, verifying that establishments are complying with food safety regulations. FSIS remains committed to public health and we will take swift action to protect American consumers.”
The FMIA and the PPIA protect public health by ensuring the nation’s commercial supply of meat and poultry is sanitary, safe, wholesome, and accurately labeled and packaged. These requirements allow consumers to have confidence in the safety of their meat and poultry products and permit public health officials to trace problems to their source.
According to the Complaint filed in Manhattan federal court:
The Defendants violated the FMIA and the PPIA by storing their meat and poultry products in a warehouse that was overrun with rodents. In April 2022, USDA-FSIS investigators visited the YA FENG warehouse and observed multiple rodents scurrying into a walk-in cooler. One rodent ran out of the cooler and up the leg of a USDA-FSIS investigator. Chew marks were observed on meat and poultry products, and droppings were observed throughout the warehouse, including on the lids of products. Rodent nesting materials and a dead mouse were found in a walk-in freezer.
The Defendants also violated the FMIA and the PPIA repeatedly between December 2018 and April 2022 by offering for sale hundreds of pounds of misbranded meat and poultry products and by failing to maintain required records.
In the Consent Decree, the Defendants admit and accept responsibility for, among other things, the following:
- On several occasions between December 2018 and April 2022, Defendants sold, transported, and/or offered for sale and/or transportation misbranded meat, meat food products, poultry, and/or poultry products, and/or failed to maintain records regarding their business transactions. Specifically:
- On or about December 13, 2018, YA FENG sold 20 pounds of misbranded chicken gizzards.
- On or about January 28, 2020, YA FENG offered for sale and transportation 80 pounds of misbranded pork spare rib product and failed to maintain records that fully and correctly disclosed all business transactions involving meat in its business.
- On or about November 9, 2020, and on other dates, YA FENG offered for sale and transportation five pounds of misbranded chicken gizzards and 117 pounds of misbranded meat products (pork spareribs, pork fat, pork feet).
- On or about November 30, 2021, YA FENG offered for sale and transportation approximately 600 pounds of misbranded whole chickens, bone-in chicken thighs, chicken drumsticks, and chicken leg quarters.
- On or about April 14, 2022, USDA-FSIS investigators visited the YA FENG warehouse facility and observed 43,771.75 pounds of meat and poultry products being held in insanitary, rodent-infested conditions. Fresh and old rodent droppings were observed throughout the building, including in a walk-in freezer and walk-in cooler that held meat and poultry products. Droppings were observed on the lids of meat and poultry product boxes and beneath pallets holding the products. Some products had gnawing and chewing marks from rodents. Rodent nesting materials and a dead mouse were found in the walk-in freezer.
- Also, on or about April 14, 2022, YA FENG offered approximately 280 pounds of misbranded poultry products for sale.
In the Consent Decree, the Defendants expressly admit and accept responsibility for having “repeatedly violated the FMIA and PPIA.”
The Consent Decree bars YA FENG and YANG from engaging in activity subject to the FMIA or PPIA for three years. All Defendants must complete mandatory training and education in the FMIA and the PPIA before returning to this line of work while the Consent Decree remains in effect. They are also prohibited from storing meat and poultry products in unsanitary conditions, selling or transporting any uninspected meat and poultry products that are required to be inspected and passed by the USDA, selling any mislabeled meat and poultry products, failing to keep records regarding meat and poultry product business transactions, and engaging in any other conduct that would violate the FMIA or the PPIA. The Defendants are subject to additional sanctions, including civil monetary penalties and other relief, if they violate the provisions of the Consent Decree.
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Mr. Williams thanked the USDA-FSIS for its efforts on this matter.
This case is being handled by the Environmental Protection Unit of the Office’s Civil Division. Assistant U.S. Attorney Mark Osmond is in charge of the case.
U.S. v. Ya Feng et al Complaint U.S. v. Ya Feng et al Consent Decree- On several occasions between December 2018 and April 2022, Defendants sold, transported, and/or offered for sale and/or transportation misbranded meat, meat food products, poultry, and/or poultry products, and/or failed to maintain records regarding their business transactions. Specifically:
Leader of Money Laundering Operation Sentenced to Three Years in PrisonRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced today that ABRAHAM ADENIYI was sentenced today by U.S. District Judge Edgardo Ramos to three years in prison for operating a money laundering scheme that laundered nearly $8 million of wire fraud proceeds. ADENIYI previously pled guilty to conspiracy to commit money laundering.
U.S. Attorney Damian Williams said: “Abraham Adeniyi used a web of bank accounts to funnel millions of dollars stolen from fraud victims into his own pockets and the pockets of the fraudsters. He now faces prison time and is required to forfeit his ill-gotten gains.”
According to the allegations in the Indictment filed against ADENIYI and other court proceedings:
From at least in or about 2017 through at least in or about 2020, ADENIYI opened and directed others to open multiple bank accounts, which received proceeds of various wire fraud schemes. ADENIYI provided his accomplices with fraudulent identification information to open those bank accounts. Upon arrival of the fraudulent proceeds, ADENIYI transferred and directed others to transfer those proceeds rapidly among the various bank accounts controlled by participants in the scheme in order to conceal and disguise the source, location, ownership, and control of the funds. Ultimately, after moving through multiple bank accounts, the funds were withdrawn as cash, transmitted overseas, or used for ADENIYI’s personal expenses. This rapid transfer of funds prevented the banks and the victims from recovering the funds once the underlying frauds were detected. During the course of the scheme, ADENIYI laundered at least nearly $8 million dollars of fraud proceeds.
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In addition to his prison term, ADENIYI, 40, of Atlanta, Georgia, was ordered to forfeit and pay restitution in the amount of $7,814,294.56.
Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation.
This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit. Assistant U.S. Attorney Anden Chow is in charge of the prosecution.
U.S. Settles Lawsuit Alleging Medical Staffing and Services Companies Defrauded Medicare by Submitting Claims Under the Names of Doctors Who Did Not Perform the ServicesRead the Press Release
Damian Williams, the 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 U.S. Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), announced today that the United States has filed and settled a civil fraud lawsuit against ADVANCED HEALTH PARTNERS, INC., f/k/a “Medicom Management Services, Inc.”; MEDEXCEL USA, INC.; MEDEXCEL EMERGENCY PHYSICIAN SERVICES OF YONKERS, PLLC (“MEPSY”); and TRI-STATE EMERGENCY PHYSICIANS, PLLC (collectively the “Defendants”). This settlement resolves a lawsuit under the False Claims Act alleging that the Defendants submitted or caused the submission of false claims to Medicare using the names and identifying information of physicians who did not perform or supervise the medical services claimed and, in many cases, were no longer employed by the Defendants.
Under the terms of the settlement approved today by U.S. District Judge Nelson S. Román, the Defendants admitted and accepted responsibility for their conduct and agreed to pay $475,000 in damages to the United States.
U.S. Attorney Damian Williams said: “Advanced Health Partners, working with Medexcel, fraudulently billed Medicare on behalf of MEPSY and Tri-State at significant cost to taxpayers. This settlement holds these entities accountable both through the monetary payment and the detailed admissions they have made.”
HHS-OIG Special Agent in Charge Naomi Gruchacz said: “Providers that conceal or fail to submit accurate billing information can affect individuals who depend on Medicare funding for access to safe and effective health care services. The laws are meant to preserve the integrity of program funds and the provision of appropriate, quality services to patients. Our agency collaborates frequently with our law enforcement partners to investigate providers alleged to undermine our federal health care programs by submitting fraudulent claims, thus violating the False Claims Act.”
As part of the settlement, the Defendants admit, acknowledge, and accept responsibility for the following conduct:
- Between 2007 and 2017 (the “Covered Period”), MEPSY and TRI-STATE provided clinical staff to operate emergency departments at various hospitals in or around the Southern District of New York (the “Emergency Departments”).
- During the Covered Period, ADVANCED HEALTH PARTNERS submitted claims to the Medicare program (the “Subject Claims”) for professional services rendered at the Emergency Departments by physicians or other clinical staff employed by MEPSY and TRI-STATE.
- MEDEXCEL provided management services to MEPSY and TRI-STATE. Additionally, MEDEXCEL provided back-office support and guidance to ADVANCED HEALTH PARTNERS concerning its billing practices, including, in some instances, by directing which physician’s National Provider Identification number (“NPI”) to use to bill for specific services.
- During the Covered Period, several thousand of the Subject Claims used the NPIs of physicians who did not render or supervise the services in question, rather than the NPIs of the physicians who had actually rendered or supervised the services. Specifically, ADVANCED HEALTH PARTNERS, who received billing guidance from MEDEXCEL, used the NPIs of physicians who previously had been, but were no longer, employed by MEPSY or TRI-STATE.
- Defendants MEPSY and TRI-STATE received substantial reimbursement from Medicare to which they were not entitled as a result of these claims, and ADVANCED HEALTH PARTNERS and MEDEXCEL caused Medicare to make these unwarranted payments.
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. Williams thanked HHS-OIG for its assistance.
The case is being handled by the Office’s Civil Division. Assistant U.S. Attorneys Peter M. Aronoff and Jacob M. Bergman are in charge of the case.
U.S. v. Advanced Health Partners et al Complaint U.S. v. Advanced Health Partners et al SettlementFlorida Woman Sentenced to 51 Months in Prison for Defrauding Holocaust Survivor of $2.8 Million in Connection with Romance ScamRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced today that PEACHES STERGO was sentenced by U.S. District Judge Edgardo Ramos to 51 months in prison in connection with her years-long scheme to defraud an 87-year-old Holocaust survivor of his life savings.
U.S. Attorney Damian Williams said: “Peaches Stergo callously defrauded an 87-year-old Holocaust survivor who was simply looking for companionship. She used the millions of dollars in fraud proceeds to live a life of luxury at the victim’s expense. But she did not get away with it. As today’s sentence demonstrates, perpetrators of romance scams will be held to account for their crimes.”
According to the Indictment and other filings and statements made in court:
From at least in or about May 2017, up to and including at least October 2021, STERGO engaged in a scheme to defraud an 87-year-old Holocaust survivor (the “Victim”) of over $2.8 million, which was his life savings.
STERGO met the Victim on a dating website approximately seven years ago. In or about early 2017, STERGO asked the Victim to borrow money to pay her lawyer, who she claimed was refusing to release funds from an injury settlement. After the Victim gave her the money, STERGO said the settlement funds had been deposited into her TD Bank account. In reality, bank records show STERGO never received any money from an injury settlement.
Over the next four and a half years, STERGO continued her lies. She repeatedly demanded that the Victim deposit money into her bank accounts. She claimed that if he did not, her accounts would be frozen, and he would never be paid back. In total, the Victim wrote 62 checks — totaling over $2.8 million — that were deposited into one of two of STERGO’s bank accounts.
In furtherance of the fraud, STERGO created a fake email account, intended to appear as if it belonged to a TD Bank employee. She also created fake letters from a TD Bank employee and fake invoices.
STERGO called defrauding the Victim her “business.” Once, STERGO told her real significant other that the Victim had said he “loved” her. STERGO thought that her successful manipulation of the Victim’s emotions was humorous, following up her message with “lol.” She also joked in a text message that the Victim was “broke” — that “[h]e don’t have anything else to pawn.” But when the scam was over — when the Victim was no longer sending STERGO money — she was upset, not because she felt bad for the Victim or had a sense of remorse, but because she was unwilling to earn money though legitimate employment; she preferred to be a fraudster. As she said in a text message, “I am just aggravated hurt frustrated that I haven’t made money . . . I don’t want to work . . . it’s too hard.”
While the Victim lost his life savings and was forced to give up his apartment, STERGO lived a life of luxury with the millions she received from the fraud: she bought a home in a gated community, a condominium, a boat, and numerous cars, including a Corvette and a Suburban. During the course of the fraud, STERGO also took expensive trips, staying at places like the Ritz Carlton, and spent many tens of thousands of dollars on expensive meals, gold coins and bars, jewelry, Rolex watches, and designer clothing from stores like Tiffany, Ralph Lauren, Neiman Marcus, Louis Vuitton, and Hermes.
In imposing today’s sentence, Judge Ramos noted that STERGO’s conduct was “unspeakably cruel” and motivated by “greed.”
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In addition to her prison term, STERGO, 36, of Champions Gate, Florida, was sentenced to three years of supervised release and ordered to pay restitution in the amount of $2,830,775 and forfeit the same amount, including the home she purchased in a gated community and over 100 luxury items she purchased with fraud proceeds, including Rolex watches, designer purses and clothing, and large amounts of gold and jewelry.
Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation.
This case is being handled by the Office’s General Crimes Unit. Assistant U.S. Attorney Adam Sowlati is in charge of the prosecution.
Connecticut Man Sentenced to Prison for Trafficking at Least 32 “Ghost Guns”Read the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that MELVIN BURROUGHS was sentenced today by U.S. District Judge Andrew L. Carter, Jr., to 58 months in prison for trafficking firearms. BURROUGHS previously pled guilty to trafficking firearms and conspiring to traffic firearms.
U.S. Attorney Damian Williams said: “Illegal firearms — and in particular ghost guns — are a scourge to our community. Melvin Burroughs built and sold a veritable armory of ghost guns, and he now faces prison time for his crimes.”
According to the Superseding Information and statements made in court proceedings and filings:
From approximately 2019 through approximately January 2022, BURROUGHS purchased the parts for “ghost guns,” assembled the parts into completed firearms, and then illegally sold the working and completed firearms.
On March 14, 2021, BURROUGHS exited his house in Ansonia, Connecticut, with a handgun and — in broad daylight — discharged five rounds at two men who had approached his house. Still images of that broad daylight shooting are below:
The Ansonia Police Department searched the defendant’s house the next day. Law enforcement officers located two completed Glock-style privately made firearms (commonly known as “ghost guns”) and a .50-caliber Desert Eagle pistol that had been reported stolen in Georgia. Law enforcement officers also recovered a custom-made red and black AR-15-style rifle with the words “SUU WHOOP” inscribed on it. “Suu whoop” is a gang call of the Bloods street gang, and red is the color of the Bloods street gang. In addition, law enforcement agents recovered large quantities of ammunition, various gun parts, tools for making ghost guns, and a flamethrower. Photographs of certain of the materials seized from the defendant’s house are below:
In connection with the shooting and search of his residence, BURROUGHS was charged in the Superior Court of Connecticut – Ansonia-Milford Judicial District in Milford, Connecticut, with Connecticut state offenses and was released on bail conditions.
On January 8, 2022 — while on bail for the shooting — BURROUGHS was arrested in Westchester County, New York, with kits to build 17 ghost guns, a completed lower receiver[1] for an AR-15 rifle, 15 extended magazines, and an 18-inch machete. A photograph of the items seized from BURROUGHS on January 8, 2022, is below:
After BURROUGHS was arrested on January 8, 2022, law enforcement agents searched multiple cellphones belonging to BURROUGHS pursuant to search warrants. Evidence on those cellphones, including text message communications, videos, and photographs, established that BURROUGHS has been unlawfully selling firearms since approximately 2019. In particular, BURROUGHS’s gun trafficking business involved purchasing ghost gun parts online or at gun shows, building the ghost guns at his home, and then selling the completed firearms. One of BURROUGHS’s cellphones contained a photograph of 15 ghost gun kits that BURROUGHS purchased in approximately February 2021.
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In addition to the prison term, BURROUGHS, 36, of Ansonia, Connecticut, was sentenced to three years of supervised release.
Mr. Williams praised the outstanding investigative work of the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Mr. Williams also thanked the New York City Police Department, the Ansonia Police Department, the Westchester County District Attorney’s Office, the Connecticut Office of the State’s Attorney for Ansonia-Milford, and the U.S. Attorney’s Office for the District of Connecticut for their assistance in the case.
The case is being handled by the Office’s Narcotics Unit. Assistant U.S. Attorney Kevin Mead is in charge of the prosecution.
[1] A “lower receiver” or “frame” is the bottom part of a firearm and the basic unit of a firearm, which, in an AR-15 rifle, houses parts related to the trigger, magazine, and hammer.
CEO of Paycheck Protection Program Lender MBE Capital Sentenced to 54 Months in Prison in Connection with Fraudulent Loan and Lender ApplicationsRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced today that RAFAEL MARTINEZ was sentenced to 54 months in prison for his role in a scheme to submit fraudulent loan and lender applications related to the Paycheck Protection Program (“PPP”) administered by the U.S. Small Business Administration (“SBA”). MARTINEZ previously pled guilty to one count of conspiring to commit wire fraud before U.S. District Judge Lewis J. Liman, who imposed today’s sentence.
U.S. Attorney Damian Williams said: “Martinez lied to get money that was supposed to help people through the challenges of COVID-19. He lied so that he could fund a lavish lifestyle of cars, jets, and fancy homes. Today’s sentence sends a clear message to those who would abuse the system to serve their own selfish ends: such conduct will be brought to light and to justice. No one’s greed is above the law.”
According to the allegations in the Superseding Indictment, the Complaint, court filings, and statements made during plea and sentencing proceedings:
MARTINEZ used false representations and documents to fraudulently obtain the approval of the SBA for his company, MBE Capital Partners, LLC (“MBE”), to be a non-bank lender through the PPP in an effort to secure hundreds of millions of dollars in capital for PPP loans and, ultimately, to collect more than approximately $71 million in lender fees. In addition, MARTINEZ engaged in a scheme to obtain a PPP loan for MBE in the amount of approximately $283,764 through false statements regarding the number of employees of MBE and the wages paid to MBE employees and using the forged signature of MBE’s tax preparer.
At all relevant times, MARTINEZ has been the CEO and primary owner of MBE, a New York limited liability company formed in or about March 2015. Republic Group, LLC, a/k/a “Republic Group Parts, LLC,” which is owned and controlled by MARTINEZ, serves as the holding company for MBE and conducts business as MBE. According to MBE’s website, “For over 20 years, MBE Capital Partners has been a leading provider of financing solutions for small and diverse businesses. . . In 2019, we financed over $1.7 billion in public and private debt and we funded over 35,000 PPP loans worth $800M.”
On or about April 5, 2020, MARTINEZ applied to a financial institution for a government-guaranteed loan for Republic Group, d/b/a MBE, through the SBA’s PPP. In connection with the loan application, MARTINEZ represented that MBE had as many as 15 employees and an average monthly payroll of approximately $119,390 in 2019. In fact, however, from in or about April 2018 through in or about April 2020, MBE had at most four employees who had a total average monthly payroll of no more $25,000. In order to support the false representations made by MARTINEZ in the loan application about the number of employees at and the wages paid by MBE, MARTINEZ submitted fraudulent and doctored tax records that contained the forged signature of a tax preparer located in New York, New York (the “Tax Preparer”). Based on the false documentation provided by MARTINEZ, MBE was approved for a PPP loan in the amount of approximately $283,764, which was disbursed to a bank account controlled by MARTINEZ. A majority of the loan proceeds do not appear to have been used for payroll for employees of MBE or other business expenses.
On or about April 9, 2020, within five days of applying for the PPP loan referenced above, MARTINEZ submitted an application to the SBA for MBE to become a non-bank PPP lender. As part of the PPP lender application process, MARTINEZ represented that MBE had originated and serviced over $3.8 billion in business loans or other commercial financial receivables for the three-year period from in or about 2017 through in or about 2019 and submitted fraudulent financial statements that purported to be audited by the Tax Preparer’s firm for the years 2018 and 2019. Based on the false information provided by MARTINEZ to the SBA, MBE was approved as a non-bank lender for PPP loans.
On or about April 27, 2020, MARTINEZ submitted various documents, including the same fraudulent audited financial statements for 2019 provided to the SBA, to a life insurance company (the “Company”) as part of a proposed partnership to fund PPP loans for minority and women-owned small businesses. On or about May 13, 2020, the Company provided MBE with $100 million to fund PPP loans, which MBE in turn used as collateral to borrow additional capital of approximately $832 million through the Paycheck Protection Program Liquidity Facility (“PPPLF”) with the Federal Reserve.
As a result of the above fraudulent misrepresentations, MARTINEZ, through his company MBE, became an approved PPP lender and issued approximately $823 million in PPP loans to approximately 36,600 businesses. These loans earned MARTINEZ a total of approximately $71.3 million in fees. MARTINEZ spent the proceeds from his criminal conduct on, among other things, the purchase of a villa in the Dominican Republic for over $10 million, a $3.5 million mansion located in Franklin Lakes, New Jersey, a chartered jet service, and several luxury vehicles, including a 2018 Porsche 911 Turbo, a 2017 Ferrari 488 Spider, a 2017 Bentley Continental GT, a BMW 750, and a 1962 Mercedes Benz 190.
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In addition to his prison term, MARTINEZ, 57, of Franklin Lakes, New Jersey, was sentenced to three years of supervised release and further ordered to forfeit $44,546,712.94, as well as multiple properties and luxury vehicles, including a Ferrari Model 488 Spider, pay restitution in the amount of $71,711,893.07, and pay a $100 special assessment fee.
Mr. Williams praised the outstanding investigative work of the Internal Revenue Service, Criminal Investigation; the U.S. Small Business Administration, Office of Inspector General; and the Office of Inspector General for the Board of Governors of the Federal Reserve System and the Bureau of Consumer Financial Protection, Eastern Region.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Micah Fergenson, Katherine Reilly, and Steven Kochevar are in charge of the prosecution.
Two Supervisors Charged with Federal Crimes in Connection with Beating of 16-Year-Old Resident at Bronx Juvenile Detention CenterRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Jocelyn E. Strauber, the Commissioner of the New York City Department of Investigation (“DOI”), announced today criminal charges against DAQUAN SEYMOUR and RASHAWN WALKER, two supervisors at the Horizon Juvenile Center (“Horizon”), a secure detention center for juveniles located in the Bronx, New York. The charges relate to the April 25, 2022, beating of a 16-year-old resident at Horizon (the “Minor Victim”) and attempt to cover-up the beating. SEYMOUR and WALKER were charged with federal civil rights offenses, including conspiring to deprive the Minor Victim of his constitutional rights and depriving the Minor Victim of his constitutional rights under color of law, as well as filing false reports. SEYMOUR and WALKER were arrested this morning and will be presented in Manhattan federal court later today. The case has been assigned to U.S. District Judge Edgardo Ramos.
U.S. Attorney Damian Williams said: “Today’s charges allege a violent beating and a brazen cover-up by two supervisors at a juvenile detention facility in the Bronx that left a teenage resident seriously injured. Instead of safeguarding the youth that they were entrusted with protecting, Seymour and Walker violently dragged, punched, and stomped on the minor and then took steps to conceal the beating. My Office is committed to protecting the constitutional rights of all New Yorkers, including minors residing at youth detention facilities, and will ensure that those who abuse their authority are held accountable.”
DOI Commissioner Jocelyn E. Strauber said: “Defendants Seymour and Walker, ACS supervisors, had a duty to protect the youth residing in the Horizon Juvenile Center in the Bronx. Instead, they taunted and violently beat a 16-year-old resident, resulting in bodily injuries requiring medical care, and attempted to hide their disturbing misconduct by filing false reports, as alleged in the Indictment. Juvenile residents in custody should never be victimized by those entrusted with their safety. I thank the United States Attorney’s Office for the Southern District of New York for their partnership in this investigation and in our efforts to protect the rights of juveniles in detention centers.”
According to the allegations in the Indictment unsealed today in Manhattan federal court:[1]
On or about April 25, 2022, SEYMOUR and WALKER were employed as Associate Youth Development Specialists at the Horizon Juvenile Center (“Horizon”), a secure detention center for juveniles located in the Bronx, New York, that was operated by the New York City Administration for Children’s Services (“ACS”). Associate Youth Development Specialists at Horizon are responsible for, among other things, supervising other staff members and ensuring the safety of all juvenile residents.
At the time of the beating, the Minor Victim was a 16-year-old pre-trial juvenile resident at Horizon. Following a confrontation between several staff members and juvenile residents at Horizon, including the Minor Victim, SEYMOUR and WALKER violently dragged the Minor Victim by his forearms across the floor of a residential hall and into a private room (the “Room”). Once inside the Room, SEYMOUR and WALKER beat the Minor Victim, striking him repeatedly and forcefully as the Minor Victim lay on the floor. SEYMOUR and WALKER took steps to restrain the Minor Victim, including by pinning down the Minor Victim’s hands. WALKER also stomped on the Minor Victim’s stomach and groin area. Both SEYMOUR and WALKER taunted and directed profanities at the Minor Victim during the beating. As a result of the beating, the Minor Victim suffered bodily injuries, including a deep laceration to his upper lip area, which required the Minor Victim to be transported to a nearby hospital for medical care.
Following the beating of the Minor Victim, SEYMOUR and WALKER attempted to cover up their participation in the beating. In particular, both SEYMOUR and WALKER prepared Horizon incident reports that described the confrontation between Horizon residents and staff members that immediately preceded the assault but failed to disclose that they dragged or physically assaulted the Minor Victim.
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SEYMOUR, 33, of the Bronx, New York, and WALKER, 33, of Queens, New York, are each charged with one count of conspiracy to deprive civil rights, which carries a maximum sentence of 10 years in prison; one count of deprivation of rights under color of law, which carries a maximum sentence of 10 years in prison; and one count of falsification of records, 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. Williams praised the efforts of the DOI for their outstanding work on this matter. Mr. Williams also thanked the Special Agents of the U.S. Attorney’s Office for the Southern District of New York for their significant assistance.
The prosecution of this case is being handled by the Office’s Civil Rights Unit in the Criminal Division. Assistant U.S. Attorneys Jamie Bagliebter and Mitzi S. Steiner 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 constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Seymour and Walker IndictmentThoroughbred Racehorse Trainer Jason Servis Sentenced to Four Years in PrisonRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that defendant JASON SERVIS was sentenced to four years in prison today for his role in a years-long scheme in which horses trained by SERVIS were doped with approved and unapproved drugs designed to improve the performance of SERVIS’s racehorses, in connection with the charges filed in United States v. Navarro et al., 20 Cr. 160 (MKV). SERVIS was one of over 30 defendants charged in four separate cases in March 2020, each arising from this Office’s multi-year investigation of the abuse of racehorses through the use of performance enhancing drugs (“PEDs”).
U.S. Attorney Damian Williams said: “Today’s sentence sends a clear signal to those in the racehorse industry that no one is above the law. Endangering the welfare of animals for profit will not be tolerated. Illegally doping racehorses is a serious crime that will be met with a serious sentence.”
According to the allegations contained in the Superseding Indictment, the Superseding Information charging SERVIS, prior charging instruments, other filings in this case, and statements during court proceedings:
The charges in the Navarro case arose from an investigation of widespread schemes by racehorse trainers, veterinarians, PED distributors, and others to manufacture, distribute, and receive adulterated and misbranded PEDs and to secretly administer those PEDs to racehorses competing at all levels of professional horseracing. By evading PED prohibitions and deceiving regulators and horse racing officials, participants in these schemes sought to improve race performance and obtain prize money from racetracks throughout the United States and other countries, including in New York, New Jersey, Florida, Kentucky, and Saudi Arabia, all to the detriment and risk of the health and well-being of the racehorses. Trainers who participated in the schemes, like SERVIS, stood to profit from the success of racehorses under their control by earning a share of their horses’ winnings and by improving their horses’ racing records, thereby yielding higher trainer fees and increasing the number of racehorses under their control.
SERVIS obtained hundreds of bottles of the drug “SGF-1000,” which was compounded and manufactured in unregistered facilities and contained growth factors that the defendant believed to be undetectable through regular drug screens. Virtually all the horses in SERVIS’s barn received that drug, including the thoroughbred racehorse “Maximum Security,” who crossed the finish line first at the 2019 Kentucky Derby. SGF-1000 was an intravenous drug promoted as, among other things, a vasodilator capable of promoting stamina, endurance, and lower heart rates in horses through the purported action of “growth factors.” SERVIS approved veterinary bills to racehorse owners that contained concealed charges for SGF-1000, which were falsely billed under the line item “Acupuncture & Chiropractic.” In September 2019, the New York State Gaming Commission released an advisory stating that SGF-1000 was prohibited under the racing rules and had been prohibited since 2012. SERVIS continued to allow the administration of that drug on the horses he trained up until his arrest in March 2020.
SERVIS-trained horses were also regularly administered the prescription drug “Clenbuterol” with no valid prescription, which was part of a deliberate effort to conceal that conduct from racing regulators and avoid mandatory reporting requirements.
SERVIS further obtained and transported a misbranded version of “Clenbuterol,” which he obtained from convicted co-defendant JORGE NAVARRO.
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In addition to the prison term, SERVIS, 65, of Jupiter, Florida, was sentenced to one year of supervised release and ordered to pay $311,760 in forfeiture, $163,932 in restitution, and a $30,000 fine.
Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation New York Field Office’s Eurasian Organized Crime Task Force and its support of the Bureau’s Integrity in Sports and Gaming Initiative. Mr. Williams also thanked the Food and Drug Administration and Customs and Border Protection for their assistance and expertise.
This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit. Assistant U.S. Attorney Sarah Mortazavi is in charge of the prosecution.
British Investor and Billionaire Businessman Joseph Lewis Charged with Insider Trading and Financial FraudRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Christie M. Curtis, the Acting Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced the unsealing of an Indictment charging JOSEPH LEWIS and his co-conspirators, PATRICK O’CONNOR and BRYAN WAUGH, a/k/a/ “Marty Waugh,” with insider trading securities fraud and related charges. The defendants were arrested this morning and will be presented later today.
U.S. Attorney Damian Williams said: “My Office, the Southern District of New York, has indicted Joe Lewis, the British billionaire, for orchestrating a brazen insider trading scheme and his co-conspirators and personal pilots, Patrick O’Connor and Bryan ‘Marty’ Waugh. We allege that, for years, Joe Lewis abused his access to corporate boardrooms and repeatedly provided inside information to his romantic partners, his personal assistants, his friends, and his pilots. Those folks then traded on that inside information – and made millions of dollars in the stock market – because, thanks to Lewis, those bets were a sure thing. None of this was necessary. Joe Lewis is a wealthy man, but as we allege, he used inside information as a way to compensate his employees or to shower gifts on his friends and lovers. That’s classic corporate corruption. It’s cheating. And it’s against the law – laws that apply to everyone, no matter who you are.”
FBI Acting Assistant Director in Charge Christie M. Curtis said: "As alleged, Lewis and his associates used material, non-public information for the personal benefit of themselves and close associates, despite knowing that the activity was illicit. This type of behavior - blatant disregard for the law - is not only illegal but undermines the integrity of our financial markets. The FBI is determined to ensure that anyone willing to perpetrate insider trading schemes is held accountable in the United States criminal justice system."
According to the allegations contained in the Indictments unsealed in Manhattan federal court and court filings:1
JOSEPH LEWIS is a billionaire businessman and investor who is the principal owner of the Tavistock Group, an international private investment organization. By virtue of LEWIS’s investments in certain companies, he has controlled one or more board of director seats at those companies and has deputized employees to serve on various company boards. In turn, through these employees, LEWIS received material, non-public information about these companies, including, for example, information about upcoming favorable test results for biochemical companies. LEWIS, on multiple occasions over the course of several years, then misused and misappropriated this confidential information to provide stock tips to various individuals in his life, including his employees, romantic partners, and friends, as a way to provide them with compensation and gifts. These individuals, in turn, traded on the tips provided by LEWIS for vast personal gain.
In addition, LEWIS conspired with others to hide his ownership shares of a pharmaceutical company through a pattern of false filings and misleading statements. More specifically, LEWIS was required to file schedules of share ownership with the Securities and Exchange Commission (“SEC”) because he was an owner of more than 10% of the stock of Mirati Therapeutics (“Mirati”). LEWIS reported to the SEC that he owned between 16 and 19.99% of the stock, when, in reality, he beneficially owned more than 19.99% of Mirati stock through an elaborate array of shell companies and other entities, including an offshore trust purportedly for the benefit of his granddaughter. As a result of the false disclosure of his ownership, LEWIS was able to exercise warrants in Mirati that he would otherwise not have been able to exercise, at vast financial gain. At one point, when HSBC bank inquired about a transaction related to Mirati, LEWIS’s employee falsely told HSBC that the transaction was the repayment of a loan from LEWIS, a false explanation that LEWIS had told him he was “happy with,” despite knowing it was false.
PATRICK O’CONNOR and BRYAN WAUGH are two pilots employed by LEWIS to fly his private aircraft. LEWIS tipped both O’CONNOR and WAUGH and encouraged them to trade based on material, non-public information. In one instance, LEWIS gave O’CONNOR and WAUGH loans, each worth $500,000, so they could buy a company’s stock before the public release of favorable clinical results. In connection with that loan, O’CONNOR texted a friend to buy the stock, told the friend the “Boss is helping us out and told us to get ASAP,” and assured the friend that “All conversations on app is encrypted so all good. No one can ever see.” O’CONNOR also texted the friend that “Boss mentioned around 6 to 8 weeks for [Mirati] to take profit” and that he thought “the Boss has inside info” and “knows the outcome” of not-yet-public clinical testing. O’CONNOR and WAUGH later sold the stock they had purchased on the basis of these tips for a profit, as did LEWIS’s assistant and friends.
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LEWIS, 86, a British national, has been charged with 13 counts of securities fraud under Title 15, each of which carries a maximum sentence of 20 years in prison; three counts of securities fraud under Title 18, each of which carries a maximum sentence of 25 years in prison; and three counts of conspiracy, each of which carries a maximum sentence of five years in prison.
O’CONNOR, 66, of Preston Hollow, New York, has been charged with four counts of securities fraud under Title 15, each of which carries a maximum sentence of 20 years in prison; three counts of securities fraud under Title 18, each of which carries a maximum sentence of 25 years in prison; and one count of conspiracy, which carries a maximum sentence of five years in prison.
WAUGH, 64, of Lynchburg, Virginia, has been charged with four counts of securities fraud under Title 15, each of which carries a maximum sentence of 20 years in prison; three counts of securities fraud under Title 18, each of which carries a maximum sentence of 25 years in prison; and one count of conspiracy, which carries a maximum sentence of five 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 the judge.
Mr. Williams praised the outstanding investigative work of the FBI. He also expressed appreciation for the SEC, which separately initiated civil proceedings against the defendants today. Mr. Williams further thanked the Justice Department’s Office of International Affairs for its assistance during this investigation.
This prosecution is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Nicolas Roos, Jason A. Richman, and Alex Rossmiller 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.
1 As the introductory phrase signifies, the entirety of the text of the Indictments and the description of the Indictments set forth herein constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Joseph Lewis Indictment U.S. v. Joseph Lewis et al IndictmentRoofing Company Principal Arrested for Failing to Protect an Employee Who Fell to His DeathRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Jonathan Mellone, the Special Agent in Charge of the Northeast Region of the U.S. Department of Labor, Office of the Inspector General (“DOL-OIG”), announced today that JOSE LEMA, a/k/a “Jose Lema Mizhirumbay,” the founder and principal of ALJ Home Improvement, Inc., a New York roofing company, was charged with willfully violating Occupational Safety and Health Administration (“OSHA”) regulations, resulting in the death of an employee (“Victim-1”) in New Square, New York, on or about February 8, 2022. The Complaint charges that LEMA failed to ensure employees wore fall protection systems, and Victim-1 fell off the roof of a building under construction and died. LEMA was arrested this morning at his home in Nanuet, New York, and will be presented before U.S. Magistrate Judge Victoria Reznik in White Plains federal court later today.
U.S. Attorney Damian Williams said: “As alleged, Lema endangered the safety of his workers by disregarding regulations and failing to ensure his employees used fall protection systems. This conduct led to the death of a roof worker on a construction site. Today’s charge should serve as a reminder to small businesses that failure to comply with safety regulations can lead to unnecessary and preventable tragedy.”
DOL-OIG Special Agent in Charge Jonathan Mellone said: “An important part of the mission of the Office of Inspector General is to investigate allegations of criminal misconduct related to U.S. Department of Labor programs. We will continue to work with our law enforcement partners and DOL’s Occupational Safety and Health Administration to hold those who jeopardize workers’ safety accountable.”
As alleged in the Complaint:[1]
On the morning of February 8, 2022, LEMA sent Victim-1 and three other ALJ employees to install a roof on a three-story multi-family apartment building under construction in New Square, New York (the “Worksite”). Victim-1 and the other ALJ employees ascended a ladder to the roof, but within 20 to 30 minutes of arriving at the Worksite, Victim-1 fell off the roof and landed on the ground approximately 30 feet below. He died from his injuries. Victim-1 was wearing a safety harness, but there was no lanyard, rope, or any other attachment connected to the D-ring on the back of the harness that would have connected him to the roof. Nor were there anchors on the roof to attach a rope had there been one connected to the harness. OSHA cited ALJ for failing to ensure its employees were using fall protection systems.
Victim-1’s deadly fall was not the first time an employee of LEMA and ALJ fell to his death at one of ALJ’s worksites or that ALJ employees were exposed to fall hazards. OSHA investigated ALJ six times before Victim-1’s death and once after. OSHA issued citations after each incident. The first time, on or about February 27, 2019, an ALJ employee slipped off the roof of a newly constructed three-story home in Kiamesha Lake, New York (“Victim-2”), fell 35 feet to the ground, and subsequently died from his injuries. OSHA determined that Victim-2 was not wearing a safety harness and issued citations to ALJ for, among other things, failure to ensure employees wear fall protection systems. ALJ settled and agreed to pay a penalty.
There were five more incidents on five different worksites in New York and New Jersey after Victim-2’s death in February 2019 and before Victim-1’s death in February 2022 in which ALJ employees were exposed to fall hazards and OSHA cited ALJ for failing to ensure its employees were using fall protection systems. In each case, ALJ settled and agreed to pay a penalty.
Even after Victim-1’s death, LEMA continued to violate OSHA standards and failed to protect his employees. On or about August 4, 2022, ALJ employees were working on an 18-foot roof in Ho Ho Kus, New Jersey, without any apparent fall protection. They were wearing harnesses that were not secured to the roof. OSHA issued more citations, including willful failure to ensure employees wear fall protection systems.
In all, between in or about 2019 and in or about 2023, OSHA performed eight investigations of ALJ worksites that resulted in the issuance of 24 willful citations, 16 serious citations, and over $2.3 million in penalties. Each time OSHA investigated, Compliance Safety and Health Officials met with LEMA and made him aware of his rights and obligations to his employees. At an OSHA administrative deposition, LEMA admitted that prior to Victim-1’s fall, he knew that employees on a roof higher than six feet high needed to be protected by some form of fall protection. But despite that knowledge, citations, and fines from six previous investigations, LEMA failed to follow OSHA standards and protect Victim-1 and his other employees.
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LEMA, 40, of Nanuet, New York, is charged with one count of knowingly and willfully violating OSHA residential construction fall protection standards by failing to protect his employees from fall hazards and causing injuries that resulted in an employee’s death, which carries a maximum sentence of six months in prison and a maximum fine of $250,000 or twice the gross gain or loss from the offense.
The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Williams praised the outstanding work of OSHA, DOL-OIG, and the Special Agents of the U.S. Attorney’s Office for the Southern District of New York.
The case is being prosecuted by the Office’s White Plains Division. Assistant U.S. Attorney Margery Feinzig 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 herein constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Lema ComplaintFormer Obstetrician/Gynecologist Robert Hadden Sentenced to 20 Years in Prison for Sexually Abusing Numerous PatientsRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that ROBERT HADDEN was sentenced today to 20 years in prison by U.S. District Judge Richard M. Berman for enticing and inducing four victims to travel interstate to engage in unlawful sexual activity. HADDEN, who practiced medicine between in or about 1987 to 2012, was convicted at trial on January 24, 2023, for inducing four victims to travel interstate to his medical offices in Manhattan so that he could sexually abuse them. The Government proved at trial that the defendant sexually abused dozens of patients over the course of more than two decades under the guise of purported medical examinations.
U.S. Attorney Damian Williams said: “Under the guise of medical treatment, Robert Hadden sexually abused and assaulted numerous patients for approximately 25 years, exploiting them in vulnerable moments for his own sexual gratification. Thanks to the tireless work of the career prosecutors of this Office, Hadden will rightfully spend decades in federal prison. We thank and commend the victims who bravely came forward to share their stories and ensure that their abuser faces justice.”
According to the Indictment, evidence presented at trial, and other filings and statements made in court:
For approximately 25 years, between in or about 1987 and in or about 2012, ROBERT HADDEN sexually abused and assaulted at least dozens of female patients, some repeatedly, as an obstetrician/gynecologist employed by Columbia University Medical Center and during purported medical examinations. HADDEN used his position as a medical doctor employed by a prestigious medical institution to make or to attempt to make his victims believe that the sexual abuse he inflicted on them was appropriate and medically necessary. HADDEN encouraged victims to return to see him and directed victims to schedule follow-up visits on timelines he set. As a result, some of the victims attended many appointments with HADDEN over the course of several years, during which HADDEN sexually abused them. HADDEN caused four victims to return to Manhattan for appointments with him so that he could sexually abuse them, knowing that these victims would have to travel across state lines for their appointment.
HADDEN used sophisticated techniques to carry out his abuse, which he honed over the course of more than two decades. He exploited the power differential inherent in the doctor-patient relationship, he built rapport with victims, he asked victims invasive and unprompted questions about their sexual activity, including about sex positions and if they were able to achieve orgasm, and he provided unsolicited advice on these topics. He also used so-called breast and vaginal exams to hide his abuse, he isolated patients, and he conducted fake examinations.
HADDEN sexually abused victims in various ways, including by massaging and groping victims’ breasts for a prolonged period; groping both breasts at the same time; pinching, twisting, or otherwise manipulating a victim’s nipples; extracting colostrum from a victim’s breasts and tasting it; digitally penetrating and/or rubbing victims’ vaginas in efforts to masturbate them; touching victims’ clitorises; and licking victims’ vaginas. Each of these abusive acts was committed by HADDEN without any valid medical purpose and under the guise of legitimate medical care.
At the sentencing, Judge Berman imposed the statutory maximum penalty for each count of conviction, to run concurrently. The Court described the defendant’s conduct as “exceptional and unprecedented,” “shocking in the extreme,” “horrific,” and “depraved.” In imposing its sentence, the Court discussed, among other things, the magnitude and scope of the defendant’s serial sexual abuse, its unchecked nature, the defendant’s “skillfulness at deception,” the predatory nature of his sex crimes, and the fact that the defendant preyed on vulnerable patients who trusted him, thereby repeatedly violating a “woman’s right to decide what happens to her body.”
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In addition to the prison term, HADDEN, 64, of Englewood, New Jersey, was sentenced to a lifetime of supervised release and ordered to pay a $10,000 fine and a $400 special assessment fee.
Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation.
This case is being handled by the Office’s Public Corruption Unit. Assistant U.S. Attorneys Lara Pomerantz, Jane Kim, and Paul Monteleoni are in charge of the prosecution, with the assistance of Paralegal Specialist Connor Hamill.
Former Correctional Officer Sentenced to 43 Months in Prison for Bribery Scheme and Attempting to Assault Inmate He Suspected of Cooperating with the GovernmentRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that PERRY JOYNER, a former Bureau of Prisons correctional officer, was sentenced today to 43 months in prison for smuggling contraband into the Metropolitan Correctional Center (“MCC”) in exchange for over $70,000 in bribes from inmates and for attempting to have an inmate assaulted to keep that inmate from reporting JOYNER’s crimes to law enforcement. JOYNER pled guilty before U.S. District Judge Andrew L. Carter, Jr. on December 14, 2022. Judge Carter imposed today’s sentence.
U.S. Attorney Damian Williams said: “Correctional officers are entrusted to care for and maintain custody and control over inmates. Perry Joyner violated that trust repeatedly by soliciting and receiving bribes from inmates and by attempting to coordinate the assault of an inmate whom he believed was cooperating with the Government. This sentence should send a message to correctional officers: you will be held accountable when you violate your sworn duty to ensure the care, custody, and control of our nation’s inmate population.”
According to the Indictment, public court filings, and statements made in court proceedings:
From at least October 2019 through February 2020, JOYNER, a correctional officer at the MCC, received approximately $77,894 in bribe payments from MCC inmates or their associates in exchange for JOYNER smuggling to inmates drugs (including, but not limited to, oxycodone, alprazolam, Suboxone, marijuana, and K2), cellphones, cigarettes, and alcohol. MCC inmates then used, sold, or exchanged that contraband amongst themselves and resold it to other inmates.
In or about February 2020, JOYNER believed a particular inmate (“Inmate-1”), who had previously bribed JOYNER, was cooperating with the Government. In response, JOYNER requested other inmates slash or otherwise assault Inmate-1 as retribution and intimidation. Before any inmate followed through on JOYNER’s request, Inmate-1 was moved out of the MCC.
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In addition to today’s prison sentence, JOYNER, 30, of Orange, New Jersey, was sentenced to two years of supervised release ordered to forfeit $77,894.
Mr. Williams praised the outstanding work of the Federal Bureau of Investigation; the Department of Justice, Office of the Inspector General; Special Agents from the U.S. Attorney’s Office for the Southern District of New York; and the U.S. Customs and Border Protection in New York.
The prosecution of this case is being handled by the Office’s Public Corruption and Narcotics Units. Assistant U.S. Attorneys Aline R. Flodr, Jonathan E. Rebold, and Daniel H. Wolf are in charge of the prosecution, with the assistance of Paralegal Specialist Christopher de Grandpre.
Colorado Man Sentenced to Prison for “We Build the Wall” Online Fundraising Fraud SchemeRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that TIMOTHY SHEA was sentenced today by U.S. District Judge Analisa Torres to 63 months in prison for his role in carrying out a scheme to defraud hundreds of thousands of donors in connection with an online crowdfunding campaign known as “We Build The Wall” by soliciting donations using false statements and then stealing the resulting donations, as well as laundering the proceeds of the fraud scheme and attempting to obstruct the federal criminal investigation of the scheme.
U.S. Attorney Damian Williams said: “Timothy Shea abused the trust of donors to ‘We Build the Wall,’ stole hundreds of thousands of dollars in donations to line his own pockets, and attempted to obstruct the federal investigation of his criminal conduct. The defendant has now been held accountable and faces prison time for his crimes.”
According to court filings and evidence introduced during court proceedings:
Starting in approximately December 2018, TIMOTHY SHEA, his co-defendants BRIAN KOLFAGE and ANDREW BADOLATO, and others orchestrated a scheme to defraud hundreds of thousands of donors, including donors in the Southern District of New York, in connection with an online crowdfunding campaign ultimately known as “We Build The Wall” that raised more than $25,000,000 to build a wall along the southern border of the United States. In particular, to induce donors to donate to the campaign, KOLFAGE repeatedly and falsely assured the public that he would “not take a penny in salary or compensation” and that “100% of the funds raised…will be used in the execution of our mission and purpose.”
Those representations were lies. In truth, KOLFAGE, BADOLATO, SHEA, and others received hundreds of thousands of dollars in donor funds from We Build the Wall, which they each used in a manner inconsistent with the organization’s public representations. For example, KOLFAGE covertly took for his personal use more than $350,000 in funds that donors had given to We Build the Wall. To conceal the payments to KOLFAGE from We Build the Wall, KOLFAGE, BADOLATO, SHEA, and others devised a scheme to route those payments through entities and bank accounts that they controlled. They took various steps to obscure or conceal these payments, including by using fake invoices and sham contracts — conduct for which SHEA was convicted at trial of obstruction of justice.
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SHEA, 52, of Castle Rock, Colorado, was convicted after trial of conspiracy to commit wire fraud, conspiracy to commit money laundering, and obstruction of justice. In addition to the prison term, SHEA was sentenced to three years of supervised release and ordered to forfeit $1,801,707 and pay restitution in the amount of $1,801,707.
KOLFAGE, 41, of Miramar Beach, Florida, and BADOLATO, 58, of Cocoa, Florida, each pled guilty to one count of conspiracy to commit wire fraud. KOLFAGE also pled guilty to tax and wire fraud charges originally filed by the U.S. Attorney’s Office for the Northern District of Florida. KOLFAGE was sentenced to 51 months in prison, and BADOLATO was sentenced to 36 months in prison.
Mr. Williams praised the outstanding investigative work of the U.S. Postal Inspection Service and 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 Public Corruption Unit. Assistant U.S. Attorneys Alison G. Moe, Nicolas Roos, Robert B. Sobelman, and Derek Wikstrom are in charge of the prosecution, with the assistance of Paralegal Specialists Christopher de Grandpre and Andrea Gieseman.
Burmese National Convicted at Trial of Conspiring to Assault Myanmar’s Ambassador to the United NationsRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced the conviction of PHYO HEIN HTUT, a Burmese national, of one count of conspiracy to assault a foreign official in connection with his participation in a plot to assault Myanmar’s Permanent Representative to the United Nations (the “Ambassador”). HTUT was found guilty after an eight-day trial before U.S. District Judge Nelson S. Román and is scheduled to be sentenced on March 14, 2024, before Judge Román.
U.S. Attorney Damian Williams said: “While volunteering on a security team at Myanmar’s Permanent Mission to the United Nations, Phyo Hein Htut betrayed the person he was supposed to be protecting by secretly feeding information about the Ambassador, the Mission, and its personnel to an arms dealer in furtherance of a plot to hurt the Ambassador. The jury’s unanimous verdict holds him to account for his actions.”
According to the allegations contained in the Indictment, the evidence offered at trial, and matters included in public filings:
Between in or about February 2021 through at least on or about August 5, 2021, HTUT, a citizen of Myanmar residing in New York, conspired to injure or kill Myanmar’s Permanent Representative to the United Nations. During the conspiracy, HTUT communicated with an arms dealer in Thailand (the “Arms Dealer”) who sells weapons to the Burmese military, which overthrew Myanmar’s civilian government in or about February 2021. In the course of those conversations, HTUT supplied information to the Arms Dealer about the Ambassador, the inner workings of Myanmar’s Permanent Mission to the United Nations, and other Mission personnel. HTUT also accepted money the Arms Dealer sent to him to hire attackers to hurt the Ambassador in an attempt to force the Ambassador to step down from his post.
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HTUT, 29, a Burmese national residing in New York, was convicted of conspiracy to assault a foreign official, which carries a maximum sentence of five 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. Williams praised the outstanding investigative work of the Federal Bureau of Investigation, the Westchester County Safe Streets Task Force, and the New York City Police Department.
This case is being handled by the Office’s White Plains Division. Assistant U.S. Attorneys Jeffrey Coffman and Benjamin Klein, with the assistance of Paralegal Specialist Teresa Leo, are in charge of the prosecution.
United States Sues Owners and Operators of Orange County Horse Training Facility for Filling Wetlands in Violation of Federal Clean Water ActRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Lisa F. Garcia, the Regional Administrator for Region 2 of the U.S. Environmental Protection Agency (“EPA”), announced today that the United States has filed a civil lawsuit against THOMAS PUSHKAL, JENNIFER VANOVER, EDWARD PUSHKAL, FRANCES PUSHKAL, and MAPLEWOOD WARMBLOODS, LLC (collectively, the “defendants”) for allegedly filling wetlands in Orange County protected by the federal Clean Water Act. The Complaint asks the Court to award injunctive relief and civil penalties for the violations.
U.S. Attorney Damian Williams said: “As alleged, the defendants violated the Clean Water Act by discharging concrete, metal, glass, and other fill material into wetlands that are part of the waters of the United States. This lawsuit will hold the defendants accountable for allegedly violating our environmental laws and require them to remedy the alleged significant damage they have caused to protected wetlands.”
EPA Regional Administrator Lisa F. Garcia said: “Wetlands serve a vital role in decreasing water pollution, providing habitat for fish and wildlife, and reducing risks from flooding and storm surges. Unlawful and unmitigated dredging and filling activities can destroy wetlands. EPA will continue to protect these vulnerable ecosystems and fight for the health of wetlands by enforcing the law under the Clean Water Act.”
As alleged in the Complaint filed today in White Plains federal court:[1]
From 2015 to 2019, defendants THOMAS PUSHKAL, JENNIFER VANOVER, and their business MAPLEWOOD WARMBLOODS, LLC discharged fill material without a federal permit into approximately 3.5 acres of wetlands, in areas referred to in the Complaint as the Bart Bull Road Site and the Expansion Site. These discharges were made in the course of operating and expanding their horse breeding, boarding, and training facility in the Town of Wallkill, Orange County.
Specifically, from in or about June 2015 to March 2016, these defendants directed or permitted construction and demolition material to be trucked in and deposited at the Bart Bull Road Site and directed or permitted the use of heavy machinery to spread the fill material to level and raise the grade of the property.
At the end of November 2018, EPA learned of the potential development activity at the Expansion Site and, in December 2018, cautioned defendant THOMAS PUSHKAL by phone that if he was filling protected wetlands on any additional properties, he would need a federal permit.
Nonetheless, beginning in or about December 2018 and continuing to April 2019, without a permit, these defendants used dump trucks and other heavy machinery to engage in extensive earthmoving, grading, and filling activities to construct private access roads through the Expansion Site. The construction of these roads caused fill to be discharged into 1.5 acres of wetlands at the Expansion Site. Some wetlands filled at the Expansion Site are on property owned by defendants EDWARD PUSHKAL and FRANCES PUSHKAL, who, at a minimum, knew or should have known of, but failed to exercise their authority to prevent, the discharges.
The wetlands that are the subject of the Complaint are adjacent to the Wallkill River, a traditional navigable water. The fill material discharged into the wetlands included, among other things, dirt, rock, brick, wood, electrical wiring, ceramic, asphalt, concrete, rebar, PVC piping, metal, and glass.
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This case is being handled by the Office’s Environmental Protection Unit. Assistant U.S. Attorneys Zachary Bannon and Alyssa O’Gallagher are in charge of the case.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitution only allegations, and every fact described should be treated as an allegation.
U.S. v. Pushkal et al ComplaintU.S. Attorney Announces the Indictment of Mount Vernon Police Sergeant for Violating the Constitutional Rights of an IndividualRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Christie M. Curtis, the Acting 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 MARIO STEWART, a Sergeant with the Mount Vernon Police Department (“MVPD”), with using excessive force against an individual (the “Victim”) while in Mount Vernon, New York, in violation of the Victim’s rights under the United States Constitution. As alleged in the Indictment, during a call for assistance, STEWART, in the presence of six other MVPD officers, tased the Victim seven times in the span of approximately two minutes. For the duration of all seven taser deployments, the Victim lay on the ground, handcuffed with his hands behind his back and his legs secured in a restraint bag. STEWART surrendered to the FBI this morning and was presented this afternoon before U.S. Magistrate Judge Judith C. McCarthy in White Plains federal court. The case has been assigned to U.S. District Judge Kenneth M. Karas.
U.S. Attorney Damian Williams said: “As alleged, Mario Stewart, a Sergeant with the Mount Vernon Police Department, was called to the scene to aid a person in emotional distress. Instead of providing aid, Stewart deployed his taser on the individual seven times in the span of roughly two minutes, while the individual was handcuffed and with his legs restrained and while several other MVPD officers were on scene to assist. Stewart’s alleged conduct not only betrayed his duty as an officer to protect those under his charge, but also violated the law. My Office is committed to protecting the constitutional rights of all New Yorkers, including those experiencing mental health crises, and to holding law enforcement officers accountable when they abuse their authority.”
FBI Acting Assistant Director in Charge Christie M. Curtis said: “As alleged in today’s indictment, Stewart’s actions led him to inflict bodily harm upon his victim. Officers of the law are not above the law, and the FBI is committed to investigating any instances in which a federal crime has been committed.”
According to the Indictment that was unsealed today in White Plains federal court:[1]
On or about March 26, 2019, STEWART was employed as a Sergeant with the MVPD. STEWART was assigned to the MVPD’s Emergency Services Unit, which is responsible for, among other things, responding to individuals who are experiencing mental health crises. On that day, STEWART and six other MVPD officers received a call to assist the Victim in Mount Vernon, New York, as the Victim was experiencing a mental health crisis.
At the scene, STEWART and the other MVPD officers restrained the Victim, handcuffing his hands behind his back and securing his legs in a restraint bag in preparation to transport the Victim for medical assistance. When the MVPD officers were unable to pull the restraint bag over the Victim’s chest because the Victim was holding onto one of the bag’s straps, STEWART directed the Victim to release the strap. STEWART then proceeded to tase the Victim seven times in the span of approximately two minutes. While STEWART deployed his taser all seven times, the Victim remained laying on the ground, handcuffed with his hands behind his back and his legs secured in the restraint bag. STEWART’s actions caused bodily injury to the Victim.
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STEWART, 44, of Brooklyn, New York, is charged with one count of deprivation of rights under color of law, which carries a maximum sentence of 10 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 the judge.
Mr. Williams praised the outstanding work of the FBI. Mr. Williams also thanked the Westchester County District Attorney’s Office for their assistance.
The prosecution is being handled by the Office’s Civil Rights Unit in the Criminal Division. Assistant U.S. Attorneys Gillian Grossman and Jared Hoffman are in charge of the prosecution.
The charge contained in the Indictment is merely an accusation, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Stewart IndictmentFormer High School Dean Convicted of 2010 MurderRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that ISRAEL GARCIA, a/k/a “Shorty Rock,” the former leader of the Get Money Gunnaz set of the Young Gunnaz street gang (the “GMG YGz”), was found guilty at trial of the October 11, 2010, murder of Alfonso “Joey” McClinton in aid of racketeering. GARCIA shot and killed McClinton on a residential street in the Bronx, New York, as part of a dispute over narcotics trafficking territory. GARCIA was also convicted of engaging in a conspiracy to distribute narcotics, murder while engaged in a narcotics conspiracy, murder through the use of a firearm, possessing firearms in connection with narcotics trafficking, and attempted witness tampering. The verdict followed a seven-day trial before U.S. District Judge Jed S. Rakoff.
U.S. Attorney Damian Williams said: “On October 11, 2010, Israel Garcia shot and killed 21-year-old Alfonso ‘Joey’ McClinton on a residential street in the Bronx. Garcia was the leader of the violent street gang known as the GMG YGz, which had been warring with Joey McClinton’s family over drug territory in the Bronx. Garcia used this horrific murder to maintain his leadership role in the GMG YGz and solidify his hold over the GMG YGz drug-selling territory. For the next decade, Garcia led the GMG YGz’s reign of terror over the neighborhood, recruiting children and others into a drug trafficking enterprise that poisoned the community with crack cocaine, heroin, and fentanyl, and protecting his drug turf with firearms and violence. Over time, Garcia attempted to create the façade of a law-abiding citizen, becoming the dean of a local high school in order to mask that he was still running the GMG YGz’s violence and drug trafficking. Yesterday, a unanimous jury held Garcia accountable for his brutal killing of Joey McClinton and for ruining countless other lives.”
According to court filings and the evidence presented in court during trial:
For more than a decade, the defendant controlled the sale of narcotics in the vicinity of East 184th Street and Morris Avenue in the Bronx as the leader of the GMG YGz. As part of their narcotics operation, GMG YGz members carried firearms and engaged in back-and-forth shootings with neighboring, rival crews. This violence resulted in, among other acts, the 2010 murder of Alfonso “Joey” McClinton. The State of New York arrested and prosecuted GMG YGz member Joseph (“Juice”) Johnson for the killing.[1] Ballistics, video evidence, and eyewitness testimony, however, revealed that there was a second shooter involved in McClinton’s murder. GARCIA was that second shooter. When GARCIA became concerned that Johnson might cooperate with law enforcement, GARCIA took steps to prevent Johnson from identifying GARCIA as the person with whom he committed the murder.
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GARCIA, 32, of the Bronx, New York, was convicted of (i) murder in aid of racketeering, which carries a mandatory minimum sentence of life in prison and a maximum sentence of death or life in prison; (ii) narcotics conspiracy, which carries a mandatory minimum sentence of 10 years in prison and a maximum sentence of life in prison; (iii) murder while engaged in a narcotics conspiracy, which carries a mandatory minimum sentence of 20 years in prison and a maximum sentence of death or life in prison; (iv) murder through the use of a firearm, which carries a mandatory minimum sentence of five years in prison and a maximum sentence of death or life in prison; (v) firearms use, carrying, and possession in connection with a drug trafficking crime, which carries a mandatory minimum sentence of five years in prison, which must be served consecutively to any other sentence imposed, and a maximum sentence of life in prison; and (vi) attempted witness tampering, which carries a maximum sentence of 20 years in prison.
The minimum and 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. Williams praised the investigative work of the Drug Enforcement Administration; the New York City Police Department; the Department of Homeland Security, Homeland Security Investigations; and the U.S. Marshals Service. This prosecution is part of an Organized Crime Drug Enforcement Task Forces (“OCDETF”) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
This case is being handled by the Office’s Narcotics Unit. Assistant U.S. Attorneys Jacob Gutwillig, Maggie Lynaugh, and Jonathan Bodansky, with the assistance of Paralegal Specialist Owen Foley, are in charge of the prosecution.
[1] Johnson was convicted at trial of second-degree murder in The People of the State of New York v. Joseph Johnson, Index Number 4311/2010. On February 3, 2022, the verdict against Johnson was vacated. Johnson subsequently pled guilty to manslaughter and is serving a 17-year sentence.
Former Venezuelan Official Hugo Armando Carvajal Barrios Extradited to the United States on Narco-Terrorism, Firearms, and Drug Trafficking ChargesRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Anne Milgram, the Administrator of the U.S. Drug Enforcement Administration (“DEA”), announced that former Venezuelan official HUGO ARMANDO CARVAJAL BARRIOS, a/k/a “El Pollo,” was extradited today from Spain to the United States based on an Indictment filed in the Southern District of New York charging CARVAJAL BARRIOS with narco-terrorism conspiracy, conspiracy to import cocaine into the United States, and related firearms offenses. CARVAJAL BARRIOS will be presented tomorrow before U.S. Magistrate Judge Stewart D. Aaron. CARVAJAL BARRIOS was arrested in Spain on September 9, 2021.
U.S. Attorney Damian Williams said: “After many years as a fugitive following a more than decade-long criminal career, Hugo Armando Carvajal Barrios arrived in the United States today to face justice for his alleged crimes, which were committed with the intent to ‘flood’ the United States with tons of potentially deadly drugs. As alleged, Carvajal Barrios exploited his authority as the director of Venezuela’s military intelligence agency to corrupt Venezuelan institutions, abuse the Venezuelan people, and to import poison to the United States. His alleged leadership of the Cártel de Los Soles inflicted immeasurable pain and suffering on many Venezuelans, Americans, and others who were affected by the cartel’s violence and drug trafficking activities. I commend the prosecutors of this Office and our law enforcement partners for their tireless work on this important case.”
DEA Administrator Anne Milgram said: “Corrupt government officials like Carvajal, who allegedly use their position to accept bribes and further drug trafficking activities, should be held accountable to the fullest extent of the law. As alleged, Carvajal abandoned his responsibility to the people of Venezuela and exploited his position for personal gain. DEA and our partners stand united to bring to justice anyone, in any position, who endangers the safety and health of the American people.”
According to the allegations contained in the Indictments, other court filings, and statements made during court proceedings:1
Beginning in at least 1999, CARVAJAL BARRIOS, a Venezuelan citizen and the former director of Venezuela’s military intelligence agency, which was known as the Dirección de Inteligencia Militar (“DIM”), along with other high-ranking Venezuelan officials, acted as leaders and managers of the Cártel de Los Soles, or “Cartel of the Suns.” The Cartel’s name refers to the sun insignias affixed to the uniforms of high-ranking Venezuelan military officials. CARVAJAL BARRIOS and other Cartel members abused the Venezuelan people and corrupted the legitimate institutions of Venezuela — including parts of the military, intelligence apparatus, legislature, and judiciary — to facilitate the importation of tons of cocaine into the United States. The Cártel de Los Soles sought not only to enrich its members and enhance their power but also to “flood” the United States with cocaine and inflict the drug’s harmful and addictive effects on users in the United States. To accomplish these goals, the leaders of the Cártel de Los Soles partnered with leaders of the Fuerzas Armadas Revolucionarias de Colombia (“FARC”), who controlled cocaine production in vast areas of Colombia and Venezuela.
CARVAJAL BARRIOS held multiple positions of public trust in Venezuela that he exploited to benefit the Cártel de Los Soles, including as director of DIM between approximately 2004 and 2011. CARVAJAL BARRIOS took advantage of that position to illegally traffic narcotics and support his drug trafficking partners, the FARC. In or about 2006, for example, CARVAJAL BARRIOS coordinated with other members of the Cártel de Los Soles to dispatch a 5.6-ton cocaine shipment from Venezuela on a private jet bearing a United States registration number. The jet departed Venezuela and landed in Mexico, where Mexican authorities seized the 5.6 tons of cocaine upon arrival. In or about 2008, CARVAJAL BARRIOS attended a meeting with a FARC representative at which it was agreed that the Cártel de Los Soles would provide the FARC with cash and weapons in exchange for increased cocaine production.
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CARVAJAL BARRIOS, 63, a Venezuelan national, is charged with: (i) participating in a narco-terrorism conspiracy, which carries a mandatory minimum sentence of 20 years in prison and a maximum sentence of life in prison; (ii) conspiring to import cocaine into the United States, which carries a mandatory minimum sentence of 10 years in prison and a maximum sentence of life in prison; (iii) using, carrying, and possessing machineguns and destructive devices in connection with the narco-terrorism and cocaine importation conspiracies, which carries a mandatory minimum sentence of 30 years in prison and a maximum sentence of life in prison; and (iv) conspiring to use, carry, and possess machineguns and destructive devices in connection with the narco-terrorism and cocaine importation conspiracies, which carries a maximum sentence of life 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 defendant will be determined by the judge.
Mr. Williams praised the outstanding efforts of the DEA’s Special Operations Division Bilateral Investigations Unit, Miami Field Division, and Madrid Country Office; Homeland Security Investigations; the U.S. Treasury Department, Office of Foreign Assets Control; the Counterterrorism Section of the Department of Justice’s National Security Division; and the U.S. Attorney’s Office for the Southern District of Florida. The Department of Justice’s Office of International Affairs and U.S. Embassy Madrid worked with law enforcement partners in Spain, including the Spanish National Police, Spain’s Antidrug Special Prosecutor’s Office, Spain’s Ministry of Justice, and Spain’s Ministry of Interior, to secure the arrest and extradition of CARVAJAL BARRIOS.
This prosecution is being handled by the Office’s National Security and International Narcotics Unit. Assistant U.S. Attorneys Jason A. Richman, Kaylan E. Lasky, and Kyle A. Wirshba are in charge of the prosecution, with assistance from Trial Attorney Kevin C. Nunnally of the Counterterrorism Section.
The charges contained in the Indictments 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 Indictments and the description of the Indictments set forth herein constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Carvajal Barrios IndictmentsEx Funcionario Venezolano Hugo Armando Carvajal Barrios Extraditado A Estados Unidos Acusado Por Narcoterrorismo, Armas Y NarcotráficoRead the Press Release
Damian Williams, Fiscal Federal para el Distrito Sur de Nueva York, y Anne Milgram, Administradora de la Drug Enforcement Administration («DEA») de Estados Unidos, anunciaron que al ex funcionario de gobierno de Venezuela HUGO ARMANDO CARVAJAL BARRIOS, alias «El Pollo», se le extraditó hoy de España a Estados Unidos bajo Acusación Formal, radicada en el Distrito Sur de Nueva York, que le imputa a CARVAJAL BARRIOS concierto para delinquir con actos de narcoterrorismo e importación de cocaína a Estados Unidos, y cargos afines por armas. CARVAJAL BARRIOS comparecerá mañana ante el Juez de Instrucción Stewart D. Aaron. A CARVAJAL BARRIOS lo arrestaron en España el 9 de septiembre de 2021.
El Fiscal Federal Damian Williams declaró: «Después de muchos años de prófugo que le siguieron a una carrera de diez años en el mundo criminal, Hugo Armando Carvajal llegó hoy a Estados Unidos a enfrentar justicia por los crímenes que se alega cometió, los cuales se cometieron con intención de ‘inundar’ Estados Unidos con toneladas de drogas potencialmente mortíferas. Según se alega, Carvajal Barrios explotó su autoridad como director de la agencia de inteligencia militar de Venezuela para corromper instituciones venezolanas, abusar del pueblo venezolano e importar veneno a Estados Unidos. El papel de mando que se le atribuye en el Cártel de Los Soles le infirió angustia y sufrimiento incomensurables a muchos venezolanos, estadounidenses y otros que se vieron afectados por la violencia y actividades de narcotráfico del cártel. Mis encomios para los fiscales de este despacho y nuestros aliados en las agencias del orden público por su incansable labor en este caso importante».
La Administradora de la DEA Anne Milgram declaró: «A los funcionarios corruptos como Carvajal, de quienes se alega que se valen de su puesto para aceptar sobornos e impulsar actividades de narcotráfico, se les debe aplicar toda la fuerza de la ley. Según se alega, Carvajal abandonó su responsabilidad para con el pueblo venezolano y explotó su puesto para beneficio personal. La DEA y nuestros aliados estamos unidos para traer ante la justicia a cualquier persona, irrespectivamente de su puesto, que pone en peligro la seguridad y salud del pueblo de Estados Unidos».
Según los alegatos plasmados en las Acusaciones Formales, otros radicados y declaraciones vertidas durante trámites judiciales:1
A partir de 1999 sino antes, CARVAJAL BARRIOS, ciudadano venezolano y ex director de la agencia de inteligencia militar de Venezuela, llamada la Dirección de Inteligencia Militar («DIM»), junto a otros funcionarios venezolanos de alto rango, obraron en calidad de cabecillas y gerentes del Cártel de Los Soles, nombre que alude a los emblemas del sol que adornan los uniformes de oficiales militares venezolanos de alto rango. CARVAJAL BARRIOS y otros miembros del cártel abusaron del pueblo venezolano y corrompieron las instituciones legítimas de Venezuela — entre ellas sectores del ejército, el aparato de inteligencia, la legislatura y el sistema judicial — para facilitar la importación de toneladas de cocaína a Estados Unidos. El Cártel de Los Soles procuró no solo enriquecer a sus miembros y acrecentarles el poder sino también ‘inundar” Estados Unidos con cocaína para inferirle los efectos dañinos y adictivos a los consumidores en Estados Unidos. Para lograr estas metas, los cabecillas del Cártel de Los Soles se mancomunaron con altos mandos de las Fuerzas Armadas Revolucionarias de Colombia (FARC), que controlaba la producción de cocaína en extensas regiones de Colombia y Venezuela.
CARVAJAL BARRIOS ostentó varios puestos de alta responsabilidad pública en Venezuela que explotó para beneficio del Cártel de Los Soles, incluido el de director de DIM entre 2004 y 2011, aproximadamente. CARVAJAL BARRIOS aprovechó ese puesto para traficar ilegalmente con sustancias narcóticas y proteger a sus socios narcotraficantes, las FARC. En 2006 aproximadamente, por ejemplo, CARVAJAL BARRIOS coordinó con otros miembros del Cártel de Los Soles para enviar una carga de 5,6 toneladas de cocaína desde Venezuela abordo de un jet privado con registro en Estados Unidos. El jet salió de Venezuela y aterrizó en México, donde las autoridades mexicanas se incautaron de las 5,6 toneladas de cocaína en el momento de su llegada. En 2008 aproximadamente, CARVAJAL BARRIOS asistió a una reunión con un representante de las FARC en la cual se acordó que el Cártel de Los Soles le daría efectivo y armas a las FARC a cambio de un alza en la producción de cocaína.
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A CARVAJAL BARRIOS, de 63 años y ciudadano venezolano, se le acusa de: (i) participar en concierto para delinquir con narcoterrorismo, que conlleva sentencia mínima compulsoria de 20 años de prisión y máxima de cadena perpetua; (ii) concierto para delinquir importando cocaína a Estados Unidos, que conlleva sentencia mínima compulsoria de 10 años de prisión y máxima de cadena perpetua; (iii) usar, portar y poseer ametralladoras y artilugios destructivos vinculados al narcoterrorismo y a un concierto para delinquir con la importación de cocaína, que conlleva sentencia mínima compulsoria de 30 años de prisión y máxima de cadena perpetua; y (iv) concierto para delinquir usando, portando y poseyendo ametralladoras y artilugios destructivos vinculados al narcoterrorismo y a un concierto para delinquir con la importación de cocaína, que conlleva sentencia máxima de cadena perpetua.
Las sentencias compulsorias mínimas y máximas en el caso presente están establecidas por el Congreso, y se incluyen aquí para fines informativos únicamente, puesto que la sentencia de todo acusado la determina el juez.
El Sr. Williams elogió los esfuerzos notables de la Unidad de Investigaciones Bilaterales de la División de Operaciones Especiales de la DEA, División de Campo de Miami, y el Despacho de Ultramar Madrid; las investigaciones del Departamento de Seguridad Interior; el Despacho de Control de Activos Extranjeros del Departamento del Tesoro de E.U.A.; la Sección Contraterrorismo, División de Seguridad Nacional del Departamento de Justicia; y la Fiscalía Federal para el Distrito Sur de la Florida. El Despacho de Asuntos Internacionales del Departamento de Justicia y la Embajada de EUA en Madrid trabajaron con aliados de las agencias del orden público en España, incluidas la Policía Nacional de España, el Despacho de la Fiscalía Especial Antidroga de España, el Ministerio de Justicia de España, y el Ministerio del Interior de España, para garantizar el arresto y la extradición de CARVAJAL BARRIOS.
Esta causa judicial está asentada en la Unidad de Seguridad Nacional y Narcotráfico Internacional del ya citado Despacho. Los Fiscales Federales Auxiliares Jason A. Richman, Kaylan E. Lasky y Kyle A. Wirshba llevarán el caso con la asistencia del Abogado Litigador Kevin C. Nunnally de la Sección Contraterrorismo.
Las acusaciones contenidas en las Acusaciones Formales son sencillamente acusaciones, y se presume del acusado que es inocente a no ser, y hasta que, se demuestre que es culpable.
1 Conforme el significado de la frase preliminar, el texto entero de las Acusaciones Formales y descripciones de las mismas aquí contenidas constituyen solamente alegatos, y todo acto descrito debo tratarse como alegato.
U.S. v. Carvajal Barrios Acusaciones FormalesFormer Pastor Sentenced to Five Years in Prison for Receipt of Child PornographyRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced today that FRANCIS HUGHES, a former pastor at a religious institution in Queens, New York, was sentenced to five years in prison by U.S. District Judge Philip M. Halpern for his receipt of images of child pornography from a 15-year-old minor in Westchester, New York, with whom HUGHES was engaging in sexually explicit text communications. HUGHES pled guilty on August 16, 2022, before Judge Halpern.
According to documents filed in this case and statements made in related court proceedings:
On February 16, 2020, HUGHES communicated by text messages with a 15-year-old boy (“Minor-1”). During the course of the text communications, among other things, Minor-1 sent HUGHES three images of Minor-1’s penis. Upon receiving one of the images, HUGHES responded, among other things, “Yummmmm I will suck you so much” and “Make you cum.” During the communications, HUGHES told Minor-1 that he was a part-time college professor and a counselor.
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In addition to the prison term, HUGHES, 68, of Glendale, New York, was sentenced to 10 years of supervised release.
Mr. Williams praised the efforts of the Federal Bureau of Investigation and the Greenburgh Police Department in connection with this investigation.
The prosecution is being handled by the Office’s White Plains Division. Assistant U.S. Attorney Marcia S. Cohen is in charge of the prosecution.
CEO of Cryptocurrency and Forex Trading Platform Sentenced to Nine Years in Prison for $240 Million Scheme to Defraud InvestorsRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced today that EDDY ALEXANDRE was sentenced by U.S. District Judge John P. Cronan to nine years in prison for engaging in commodities fraud. ALEXANDRE was the leader of a purported cryptocurrency and foreign exchange (“forex”) trading platform called EminiFX, and he defrauded over 25,000 investors in the EminiFX trading platform of more than $248 million.
U.S. Attorney Damian Williams said: “Eddy Alexandre defrauded tens of thousands of ordinary investors of almost a quarter-billion dollars in his cryptocurrency investment scam. Alexandre’s fraud was brazen and included fabricating weekly investment returns of at least 5% out of thin air and falsely claiming to use artificial intelligence trading technology that did not even exist. Most egregiously, Alexandre recruited many of his investors by exploiting his position of trust within his church and the Haitian community, even going so far as to enlist members of the church to help recruit EminiFX investors. As today’s sentence demonstrates, cryptocurrency executives who lie and cheat their customers will be held to account for their crimes.”
According to the allegations in the Indictment and other filings and statements made in court:
From in or about September 2021, up to and including in or about May 2022, ALEXANDRE operated EminiFX, Inc. (“EminiFX”), a purported investment platform that ALEXANDRE founded, and for which he solicited more than $248 million in investments from over 25,000 individual investors. ALEXANDRE marketed EminiFX as an investment platform through which investors would earn passive income through automated investments in cryptocurrency and forex trading. ALEXANDRE offered his investors “guaranteed” high investment returns using new technology that he claimed was secret. Specifically, ALEXANDRE falsely represented to investors that they would double their money within five months of investing by earning at least 5% weekly returns on their investment using a “Robo-Advisor Assisted account” to conduct trading. ALEXANDRE referred to this technology as his “trade secret” and refused to tell investors what the technology was. Each week, EminiFX’s website falsely represented to investors that they had earned at least 5% on their investment, which they could withdraw or re-invest.
In truth and in fact, and as ALEXANDRE well knew, EminiFX did not earn 5% weekly returns for its investors. ALEXANDRE did not even invest a substantial portion of the investor funds entrusted to him, and ALEXANDRE sustained millions of dollars in losses on the limited portion of funds that he did invest, which he did not disclose to his investors. Instead of using investors’ funds as he had promised, ALEXANDRE also misdirected at least approximately $14,700,000 to his personal bank account. For example, ALEXANDRE used $155,000 in investor funds to purchase a BMW car for himself and spent an additional $13,000 of investor funds on car payments, including to Mercedes Benz.
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In addition to his prison term, ALEXANDRE, 51, of Valley Stream, New York, was sentenced to three years of supervised release and ordered to pay forfeiture in the amount of $248,829,276.73 and restitution in the amount of $213,639,133.53.
Mr. Williams praised the investigative work of the Federal Bureau of Investigation and also thanked the Commodity Futures Trading Commission, which brought a separate civil action.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Nicholas Folly and Jared Lenow are in charge of the prosecution.
Statement of U.S. Attorney Damian Williams on Intention to File for Contempt and Seek A Court-Appointed Receiver to Address Conditions on Rikers IslandRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced his Office’s intention to seek the appointment of a receiver to address the ongoing risk of harm to both incarcerated individuals and Department of Correction (“DOC”) Staff.
U.S. Attorney Damian Williams said: “Rikers Island has been in crisis for years. This is a collective failure with deep roots, spanning multiple mayoral administrations and DOC commissioners. But after eight years of trying every tool in the toolkit, we cannot wait any longer for substantial progress to materialize. That is why my Office will seek a court-appointed receiver to address the conditions on Rikers Island.”
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In 2015, the United States entered into a consent decree with the City of New York and the DOC to address violations of the constitutional rights of incarcerated individuals at Rikers Island (the “Consent Decree”). The Consent Decree required DOC to develop and implement a wide range of reforms to reduce the level of violence in the jails and ensure the safety and well-being of people in custody as well as corrections officers. Over the past eight years, this Office has worked diligently with the Monitor appointed pursuant to the Consent Decree and all parties to address the ongoing unsafe conditions on Rikers Island. After multiple remedial orders and an Action Plan that has been in place for over a year, on July 10, 2023, the Monitor found that despite some progress in certain areas, DOC has not made “substantial and demonstrable progress in implementing the reforms, initiatives, plans, systems, and practices as outlined in the Action Plan” and “there has not been a substantial reduction in the risk of harm currently facing incarcerated individuals and Department staff.” In light of these findings, this Office has decided to pursue contempt proceedings and seek additional relief from the Court, including the appointment of a receiver, to address the ongoing risk of harm to both incarcerated individuals and DOC staff. If appointed, the receiver would report to the Court and have independent authority to take necessary steps to comply with core provisions of the Consent Decree and other Court-ordered relief.
Statement of U.S. Attorney Damian Williams on the Arrest of Sophia MarksRead the Press Release
“Last night, my Office, the Southern District of New York, authorized the arrest of Sophia Marks in connection with her distribution of fake oxycodone pills that contained fentanyl. At least one of Marks’s counterfeit pills was purchased and taken by a teenager who subsequently died of a suspected overdose. The arrest was critical because, as we allege, Marks knew the pills could kill, and she continued selling them anyway. The investigation is ongoing.
Fentanyl is now the number one killer of Americans between the ages of 18 and 49. More than cancer, car accidents, or gun violence. It is a law enforcement crisis and a public health crisis. And we are doing everything we can to stop it.”
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SOPHIA MARKS, 20, of New York, New York, is charged with one count of distributing and possessing with intent to distribute fentanyl and alprazolam, which carries a maximum sentence of 20 years in prison, and two counts of distributing and possessing with intent to distribute fentanyl, each of which also carry 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 defendant will be determined by the judge.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
U.S. v. Marks ComplaintInternational Tax Advisor Arrested for Helping to Conceal over $100 Million of Income for High-Net-Worth U.S. TaxpayersRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Thomas Fattorusso, the Special Agent in Charge of the New York Field Office of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), announced the indictment of FRANK BUTSELAAR for participating in a conspiracy to engage in tax fraud over the course of over seven years. BUTSELAAR was an advisor to high-net-worth DJs and fashion industry clients who earned income all over the world (the “Clients”). The Clients earned millions of dollars every year. In certain years, these Clients became U.S. tax residents, meaning they had a legal obligation to pay U.S. taxes on their worldwide income. BUTSELAAR, working with other professionals, devised a strategy to unlawfully conceal from the U.S. Government millions of dollars of income the Clients were earning outside the United States during years they were U.S. tax residents. After having been arrested earlier this year following a request from the United States to Italy for provisional arrest for purposes of extradition, BUTSELAAR was taken back into custody earlier this week in Italy following a favorable ruling on the U.S. extradition request.
U.S. Attorney Damian Williams said: “As alleged, this defendant and his co-conspirators devised strategies to file false and fraudulent returns with the IRS for U.S. taxpayers of incredible means. Butselaar, as a tax advisor to many wealthy clients, knew intimately the responsibility his clients had to pay U.S. taxes on their income but ignored this obligation, opting instead to deceptively hide this income from the IRS. Our Office will continue to pursue those who use their expertise to unlawfully conceal income.”
IRS-CI Special Agent in Charge Thomas Fattorusso said: “Butselaar thought he was above the law. It’s alleged he operated this international fraud scheme to conceal millions of dollars in income earned by his high-profile clients around the world. This wasn’t just a get rich quick scheme, but rather Butselaar sought to play the long game and used a variety of sophisticated techniques to perpetuate this tax fraud over the course of several years. IRS-CI has a global reach, and we thank our J5 collaborators for their valuable partnership on this case. For Butselaar, it’s time to pay the tab.”
As alleged in the Indictment unsealed in White Plains federal court:[1]
FRANK BUTSELAAR conspired to defraud the United States and to conceal from the IRS through fraudulent, deceitful, and dishonest means the existence of millions of dollars of worldwide income generated by various clients, including Client-1 and Client-2, who are internationally renowned DJs (the “DJ Clients”). The DJ Clients, in particular, utilized offshore entities that at all relevant times BUTSELAAR and his co-conspirators knew the DJ Clients beneficially owned and effectively controlled. These entities were, in turn, held by trusts that the DJ Clients established on the advice of BUTSELAAR and others (the “Offshore Structures”). As part of their efforts to conceal the DJ Clients’ worldwide income, BUTSELAAR and his co-conspirators created and implemented a fraudulent scheme to use straw beneficiaries to conceal the income held within the DJ Clients’ Offshore Structures from the IRS.
In addition, FRANK BUTSELAAR and his co-conspirators devised and implemented similar fraudulent schemes for certain fashion industry clients (the “Fashion Industry Clients”) that involved fraudulent transfers of the Fashion Industry Clients’ overseas companies to family members, knowing that the Fashion Industry Clients would maintain beneficial ownership of the overseas companies and the income therefrom.
The tax evasion schemes, created and implemented by FRANK BUTSELAAR and his co-conspirators, caused to be filed Forms 1040 for the DJ Clients and the Fashion Industry Clients (during the time those Clients were U.S. tax residents) that fraudulently omitted over $100 million in worldwide income earned by those Clients.
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BUTSELAAR, 63, of Naarden, Netherlands, was charged with one count of conspiracy to defraud the United States, which carries a maximum penalty of five years in prison, and five counts of aiding and abetting the filing of false tax returns, each of which carries a maximum penalty of three 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. Williams praised the outstanding investigative work of the IRS-CI and the Joint Chiefs of Global Tax Enforcement (“J5”). Mr. Williams also thanked the Justice Department’s Office of International Affairs and Italy’s Ministero della Giustizia, Arma dei Carabinieri, and Guardia di Finanza for their assistance.
The J5 works together to gather information, share intelligence, and conduct coordinated operations against transnational financial crimes. The J5 includes the Australian Taxation Office, the Canadian Revenue Agency, the Dutch Fiscal Intelligence and Investigation Service, His Majesty’s Revenue and Customs from the United Kingdom, and the IRS-CI from the U.S.
This case is being handled by the Office’s White Plains Division and Money Laundering and Transnational Criminal Enterprises Unit. Assistant U.S. Attorneys Shiva H. Logarajah and Nicholas S. Bradley 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 constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Butselaar IndictmentTwo Bronx Men Charged in Connection with Shooting of Five-Year-Old GirlRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, Edward Caban, the First Deputy Commissioner of the New York City Police Department (“NYPD”), and John DeVito, the Special Agent in Charge of the New York Field Division of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”), announced charges against AUSTIN MORRISHOW and CURTIS WHITE for possessing ammunition after conviction of a felony. MORRISHOW and WHITE were congregated outside on a busy sidewalk in the Bronx the Friday before the July Fourth holiday weekend when they fired multiple shots at three cars in the Bronx, New York, hitting and seriously injuring a five-year-old child sitting in the backseat of one of the cars. WHITE was arrested this morning in Hazleton, Pennsylvania, pursuant to a criminal Complaint and was presented earlier today in the Southern District of New York before U.S. Magistrate Judge Ona T. Wang. MORRISHOW remains at large.
U.S. Attorney Damian Williams said: “As alleged, the defendants fired two guns — with ammunition that they were not allowed to possess — multiple times at three fleeing cars with innocent passengers inside, including a five-year-old girl, who was shot in the back. These senseless acts of violence occurred in front of a memorial of someone shot and killed in the area just the day before. Let this be a message to those who plague our streets with gun violence: We will work tirelessly, swiftly, and unceasingly in coordination with our law enforcement partners to find you, wherever you are and whenever it may be, and we will bring you to justice.”
NYPD First Deputy Commissioner Edward Caban said: “We promised this little girl and her family that we would not rest until the criminals involved in her shooting were identified, located, and held accountable. True to our word, we vow that the actions of any repeat violent offender who uses an illegal gun on our streets will never be tolerated – there will always be consequences.”
ATF Special Agent in Charge John DeVito said: “Today’s arrest sends a clear message that violent criminals will be met with swift justice for their blatant criminal acts. Any shootings carried out on the streets of NYC are reprehensible let alone one that caused harm to innocent bystanders and a child. This callous disregard for life has no place in our communities, and ATF will work hand in hand with all our partners to ensure those responsible are held accountable.”
According to the allegations contained in the Complaint:[[1]]
On June 30, 2023, the victim — a five-year-old girl — was sitting in the backseat of her father’s tan sedan, which was double-parked in front of a residential building in the Bronx near a group of individuals who were gathered outside at a makeshift memorial for an individual who had been shot and killed just the day prior. The victim’s father, who was sitting in the driver’s seat of the car, was waiting for two friends to arrive to attend a car show in Queens. The two friends arrived at approximately 7:00 p.m. — one driving a silver sedan and the other driving a red minivan. A still image from surveillance footage is below with the three cars circled in red and the gathering circled in yellow:
As the driver of the silver sedan pulled next to the victim’s father, the driver of the silver sedan revved his engine. The victim’s father cautioned his friend not to accelerate the car to avoid the vehicle backfiring and the sound being mistaken for gunshots. But it was too late. The silver sedan backfired, causing the group of individuals — including MORRISHOW and WHITE — to scatter.
MORRISHOW took cover behind a parked vehicle and fired a .40 caliber pistol multiple times at the three cars, which began fleeing from the gunfire. A still image from surveillance video footage is below with MORRISHOW circled in red:
WHITE ran down the street after the fleeing cars, firing a .380 caliber pistol. A still image from surveillance video footage is below with WHITE circled in red:
After the victim’s father drove his daughter to safety a couple blocks away, he got out of his car to check on his daughter. Realizing that she had been shot in his back, he held her in his arms and yelled for somebody to call an ambulance. The driver of the silver car called 911. Minutes later, NYPD officers arrived and transported the victim to the hospital.
In the wake of the shooting, the NYPD recovered a .380 caliber firearm from an apartment unit that WHITE entered immediately after the shooting before exiting shortly thereafter. A photograph of the .380 caliber firearm recovered by the NYPD is below:
The NYPD also recovered seven .40 caliber shell casings from the vicinity of the parked car near where MORRISHOW fired his gun, as well as two .380 caliber shell casings from the street near where WHITE fired his gun. 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.
* * *
MORRISHOW, 25, and WHITE, 26, both of the Bronx, New York, are each charged with one count of possession of ammunition after a felony conviction, which carries a maximum sentence of 15 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. Williams praised the outstanding investigative work of the NYPD and the ATF and thanked the U.S. Marshals Service and the Bronx County District Attorney’s Office for their assistance.
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.
The charges contained in the Complaint are merely an accusation, 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.
U.S. v. Morrishow and White ComplaintCelsius Founder and Former Chief Revenue Officer Charged in Connection with Multibillion-Dollar Fraud and Market Manipulation SchemesRead the Press Release
Alexander Mashinsky, Founder and Former Chief Executive Officer of Celsius, Charged with Defrauding Celsius Customers, and Mashinsky and Roni Cohen-Pavon, Former Celsius Chief Revenue Officer, Charged with Manipulating the Market for Celsius Crypto Token
Celsius Network LLC Accepts Responsibility and Pledges to Continue Cooperating
Damian Williams, the United States Attorney for the Southern District of New York, and Christie M. Curtis, the Acting 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 ALEXANDER MASHINSKY, the founder and former Chief Executive Officer of Celsius Network LLC and their affiliated entities (collectively, “Celsius”), with securities fraud, commodities fraud, and wire fraud for defrauding customers and misleading them about core aspects of the company he founded, including Celsius’s success, profitability, and the nature of the investments Celsius made using customer funds. MASHINSKY and RONI COHEN-PAVON, Celsius’s former Chief Revenue Officer, are further charged with conspiracy, securities fraud, market manipulation, and wire fraud for illicitly manipulating the price of CEL, Celsius’s proprietary crypto token, all while secretly selling their own CEL tokens at artificially inflated prices.
On June 12, 2022, Celsius announced it was halting all customer withdrawals from the Celsius platform, at which time hundreds of thousands of Celsius customers — many of whom were retail investors — still had approximately $4.7 billion worth of crypto assets on the Celsius platform, none of which they could access. On or about July 13, 2022, Celsius filed for Chapter 11 bankruptcy. MASHINSKY was arrested earlier today and will be presented this afternoon before U.S. Magistrate Judge Ona T. Wang. COHEN-PAVON, an Israeli citizen and resident, is currently abroad. The case has been assigned to U.S. District Judge John G. Koeltl.
U.S. Attorney Williams also announced today that the United States has entered into a non-prosecution agreement (the “Agreement”) with Celsius pursuant to which Celsius has agreed to accept responsibility for its role in the fraudulent schemes. In entering into the Agreement, the Office considered the fact that Celsius is in Chapter 11 bankruptcy proceedings and is making efforts to maximize recovery for victims in connection with the bankruptcy, as well as the fact that Celsius dramatically improved its cooperation after the Government brought certain production failures to the attention of the Special Committee of Celsius’s Board of Directors.
U.S. Attorney Damian Williams said: “Exactly one year ago today, Celsius Network, a crypto platform that, at its height, managed approximately $25 billion in customer assets, filed for bankruptcy protection in the Southern District of New York. Over the course of the past year, we have worked quickly to get to the bottom of what led to Celsius’s collapse and to understand how a platform that advertised itself as the ‘safest place for your crypto’ could have left investors holding billions of dollars in losses. Today we have the answer. Today I am announcing the unsealing of an indictment charging Celsius’s founder and CEO, Alex Mashinsky, with orchestrating a scheme to defraud customers of Celsius through a series of false claims about the fundamental safety and security of the Celsius platform, and for participating in a scheme with Celsius’s Chief Revenue Officer, Roni Cohen-Pavon, to inflate the price of Celsius’s proprietary token, CEL. This case, like the others my Office has recently announced alleging fraud in the crypto economy, may appear complicated. But the message we send today is quite simple: if you rip off ordinary investors to line your own pockets, we will hold you accountable. Whether it’s old-school fraud or some new-school crypto scheme, it doesn’t matter one bit. It’s all fraud to us. And we’ll be here to catch it.”
FBI Acting Assistant Director in Charge Christie M. Curtis said: “As alleged in the indictment, Mashinsky and Cohen-Pavon knowingly engaged in complex financial schemes – deliberately misrepresenting the company’s business model and criminally manipulating the value of Celsius’s proprietary crypto token CEL – while serving in leadership roles at Celsius. The FBI will continue to ensure that anyone committing fraud and deceiving the public through the misrepresentations of a business’s financial standing or practice is held accountable.
According to the allegations in the Indictment unsealed today in Manhattan federal court and the stipulated facts in the Agreement:[1]
Celsius was a crypto asset platform that, among other things, allowed its customers to earn returns on their crypto assets in the form of weekly “rewards” payments, to take loans secured by their crypto assets, and to custody their crypto assets. Celsius billed itself as the “safest place for your crypto” and urged potential customers to “unbank” themselves by moving their crypto assets to Celsius. Celsius’s primary public offering was its “Earn” program, through which Celsius offered to deploy customers’ crypto assets to generate investment returns. In addition to its Earn program, Celsius offered retail investors a “Custody” program and a “Borrow” program, which allowed customers to receive retail loans in exchange for posting their crypto assets as collateral with Celsius.
MASHINSKY directly marketed Celsius to retail customers located in the United States and abroad. Throughout his tenure as CEO of Celsius, MASHINSKY repeatedly made public misrepresentations regarding core aspects of Celsius’s business and financial condition in order to induce retail customers to provide their crypto assets to Celsius and continue to use Celsius’s services. MASHINSKY misrepresented, among other things, the safety of Celsius’s yield-generating activities, Celsius’s profitability, the long-term sustainability of Celsius’s high rewards rates, and the risks associated with depositing crypto assets with Celsius.
As MASHINSKY falsely portrayed Celsius as a safe and secure institution, Celsius’s customer base grew exponentially. Many of those customers were retail investors rather than large institutions. By in or about the fall of 2021, Celsius had grown to become one of the largest crypto platforms in the world, purportedly holding approximately $25 billion in assets at its peak.
MASHINSKY, COHEN-PAVON, and others working at Celsius also orchestrated a yearslong scheme to mislead customers and market participants regarding the market value and interest in Celsius’s proprietary crypto token CEL. They did so by manipulating the price of CEL through causing Celsius to spend hundreds of millions of dollars purchasing CEL in the open market with the objective of artificially supporting and inflating the price of CEL. At various times during MASHINSKY’s tenure, MASHINSKY, COHEN-PAVON, and their co-conspirators also caused Celsius to use its own customer deposits to fund these market purchases of CEL in order to prop up CEL’s price, without disclosing this fact to Celsius’s customers.
Without Celsius’s aggressive and illegal price manipulation, the price of CEL would have been drastically lower. As COHEN-PAVON wrote to MASHINSKY in a private message exchanged during the scheme: “[T]he issue is that people are selling [CEL] and no one is buying except for us,” adding, “[t]he main problem was that the value was fake and was based on us spending millions (~8M a week and even more until February 2020) just to keep it where it is.”
To further the scheme to manipulate CEL, MASHINSKY also repeatedly made false and misleading public statements concerning the nature of Celsius’s market activity and the extent to which Celsius itself was responsible for artificially supporting and inflating the price of CEL. In certain instances, MASHINSKY and other Celsius executives also personally purchased CEL for the purpose of artificially supporting CEL’s price.
Artificially inflating the price of CEL allowed MASHINSKY, COHEN-PAVON, and other Celsius executives to sell their own CEL holdings for a substantial profit. MASHINSKY personally reaped approximately $42 million in proceeds from his sales of CEL, and COHEN-PAVON personally reaped at least $3.6 million in proceeds from his sales of CEL. At various times, MASHINSKY made false and misleading public statements about his own sales of CEL, claiming that he was not selling CEL, when, in reality, he was taking advantage of the upward price manipulation he had orchestrated by contemporaneously selling huge quantities of his CEL on the market, including, on occasion, to Celsius itself.
In the lead up to the June 12, 2022, “Pause” of Celsius customer withdrawals, MASHINSKY continued to assure Celsius customers that Celsius was in a strong financial position and had sufficient liquidity to meet all customer withdrawal demands. Even as he made these statements, however, MASHINSKY had removed approximately $8 million worth of his own non-CEL crypto assets from the Celsius platform.
* * *
A chart containing the names, ages, residences, charges, and maximum penalties for the individual defendants is 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 a judge.
Mr. Williams praised the outstanding work of the FBI. Mr. Williams further thanked the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission, each of which today filed parallel civil actions against MASHINSKY.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Adam Hobson, Allison Nichols, and Noah Solowiejczyk 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.
Defendant
Age
Residence
Charges
Maximum Potential Sentences
MASHINSKY
57
New York, New York
Securities fraud
(Count One)
Commodities fraud
(Count Two)
Wire fraud
(Count Three)
Conspiracy to commit securities fraud, market manipulation, and wire fraud
(Count Four)
Securities fraud
(Count Five)
Market manipulation
(Count Six)
Wire fraud
(Count Seven)
20 years
10 years
20 years
Five years
20 years
20 years
20 years
COHEN-PAVON
36
Israel
Conspiracy to commit securities fraud, market manipulation, and wire fraud
(Count Four)
Securities fraud
(Count Five)
Market manipulation
(Count Six)
Wire fraud
(Count Seven)
Five years
20 years
20 years
20 years
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth in this release constitute only allegations, and every fact described should be treated as an allegation.
Statement of Facts U.S. Mashinsky and Cohen-Pavon Indictment Celsius Non-Prosecution AgreementTwo Bronx Men Sentenced to Prison for Throwing Molotov Cocktails at Neighbors’ Cars and HousesRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced today that NAYEEM AHMED CHOWDHURY and DAVID MENDEZ were sentenced by U.S. District Judge John P. Cronan to six years and 27 months in prison, respectively, in connection with using glass bottles with ignitable liquid and lit wicks, commonly known as “Molotov cocktails,” in an attempt to set a car and an apartment building on fire in the Bronx, New York. CHOWDHURY previously pled guilty to possession of unregistered Molotov cocktails and was sentenced on June 15, 2023. MENDEZ previously pled guilty to conspiracy to possess unregistered Molotov cocktails and was sentenced today.
According to the allegations contained in the Complaint and court filings:
Just after 2:00 a.m. on June 8, 2022, after circling the block for at least an hour, CHOWDHURY and MENDEZ approached a vehicle that was parked in the front yard of an apartment building in the defendants’ neighborhood in the Bronx, New York. CHOWDHURY lit a Molotov cocktail and placed it underneath the vehicle as MENDEZ looked on. The defendants drove off to let the fire burn. Approximately 30 minutes later, CHOWDHURY and MENDEZ returned to the vehicle. MENDEZ lit a second Molotov cocktail and placed it under the vehicle as CHOWDHURY looked on. Approximately 30 minutes after the defendants drove away from the vehicle the second time, the owner of the vehicle observed the fire and, together with other individuals from the neighborhood, threw buckets of water on and around the vehicle to put out the flames. Photographs of the June 2022 incident are below, with the defendants circled in green and the victims’ buckets of water circled in red:
Around 7:00 a.m. on July 24, 2022, CHOWDHURY approached another residence in his neighborhood, lit a third Molotov cocktail, and hurled it at the residence. The Molotov cocktail hit a window and fell onto the front porch, where it burst into flames. The family that was sleeping inside the residence, including a husband, his pregnant wife, and their toddler, woke up from the loud crash against the window and immediately poured buckets of water onto the Molotov cocktail to put out the flames. Photographs of CHOWDHURY throwing the third Molotov cocktail at the residence in July 2022 are below:
* * *
In addition to their prison terms, CHOWDHURY, 36, and MENDEZ, 40, both of the Bronx, New York, were sentenced to three years of supervised release.
Mr. Williams praised the outstanding investigative work of the New York City Fire Department, the New York City Police Department, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
This case is being handled by the Office’s General Crimes Unit. Assistant U.S. Attorney Amanda C. Weingarten is in charge of the prosecution.
Rockland County Man Charged with Distributing Fentanyl That Resulted in Six Overdoses, Including Multiple DeathsRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, Frank A. Tarentino III, the Special Agent in Charge of the New York Division of the Drug Enforcement Administration (“DEA”), and Tom Walsh, the Rockland County District Attorney, announced today an Indictment charging JUSTIN TURNICK with distributing fentanyl that resulted in death or serious bodily injury to five victims between February 2020 and April 2022 in Rockland County, New York. TURNICK was arrested on these charges this morning and will be presented before U.S. Magistrate Judge Victoria Reznik this afternoon.
U.S. Attorney Damian Williams said: “Fentanyl is one of the foremost crises the United States faces today, as the leading cause of death for Americans ages 18 to 49. The fentanyl epidemic is lethally perpetuated by, among others, dealers like Justin Turnick who allegedly knowingly sell a drug that can be fatal to their customers. As alleged, Justin Turnick was well aware of the dangers of the poison he peddled as he had witnessed three of his victims overdose before his own eyes, but he continued to distribute the drug anyway. Turnick’s arrest re-emphasizes our efforts to prosecute and dismantle the entirety of the fentanyl supply chain and to take this poison off the streets of our communities.”
DEA Special Agent in Charge Frank A. Tarentino III said: “The DEA renamed overdoses to poisonings for one simple reason – drug traffickers are intentionally lacing all drugs with fentanyl, making today’s street drugs more lethal than ever. Fentanyl is responsible for killing more and more Americans at unprecedented rates. These six poisonings, including two deaths, allegedly linked to Turnick, underscore the devastation fentanyl traffickers have brought into our homes and exemplify law enforcement’s pursuit to bring those responsible to justice. I applaud the tireless work by our law enforcement partners, the U.S. Attorney’s Office for the Southern District of New York, and the DEA Westchester Resident Office Task Force.”
Rockland County District Attorney Tom Walsh said: “Today's indictment is an example of local and federal agencies working together to stem the tide of fatal fentanyl overdose deaths. My office, working with the New York Field Office of the DEA, is investigating and arresting the fentanyl dealers who are devasting our community. Fentanyl is killing people from all walks of life, every demographic and every ethnicity. In 2021, Rockland County reported 70 overdose deaths. That number is completely unacceptable. I commend the hard work of the Rockland County District Attorney's Drug Task Force, the DEA, and the prosecutors of the United States Attorney’s Office for the Southern District of New York.”
According to the allegations in the Indictment:[1]
At all times relevant to the Indictment, TURNICK engaged in the regular distribution of narcotics to members of his community in Rockland County, New York, including his friends, partners, and acquaintances. In particular, TURNICK knowingly distributed, among other narcotics, fentanyl — a deadly and highly potent opioid — in various forms, including fentanyl that had been packaged into pills, pure fentanyl, and fentanyl-laced powder.
TURNICK repeatedly distributed fentanyl despite knowing how dangerous the drug is. Between approximately February 2020 and April 2022, TURNICK’s fentanyl distribution was responsible for at least six overdoses, four of which TURNICK personally observed. The victims were between the ages of 19 and 24 at the time of their overdoses. Two victims died as a result of consuming fentanyl provided by TURNICK.
* * *
JUSTIN TURNICK, 25, of Congers, New York, is charged with two counts of narcotics distribution resulting in the deaths of Victim-1 and Victim-2, and four counts of narcotics distribution resulting in serious bodily injury to Victim-3, Victim-4 (who overdosed twice), and Victim-5. Each of these counts carries a mandatory minimum sentence of 20 years in prison and a maximum sentence of life 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 a judge.
Mr. Williams praised the outstanding work of the DEA’s Westchester Resident Office, the Clarkstown Police Department, and the Rockland County District Attorney’s Office. He also thanked the Ramapo Police Department, the Westchester County Police Department, the Yonkers Police Department, the Putnam County Sherriff’s Department, the Rockland County Sherriff’s Office, and the Orangetown Police Department for their support and assistance in this matter. Mr. Williams noted that the investigation is ongoing.
The case is being prosecuted by the Office’s White Plains Division. Assistant U.S. Attorneys Ryan W. Allison and Kathryn Wheelock 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, constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Turnick IndictmentFormer Yonkers Teacher Charged in Connection with Sexual Exploitation of Minor StudentRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Christie M. Curtis, 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 two-count Indictment charging SANDY CARAZAS-PINEZ with enticing a minor victim to engage in illegal sexual activity and production of child pornography. As alleged in the Indictment, CARAZAS-PINEZ, a former high school teacher in Yonkers, New York, enticed one of her students, who was only 16 years old at the time, to engage in sexual activity with CARAZAS-PINEZ and further induced the same student to participate in live-streamed sexually explicit conduct while on video calls with CARAZAS-PINEZ. CARAZAS-PINEZ was arrested this morning and will be presented in Manhattan federal court later today before U.S. Magistrate Judge Robert W. Lehrburger. The case has been assigned to U.S. District Judge John P. Cronan.
U.S. Attorney Damian Williams said: “As alleged, Sandy Carazas-Pinez exploited the trust placed in her as a teacher to sexually abuse a teenage student in her care. Today’s indictment makes clear that my Office will continue to tirelessly pursue sexual predators of all forms – especially those who are entrusted to care for children – and hold them accountable to the fullest extent under the law.”
FBI Acting Assistant Director in Charge Christie M. Curtis said: “As alleged, Ms. Carazas-Pinez, a former high school teacher, enticed one of her students to engage in sexual activity and live-stream sexually explicit conduct. Teachers are entrusted to protect children under their supervision, not bring them harm. As today’s action demonstrates, the FBI remains steadfast in our commitment to bring justice to those who prey upon our youth.”
According to the allegations in the Indictment unsealed today in Manhattan federal court:[1]
CARAZAS-PINEZ was a high school teacher at a school for kindergarten through 12th grade students located in Yonkers, New York (“School-1”). From in or about November 2022 through in or about February 2023, CARAZAS-PINEZ abused her position as a teacher at School-1 by inducing and attempting to induce a student (“Minor Victim-1”) at School-1 into a sexual relationship with CARAZAS-PINEZ. Minor Victm-1 was 16 years old at the time of the abuse.
CARAZAS-PINEZ singled out Minor Victim-1 for personal attention at School-1. In addition, CARAZAS-PINEZ induced Minor Victim-1 to engage in sexual activity with her by leading Minor Victim-1 to believe that they were in a romantic relationship.
CARAZAS-PINEZ used her personal cellphone to call, text, and video call Minor Victim-1 to arrange sexual encounters and to repeatedly induce Minor Victim-1 to engage in live-streamed sexually explicit conduct while on video calls with CARAZAS-PINEZ. In text messages with Minor Victim-1, CARAZAS-PINEZ referred to her sexual encounters with Minor Victim-1 and the live depictions of sexually explicit conduct she induced Minor Victim-1 to create as “gifts.”
CARAZAS-PINEZ also used her personal cellphone to send Minor Victim-1 sexually suggestive photographs of herself along with sexually explicit text messages. After sending the photographs and messages, CARAZAS-PINEZ instructed Minor Victim-1 to delete them and inquired repeatedly as to whether Minor Victim-1 had done so.
To facilitate their sexual encounters outside the premises of School-1, CARAZAS-PINEZ directed Minor Vicitim-1 in text messages to obtain day passes from School-1 to be permitted to leave campus. CARAZAS-PINEZ then met Minor Victim-1 at a location near School-1’s campus and drove Minor Victim-1 to another location. On multiple occasions, while parked in CARAZAS-PINEZ’s car at various locations, including in or around the Bronx, Yonkers, and Staten Island, New York, CARAZAS-PINEZ engaged in sexual intercourse and other sexual acts, and attempted to do so, with Minor Victim-1.
* * *
CARAZAS-PINEZ, 34, of Bethel, Connecticut, is charged with one count of enticing a minor victim to engage in illegal sexual activity, which carries a mandatory minimum sentence of 10 years in prison and a maximum sentence of life in prison, and one count of production of child pornography, which carries a mandatory minimum sentence of 15 years in prison and a maximum sentence of 30 years in prison.
The minimum and 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. Williams praised the efforts of the FBI and the New York City Police Department (“NYPD”) for their outstanding work on this matter, particularly the FBI-NYPD New York Child Exploitation and Human Trafficking Task Force. Mr. Williams also thanked the Richmond County District Attorney’s Office for their significant assistance and the Westchester County District Attorney’s Office, the Bronx County District Attorney’s Office, and the Yonkers Police Department for their assistance. He added that the investigation is ongoing.
Any individuals who believe they have information that may be relevant to this investigation should contact the FBI at 1-800-CALL-FBI or tips.fbi.gov.
The prosecution of this case is being handled by the Office’s Civil Rights Unit in the Criminal Division. Assistant U.S. Attorney Mitzi S. Steiner is 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 constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Carazas-Pinez IndictmentFather and Son Charged in Manhattan Federal Court with Multimillion-Dollar Cryptocurrency-Related CrimesRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Ivan J. Arvelo, the Special Agent in Charge of the New York Field Office of Homeland Security Investigations (“HSI”), announced today the arrest of EUGENE WILLIAM AUSTIN, JR., a/k/a “Hugh Austin,” for charges in connection with a scheme to steal money from investors and other victims by offering a variety of fraudulent cryptocurrency-related investment services, including sales of multimillion-dollar batches of cryptocurrency, marketing and advertising services, and short-term investments and loans. EUGENE AUSTIN was arrested on July 5, 2023, and was presented that same day before U.S. Magistrate Judge Jennifer E. Willis. Mr. Williams also announced the guilty plea of EUGENE AUSTIN’s son, BRANDON P. AUSTIN, who pled guilty on April 13, 2023, before U.S. District Judge P. Kevin Castel to participating in a money laundering conspiracy with his father, EUGENE AUSTIN, relating to his involvement in conducting financial transactions with the intent to conceal proceeds of fraud.
U.S. Attorney Damian Williams said: “This is the third case we are announcing this week to shed light on fraud in the cryptocurrency and digital asset ecosystem. As alleged, the father-son duo of Hugh and Brandon Austin engaged in a cryptocurrency fraud and money laundering scheme that victimized both sophisticated and novice cryptocurrency investors alike out of millions of dollars. They used the money from victims to fund a lavish lifestyle of travel, luxury hotels, and fancy restaurants. Thanks to the tenacity of HSI and the career prosecutors of this Office, Hugh Austin is now facing serious criminal charges for his alleged crimes, and Brandon Austin has already pled guilty.”
HSI Special Agent in Charge Ivan J. Arvelo said: “The charging of Hugh and Brandon Austin reflects our ongoing commitment to thwarting individuals involved in all types of financial crimes, especially those that affect the digital environment and subsequently impact the security of our economy. As alleged, these sophisticated scammers exploited the novelty of digital currency to defraud unsuspecting investors out of millions of dollars, while utilizing it as a cover to engage in illicit activity. HSI commends the prosecutorial team at the Southern District of New York’s Complex Frauds and Cybercrime Unit for their unwavering support.”
According to the allegations in the Complaint, which was unsealed today in Manhattan federal court, as well as publicly filed court documents and statements made at public court proceedings:[1]
EUGENE WILLIAM AUSTIN, JR. participated in a scheme with his son BRANDON P. AUSTIN and others to steal money from investors and other victims by fraudulently offering to, among other things: (i) serve as a broker for sales of large quantities of cryptocurrency at below-market exchange rates; (ii) provide short-term investments in cryptocurrency for purportedly high returns; and (iii) provide marketing and advertising services to small businesses, while knowing that, in fact, EUGENE AUSTIN and BRANDON AUSTIN would not provide the promised cryptocurrency, returns, or services. EUGENE AUSTIN also frequently sought personal loans from friends and acquaintances in connection with his purported cryptocurrency and investment businesses, falsely promising to pay lenders back with interest. In each instance, investors and lenders lost their money, and EUGENE AUSTIN and BRANDON AUSTIN frequently spent investors’ funds on personal expenses, including airline travel, luxury hotels, restaurants, and shopping, as well as nominal payments to victims to prolong the scheme. In total, EUGENE AUSTIN and BRANDON AUSTIN have caused more than $10 million in losses to over 20 victims. Below are several examples of victims defrauded by AUSTIN and BRANDON:
- In or about February 2018, EUGENE AUSTIN and BRANDON AUSTIN fraudulently induced a Japanese cryptocurrency company to conduct an interstate cryptocurrency transaction for approximately $600,000 worth of cryptocurrency, for the purported purchase of fundraising and marketing services, which were never provided to the victim.
- In or about August 2018, EUGENE AUSTIN and BRANDON AUSTIN fraudulently induced a partner at a California-based investment firm to send an interstate wire transfer of approximately $5 million to a Manhattan-based attorney, for the purported purchase of cryptocurrency, which was never provided to the victim.
- In or about September 2018, EUGENE AUSTIN and BRANDON AUSTIN fraudulently induced a cryptocurrency start-up company to send an interstate wire transfer of approximately $100,000 for a purported cryptocurrency investment opportunity with high returns; instead of using the funds as promised, EUGENE AUSTIN and BRANDON AUSTIN spent the money on gas, restaurants, hotels, flights, and cash withdrawals.
- In or about January 2019, EUGENE AUSTIN and BRANDON AUSTIN fraudulently induced the founder and chairman of a New Jersey- and Hong Kong-based cryptocurrency investment firm to send an interstate wire transfer of approximately $4 million to a Georgia-based attorney for the purported purchase of cryptocurrency, which was never provided to the victim.
- In or about June 2020, EUGENE AUSTIN and BRANDON AUSTIN embezzled approximately $776,000 that had been sent via an interstate wire transfer to the trust account of a New York-based real estate attorney for the purported purchase of cryptocurrency.
- In or about October 2021, EUGENE AUSTIN and BRANDON AUSTIN embezzled approximately $574,000 that had been sent via an interstate wire transfer to the bank account of a Manhattan-based investment firm for the purported purchase of cryptocurrency.
In connection with BRANDON AUSTIN’s guilty plea, he forfeited his rights and interest in a 2022 E-Pace P250 Jaguar, depicted below:
* * *
EUGENE WILLIAM AUSTIN, JR., 60, of Port Jefferson, New York, is charged with one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison; one count of conspiracy to commit money laundering, which carries a maximum sentence of 10 years in prison; and one count of conspiracy to commit interstate transportation of stolen property, which carries a maximum sentence of five years in prison.
BRANDON P. AUSTIN, 27, of Coram, New York, pled guilty to one count of conspiracy to commit money laundering, which carries a maximum penalty of 20 years in prison. In connection with the guilty plea, BRANDON AUSTIN also agreed to forfeit $3,406,450 and to make restitution to victims in the amount of $3,406,450. BRANDON AUSTIN is scheduled to be sentenced on September 6, 2023, at 12:00 p.m., by Judge Castel.
The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of each defendant will be determined by the judge.
Mr. Williams praised the investigative work of HSI.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Andrew K. Chan, Sarah Lai, and Olga I. Zverovich are in charge of the prosecution.
The charges contained in the Complaint are merely accusations and the defendant, EUGENE WILLIAM AUSTIN, JR., a/k/a “Hugh Austin,” 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 herein should be treated as an allegation.
U.S. v. Eugene Austin Complaint U.S. v. Brandon Austin InformationAttorney and Former Bank Director Convicted at Trial of Bank FraudRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that yesterday a federal jury found MENDEL ZILBERBERG guilty of five counts — conspiracy to commit bank fraud, bank fraud, conspiracy to make false statements to a bank, making false statements to a bank, and misapplication of bank funds — in connection with a scheme to obtain a fraudulent loan from Park Avenue Bank. The defendant was found guilty following a one-week trial before U.S. District Judge George B. Daniels. Sentencing is scheduled for November 29, 2023, before Judge Daniels.
U.S. Attorney Damian Williams said: “Mendel Zilberberg, while working as a practicing lawyer and serving as a director of Park Avenue Bank, ignored his duties and took advantage of the bank, viewing it as the object of his fraud scheme. Far from helping the bank through a tenuous moment in its existence, Zilberberg was focused on squeezing money out of it for himself, on the basis of lies. The bank collapsed just months after Zilberberg defrauded it.”
According to the allegations contained in the Indictment, the evidence offered at trial, and matters included in public filings:
In or about 2009, ZILBERBERG conspired with Aron Fried and others to obtain a fraudulent loan from Park Avenue Bank (the “Bank”). Knowing that the conspirators would not be able to obtain the loan directly, the conspirators recruited a straw borrower (the “Straw Borrower”) to make the loan application. The Straw Borrower applied for a $1.4 million loan from the Bank on the basis of numerous lies directed by ZILBERBERG and his coconspirators.
ZILBERBERG used his privileged position at the bank to ensure that the loan was processed promptly. Based on the false representations made to the Bank and ZILBERBERG’s involvement in the loan approval process, the Bank issued a $1.4 million loan to the Straw Borrower, which was quickly disbursed to the defendants through multiple bank accounts and transfers. In total, ZILBERBERG received more than approximately $500,000 of the loan proceeds. The remainder of the loan was split between Fried and another conspirator. The Straw Borrower received nothing from the loan. The loan ultimately defaulted, resulting in a loss of over $1 million.
On November 15, 2022, Fried pled guilty to conspiracy to commit bank fraud. On April 10, 2023, Judge Daniels sentenced Fried to one year and one day in prison.
* * *
ZILBERBERG, 65 of Monsey, New York, was convicted of conspiracy to commit bank fraud, which carries a maximum sentence of 30 years in prison; bank fraud, which carries a maximum sentence of 30 years in prison; conspiracy to make false statements to a bank, which carries a maximum sentence of five years in prison; making false statement to a bank, which carries a maximum sentence of 30 years in prison; and misapplying bank funds, which carries a maximum sentence of 30 years in prison. The maximum sentence ZILBERBERG faces on all of these charges is 125 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. Williams praised the outstanding investigative work of the Federal Bureau of Investigation and the Federal Deposit Insurance Corporation, Office of the Inspector General.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Dina McLeod, Daniel G. Nessim, and Kimberly Ravener, with the assistance of Paralegal Specialist Joseph Carbone, are in charge of the prosecution.
Allianz Global Investors U.S. Sentenced in Connection with Multibillion-Dollar Fraud SchemeRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that Allianz Global Investors U.S. LLC (“AGI”) was sentenced today by U.S. District Judge Colleen McMahon for a multi-year securities fraud involving a series of private investment funds managed by AGI. Those funds ultimately collapsed, leading to billions of dollars of investor losses. AGI previously pled guilty to one count of securities fraud.
U.S. Attorney Damian Williams said: “Telling the truth to investors is the core duty of an investment adviser. AGI violated that central tenet and deceived investors by materially understating the risk to which their assets were exposed. This Office and our law enforcement partners will be relentless in protecting investors, and this sentence should send a message to the industry: companies will be held responsible when they fail to implement safeguards and ensure that they uphold their duties to investors.”
According to court filings and statements made in court proceedings:
From at least in or about 2014 up through and including at least in or about March 2020, AGI, an investment adviser registered with the Securities and Exchange Commission (“SEC”), headquartered in New York City, and an indirect, wholly owned subsidiary of Allianz SE – one of the world’s largest financial services companies and one of the world’s largest insurance companies – engaged in a scheme to defraud investors in multiple private funds within AGI’s “Structured Alpha Funds.” The Structured Alpha Funds (the “Funds”) were among the most profitable groups of funds AGI managed and, at their height, held over $11 billion in assets under management. The Funds employed a complex options trading strategy that sought to provide investors with guaranteed returns, while managing risk. AGI deceived the Funds and their investors by understating the risk to which investors’ assets were exposed, and therefore how the returns they touted were actually generated.
In particular, in order to generate the Funds’ positive returns and attract and retain capital, AGI fraudulently misled investors regarding the risk taken on by the funds. Among other things, AGI misrepresented the hedging and other risk-mitigation strategies that were undertaken to protect investor funds. Investors also received documents altered to hide the riskiness of the Funds’ investments. Instead of managing the Funds as promised to investors, AGI deployed an investment strategy that prioritized returns over risk management in ways that were fundamentally inconsistent with representations made to investors. As a result of this scheme to defraud, investors’ funds were exposed to higher risk than promised, and investors were deprived of information about the true risks to which their investments were exposed.
After the market dislocations following the onset of the COVID-19 pandemic (the “COVID Crash”) in March 2020, the Funds lost in excess of $8 billion in market value and $3 billion in principal, faced margin calls and redemption requests, and ultimately were shut down. More than 100 investors were victims of this scheme, including, among others, pension funds for teachers, religious organizations, bus drivers, engineers, and other individuals, universities, and charitable organizations.
* * *
AGI was sentenced to financial penalties comprised of over $463 million in forfeiture, over $3.23 billion in restitution, and over $2.33 billion in fines. These amounts include restitution to the victims, the forfeiture of proceeds traceable to the fraud, and the forfeiture by AGI’s corporate parent of the dividends that were paid from AGI to its corporate parent that are traceable to the fraud. AGI has paid these financial penalties in full and has compensated victims of the conduct through settlements in civil litigation filed against AGI in an aggregate amount of over $5 billion.
Mr. Williams praised the outstanding work of the U.S. Postal Inspection Service. Mr. Williams further thanked the SEC, which is pursuing parallel civil actions.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Nicholas Folly, Margaret Graham, and Allison Nichols are in charge of the prosecution.
Senior Adviser to the Operator of the Silk Road Online Black Market Sentenced to 20 Years in PrisonRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that ROGER THOMAS CLARK, a/k/a “Plural of Mongoose,” a/k/a “Variety Jones,” a/k/a “VJ,” a/k/a “cimon,” was sentenced to 20 years in prison today for conspiring to distribute massive quantities of narcotics, arising out of his role as the top adviser to Ross Ulbricht, a/k/a “Dread Pirate Roberts,” the owner and operator of the “Silk Road” online illicit black market. During its operation from 2011 until 2013, Silk Road was used by thousands of drug dealers and other unlawful vendors to distribute illegal drugs and other illicit goods and services to more than 100,000 buyers and to launder hundreds of millions of dollars derived from those unlawful transactions. CLARK advised Ulbricht on all aspects of the enterprise, including urging and facilitating an attempted murder-for-hire. CLARK’s sentence was imposed by U.S. District Judge Sidney H. Stein. CLARK previously pled guilty before the late U.S. District Judge William H. Pauley III on January 30, 2020.
U.S. Attorney Damian Williams said: “Silk Road was a secret online marketplace for illegal drugs, computer hacking services, and a host of other criminal activity. Roger Thomas Clark was a central figure in helping to lead Silk Road and in advocating violence, even murder, to protect this digital drug empire. Today’s sentence is another reminder that criminal marketplaces, like Silk Road, are a road to prison.”
According to the allegations in the Superseding Indictment, court filings, statements made in court, and evidence presented during the 2015 trial of Ross Ulbricht, Silk Road’s founder:
Ulbricht created Silk Road in approximately January 2011 and owned and operated the underground website until it was shut down by law enforcement in October 2013. Silk Road emerged as the most sophisticated and extensive criminal marketplace on the Internet at the time and one of the first online marketplaces to exclusively use cryptocurrency to facilitate illegal transactions. Silk Road was massive in scope; there were more than 1.5 million transactions on the site, involving more than 115,000 buyer accounts and 3,000 seller accounts. These transactions had a total value of approximately $213 million, including more than $183 million in drug sales. The drugs sold on Silk Road included more than 82 kilograms of cocaine and 26 kilograms of heroin. Silk Road was also used to launder hundreds of millions of dollars deriving from these unlawful transactions. Silk Road was specifically designed to allow its users to buy and sell drugs and other illegal goods and services anonymously and outside the reach of law enforcement through the use of the Tor network and a Bitcoin-based payment system.
In his journal, Ulbricht described CLARK as a “real mentor” who advised Ulbricht about, among other things, security vulnerabilities in the Silk Road site, technical infrastructure, the rules that governed Silk Road users and vendors, and the promotion of sales on Silk Road, including the sales of narcotics. CLARK also provided advice to Ulbricht on developing a “cover story” to make it appear as though Ulbricht had sold Silk Road. In addition, CLARK assisted Ulbricht with hiring a programmer to help improve and maintain the infrastructure of Silk Road. CLARK also was responsible for gathering information to counter law enforcement’s efforts to investigate Silk Road. CLARK advised Ulbricht on how to protect the Silk Road criminal empire. For instance, when a Silk Road staff member was suspected of stealing approximately $350,000 in Bitcoin from the site, CLARK suggested to Ulbricht that Ulbricht commission a murder-for-hire. Ulbricht took that suggestion. Although the attempted murder-for-hire did not result in any harm to the intended target, Ulbricht paid the purported hitman $80,000 for the job.
* * *
In addition to his prison sentence, CLARK, 61, a citizen of Canada, was sentenced to three years of supervised release and ordered to forfeit $1,606,150.
Mr. Williams praised the outstanding joint efforts of the Federal Bureau of Investigation, the Internal Revenue Service - Criminal Investigation’s New York Field Office, Homeland Security Investigations (“HSI”) Chicago-O’Hare, the Drug Enforcement Administration’s New York Field Division, and the New York City Police Department. Mr. Williams also thanked the HSI Attaché Bangkok, the Royal Thai Police, and the U.S. Department of Justice’s Office of International Affairs for their support and assistance.
This case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Michael D. Neff and Vladislav Vainberg are in charge of the prosecution.
Former Security Engineer for International Technology Company Arrested for Defrauding Decentralized Cryptocurrency ExchangeRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, Chad Plantz, the Special Agent in Charge of the San Diego Field Office of Homeland Security Investigations (“HSI”), and Tyler Hatcher, the Special Agent in Charge of the Los Angeles Field Office of the Internal Revenue Service - Criminal Investigation (“IRS-CI”), announced the unsealing of an Indictment charging SHAKEEB AHMED with wire fraud and money laundering in connection with his attack on a decentralized cryptocurrency exchange (the “Crypto Exchange”). AHMED was arrested this morning in New York, New York, and will be presented this afternoon before U.S. Magistrate Judge Robert W. Lehrburger.
U.S. Attorney Damian Williams said: “This is the second case we are announcing this week to shed light on fraud in the cryptocurrency and digital asset ecosystem. As alleged in the indictment, Shakeeb Ahmed, who was a senior security engineer at an international technology company, used his expertise to defraud the exchange and its users and steal approximately $9 million in cryptocurrency. We also allege that he then laundered the stolen funds through a series of complex transfers on the blockchain where he swapped cryptocurrencies, hopped across different crypto blockchains, and used overseas crypto exchanges. But none of those actions covered the defendant’s tracks or fooled law enforcement, and they certainly didn’t stop my Office or our law enforcement partners from following the money.”
HSI Special Agent in Charge Chad Plantz said: “Financial crime strikes at the core of our national and economic banking security. With an attack of this magnitude, it’s crucial we ensure continued consumer confidence in our financial system. Ruthless and reckless attempts aimed to sabotage legitimate commerce for greed must be stopped. It’s cases like these that demonstrate HSI’s commitment and ability to work with a coalition of the willing to dismantle these complicated and technical fraud schemes and identify those responsible regardless of where they operate.”
IRS-CI Special Agent in Charge Tyler Hatcher said: “As alleged, Mr. Ahmed used his skills as a computer security engineer to steal millions of dollars. He then allegedly tried to hide the stolen funds, but his skills were no match for IRS Criminal Investigation's Cyber Crimes Unit. We, along with our partners at HSI and the Department of Justice, are at the forefront of cyber investigations and will track these fraudsters anywhere they try to hide and hold them accountable.”
As alleged in the Indictment:[1]
The Crypto Exchange was incorporated overseas and operates on the Solana blockchain. At all relevant times, the Crypto Exchange allowed users to exchange different kinds of cryptocurrencies and paid fees to users who deposited cryptocurrency to provide liquidity on the Crypto Exchange.
In July 2022, AHMED carried out an attack on the Crypto Exchange by exploiting a vulnerability in one of the Crypto Exchange’s smart contracts and inserting fake pricing data to fraudulently cause that smart contract to generate approximately $9 million dollars’ worth of inflated fees that AHMED did not legitimately earn, which fees AHMED was able to withdraw from the Crypto Exchange in the form of cryptocurrency. This conduct defrauded the Crypto Exchange and its users, whose cryptocurrency AHMED had fraudulently obtained. Additional details regarding the attack, including AHMED’s use of cryptocurrency “flash loans” to further defraud the Crypto Exchange, are described in the Indictment publicly filed today.
After he stole the fees he never legitimately earned, AHMED had communications with the Crypto Exchange in which he decided to return all of the stolen funds except for $1.5 million if the Crypto Exchange agreed not to refer the attack to law enforcement.
At the time of the attack, AHMED was a senior security engineer for an international technology company whose resume reflected skills in, among other things, reverse engineering smart contracts and blockchain audits, which are some of the specialized skills AHMED used to execute the attack.
AHMED laundered the millions in fees that he stole from the Crypto Exchange to conceal their source and ownership, including through (i) conducting token-swap transactions, (ii) “bridging” fraud proceeds from the Solana blockchain over to the Ethereum blockchain, (iii) exchanging fraud proceeds into Monero, an anonymized and particularly difficult cryptocurrency to trace, and (iv) using overseas cryptocurrency exchanges.
After the attack, AHMED searched online for information about the attack, his own criminal liability, criminal defense attorneys with expertise in similar cases, law enforcement’s ability to successfully investigate the attack, and fleeing the United States to avoid criminal charges. For example, approximately two days after the attack, AHMED conducted an internet search for the term “defi hack,” read several news articles about the hack of the Crypto Exchange, and visited several pages on the Crypto Exchange’s website. As another example, AHMED conducted internet searches or visited websites related to the charges in the indictment, including by searching for the term “wire fraud” and for the term “evidence laundering.” Finally, AHMED also conducted internet searches or visited websites related to his ability to flee the United States, avoid extradition, and keep his stolen cryptocurrency: he searched for the terms “can I cross border with crypto,” “how to stop federal government from seizing assets,” and “buying citizenship”; and he visited a website titled “16 Countries Where Your Investments Can Buy Citizenship . . .”
* * *
AHMED, 34, of New York, New York, is charged with wire fraud and money laundering, each of which carry 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 defendant will be determined by a judge.
Mr. Williams praised the outstanding work of HSI and IRS-CI. Mr. Williams also thanked the U.S. Attorney’s Office for the Southern District of California for their assistance in the investigation.
The case is being prosecuted by the Office’s Money Laundering and Transnational Criminal Enterprises Unit and Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys David R. Felton 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 constitute only allegations, and every fact described therein should be treated as an allegation.
U.S. v. Ahmed IndictmentU.S. Attorney Announces Charges Against Co-Director of Think Tank for Acting as an Unregistered Foreign Agent, Trafficking in Arms, Violating U.S. Sanctions Against Iran, and Making False Statements to Federal AgentsRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, Matthew G. Olsen, the Assistant Attorney General for National Security, and Christie M. Curtis, the Acting Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of an eight-count Indictment charging GAL LUFT with offenses related to willfully failing to register under the Foreign Agents Registration Act (“FARA”), arms trafficking, Iranian sanctions violations, and making false statements to federal agents. LUFT, a dual U.S.-Israeli citizen, was indicted on November 1, 2022, and arrested on February 17, 2023, in the Republic of Cyprus based on the charges in the Indictment. LUFT subsequently fled after being released on bail while extradition proceedings were pending and remains a fugitive.
U.S. Attorney Damian Williams said: “As alleged, Gal Luft, a dual U.S.-Israeli citizen and co-head of a Maryland think tank, engaged in multiple, serious criminal schemes. He subverted foreign agent registration laws in the United States to seek to promote Chinese policies by acting through a former high-ranking U.S. Government official; he acted as a broker in deals for dangerous weapons and Iranian oil; and he told multiple lies about his crimes to law enforcement. As the charges unsealed today reflect, our Office will continue to work vigorously with our law enforcement partners to detect and hold accountable those who surreptitiously attempt to perpetrate malign foreign influence campaigns here in the United States.”
FBI Acting Assistant Director in Charge Christie M. Curtis said: “As alleged, the defendant engaged in multiple schemes to evade sanctions and laws intended to protect our national security. The FBI is determined to defend our nation by enforcing laws designed to promote transparency of foreign influence within the United States.”
According to the allegations contained in the Indictment, other filings, public information, and statements made during court proceedings:[1]
For years, LUFT, a dual U.S.-Israeli citizen who serves as the co-director of a Maryland-based think tank, engaged, along with others, in multiple international criminal schemes.
First, LUFT conspired with others in an effort to act within the United States to advance the interests of the People’s Republic of China (“China”) as agents of China-based principals, without registering as foreign agents as required under U.S. law. As part of this scheme, while serving as the co-director of a Maryland-based non-profit think tank, LUFT agreed to covertly recruit and pay, on behalf of principals based in China, a former high-ranking U.S. Government official (“Individual-1”), including in 2016 while the former official was an adviser to the then-President-elect, to publicly support certain policies with respect to China without LUFT or Individual-1 filing a registration statement as an agent of a foreign principal with the Attorney General of the United States, in violation of FARA. Among other things, in the weeks before the 2016 U.S. presidential election, LUFT and a co-conspirator (“CC-1”), who is a Chinese national and worked for a Chinese nongovernmental organization affiliated with a Chinese energy company, created a written “dialogue” between CC-1 and Individual-1, in which LUFT wrote Individual-1’s responses and included information that was favorable to China. The dialogue was then published in a Chinese newspaper online and sent to, among others, individuals in the United States, including a journalist and professors at multiple U.S. universities. When LUFT was writing the dialogue, CC-1 told LUFT that “[i]n these articles, we do not want to spill all the beans yet, just enough to let ‘people’ know he [i.e., Individual-1] is in the corridor of power to be. Just broad stroke policy consideration that leaves plenty of room for interpretation and imagination to be filled in later.” After the purported “conversations” were published, LUFT told CC-1 that certain information, favorable to China, had been “tucked between the lines.” Shortly after the 2016 election, LUFT and CC-1 also discussed possible roles Individual-1 might have in the incoming U.S. administration and discussed Individual-1 taking a “silent trip” to China. LUFT responded that “[w]e are debating about his role in the new admin. There are all kinds of considerations . . .We should talk ftf [i.e., face-to-face] as there can be a supremely unique opportunity for china.”
Second, LUFT conspired with others and attempted to broker illicit arms transactions with, among others, certain Chinese individuals and entities. In his role as a broker or middleman, LUFT worked to find both buyers and sellers of certain weapons and other materials, without a license to do so as required under U.S. law, in violation of the Arms Export Control Act. Among other things, LUFT worked to broker a deal for Chinese companies to sell certain weapons to Libya, including anti-tank launchers, grenade launchers, and mortar rounds (which LUFT and his associates referred to in coded language as “toys”). LUFT also worked to broker deals for certain weapons to be sold to the United Arab Emirates, including aerial bombs and rockets. LUFT further worked to broker deals for certain weapons to be sold by a Chinese company to Kenya, including unmanned aerial vehicles (“UAVs”) – and specifically “strike” UAVs, which LUFT acknowledged “[t]he US doesn’t want to sell[, . . .] hence the opportunity.” LUFT also discussed brokering a deal for weapons to Qatar and told CC-1 that Israel was “not a good fit” as the middleman for the deal because it had the “[s]ame problem the [] Q [i.e., Qataris] have w uncle [i.e., the United States]. Need a third party. . . . I will activate.” In his role as a broker for illicit arms deals, LUFT worked on a commission basis and traveled to meetings and received and passed on documentation needed to secure the deals. During a voluntary interview with U.S. law enforcement in which he was asked questions about his involvement in arms trafficking, LUFT made multiple false statements, including that he had not sought to engage in or profit from arms deals.
Third, LUFT conspired with others and attempted to broker deals for Iranian oil – which he directed an associate to refer to as “Brazilian” oil in an effort to conceal the activity and evade sanctions – in violation of U.S. sanctions against Iran and the International Emergency Economic Powers Act. In his role as a broker or middleman, LUFT solicited buyers and passed on pricing and other information. One offer letter for Iranian oil that LUFT received noted that the “origin” of the oil was “Iranian / It can be presented as UAE origin without Iranian papers.” He also assisted in setting up meetings between Iranian representatives and a Chinese energy company for the purpose of discussing oil deals. During a voluntary interview with U.S. law enforcement in which he was asked about his role brokering deals in Iranian oil, LUFT made multiple false statements, including that he had tried to prevent oil deals with Iran and had not been present during meetings with the Chinese energy company and Iranians.
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LUFT, 57, a dual U.S.-Israeli citizen who formerly resided in both Maryland and Israel and is now a fugitive, has been charged with the following offenses, which carry the maximum prison terms listed below. The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant would be determined by a judge.
Count
Charge
Maximum Prison Term
One
Conspiracy to violate the Foreign Agents Registration Act
Five years
Two
Conspiracy to violate the Arms Export Control Act
Five years
Three
Violation of the Arms Export Control Act (relating to Libya)
20 years
Four
Violation of the Arms Export Control Act (relating to the United Arab Emirates)
20 years
Five
Violation of the Arms Export Control Act (relating to Kenya)
20 years
Six
Making false statements
Five years
Seven
Conspiracy to violate the International Emergency Economic Powers Act
20 years
Eight
Making false statements
Five years
Mr. Williams praised the outstanding investigative work of the FBI and its New York Field Office, Counterintelligence Division. Mr. Williams also thanked the Internal Revenue Service – Criminal Investigation, the Department of Justice’s National Security Division, and the Department of Justice’s Office of International Affairs for their assistance.
If you have any information about LUFT’s whereabouts, please contact your local FBI office or the nearest American Embassy or Consulate. Tips can be reported anonymously and can also be reported online at tips.fbi.gov.
This matter is being handled by the Office’s National Security and International Narcotics Unit. Assistant U.S. Attorneys Daniel C. Richenthal and Catherine Ghosh are in charge of the prosecution, with assistance from Trial Attorney Scott Claffee of the National Security Division’s Counterintelligence and Export Control Section.
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 Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Luft Indictment_As FiledDefendant Charged with Theft of Cryptocurrency and NFTs Through Spoofing of OpenSea MarketplaceRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Christie M. Curtis, the Acting Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced the unsealing of a four-count Indictment charging SOUFIANE OULAHYANE, a/k/a “Soufiane Oulahya,” for a scheme to impersonate the OpenSea marketplace in order to obtain unauthorized access to cryptocurrency and non-fungible tokens (“NFTs”). In September 2021, OULAHYANE stole approximately $450,000 worth of cryptocurrency and NFTs from a victim in Manhattan. OULAHYANE is currently in custody in Morocco for domestic Moroccan charges.
U.S. Attorney Damian Williams said: “As alleged, Soufiane Oulahyane used a common cybercrime technique to steal victim cryptocurrency and NFTs. ‘Spoofing’ is one of the oldest tricks in the criminal playbook. Oulahyane adapted this old tool for use in a new and developing arena – the crypto space. The charges unsealed today should serve as a reminder that digital assets, such as cryptocurrency and NFTs, are not immune from cyber fraudsters and that my Office is committed to prosecuting these fraudsters both here and abroad.”
FBI Acting Assistant Director in Charge Christie M. Curtis said: “Oulahyane is alleged to have operated a spoof website to gain unauthorized access to victims’ cryptocurrency wallets to steal their cryptocurrency and NFTs. The FBI is committed to holding all individuals who conduct malicious cyberattacks against U.S. interests accountable in the United States criminal justice system - no matter where in the world they are located.”
As alleged in the Indictment unsealed today in Manhattan federal court:[1]
In or about September 2021, SOUFIANE OULAHYANE, a/k/a “Soufiane Oulahya,” engaged in a scheme to “spoof” the login page to the OpenSea marketplace, the first and largest NFT marketplace. Through paid advertisements on a popular search engine, OULAHYANE caused his spoofed version of OpenSea to appear first in search results for “opensea.” The spoofed website was purposefully designed to look like the legitimate OpenSea login page in order to trick unsuspecting victims into thinking they were interfacing with the real OpenSea marketplace. However, when victims entered their login credentials or other private information on the spoofed site, their credentials were automatically sent to an email account controlled by OULAHYANE.
On or about September 26, 2021, a Manhattan-based victim (“Victim-1”) used a popular search engine to search for “opensea.” That search yielded a link that, unbeknownst to Victim-1, connected to OULAHYANE’s spoofed version of the OpenSea login page. Believing that the spoofed website was the legitimate OpenSea website, Victim-1 entered the seed phrase to their cryptocurrency wallet. By doing this, Victim-1 unwittingly transferred their seed phrase to OULAHYANE, giving access to Victim-1’s cryptocurrency wallet.
Almost immediately, OULAHYANE used Victim-1’s seed phrase to obtain unauthorized access to Victim-1’s cryptocurrency wallet. OULAHYANE then transferred the cryptocurrency from Victim-1’s wallet to another cryptocurrency wallet outside of Victim-1’s control. In addition, OULAHYANE sold approximately 39 of Victim-1’s NFTs on the OpenSea marketplace and transferred the fraudulent cryptocurrency proceeds to a wallet outside of Victim-1’s control. For example:
OULAHYANE sold an NFT from the “Bored Ape Yacht Club” series, depicted below, which Victim-1 had purchased for approximately 49 ETH.
OULAHYANE sold an NFT from the “Meebit” series, depicted below, which Victim-1 had purchased for approximately 9.88 ETH.
OULAHYANE sold an NFT from the “Bored Ape Kennel Club” series, depicted below, which Victim-1 had purchased for six ETH.
OULAHYANE sold an NFT from the “CryptoDad” series, depicted below, which Victim-1 had purchased for 1.789 ETH.
In total, OULAHYANE stole cryptocurrency and NFTs from Victim-1 that Victim-1 had paid approximately $448,923 to obtain.
* * *
OULAHYANE, 25, of Morocco, is charged with wire fraud, which carries a maximum sentence of 20 years in prison; the use of an unauthorized access device, which carries a maximum sentence of 10 years in prison; affecting transactions with an access device to receive something of value that is equal to or greater than $1,000, which carries a maximum sentence of 15 years in prison; and aggravated identity theft, which carries a mandatory consecutive sentence of two years in prison.
The maximum and mandatory 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. Williams praised the outstanding investigative work of the FBI.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney Nicholas W. Chiuchiolo is 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 constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Oulahyane IndictmentCo-Director of Think Tank Indicted for Acting as Unregistered Foreign Agent, Trafficking in Arms, Violating U.S. Sanctions Against Iran, and Making False Statements to Federal AgentsRead the Press Release
A dual U.S.-Israeli citizen who serves as the co-director of a Maryland-based think tank was indicted today for allegedly engaging in multiple international criminal schemes.
According to court documents, Gal Luft, 57, is charged in an eight-count indictment with offenses related to willfully failing to register under the Foreign Agents Registration Act (FARA), arms trafficking, Iranian sanctions violations and making false statements to federal agents. Luft was arrested on Feb. 17 in the Republic of Cyprus based on the charges in the indictment. Luft subsequently fled after being released on bail while extradition proceedings were pending and remains a fugitive.
According to the allegations contained in the indictment, for years, Luft conspired with others in an effort to act within the United States to advance the interests of the People’s Republic of China (China) as agents of China-based principals, without registering as foreign agents as required under U.S. law. As part of this scheme, while serving as the co-director of a Maryland-based nonprofit think tank, Luft agreed to covertly recruit and pay, on behalf of principals based in China, a former high-ranking U.S. government official (Individual-1), including in 2016 while the former official was an adviser to the then-President-elect, to publicly support certain policies with respect to China without Luft or Individual-1 filing a registration statement as an agent of a foreign principal with the Attorney General of the United States, in violation of FARA.
Among other things, in the weeks before the 2016 U.S. presidential election, Luft and a co-conspirator (CC-1), who is a Chinese national and worked for a Chinese nongovernmental organization affiliated with a Chinese energy company, created a written “dialogue” between CC-1 and Individual-1, in which Luft wrote Individual-1’s responses and included information that was favorable to China. The dialogue was then published in a Chinese newspaper online and sent to, among others, individuals in the United States, including a journalist and professors at multiple U.S. universities. When Luft was writing the dialogue, CC-1 told Luft that “[i]n these articles, we do not want to spill all the beans yet, just enough to let ‘people’ know he [i.e., Individual-1] is in the corridor of power to be. Just broad stroke policy consideration that leaves plenty of room for interpretation and imagination to be filled in later.” After the purported “conversations” were published, Luft told CC-1 that certain information, favorable to China, had been “tucked between the lines.” Shortly after the 2016 election, Luft and CC-1 also discussed possible roles Individual-1 might have in the incoming U.S. administration, and discussed Individual-1 taking a “silent trip” to China. Luft responded that “[w]e are debating about his role in the new admin. There are all kinds of considerations . . .We should talk ftf [i.e., face-to-face] as there can be a supremely unique opportunity for china.”
Second, Luft conspired with others and attempted to broker illicit arms transactions with, among others, certain Chinese individuals and entities. In his role as a broker or middleman, Luft worked to find both buyers and sellers of certain weapons and other materials, without a license to do so as required under U.S. law, in violation of the Arms Export Control Act. Among other things, Luft worked to broker a deal for Chinese companies to sell certain weapons to Libya, including anti-tank launchers, grenade launchers and mortar rounds (which Luft and his associates referred to in coded language as “toys”). Luft also worked to broker deals for certain weapons to be sold to the United Arab Emirates, including arial bombs and rockets. Luft further worked to broker deals for certain weapons to be sold by a Chinese company to Kenya, including unmanned aerial vehicles (UAVs) – and specifically “strike” UAVs, which Luft acknowledged “[t]he US doesn’t want to sell[, . . .] hence the opportunity.” Luft also discussed brokering a deal for weapons to Qatar, and told CC-1 that Israel was “not a good fit” as the middleman for the deal because it had the “[s]ame problem the [] Q [i.e., Qataris] have w uncle [i.e., the United States]. Need a third party. . . . I will activate.” In his role as a broker for illicit arms deals, Luft worked on a commission basis, and traveled to meetings and received and passed on documentation needed to secure the deals. During a voluntary interview with U.S. law enforcement in which he was asked questions about his involvement in arms trafficking, Luft made multiple false statements, including that he had just been checking prices for a friend and had not sought to engage in or profit from arms deals.
Third, Luft conspired with others and attempted to broker deals for Iranian oil – which he directed an associate to refer to as “Brazilian” oil in an effort to conceal the activity and evade sanctions – in violation of U.S. sanctions against Iran and the International Emergency Economic Powers Act (IEEPA). In his role as a broker or middleman, Luft solicited buyers and passed on pricing and other information. One offer letter for Iranian oil that Luft received noted that the “origin” of the oil was “Iranian / It can be presented as UAE origin without Iranian papers.” He also assisted in setting up meetings between Iranian representatives and a Chinese energy company for the purpose of discussing oil deals. During a voluntary interview with U.S. law enforcement in which he was asked about his role brokering deals in Iranian oil, Luft made multiple false statements, including that he had tried to prevent oil deals with Iran and had not been present during meetings with the Chinese energy company and Iranians.
Luft is charged with the following offenses, which carry the maximum prison terms listed below. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Count
Charge
Maximum Prison Term
One
Conspiracy to violate the Foreign Agents Registration Act
Five years
Two
Conspiracy to violate the Arms Export Control Act
Five years
Three
Violation of the Arms Export Control Act (relating to Libya)
20 years
Four
Violation of the Arms Export Control Act (relating to the United Arab Emirates)
20 years
Five
Violation of the Arms Export Control Act (relating to Kenya)
20 years
Six
Making false statements
Five years
Seven
Conspiracy to violate the International Emergency Economic Powers Act
20 years
Eight
Making false statements
Five years
The FBI New York Field Office and FBI’s Counterintelligence Division are investigating the case, with valuable assistance provided by the IRS-Criminal Investigation (IRS-CI) and the Justice Department’s Office of International Affairs.
Assistant U.S. Attorneys Daniel C. Richenthal and Catherine Ghosh for the Southern District of New York and Trial Attorney Scott Claffee of the National Security Division’s Counterintelligence and Export Control Section are prosecuting the case.
If you have any information about Luft’s whereabouts, please contact your local FBI office or the nearest American Embassy or Consulate. Tips can be reported anonymously and can also be reported online at tips.fbi.gov.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Former Partner of Investment Management Firm Arrested for $1.6 Million Investment Fraud SchemeRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York and Christie M. Curtis, 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 Indictment charging JOSHUA HENNER with wire fraud and aggravated identity theft. As alleged in the Indictment, HENNER, through false statements and representations, convinced victims to loan him at least $1.6 million for the purpose of investing in a start-up, while, in reality, misappropriating those funds for his own purposes. HENNER was arrested this morning and will be presented in Manhattan federal court later today before U.S. Magistrate Judge Jennifer E. Willis.
U.S. Attorney Damian Williams said: “As alleged, Joshua Henner defrauded his victims of over $1.6 million and used those funds to line his own pockets. Investment fraud schemes are all too common. Thanks to our partnership with the Federal Bureau of Investigation, Henner will now be held accountable for his conduct.”
FBI Acting Assistant Director in Charge Christie M. Curtis said: “The defendant is alleged to have to conducted an investment fraud scheme, based on misrepresentations and falsehoods, in order to misappropriate more than $1.6 million in investor funds. Investment fraud schemes cause harm to victims directly involved, but also weaken the public's faith in the financial marketplace. Investigating and holding the individuals responsible for complex financial schemes accountable remains a top focus for the FBI.”
As alleged in the Indictment[1]:
From at least in or about May 2022 through at least in or about December 2022, HENNER ran a scheme that defrauded victims out of at least $1.6 million. HENNER solicited and obtained funds from victims based on representations that he had been an angel investor in a start-up (the “Company”) and that he needed funds to purchase additional shares in the Company to maintain his investment position.
To induce victims to give him funds, HENNER routinely made materially false oral and written statements, including lies about his previous investment in the Company and his ownership interest in the Company. Without their knowledge or authorization, HENNER misappropriated his victims’ funds by, among other things, transferring the funds to himself and other individuals.
During and in relation to the scheme, HENNER used, without authorization, the name and email address of a lawyer purportedly involved in the investments to communicate via email with his victims and foster the illusion that he was using the funds that his victims lent him for their intended purposes.
* * *
HENNER, 35, of New York, New York, is charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison, and one count of aggravated identity theft, which carries a mandatory two-year consecutive sentence. The minimum and maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant would be determined by a judge.
Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation.
This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorney Brandon C. Thompson is 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.
U.S. v. Henner Indictment
[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 herein should be treated as an allegation.
U.S. Attorney Announces Charges in Four Separate Insider Trading Cases Against 10 Individuals, Including Drug Company Employees, Investment Firm Executive Director, and SPAC InvestorsRead the Press Release
Pfizer Employee and Associate Charged with Insider Trading Based on Non-Public Drug Trial Results for COVID-19 Treatment
Investment Firm Executive Director Charged with Insider Trading Based on Information Stolen from a Major Investment Bank
SPAC Investors Charged with Insider Trading by Exploiting Their Privileged Access to Information to Engage in Illegal Open Market Trades
Network of Individuals, Including Police Chief, Charged with Insider Trading Based on Inside Information About an Impending Merger
Damian Williams, the United States Attorney for the Southern District of New York, and Michael J. Driscoll, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced charges in four separate insider trading cases, collectively charging 10 defendants with securities fraud and other related charges. These cases involve trading based on confidential information misappropriated from entities and individuals in a variety of industries and reflect the U.S. Attorney’s Office for the Southern District of New York’s broad investigative reach and continued resolve to root out corruption in our financial markets. The defendants in these cases collectively generated more than $30 million dollars from illegal securities trading based on material, non-public information (“MNPI”) that was stolen from numerous sources.
U.S. Attorney Damian Williams said: “Insider trading is not a quick buck. It’s not easy money. It’s not a sure thing. It’s cheating. It’s a bad bet. It’s a ticket to prison. Because my Office, the Southern District of New York, is watching. And we’re working quickly to investigate and prosecute anyone who corrupts our financial markets. And we’ll keep at it as long as it takes. You can bet on that.”
FBI Assistant Director in Charge Michael J. Driscoll said: “The charges announced today center on the defendants’ alleged participation in illegal securities trading based on material, non-public information. Insider trading schemes not only yield ill-gotten gains for those directly involved but also damage the public’s faith in the fairness of our financial markets. Today’s announcement serves as a reminder to anyone attempting to tilt the balance in their direction using insider trading, investigating this illegal behavior is a top priority of the FBI.”
According to the allegations contained in the Indictments filed in federal court and other publicly available information:[1]
United States v. Amit Dagar and Atul Bhiwapurkar
In or about November 2021, AMIT DAGAR and ATUL BHIWAPURKAR participated in an insider trading scheme to reap illicit profits from options trading based on inside information about the results of clinical trials of Paxlovid, a medicine used to treat COVID-19. DAGAR was an employee of Pfizer Inc. (“Pfizer”) and assisted in managing the data analysis in certain clinical drug trials.
On or about November 4, 2021, DAGAR learned that a Pfizer trial of the drug Paxlovid, a medicine designed to treat mild to severe COVID‑19 infection, had produced positive results. The results were confidential and meant to remain so until Pfizer publicized them on or about November 5, 2021.
Later that same day, and while those results remained confidential, DAGAR purchased short-dated, out-of-the-money call options in Pfizer stock. DAGAR also tipped his close friend, ATUL BHIWAPURKAR, about the coming drug results and BHIWAPURKAR also purchased short-dated, out-of-the-money Pfizer call options that expired approximately two weeks later. BHIWAPURKAR also tipped another friend (“Individual-1”), who similarly purchased short-dated, out-of-the-money Pfizer call options that expired approximately three weeks later.
The next day, on or about November 5, 2021, and before the market opened, Pfizer publicly released results of its Paxlovid study. That same day, following the publication of the positive results, Pfizer’s stock price increased substantially, opening — and eventually closing — more than 10% higher than the prior day’s closing price. In the coming weeks, DAGAR, BHIWAPURKAR, and Individual-1 sold their Pfizer call options at significant profits, totaling approximately more than $350,000.
DAGAR, 44, of Hillsborough, New Jersey, who was arrested this morning, has been charged with four counts of securities fraud, each of which carries a maximum sentence of 20 years in prison, and one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years in prison.
BHIWAPURKAR, 45, of Milpitas, California, who was arrested this morning, has been charged with two counts of securities fraud, each of which carries a maximum sentence of 20 years in prison, and one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years in prison.
United States v. Jordan Meadow
From at least in or about March 2021 through in or about May 2022, JORDAN MEADOW, a registered broker at a brokerage firm based in New York, New York, used inside information stolen from a major investment bank in New York City (“the Investment Bank”) to make millions of dollars in illegal profits trading stock on behalf of himself and his clients. In or about late 2020, MEADOW offered and agreed to provide items of value, such as Rolex watches, to a friend, Steven Teixeira, in exchange MNPI that Teixeira obtained by secretly accessing confidential work documents on a personal laptop computer (the “Laptop”) belonging to Teixeira’s then-girlfriend, an executive assistant at the Investment Bank. The documents on the Laptop contained MNPI about planned corporate acquisitions in which the Investment Bank served as an advisor.
In or around late July 2021, Teixeira secretly accessed confidential work information on the Laptop and learned that in less than a week, Penn National Gaming, Inc. (“Penn National”), was going to acquire Score Media and Gaming Inc. (“Score”), a Canadian digital media company, for approximately $2.2 billion. Teixeira shared this MNPI with a friend, who in turn shared it with MEADOW. MEADOW then purchased more than 769 call option contracts in Score between August 2, 2021, and August 3, 2021, based on the MNPI and also advised a colleague at the brokerage firm where he worked, their clients, and a friend to purchase Score securities. After Penn National’s acquisition of Score was announced publicly on August 5, 2021, MEADOW, his colleague, their clients at the brokerage firm, and MEADOW’s friend sold their holdings in Score for a combined profit exceeding $5 million.
Later, in or around early March 2022, Teixeira secretly accessed confidential work information on his then-girlfriend’s laptop and learned about a planned corporate acquisition of VMWare, an enterprise software company, for approximately $65 billion. Teixeira shared this MNPI with his friend, who in turn shared it with MEADOW. MEADOW purchased over 5,000 shares of VMWare stock, as well as call options contracts in VMWare, between May 9, 2022, and May 18, 2022, and advised his colleague at the brokerage firm to purchase VMWare securities. After there was public reporting that Broadcom was in talks to acquire VMWare, the VMWare holdings of MEADOW and his colleague increased significantly, and they began to sell their VMWare holdings for a combined profit exceeding $100,000.
MEADOW, 34, of Warren, New Jersey, who was arrested this morning, has been charged with six counts of securities fraud under Title 15, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy, which carries a maximum sentence of five years in prison.
Also unsealed today were charges against Steven Teixeira, who has pled guilty pursuant to a cooperation agreement.
United States v. Michael Shvartsman, Gerald Shvartsman, and Bruce Garelick
In October 2021, MICHAEL SHVARTSMAN, GERALD SHVARTSMAN, and BRUCE GARELICK together made more than $22 million dollars in illegal profits by trading in securities of Digital World Acquisition Corporation (“DWAC”) based on MNPI about DWAC’s planned but not yet public business combination with a media company founded by former President Donald J. Trump.
As sophisticated investors, MICHAEL SHVARTSMAN, GERALD SHVARTSMAN, and BRUCE GARELICK were invited to invest in DWAC and another special purpose acquisition company (“SPAC”), and after signing non-disclosure agreements, they were provided confidential information about the SPACs, including that a potential target of the SPACs was Trump Media & Technology Group (“Trump Media”). As a condition of receiving this information, the defendants were prohibited by the non-disclosure agreements from disclosing the confidential information they learned or using it to buy and sell securities on the open market. After making initial investments into DWAC through the initial public offering process, GARELICK was given a seat on DWAC’s board of directors, which gave him access to valuable MNPI about DWAC’s plans to merge with Trump Media. After learning MNPI through his role on DWAC’s board, GARELICK provided updates to his alleged co-conspirators — which he called “intelligence” — about the status of the merger negotiations and the timing of a public merger announcement.
In violation of the non-disclosure agreements that they had signed, and in contravention of GARELICK’s duties and responsibilities as a board member, the defendants bought millions of dollars of DWAC securities on the open market before the news of the Trump Media business combination was public. In addition to their own purchases, the defendants also passed DWAC’s confidential information to their friends on a trip to Las Vegas, to MICHAEL SHVARTSMAN’s neighbors, and to GERALD SHVARTSMAN’s employees at a furniture supply store. After DWAC’s merger with Trump Media was announced publicly, the stock and warrant holdings of MICHAEL SHVARTSMAN, GERALD SHVARTSMAN, and BRUCE GARELICK, and those they tipped, significantly increased in value. The defendants and the individuals they tipped then sold their DWAC securities for a significant profit.
MICHAEL SHVARTSMAN, 52, of Sunny Isles Beach, Florida, who was arrested this morning, has been charged with five counts of securities fraud under Title 15, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy, which carries a maximum sentence of five years in prison.
GERALD SHVARTSMAN, 45, of Aventura, Florida, who was arrested this morning, has been charged with three counts of securities fraud under Title 15, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy, which carries a maximum sentence of five years in prison.
BRUCE GARELICK, 53, of Fort Lauderdale, Florida, who was arrested this morning, has been charged with five counts of securities fraud under Title 15, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy, which carries a maximum sentence of five years in prison.
United States v. Joseph Dupont, Shawn Cronin, Slava Kaplan, and Paul Feldman
In 2020, JOSEPH DUPONT, SHAWN CRONIN, SLAVA KAPLAN, a/k/a “Stanley Kaplan,” and PAUL FELDMAN engaged in an insider trading scheme surrounding the announcement of one pharmaceutical company’s acquisition of another. CRONIN, KAPLAN, and FELDMAN collectively made more than $2.2 million dollars in illegal profits by trading in stocks and options based on MNPI that DUPONT misappropriated from his employer.
DUPONT was a vice president at Alexion Pharmaceuticals, Inc. (“Alexion”) and, on January 31, 2020, was informed of Alexion’s upcoming acquisition of Portola Pharmaceuticals, Inc. (“Portola”). Before that acquisition was publicly announced, in April 2020, DUPONT provided MNPI about the acquisition to his childhood friend, CRONIN. Not only were CRONIN and DUPONT childhood friends, but also CRONIN — who, at the time, was a sergeant in the police department of Dighton, Massachusetts, and later served as the chief of police — supervised DUPONT in DUPONT’s capacity as a reserve officer in that police department. Based on the MNPI that DUPONT provided CRONIN, CRONIN purchased shares of Portola stock as well as out-of-the-money call options for Portola stock.
In turn, CRONIN shared MNPI about Portola’s pending acquisition with Jarett Mendoza, another childhood friend of both CRONIN’s and DUPONT’s. CRONIN also assisted Mendoza in purchasing Portola stock in the days before the acquisition was publicly announced.
CRONIN shared MNPI about Portola’s pending acquisition not only with Mendoza, but also with KAPLAN, a friend of CRONIN’s, who was also known to DUPONT. CRONIN shared the MNPI with KAPLAN both so that KAPLAN could trade in advance of the acquisition and so that KAPLAN would assist CRONIN in formulating trading strategies to maximize CRONIN’s own insider trading profits. Based on the MNPI that CRONIN gave to KAPLAN, KAPLAN bought Portola shares and options.
KAPLAN, in turn, shared MNPI about the upcoming acquisition with, among others, FELDMAN, a friend and colleague of KAPLAN’s. Based on the MNPI that KAPLAN gave FELDMAN, FELDMAN aggressively bought Portola call options.
FELDMAN, for his part, shared MNPI about the Portola acquisition with others, including a work colleague.
Alexion’s acquisition of Portola was publicly announced on the morning of May 5, 2020. Portola’s stock increased significantly in value. CRONIN, KAPLAN, FELDMAN, and their tippees sold their shares of Portola and call options for Portola stock, reaping millions of dollars of illegally obtained trading profits.
DUPONT, 44, of Rehoboth, Massachusetts, who surrendered to authorities today, has been charged with one count of Title 15 securities fraud and one count of tender offer fraud, each of which carries a maximum sentence of 20 years in prison, and one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison.
CRONIN, 43, of Dighton, Massachusetts, who surrendered to authorities today, has been charged with three counts of securities fraud under Title 15 and three counts of tender offer fraud, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy to commit securities fraud and tender offer fraud, which carries a maximum sentence of five years in prison;.
KAPLAN, 45, of Hopewell Junction, New York, who was arrested today, has been charged with three counts of securities fraud under Title 15 and three counts of tender offer fraud, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy to commit securities fraud and tender offer fraud, which carries a maximum sentence of five years in prison.
FELDMAN, 48, of Poughquag, New York, who was arrested today, has been charged with six counts of securities fraud under Title 15 and six counts of tender offer fraud, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy to commit securities fraud and tender offer fraud, which carries a maximum sentence of five years in prison.
Also unsealed today were charges against Jarett Mendoza, who has pled guilty pursuant to a cooperation agreement.
* * *
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 the judge.
Mr. Williams praised the outstanding investigative work of the FBI’s New York and Philadelphia Field Offices. He also thanked the Miami Field Office of the U.S. Department of Homeland Security, Homeland Security Investigations, for its assistance in the investigation in United States v. Michael Shvartsman, Gerald Shvartsman, and Bruce Garelick. He further thanked the Securities and Exchange Commission for its cooperation and assistance across these investigations.
These cases are being handled by the Office’s Securities and Commodities Fraud Task Force. United States v. Dagar and Bhiwapurkar is in the charge of Assistant U.S. Attorney Alex Rossmiller. United States v. Meadow is in the charge of Assistant U.S. Attorney Nicholas Folly. United States v. Michael Shvartsman, Gerald Shvartsman, and Bruce Garelick is in the charge of Assistant U.S. Attorneys Elizabeth Hanft, Nicolas Roos, and Matthew Shahabian. United States v. Dupont, Cronin, Kaplan, and Feldman is in the charge of Assistant U.S. Attorneys Samuel P. Rothschild, Sarah Mortazavi, and Margaret Graham.
The charges contained in the Indictments 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 Indictments and the description of the Indictments set forth below constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Dagar and Bhiwapurkar Indictment U.S. v. Meadow Indictment U.S. v. Shvartsman et al Indictment U.S. v. Dupont et al IndictmentRecidivist Defendant Pleads Guilty in Connection with Million-Dollar Fraud Scheme Targeting Senior Executives of Investment FirmsRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that JONATHAN GHERTLER pled guilty today before U.S. District Judge Edgardo Ramos in connection with his scheme to impersonate senior leaders of two Manhattan-based investment firms, resulting in over $1 million in losses to their portfolio companies, and to impersonating a partner of a global law firm on telephone calls with federal law enforcement agents who were investigating the scheme.
U.S. Attorney Damian Williams said: “Jonathan Ghertler defrauded companies of over $1 million by impersonating some of the most prominent figures in finance. But law enforcement got wind of his scheme. Again. And when Ghertler saw the writing on the wall, he brazenly impersonated a partner of a global law firm and tried to convince federal agents and an Assistant United States Attorney to drop their investigation. His efforts failed and his fraud was unraveled, as have all of Ghertler’s past frauds, thanks to the persistent work of the prosecutors of this Office and our law enforcement partners.”
According to the allegations in the Indictment and Complaint:
From at least in or about December 2021, up to and including at least June 2022, GHERTLER impersonated the General Counsel of a global private equity firm (the “Private Equity Firm”). In doing so, GHERTLER fraudulently caused the Private Equity Firm’s portfolio companies to pay at least $200,000 to fund a non-existent internal investigation into alleged links between senior employees of the Private Equity Firm and Jeffrey Epstein, the deceased financier who, before he died on or about August 10, 2019, had been charged in the Southern District of New York with sex trafficking of minors and conspiring to commit sex trafficking of minors.
In addition, from at least May 2021, up to and including February 2023, GHERTLER impersonated the founder of an investment firm (the “Investment Firm”), directing the Chief Executive Officer (the “CEO”) of one of the Investment Firm’s portfolio companies (the “IF Portfolio Company”) to make at least $865,000 in payments to fund a non-existent internal investigation related to the founder’s alleged relationship with Epstein. In recent weeks, GHERTLER, posing as the founder of the Investment Firm, had discussed with the CEO the possibility of making a large investment into a restaurant chain owned by another investment firm.
On or about February 7, 2023, after learning from the CEO that federal investigators were investigating a potentially fraudulent payment made by the Investment Firm, GHERTLER, posing as a partner (the “Partner”) at a global law firm, spoke on the phone with Special Agents with the Federal Bureau of Investigation (“FBI”). GHERTLER told the federal agents that the IF Portfolio Company had chosen not to report the fraud because it had been “made whole” by the fraudster.
On or about February 10, 2023, GHERTLER, impersonating the Partner, spoke again with federal agents. GHERTLER said, after “consult[ing]” with “associates and lower-level partners” at the Global Law Firm who “used to work” at the United States Attorney’s Office for the Southern District of New York, “our position is that, uh, the law states that, umm, you know, if the money was paid back prior to, uh, the crime being, uh, discovered, uh, it’s not a crime.” GHERTLER added that his “client [i.e., the founder of the Investment Firm] has a lot of other issues he is dealing with right now, so this is one he really doesn’t need to deal with.”
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GHERTLER, 60, of Orlando, Florida, pled guilty to one count of wire fraud, which carries a maximum sentence of 20 years in prison, and one count of making false statements, which carries a maximum sentence of five 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 a judge. Sentencing has been scheduled for August 9, 2023, at 11 a.m.
Mr. Williams praised the outstanding investigative work of the FBI.
This case is being handled by the Office’s General Crimes Unit. Assistant U.S. Attorney Adam Sowlati is in charge of the prosecution.
Nigerian Man Pleads Guilty in Manhattan Federal Court to Participating in Business Email Compromise ScamsRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced today that CHIBUNDU JOSEPH ANUEBUNWA, a citizen of Nigeria who was previously extradited from the United Kingdom, pled guilty today before U.S. District Judge Paul A. Crotty to wire fraud conspiracy in connection with his participation in fraudulent business email compromise scams that targeted thousands of victims around the world, including in the United States. In connection with the same conspiracy as ANUEBUNWA, co-defendant DAVID CHUKWUNEKE ADINDU was previously sentenced to 41 months in prison, and co-defendant ONYEKACHI EMMANUEL OPARA was previously extradited from South Africa and sentenced to 60 months in prison.
U.S. Attorney Damian Williams said: “As he has now admitted, Chibundu Joseph Anuebunwa participated in a conspiracy to trick thousands of business employees located all around the world into wiring millions of dollars to overseas bank accounts by sending bogus emails that appeared to be legitimate. This case should serve as a reminder to cyber criminals located around the globe that we will track them down and hold them responsible.”
According to publicly filed court documents and statements made at public court proceedings:
Between 2014 and 2016, ANUEBUNWA, OPARA, and ADINDU participated in business email compromise scams (“BEC scams”) targeting thousands of victims around the world, including in the United States. As part of the BEC scams, emails were sent to employees of various companies directing that funds be transferred to specified bank accounts. The emails purported to be from supervisors at those companies or third-party vendors that did business with those companies. The emails, however, were not legitimate. Rather, they were either from email accounts with a domain name that was very similar to a legitimate domain name, or the metadata in the emails had been modified so that the emails appeared as if they were from legitimate email addresses. After victims complied with the fraudulent wiring instructions, the transferred funds were quickly withdrawn or moved into different bank accounts. In total, the BEC scams attempted to defraud the victims of millions of dollars.
ANUEBUNWA and others carried out BEC scams by exchanging information regarding: (i) bank accounts used for receiving funds from victims; (ii) email accounts used for communicating with victims; (iii) scripts for requesting wire transfers from victims; and (iv) lists of names and email addresses for contacting and impersonating potential victims.
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ANUEBUNWA, 40, a citizen of Nigeria, pled guilty to one count of conspiracy to commit wire fraud, which carries a maximum penalty of 20 years in prison. ANUEBUNWA is scheduled to be sentenced by Judge Crotty on October 2, 2023, at 3:30 p.m.
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 the judge.
Mr. Williams praised the investigative work of the Federal Bureau of Investigation. Mr. Williams also thanked United Kingdom authorities and the Yahoo E-Crime Investigations Team for their assistance in the investigation. The U.S. Department of Justice’s Office of International Affairs provided significant assistance in securing the defendant’s extradition from the United Kingdom.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney Andrew K. Chan is in charge of the prosecution.
Turkish National Charged with Attack on Turkish Consulate in ManhattanRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, Carlos F. Matus, the Director of the U.S. Department of State’s Diplomatic Security Service (“DSS”), and Keechant L. Sewell, the Commissioner of the New York City Police Department (“NYPD”), announced that a Complaint was unsealed today alleging that RECEP AKBIYIK used a metal bar to shatter the glass of 10 windows and two doors of the building housing the Turkish Consulate General in New York, New York (the “Turkish Consulate”). When two of the Turkish Consulate’s security officers emerged from the building to investigate, AKBIYIK allegedly charged at the security officers with the metal bar and, as the security officers retreated into the building, repeatedly struck the building’s doors with the metal bar. AKBIYIK was arrested this morning and will be presented today before U.S. Magistrate Judge Sarah L. Cave.
U.S. Attorney Damian Williams said: “As alleged, Recep Akbiyik brazenly attacked the Turkish Consulate building, causing serious damage to its windows and doors. Even worse, Akbiyik allegedly endangered two of the Turkish Consulate’s security officers, nearly beating them with a metal bar. As these charges make clear, people who attack diplomatic facilities or their employees within the United States will be held accountable for their actions.”
DSS Director Carlos F. Matus said: “The Diplomatic Security Service is firmly committed to working with the U.S. Attorney’s Office and our other law enforcement partners to investigate allegations of crime related to diplomatic facilities and personnel within the United States, and to bring those who commit these crimes to justice. This was a great success by all of the agencies involved.”
According to the allegations in the Complaint:[1]
On May 22, 2023, at 3:15 a.m., AKBIYIK used a blue metal bar to shatter approximately 10 of the Turkish Consulate’s windows. Below are photographs reflecting the damage done to the windows:
As AKBIYIK shattered the Turkish Consulate’s windows, two security officers who had been in the Turkish Consulate’s lobby stepped outside of the building. AKBIYIK sprinted toward the security officers with the blue metal bar raised as if to strike them. Below are stills from surveillance video showing AKBIYIK running toward the security officers:
As the Security Officers retreated into the Turkish Consulate, pulling its doors closed, AKBIYIK repeatedly struck the Turkish Consulate’s doors with the blue metal bar, breaking the doors’ glass panes. Below is a photograph reflecting the damage done to the Turkish Consulate’s doors:
AKBIYIK fled, leaving behind a blue bag containing eight bricks and the blue metal bar, photographs of which are below:
In a post-arrest interview with NYPD officers, AKBIYIK admitted to the attack on the Turkish Consulate and stated that he had been planning the attack for weeks.
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AKBIYIK, 29, of Brooklyn, New York, is charged with damaging property occupied by a foreign government, which carries a maximum sentence of five 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. Williams praised the outstanding investigative work of DSS and the NYPD and thanked the U.S. Marshals Service and the New York County District Attorney’s Office for their assistance.
This case is being handled by the Office’s General Crimes Unit. Assistant U.S. Attorney Benjamin M. Burkett is 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 below constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Akbiyik ComplaintRecording Artist Casanova Sentenced to 188 Months in Prison for Gang-Related Racketeering and Narcotics OffensesRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that recording artist CASWELL SENIOR, a/k/a “Casanova,” was sentenced today by U.S. District Judge Philip M. Halpern to 188 months in prison for racketeering and narcotics offenses arising out of his leadership role in the Untouchable Gorilla Stone Nation Bloods Gang (“Gorilla Stone”). As part of the racketeering conspiracy, SENIOR participated in a shooting in Florida on July 5, 2020, and a robbery in New York City on August 5, 2018, and conspired to traffic over 100 kilograms of marijuana.
U.S. Attorney Damian Williams said: “Caswell Senior is not just a notorious recording artist, but he is also a high-profile leader of a vicious street gang and a magnet for gang violence. At a crowded Miami house party, Senior personally fired a gun that seriously injured and could have killed a victim, inciting a shootout. Further, Senior’s stature in the community was central to Gorilla Stone’s successful recruitment and nationwide expansion. Today’s sentencing — along with the other significant sentences that have been imposed in this case — shows once again that gang life is not worth it and will lead to many years in prison.”
According to the Indictment, public court filings, and statements made in court:
Since at least 2004, Gorilla Stone has been a brutally violent street gang with a national presence that was founded by SENIOR’s co-defendant Dwight Reid, a/k/a “Dick Wolf.” Gorilla Stone has many members across New York State, including throughout New York City, Westchester, and the New York State Prison System, and all over the country — such as in Florida, where SENIOR engaged in substantial criminal conduct. Gorilla Stone is comprised of various sets (or “Caves,” as they are called by gang members). Gorilla Stone is a highly organized and efficient street gang with an organizational commitment to violence that strictly enforces its internal laws.
SENIOR’s Gorilla Stone co-defendants were charged with a host of crimes committed in furtherance of their joint enterprise. Some of the charges against Gorilla Stone members include racketeering conspiracy, various frauds, a large-scale narcotics conspiracy that SENIOR actively participated in, myriad firearms offenses, and numerous acts of violence, including a daytime murder of a juvenile in the middle of a Poughkeepsie street; multiple attempted murders and shootings, including two in Florida in which SENIOR was involved; a gunpoint drug-related robbery; and a brutal slashing.
For over a decade, SENIOR participated in and was associated with the Gorilla Stone racketeering conspiracy. SENIOR was a powerful, respected, high-profile member of the gang. SENIOR admitted that he was an organizer or leader of a criminal activity that involved five or more participants. SENIOR joined the gang while incarcerated over a decade ago and has remained an active member ever since, including upon his release from custody from a prior case in 2013.
As part of the racketeering activity, on or about July 5, 2020, while in Florida for a gang member’s birthday, SENIOR shot a gun at a gang member with whom he was having a gambling dispute, hitting one gang member in the leg/calf area and a second, different gang member in the foot when the bullet ricocheted. A victim suffered serious bodily injury because of the shooting and was treated at a Miami-area hospital for a gunshot wound to the foot. Thereafter, other party attendees, including a member of Gorilla Stone, discharged multiple firearms.
Additionally, as part of an August 5, 2018, robbery at a Manhattan diner that SENIOR participated in, a victim was restrained and suffered serious bodily injury. The robbery started when SENIOR appeared to believe that a female victim took a photo of him from the booth where the victim was sitting. SENIOR then proceeded to forcefully take the victim’s cellphone. SENIOR’s gang member associate then came up behind the victim and put her in a headlock until she fell to the floor unconscious from lack of oxygen.
SENIOR further agreed to traffic at least 100 kilograms of marijuana. During an approximately nine-month period, SENIOR was responsible for distributing between 100 kilograms and 400 kilograms of his personally branded “2x” marijuana.
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SENIOR, 36, of Montville, New Jersey, previously pled guilty on May 11, 2022, before Judge Halpern to one count of conspiring to conduct and participate in the conduct of the affairs of a criminal enterprise through a pattern of racketeering activity and one count of conspiring to distribute over 100 kilograms of marijuana. In addition to the prison term, SENIOR was sentenced to four years of supervised release and ordered to forfeit $50,000.
SENIOR is the 12th defendant in the Gorilla Stone case to have been sentenced. The 11 other defendants who have been sentenced by Judge Halpern are:
- DONAVAN GILLARD, a/k/a “Donnie Love,” who was sentenced to 248 months in prison;
- NAYA AUSTIN, a/k/a “Baby,” who was sentenced to 234 months in prison;
- JARRETT CRISLER, Jr., a/k/a “Jayecee,” who was sentenced to 207 months in prison;
- BRANDON NIEVES, a/k/a “Untouchable Dot,” who was sentenced to 110 months in prison;
- JAMAL TRENT, a/k/a “Trap Smoke,” who was sentenced to nine years in prison;
- DEZON WASHINGTON, a/k/a “Blakk,” who was sentenced to 97 months in prison;
- ROBERTA SLIGH, a/k/a “Trouble,” who was sentenced to eight years in prison;
- JORDAN INGRAM, a/k/a “Flow,” who was sentenced to eight years in prison;
- STEPHEN HUGH, a/k/a “Chino,” who was sentenced to seven years in prison;
- ISAIAH SANTOS, a/k/a “Zay,” who was sentenced to seven years in prison; and
- SHANAY OUTLAW, a/k/a “Easy,” who was sentenced to three years in prison.
Five additional defendants have pled guilty and are awaiting sentencing: DESHAWN THOMAS, a/k/a “Don,” AHMED WALKER, a/k/a “Ammo,” BRANDON SOTO, a/k/a “Stacks,” ROBERT WOODS, a/k/a “Blakk Rob,” and BRINAE THORNTON, a/k/a “Luxury.”
Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation (“FBI”) Westchester County Safe Streets Task Force, which is comprised of special agents and task force officers from the FBI, U.S. Probation, New York State Police, New York State Department of Corrections and Community Supervision, New York City Police Department, Westchester County Police Department, Westchester County District Attorney’s Office, Putnam County Sheriff’s Office, Rockland District Attorney’s Office, and the Yonkers, New Rochelle, Mount Vernon, Greenburgh, White Plains, Peekskill, Ramapo, and Clarkstown Police Departments.
This case is being prosecuted by the Office’s White Plains Division. Assistant U.S. Attorneys Shiva H. Logarajah, David R. Felton, and Courtney L. Heavey are in charge of the prosecution.