Southern District of New York

Damian Williams, the United States Attorney for the Southern District of New York, John B. DeVito, Special Agent in Charge of the New York Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”), and Keechant L. Sewell, Police Commissioner for the City of New York (NYPD), announced that ABOUDULAYE KEITA, a/k/a “Abdoulaye,” MARQUISE DESHAUN AUSTIN, CEDRIC KEYON CHRISTOPHER, JR., and JAILYN HILLIARD were indicted yesterday with conspiracy to commit firearms offenses and gun trafficking, in connection with their involvement in a scheme to illegally obtain and transport firearms from Arkansas for resale to residents of New York. KEITA was also charged with interstate travel with intent to engage in gun trafficking. The case is assigned to U.S. District Judge Loretta A. Preska.

AUSTIN was arrested on March 11, 2022 in Arkansas and the complaint charging AUSTIN was unsealed yesterday in the Southern District of New York. CHRISTOPHER and HILLIARD were charged by complaint and arrested last month in Arkansas. KEITA is in state custody on unrelated charges and is expected to be transferred into federal custody.

U.S. Attorney Damian Williams said:  “As alleged, the defendants are responsible for trafficking dozens of guns across state lines, including guns that were later used to commit violent acts extending all the way from Arkansas to New York. Let today’s arrests make clear that we will not tolerate gun traffickers and the devastating harm they inflict on our communities.”

ATF Special Agent-in-Charge John DeVito said:  “People who flood illegal guns on our streets are drivers of violent crime and put communities in danger. This case highlights how ATF’s National Integrated Ballistic Information Network is a crucial tool in the investigation and prosecution of gun crimes because it connects individual firearms to the violent criminal offenses in which they are used.  ATF will continue to work with our partners to identify and disrupt the schemes used to put illegal firearms into the hands of violent criminals and on our streets. Thank you to the partnership and hard work of the men and women of Little Rock Police Department’s Gun Crimes Unit and ATF NY’s Crime Gun Intelligence Center.”

NYPD Commissioner Keechant L. Sewell said:  “The interstate flow of illegal guns into New York City is a grave threat to the public safety of everyone we serve.  Each gun seized is another step forward in our tireless pursuit to rid our streets of these deadly weapons – and anyone who traffics them must be held fully accountable. I want to thank the U.S. Attorney’s Office for the Southern District of New York, the ATF’s New York Field Division, and all of our law-enforcement partners who worked on this critical case.”

According to the allegations in the Indictment and the Complaints[1]:

From at least October 2020 through December 2021, the defendants and others conspired to illegally purchase and traffic firearms across state lines. AUSTIN, CHRISTOPHER and HILLIARD each acted as straw purchasers to buy firearms from licensed gun shops in Arkansas—a total of at least 73 firearms—and then sold these firearms illegally to KEITA and others with the understanding the firearms would then be transported to New York. To date, nine of the defendants’ firearms have been recovered in the Bronx and Brooklyn, in addition to six recoveries in California and five in Arkansas.

Through lead information collected and maintained by the National Integrated Ballistic Information Network (NIBIN), casings from the recovered firearms have been connected to a shooting that took place in the Bronx on June 20, 2021 and shootings that took place in Harlem on July 5, 2021 and October 6, 2021. Casings from one firearm recovered in Arkansas were found at the scene of a September 3, 2021 homicide in Little Rock.

*                *                *

KEITA, AUSTIN, CHRISTOPHER, and HILLIARD are charged with one count of conspiracy to commit firearms offenses, which carries a maximum penalty of five years in prison, and one count of gun trafficking, which also carries a maximum penalty of five years in prison. KEITA is also charged with one count of interstate travel with intent to commit gun trafficking, which carries a maximum penalty of ten 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 the judge.

Mr. Williams praised the outstanding investigative work of the ATF and the NYPD. Mr. Williams also thanked local law enforcement partners in Arkansas, the ATF’s Little Rock Field Office, and the U.S. Attorney’s Office in the Eastern District of Arkansas for their assistance.

This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorney Jane Y. Chong is in charge of the prosecution.

The charges 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.

Damian Williams, the United States Attorney for the Southern District of New York, Michael J. Driscoll, Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and Keechant L. Sewell, Police Commissioner for the City of New York (“NYPD”), announced today that JEAN CARMONA was charged with racketeering conspiracy, murder in aid of racketeering, committing violent crimes in aid of racketeering, and firearms offenses. As alleged, CARMONA is a member of a street gang known as “the 200s,” operating in and around upper Manhattan. On January 31, 2019, CARMONA and other 200s members traveled to another neighborhood, murdered Roberto Vasquez and attempted to murder a second individual. Vasquez and the second victim were innocent bystanders mistaken for rival gang members. CARMONA was in custody in Bergen County, New Jersey and was transferred into federal custody today. He will be presented this afternoon in Manhattan federal court.  The case has been assigned to United States District Judge Paul G. Gardephe.

U.S. Attorney Damian Williams said:  “Carmona allegedly participated in a callous, gang-related murder of an innocent bystander whose only offense was wanting to go home. Carmona’s callous actions not only took Roberto Vasquez’ life, but also led to a second innocent bystander being shot as well.  We hope that today’s charges bring some measure of comfort to the families of the victims and make clear that this Office and our law enforcement partners will continue to be relentless in our pursuit of anyone who takes another person’s life.”

FBI Assistant Director Michael J. Driscoll said:  “As alleged, Mr. Carmona is a member of the 200’s street gang who participated in the 2019 murder of Roberto Vasquez, an innocent victim mistaken for a rival gang member, in Upper Manhattan.  Our communities deserve far better than to live in fear of criminal gangs.  As the scourge of gang violence continues to plague the streets of our city, the FBI and our partners with the NYPD will continue to be relentless in our pursuit of the criminals responsible for these violent acts.”

NYPD Commissioner Keechant L. Sewell said:  “Today’s charges demonstrate that as long as people are involved in the violence and other illegal activities so often associated with gang life, the NYPD and our law-enforcement partners will be relentless in holding them fully accountable. I want to commend and thank our colleagues in the FBI and the U.S. Attorney’s Office for the Southern District of New York for their hard work in furthering this cause.”

According to the allegations in the Indictment unsealed today in Manhattan federal court[1]:

From at least in or about 2017 up to and including June 2022, in the Southern District of New York and elsewhere, JEAN CARMONA was a member of the 200s street gang. In order to fund the gang, protect its territory, and promote its standing, members of the 200 engaged in, among other things, narcotics trafficking and other acts of violence, including murder. 200 members sold marijuana in the gang’s territory and engaged in shootings as part of their gang membership.  In particular, on January 31, 2019, CARMONA participated in the shooting and murder of Roberto Vasquez and the non-fatal shooting of a second individual, who were innocent bystanders mistaken for rival gang members, in the vicinity of 158th Street and Broadway Avenue, in Manhattan, New York.

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CARMONA, 31, is charged with one count of racketeering conspiracy, which carries a maximum term of life in prison; one count of murder in aid of racketeering, which carries a mandatory minimum term of life in prison or death; one count of causing death through use of a firearm, which carries a mandatory minimum sentence of five years in prison and a maximum of life in prison or death; one count of committing violent crimes in aid of racketeering, which carries a maximum term of 20 years in prison; and one count of carrying, brandishing, and discharging a firearm in connection with a crime of violence, which caries a mandatory minimum term of 10 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 defendants will be determined by the judge.

Mr. Williams praised the outstanding investigative work of the FBI and NYPD.

The case is being handled by the Office’s Violent and Organized Crime Unit. Assistant United States Attorneys Mathew Andrews, Rushmi Bhaskaran, and Elizabeth Espinosa 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.

Damian Williams, the United States Attorney for the Southern District of New York, announced that ROGER RALSTON, the CEO of DirectView Holdings, Inc. (“DirectView”), a Florida-based video surveillance and security company, pled guilty today to one count of conspiracy to commit wire fraud for defrauding elderly victims in connection with the fraudulent sale of stock and fake carbon credits as part of an international telemarketing scheme that caused nearly $16 million in losses.  RALSTON pled guilty before U.S. District Judge Jed S. Rakoff.  Co-defendants Christopher Wright and Steven Hooper previously pled guilty and were sentenced to 52 months in prison and 42 months in prison, respectively, for their roles in the fraud.

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

From in or about 2009 up to and including in or about 2015, RALSTON and other co-conspirators engaged in a scheme to defraud victims in the United Kingdom of nearly $16 million through the sale of false, fraudulent, and materially misleading investments, and to launder the proceeds of the fraud through bank accounts in the United States and foreign countries.  RALSTON and his co-conspirators used the services of telemarketing call centers to identify and cold-call potential victims, who were primarily elderly or retired individuals residing in the United Kingdom.  Over a series of telephone calls, the telemarketers persuaded victims to invest money under various false and misleading pretenses, including the promise of short-term, high-yield, no-risk returns, when in fact the investments were high-risk, illiquid, and in some instances, entirely fictitious.  Many victims were persuaded to make additional investments under the false pretense that they would not be permitted to sell their holdings until they purchased more.  In reliance on the false representations and promises, the victims wired funds to various bank accounts in the United States, including in the Southern District of New York, in the names of corporate entities controlled by RALSTON.  RALSTON then mailed and emailed documents related to the fraudulent investments, including purchase contracts and investment certificates, to the victims.  Victims who tried to sell their investments found they were unable to do so.  The victims never received a refund on their principal or any return on their investments.  

In order to conceal the nature, location, source, ownership, and control of the proceeds of the fraudulent scheme, RALSTON regularly transferred a substantial portion of the fraud proceeds from bank accounts in the United States, including in the Southern District of New York, to overseas bank accounts, including accounts in Cyprus, Switzerland, and the United Kingdom, in the names of various shell companies controlled by RALSTON’s co-conspirators.

The nature of the particular fraudulent investment vehicles being marketed to the victims changed over time.  From in or about 2009 until in or about 2011, RALSTON and his co-conspirators sold DirectView stock to the victims based on telemarketers’ false representations and promises that the shares were a no-risk, short-term investment in a debt-free company, and that the shares were likely to increase over 100 percent in value in a short period of time.  In contrast to what RALSTON represented to victims, DirectView’s annual report filed with the United States Securities and Exchange Commission for the year ending December 31, 2010, contained dire warnings about the poor fiscal health of DirectView and the risk attendant in purchasing stock, including that the company “may be forced to cease operations” due to losses and cash flow problems, and purchasers “may find it extremely difficult or impossible to resell our shares.”

From in or about 2011 until in or about 2015, RALSTON and his co-conspirators engaged in the sale of fraudulent “carbon credits.”  The boiler room callers appealed to victims by claiming that the investments would be environmentally friendly and help address the climate crisis.  “Carbon credits,” which are issued as part of governmental and voluntary regulatory regimes, are permits representing the right to emit a certain number of tons of carbon dioxide into the atmosphere. “Carbon offsets,” which are tied to particular carbon-dioxide emissions reducing projects, represent a reduction in carbon dioxide emissions, and can be purchased by individuals and companies to “offset” their or third parties’ “carbon-footprints.”  The victims were falsely promised that the carbon-related investments they purchased could be easily sold, carried no risk, and would yield a significant, short-term return.  In fact, the carbon credits and offsets that were sold to the victims were fake, and did not represent any actual carbon credits or offsets.  Ralston caused fraudulent carbon certificates to be created and sent to the victims.   

*                *                *

RALSTON, 53, of Florida, pled guilty to one count of conspiracy to commit wire fraud, which carries a maximum sentence of 30 years in prison.  As part of his guilty plea, RALSTON also agreed to forfeit $15,713,621.20 and to pay restitution in the same amount to victims of the scheme.  RALSTON is scheduled to be sentenced by Judge Rakoff on December 13, 2022, at 4 p.m.

The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as RALSTON’s sentence will be determined by the judge.

Mr. Williams praised the outstanding investigative work of IRS Criminal Investigation in this case.

This case is being prosecuted by the Office’s Money Laundering and Transnational Criminal Enterprises and Complex Frauds and Cybercrime Units. Assistant U.S. Attorneys Jessica Feinstein, Olga I. Zverovich, and David Felton are in charge of the prosecution.

The United States of America has been authorized to seize an Airbus A319-100 (the Airbus) owned and controlled by sanctioned Russian oligarch Andrei Skoch, pursuant to a seizure warrant from the U.S. District Court for the Southern District of New York, which found that the airplane is subject to seizure and forfeiture based on probable cause of violation of the federal anti-money laundering laws.

According to the seizure warrant and affidavit sworn out today:

Pursuant to the International Emergency Economic Powers Act (IEEPA), the National Emergencies Act (NEA), and Executive Orders Issued by the President of the United States, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated Andrei Skoch as a Specially Designated National (SDN) on or about April 6, 2018 “for being an official of the Government of the Russian Federation,” “a deputy of the Russian Federation’s State Duma,” and because of his “longstanding ties to Russian organized criminal groups, including time spent leading one such enterprise.” After Russia invaded Ukraine in 2022, OFAC issued further sanctions against Skoch and his assets. On or about March 24, 2022, OFAC designated Skoch and other members of the Duma for “support[ing] the Kremlin’s efforts to violate Ukraine’s sovereignty and territorial integrity.” On or about June 2, 2022, OFAC identified the Airbus as blocked property in which Skoch had an interest. 

Skoch is the beneficial owner of the Airbus through a series of shell companies and trusts tied to his romantic partner. After OFAC designated Skoch in or about April 2018 and continuing through in or about at least in or about 2021, U.S. dollar transactions were made to pay for the registration of the Airbus in Aruba and for aviation insurance premiums for the Airbus, each of which was a necessary expense to maintain and operate the Airbus. 

The Airbus (pictured below), bearing tail number P4-MGU and serial number 5445, is believed to be worth more than $90 million.

U.S. Attorney Williams praised the outstanding work of the FBI and U.S. Department of Commerce, Bureau of Industry and Security. The Justice Department’s National Security Division and Office of International Affairs and the U.S. Treasury Department’s Office of Foreign Assets Control provided valuable assistance in this investigation. 

Assistant U.S. Attorneys Joshua A. Naftalis and Nicholas S. Bradley for the Southern District of New York are in charge of the investigation. 

The investigation was coordinated through the Justice Department’s Task Force KleptoCapture, an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export controls, and economic countermeasures that the United States, along with its foreign allies and partners, has imposed in response to Russia’s unprovoked military invasion of Ukraine. Announced by the Attorney General on March 2 and run out of the Office of the Deputy Attorney General, the task force will continue to leverage all of the Department’s tools and authorities to combat efforts to evade or undermine the collective actions taken by the U.S. government in response to Russian military aggression.

Damian Williams, the United States Attorney for the Southern District of New York, Lisa O. Monaco, the Deputy Attorney General of the United States, Michael J. Driscoll, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Matthew S. Axelrod, Assistant Secretary of Commerce for Export Enforcement, announced today that the United States of America has been authorized to seize an Airbus A319-100 (the “Airbus”) owned and controlled by sanctioned Russian oligarch Andrei Skoch, pursuant to a seizure warrant from the U.S. District Court for the Southern District of New York, which found that the airplane is subject to seizure and forfeiture based on probable cause of violation of the federal anti-money laundering laws.

U.S. Attorney Damian Williams said:  “Today’s affidavit and warrant authorizing the seizure of Andrei Skoch’s private airplane demonstrate the Southern District’s partnership commitment with the task force to pursuing sanctioned Russian oligarchs and their blocked property.  We will continue to use every legal tool available to enforce our anti-money laundering laws and to pursue those who seek to use the U.S. financial system to violate and evade sanctions.” 

Task Force KleptoCapture Director Andrew C. Adams said:  “Once again U.S. law enforcement has demonstrated that international shell games will not suffice to hide the fruits of corruption and money laundering. Through today’s warrant, the Department of Justice lays out a roadmap for those engaged in the legitimate financial sector to follow when assessing transactions with Skoch’s laundering network, while taking steps to freeze, seize, and forfeit the fruits of his criminal activities.”

FBI Assistant Director-in-Charge Michael J. Driscoll said:  “An oligarchy is defined as a government in which a small group exercises control for their own selfish and corrupt gain.  Members of that group in Russia have long hid and disguised their illegal activities using the U.S. dollar in the process.  The sanctions levied by the U.S government and the work of this task force demonstrate to these offensively wealthy oligarchs who support Russia’s military aggression that they are not untouchable, and we are dramatically impacting their way of life.”

Assistant Secretary of Commerce for Export Enforcement Matthew S. Axelrod said:  “Today’s action demonstrates that the U.S. government will be relentless in our efforts to bring to justice those that are enabling Putin’s heinous war against Ukraine.  Coordination and collaboration between federal law enforcement and international partners is essential to effective enforcement of U.S. law, and I’m proud of our team of dedicated law enforcement professionals.”

According to the seizure warrant and affidavit sworn out today:[1]

Pursuant to the International Emergency Economic Powers Act (“IEEPA”), the National Emergencies Act, and Executive Orders Issued by the President of the United States, the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) designated Andrei Skoch as a Specially Designated National (“SDN”) on April 6, 2018 “for being an official of the Government of the Russian Federation,” “a deputy of the Russian Federation’s State Duma,” and because of his “longstanding ties to Russian organized criminal groups, including time spent leading one such enterprise.”  After Russia invaded Ukraine in 2022, OFAC issued further sanctions against Skoch and his assets.  On March 24, 2022, OFAC designated Skoch and other members of the Duma, for “support[ing] the Kremlin’s efforts to violate Ukraine’s sovereignty and territorial integrity.”   On June 2, 2022, OFAC identified the Airbus as blocked property in which Skoch had an interest. 

Skoch is the beneficial owner of the Airbus through a series of shell companies and trusts tied to his romantic partner.  After OFAC designated Skoch in April 2018 and continuing through at least 2021, U.S. dollar transactions were made to pay for the registration of the Airbus in Aruba and for aviation insurance premiums for the Airbus, each of which was a necessary expense to maintain and operate the Airbus. 

The Airbus (pictured below), bearing tail number P4-MGU and serial number 5445, is believed to be worth more than $90 million.

*                *                *

Mr. Williams praised the outstanding work of the FBI and U.S. Department of Commerce, Bureau of Industry and Security.  Mr. Williams further thanked the Justice Department’s National Security Division and Office of International Affairs, and OFAC for their assistance in this investigation. 

This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit and National Security and International Narcotics Unit.  Assistant United States Attorneys Joshua A. Naftalis and Nicholas S. Bradley are in charge of the investigation. 

The investigation was coordinated through the Justice Department’s Task Force KleptoCapture, an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export controls, and economic countermeasures that the United States, along with its foreign allies and partners, has imposed in response to Russia’s unprovoked military invasion of Ukraine.  Announced by the Attorney General on March 2 and run out of the Office of the Deputy Attorney General, the task force will continue to leverage all of the Department’s tools and authorities to combat efforts to evade or undermine the collective actions taken by the U.S. government in response to Russian military aggression.

[1] The burden to prove forfeitability in a forfeiture proceeding is upon the government.

Damian Williams, the United States Attorney for the Southern District of New York, and Ricky J. Patel, Acting Special Agent in Charge of Homeland Security Investigations (“HSI”) in New York, announced today the return to the Kingdom of Cambodia of 30 antiquities which were stolen from Cambodia as part of an organized looting network and sold by antiquities dealer Douglas Latchford.  Among the antiquities returned today was a 10th Century sculpture of Skanda on a Peacock and a monumental 10th Century sculpture of Ganesha, both looted from the ancient Khmer capital Koh Ker. Cambodian Ambassador to the United States Keo Chhea received the antiquities today during a ceremony at the U.S. Attorney’s Office.

U.S. Attorney Damian Williams said:  “Today, we celebrate the return of Cambodia’s cultural heritage to the Cambodian people, and reaffirm our commitment to reducing the illicit trafficking of art and antiquities.  It is with great pleasure that we send the Skanda on a Peacock and the rest of these artworks on the final leg of their journey home.”

HSI Acting Special-Agent-in-Charge Ricky J. Patel said:  “These antiquities we return today were ripped from their country. Beyond their extraordinary beauty and craftsmanship, many are sacred artifacts pried from temples and palaces to be smuggled across borders and peddled by those seeking profit, without any regard to the intangible value they have to the people of their homeland.  For over five years, the agents and experts in HSI New York’s specialized dedicated Cultural Property, Arts and Antiquities Unit, alongside our government partners, hunted down leads, examined origin, reviewed financial records, and conducted dozens of interviews to find and recover these pieces we are returning today.  These artifacts belong to the people of Cambodia, and we are proud to participate in their recovery and their return home.”

The 30 antiquities returned to Cambodia today were the subjects of three civil forfeiture actions filed in this District. According to the civil forfeiture complaints filed in 2021 and 2022, and other documents filed in the cases:

The antiquities repatriated to Cambodia are sandstone and bronze sculptures and artifacts, ranging in age from the Bronze Age to the 12th Century, which were either removed illegally from Cambodia by looters, imported into the United States based on false statements to United States Customs and Border Protection (“CBP”), or both.

During the civil conflicts of late 20th century, statues and other artifacts were stolen from Koh Ker and other archeological sites in Cambodia and entered the international art market through an organized looting network.  Local teams of looters would first remove the statues from the original sites. The statues would then be transported to the Cambodia-Thailand border, and transferred to brokers, who would in turn transport them to dealers in Khmer artifacts located in Thailand, particularly Bangkok.  These dealers would sell the artifacts to local or international customers, who would either retain the pieces or sell them on the international art market.

Bangkok-based antiquities dealer Douglas Latchford, a/k/a “Pakpong Kriangsak” sold the antiquities to individuals in the Western art market, including the two private collectors and an American museum which were the prior owners of the pieces returned today. In 2019, Latchford was charged by this Office with wire fraud conspiracy and other crimes related to a many-year scheme to sell looted Cambodian antiquities on the international art market, primarily by creating false provenance documents and falsifying invoices and shipping documents. The indictment was ultimately dismissed due to the death of Latchford.

Once the prior owners were contacted by the United States, they agreed to relinquish possession of the antiquities and to waive all claims of right, title, and interest in them.

*                *                *

Mr. Williams thanked Homeland Security Investigations for its outstanding work on this investigation, and U.S. Customs and Border Protection for its invaluable assistance. Mr. Williams also thanked the Kingdom of Cambodia’s Ministry of Culture and Fine Arts for its assistance with this investigation.

This matter is being handled by the Office’s Money Laundering and International Criminal Enterprises Unit. Assistant U. S. Attorney Jessica Feinstein is in charge of the case.

Damian Williams, the United States Attorney for the Southern District of New York, announced that GREGORY DWYER, a high-ranking employee of purportedly “off-shore” cryptocurrency derivatives exchange the Bitcoin Mercantile Exchange or “BitMEX,” pled guilty today to violating the Bank Secrecy Act (the “BSA”) by willfully failing to establish, implement, and maintain an anti-money laundering (“AML”) program at BitMEX, and aiding and abetting the same.  DWYER pled guilty today before U.S. District Judge John G. Koeltl.

U.S. Attorney Damian Williams said:  “With this plea, this Office has now obtained criminal convictions against all three founders, as well as a high-ranking employee at BitMEX, for willful violations of anti-money laundering laws.  Today’s plea reflects that employees with management authority at cryptocurrency exchanges, no less than the founders of such exchanges, cannot willfully disregard their obligations under the Bank Secrecy Act.”

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

DWYER was one of the first employees of BitMEX, and served as its Head of Business Development.  BitMEX is an online cryptocurrency derivatives exchange that, during the relevant time period, had U.S.-based operations and served thousands of U.S. customers.  From at least September 2015, and continuing at least through the time of the Indictment in September 2020, DWYER, working with BitMEX’s founders Arthur Hayes, Benjamin Delo, and Samuel Reed, willfully caused BitMEX to fail to establish and maintain an AML program, including a program for verifying the identify of BitMEX’s customers (or a “know your customer” or “KYC” program).  As a result of its willful failure to implement AML and KYC programs, BitMEX was in effect a money laundering platform. 

DWYER aided and abetted BitMEX’s failure to institute AML or KYC programs despite closely following U.S. regulatory developments that made clear the legal obligation to do so if BitMEX operated in the United States, which it did.  DWYER knew that BitMEX’s purported withdrawal from the U.S. market after in or about September 2015 was a sham, and that purported “controls” BitMEX put in place to prevent U.S. trading were an ineffective facade that did not, in fact, prevent users from accessing or trading on BitMEX from the United States.  Among his other tasks at BitMEX, DWYER collected and circulated data evidencing that BitMEX users included traders, and that the company earned revenue, from the United States.

*                *                *

DWYER, 39, of Australia and Bermuda, pled guilty to one count of violating the Bank Secrecy Act, which carries a maximum penalty of five years in prison.  Under the terms of his plea agreement, DWYER agreed to separately pay a $150,000 criminal fine representing pecuniary gain derived 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.

HAYES, DELO, and REED, previously pled guilty to the same count, and were sentenced by Judge Koeltl.

Mr. Williams praised the outstanding investigative work of the FBI’s New York Money Laundering Investigation Squad, and thanked the attorneys and investigators at the Commodity Futures Trading Commission whose expertise and diligence were integral to the development of this investigation.

The prosecution is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit.  Assistant U.S. Attorneys Jessica Greenwood, Samuel Raymond, and Thane Rehn are in charge of the prosecution. 

Damian Williams, the United States Attorney for the Southern District of New York, and Keechant L. Sewell, Commissioner of the New York City Police Department (“NYPD”) announced the unsealing today of a Superseding Indictment charging DANZEL MACKINS, a/k/a “Putt,” DARRIN SAMUELS, a/k/a “Klepto,” JAMEL WILLIAMS, a/k/a “Big T,” and BRANDON WILKINS, a/k/a “Banger,” a/k/a “Fishy,” with participating in a conspiracy to distribute crack cocaine.  MACKINS and SAMUELS are also charged with carrying and using firearms in connection with that drug trafficking crime, and with participating in the murder of Felton Durant, who was shot to death on April 25, 2021.

MACKINS and SAMUELS were previously charged with conspiring to distribute crack cocaine, though the charge of murder against each of them was only made public today.  WILLIAMS and WILKINS were both arrested yesterday and are expected to be presented later today before the Honorable Katharine H. Parker, United States Magistrate Judge for the Southern District of New York.  The case is assigned to United States District Judge Lewis A. Kaplan.

U.S. Attorney Damian Williams said:  “On April 25, 2021, Felton Durant was shot to death in broad daylight on a weekend afternoon over a drug trafficking dispute.  As alleged in the Superseding Indictment unsealed today, Danzel Mackins and Darrin Samuels participated in that brutal killing, which took place in the middle of a busy public housing development in South Brooklyn.  Thanks to the hard work of the NYPD, the defendants have been charged with this heinous crime.  I am committed to devoting every resource in my Office to target gun violence in this City.  To be clear, we are not going to give up any neighborhood, anywhere in this City to drug violence, and the charges unsealed today should make that clear to all violent actors who endanger our neighborhoods and our communities.”

NYPD Commissioner Keechant L. Sewell said:  “The wanton depravity outlined in the charges leveled against these individuals today will never be acceptable in any neighborhood of New York City. By dismantling their drug trafficking organization, and by putting a stop to the violence so often associated with this illegal activity, the NYPD and our law enforcement partners have affirmed our promise to the people we serve: Anyone who deals in this type of violent, destructive behavior will be held accountable to the fullest extent of the law.”

As alleged in the Superseding Indictment,[1] DANZEL MACKINS, DARRIN SAMUELS, JAMEL WILLIAMS, and BRANDON WILKINS, all of New York City, are charged with being members of a drug trafficking organization (the “DTO”) that distributed crack cocaine from December 2019 through July 2022.  In addition to the murder of Durant Felton on April 25, 2021, MACKINS and SAMUELS are charged with using and carrying multiple firearms in connection with the charged drug trafficking conspiracy and aiding and abetting the same.

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

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

Mr. Williams praised the outstanding investigative work of the NYPD and thanked the Kings County District Attorney’s Office for its assistance in this case.

This case is being handled by the Office’s Narcotics Unit.  Assistant United States Attorney Thomas John Wright is in charge of the prosecution.

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

COUNT

CHARGE

DEFENDANTS

MAXIMUM PENALTIES

1

Narcotics conspiracy

21 U.S.C. § 846

DANZEL MACKINS, a/k/a “Putt,” DARRIN SAMUELS, a/k/a “Klepto,” JAMEL WILLIAMS, a/k/a “Big T,” and BRANDON WILKINS, a/k/a “Banger,” a/k/a “Fishy"

40 years’ Imprisonment

Mandatory Minimum Sentence of 5 years

2

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

18 U.S.C. § 924(c)

DANZEL MACKINS, a/k/a “Putt,” and DARRIN SAMUELS, a/k/a “Klepto”

Life Imprisonment

Mandatory Minimum Sentence of 10 years

3

Murder through use of a firearm

18 U.S.C. § 924(j)

DANZEL MACKINS, a/k/a “Putt,” and DARRIN SAMUELS, a/k/a “Klepto”

Death or Life Imprisonment

Mandatory Minimum Sentence of 5 years

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

Damian Williams, the United States Attorney for the Southern District of New York, announced that a jury returned a guilty verdict today against VICENTE ESTEVES, a/k/a “El Bori,” on one count of conspiracy to traffic cocaine, as charged in a Superseding Indictment.  ESTEVES is scheduled to be sentenced on November 17, 2022, by U.S. District Judge John G. Koeltl, who presided over the eight-day trial. 

U.S. Attorney Damian Williams said:  “Esteves was a ‘boss’ of a drug trafficking crew that conspired to import 150 kilograms of cocaine into the United States.  Today, Esteves’s drug trafficking operation has been disrupted, and he stands convicted of his crime and faces the possibility of a lengthy prison sentence.”  

According to the Superseding Indictment and the evidence at trial:

Between at least in or about September 2020 and in or about December 2020, ESTEVES belonged to a New York/New Jersey-based drug trafficking organization (the “DTO”) that attempted to purchase 150 kilograms of cocaine from purported Colombian suppliers, who were in fact undercover law enforcement agents.  The DTO negotiated for the delivery of the cocaine in Puerto Rico, with the delivery of the purchase money in the Bronx, New York.  On the day of the exchange, December 4, 2020, ESTEVES and his coconspirators arrived in the Bronx to complete the transaction with two suitcases stuffed with more than $1.3 million cash, which was intended as a payment for part of the overall 150-kilogram transaction.  ESTEVES supervised the collection and delivery of the $1.3 million and carried a ledger for the transaction in his wallet.  A third suitcase, containing over $644,000 in additional cash, was later recovered in a stash house that ESTEVES and coconspirators met at in preparation for the transaction.

*               *                *

ESTEVES, 49, was convicted on one count of conspiring to distribute and possess with intent to distribute at least five kilograms of cocaine, which carries a mandatory minimum prison term of ten years and a maximum prison term of life.

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

Mr. Williams praised the outstanding investigative work of the Drug Enforcement Task Force, the Drug Enforcement Administration, the New York City Police Department, the New York State Police, the Office of the Special Narcotics Prosecutor, Homeland Security Investigations, the Middlesex County Prosecutor’s Office, and the Edison Police Department. 

The case is being handled by the Office’s Narcotics Unit.  Assistant United States Attorneys Jun Xiang, Ashley Nicolas, and Frank Balsamello and Paralegal Specialists Christopher Sykes and Alei Rizvi are in charge of the prosecution.

Damian Williams, the United States Attorney for the Southern District of New York, and Jonathan Mellone, the Special Agent-in-Charge of the New York Region of the Office of the Inspector General, Department of Labor (“DOL-OIG”) announced today that ONEKEY, LLC, a New Jersey construction company, and its principal, FINBAR O’NEILL, were charged by Information with willfully violating Occupational Safety and Health Administration (“OSHA”) regulations, resulting in the death of a construction worker (“Victim-1”) in Poughkeepsie, New York, on or about August 3, 2017.  The Information charges that ONEKEY and O’NEILL built and placed construction loads on a concrete wall without consulting with a qualified person to determine whether the wall could withstand the weight.  The Information also charges that ONEKEY and O’NEILL failed to warn workers about the dangers of the wall.  The wall collapsed, killing Victim-1.  ONEKEY and O’NEILL were arraigned on the charges this afternoon before United States Magistrate Judge Judith C. McCarthy.

U.S. Attorney Damian Williams said: “As alleged, OneKey, a construction company, and its principal, Finbar O’Neill, endangered the safety of their workers by disregarding regulations and taking shortcuts to sidestep their safety obligations. This conduct led to the death of a worker on a construction site. Today’s charges should serve as a reminder to small business 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 (DOL) programs. We will continue to work with our law enforcement partners and DOL’s Occupational Safety and Health Administration to hold accountable those who jeopardize workers’ safety.”

As alleged in the Information[1]:

In 2017, ONEKEY and O’NEILL implemented a soil compaction plan at a construction site at 1 Dutchess Avenue in Poughkeepsie.  The soil compaction plan involved piling large quantities of dirt, called “surcharges,” on top of the sites of three future buildings.  An engineering firm designed a plan for the use of the surcharges.  ONEKEY and O’NEILL did not follow this plan.  Instead, they built a wall to hold back one of the surcharges, so workers could get started on the buildings next to it.  ONEKEY and O’NEILL did not consult with any qualified person to see if the wall could withstand the weight to be placed on it by the surcharge. 

While people were working next to the wall, ONEKEY kept using construction machinery to add dirt to the surcharge pressing up against the wall.  The people working near the wall were not warned about the dangers it created.  ONEKEY and O’NEILL heard from people working at the site that the wall was not safe.  They did not fix the wall.

On August 3, 2017, workers complained that construction machines were driving on top of the surcharge, adding dirt to it.  Later that day, the wall collapsed.  As it fell, Victim-1 ran away from the wall, but he could not get away in time and was killed.

*                *                *

ONEKEY, LLC, a New Jersey corporation, is charged with one count of willful violation of OSHA regulations resulting in death.  The foregoing count carries a maximum fine of $500,000. 

FINBAR O’NEILL, 57, of Paramus, New Jersey, is charged with one of count of willful violation of OSHA regulations resulting in death. The foregoing count carries a maximum sentence of six months in prison and a maximum fine of $250,000.  

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.

Mr. Williams praised the outstanding work of OSHA and DOL-OIG.

The case is being prosecuted by the Office’s White Plains Division.  Assistant U.S. Attorney Steven J. Kochevar is in charge of the prosecution.

The charges contained in the Information 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 Information, and the description of the Information set forth herein, constitutes only allegations, and every fact described therein should be treated as an allegation.

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 Field Office of the Drug Enforcement Administration (“DEA”), Keechant Sewell, the Commissioner of the New York City Police Department (“NYPD”), and Kevin P. Bruen, the Superintendent of the New York State Police (“NYSP”), announced the unsealing of an Indictment charging 16 members and associates of the Own Every Dollar (or “OED”) gang, a subset of the Trinitarios, with committing various racketeering, narcotics, and firearms offenses, including murder and attempted murder. 

JOWENKY NUNEZ, JR., a/k/a “Juju,” JERRIN PENA, a/k/a “Rooga,” a/k/a “Perry,” JUSTIN DEAZA, a/k/a “Booka,” a/k/a “Pepito,” WILSON MENDEZ, a/k/a “Tati,” BRIAN HERNANDEZ, a/k/a “Malikai,” HUGO RODRIGUEZ, a/k/a “Juice,” MAYOVANEX RODRIGUEZ, a/k/a “Menorcito,” JOHANN ZAPATA, a/k/a “Zapata,” ELVIS TREJO, a/k/a “Po Po,” STEVEN JOAQUIN, a/k/a “Baby Gunz,” IYAURY RODRIGUEZ-ROSARIO, a/k/a “Bricha,” JOWENKY NUNEZ, SR., a/k/a “Bala,” ARGENIS TAVAREZ, a/k/a “Nose,” a/k/a “A-Kash,” VICTOR COLON, a/k/a “V,” JOSE GUTIERREZ, a/k/a “G,” and NIJMAH MARTE, a/k/a “N,” a/k/a “Nena,” are members or associates of the OED gang.

The Indictment charges five defendants—JOWENKY NUNEZ, JR., JERRIN PENA, BRIAN HERNANDEZ, MAYOVANEX RODRIGUEZ, and IYAURY RODRIGUEZ-ROSARIO—with committing one or more of a total of five murders in the Bronx and Manhattan.  Eleven of the defendants—JOWENKY NUNEZ, JR., JERRIN PENA, JUSTIN DEAZA, WILSON MENDEZ, BRIAN HERNANDEZ, HUGO RODRIGUEZ, ELVIS TREJO, STEVEN JOAQUIN, IYAURY RODRIGUEZ-ROSARIO, JOWENKY NUNEZ, SR., and ARGENIS TAVAREZ—are charged with committing one or more of a total of 12 attempted murders. 

U.S. Attorney Damian Williams said:  “Our indictment alleges that for the past four years, OED has wreaked havoc in this City – committing multiple murders, numerous armed robberies, shootings, assaults, and also dealing dangerous drugs, including fentanyl.  The defendants charged today include OED’s leadership and some of the gang’s most violent members, who we allege murdered five victims over the past four years, committed 13 shootings, and committed seven robberies or attempted robberies.  The charges we unseal today required the partnership and dedication of our law enforcement partners.  It required us to work together, side by side, across jurisdictions, to protect the people.  I want to thank all of our partners here today for their hard work on these and so many other investigations.”

DEA Special Agent-in-Charge Frank Tarentino said: “These arrests and seizures amplify our commitment and focus to safeguard our communities from the perils of violent crime, and the destruction that follows.  The DEA works in partnership with our law enforcement partners having two goals in mind: saving lives and making our communities healthy and safe.  I applaud the U.S. Attorney’s Office, Southern District of New York and the New York Drug Enforcement Task Force comprising DEA, NYPD, and NYSP for their diligence and commitment to this impactful investigation.”

NYPD Commissioner Keechant Sewell said:  “These individuals lived by a brutal code of street violence – where firearms were recklessly pulled out and indiscriminately fired, where innocent lives were disregarded, where families and neighborhoods were traumatized and torn apart. Now they will no longer be able to terrorize New Yorkers.  And make no mistake: Organized groups like this do terrorize.  They sow fear and disorder, and they show zero respect for the lives of the people who reside and work in the neighborhoods where they wreak havoc.  The vast resources and untiring efforts of the NYPD and our law enforcement partners, across multiple agencies, are concentrated on the nexus of gangs, guns, and drugs that drive much of the crime in New York City.  And all the people we serve are safer today because of our collaboration.”

NYSP Superintendent Kevin P. Bruen said: “The charges brought today against these dangerous individuals are a direct result of the vigilant work conducted by law enforcement partners.  These partnerships were instrumental in shutting down this racketeering operation, took dangerous drugs and weapons off our streets, and interrupted heinous crimes in our neighborhoods.  Let this be a strong message that New York State will not tolerate those who bring drugs and violence into our communities.”

As alleged in the Indictment unsealed today in Manhattan federal court and in statements made in court filings[1]:

OED Acts of Violence

The following murders, attempted murders, shootings, and gunpoint robberies and attempted robberies were perpetrated in part so that the following members and associates of OED could maintain or increase their positions in the OED racketeering enterprise operating in the Southern District of New York:      

• On August 31, 2018, JOWENKY NUNEZ, JR. shot and killed Nicolas Vargas in the vicinity of 232nd Street in the Bronx, and aided and abetted the same. 

• On April 14, 2019, JOWENKY NUNEZ, JR. and JERRIN PENA shot and killed Hector Cruz in the vicinity of West 135th Street in Manhattan, and aided and abetted the same. 

• On January 24, 2020, JOWENKY NUNEZ, JR., BRIAN HERNANDEZ, WILSON MENDEZ, STEVEN JOAQUIN, and ARGENIS TAVAREZ shot at a rival gang member in the vicinity of West 136th Street in Manhattan, and aided and abetted the same. 

• In February 2020, JOWENKY NUNEZ, JR., JERRIN PENA, BRIAN HERNANDEZ, and ARGENIS TAVAREZ shot at rival gang members in the vicinity of West 138th Street in Manhattan, and aided and abetted the same. 

• On March 30, 2020, JOWENKY NUNEZ, JR. and STEVEN JOAQUIN shot at a rival narcotics trafficker in the vicinity of West 180th Street in Manhattan, and aided and abetted the same.  Photographs of NUNEZ, JR. (on the left) and JOAQUIN (on the right) committing that shooting are below:

• On April 18, 2020, JOWENKY NUNEZ, SR. shot at an individual in the vicinity of Audubon Avenue in Manhattan, and aided and abetted the same.
• On May 13, 2020, JUSTIN DEAZA and WILSON MENDEZ shot at rival narcotics traffickers in the vicinity of West 184th Street in Manhattan, and aided and abetted the same. 

• On May 15, 2020, BRIAN HERNANDEZ shot at a rival narcotics trafficker in the vicinity of West 188th Street in Manhattan, and aided and abetted the same. 

• On June 26, 2020, JOWENKY NUNEZ, JR., STEVEN JOAQUIN, and IYAURY RODRIGUEZ-ROSARIO shot at rival narcotics traffickers during a high-speed chase through Washington Heights in Manhattan, and aided and abetted the same. 

• On July 2, 2020, JOWENKY NUNEZ, JR., BRIAN HERNANDEZ, and IYAURY RODRIGUEZ-ROSARIO shot and killed Richard Dominguez and Israel Cabrera in the vicinity of Sedgewick Avenue in the Bronx, and aided and abetted the same. 

• On July 5, 2020, JOWENKY NUNEZ, JR. and IYAURY RODRIGUEZ-ROSARIO shot at rival gang members in the vicinity of West 136th Street in Manhattan, and aided and abetted the same. 

• On July 18, 2020, JOWENKY NUNEZ, JR. shot at an individual in the vicinity of West 183rd Street in Manhattan, and aided and abetted the same. 

• On October 22, 2020, JOWENKY NUNEZ, JR. and JUSTIN DEAZA shot at individuals in the vicinity of Valentine Avenue in the Bronx, and aided and abetted the same. 

• On December 13, 2020, WILSON MENDEZ robbed an individual at gunpoint, in the vicinity of West 188th Street in Manhattan, and aided and abetted the same. 

• On August 12, 2021, HUGO RODRIGUEZ and JOWENKY NUNEZ, SR. engaged in a shootout with each other in the vicinity of West 183rd Street in Manhattan, and aided and abetted the same.  A photograph of NUNEZ, SR., committing that shooting is below:

• In August 2021, JUSTIN DEAZA robbed an individual at gunpoint, in the vicinity of West 28th Street in Manhattan, and aided and abetted the same. 

• In September 2021, JUSTIN DEAZA attempted to rob an individual at gunpoint, in the vicinity of the FDR Drive in Manhattan, and aided and abetted the same. 

• In September 2021, JUSTIN DEAZA and WILSON MENDEZ robbed an individual at gunpoint, in Queens, and aided and abetted the same. 

• On January 22, 2022, JOWENKY NUNEZ, JR., JERRIN PENA, ELVIS TREJO, and STEVEN JOAQUIN robbed and shot several individuals in the vicinity of West 145th Street in Manhattan, and aided and abetted the same. 

• On February 7, 2022, MAYOVANEX RODRIGUEZ shot and killed Anthony Savarese in the vicinity of Andrews Avenue in the Bronx, and aided and abetted the same. 

• On February 14, 2022, HUGO RODRIGUEZ and ELVIS TREJO robbed several individuals at gunpoint in the vicinity of West 203rd Street in Manhattan, and aided and abetted the same.

• On March 4, 2022, JOWENKY NUNEZ, JR. and ELVIS TREJO shot at a rival gang member in the vicinity of Dyckman Street in Manhattan, and aided and abetted the same.   A photograph of NUNEZ, JR., committing that shooting is below:

Narcotics Trafficking and Firearms Use

Between 2018 and July 2022, JOWENKY NUNEZ, JR., JERRIN PENA, JUSTIN DEAZA, WILSON MENDEZ,  BRIAN HERNANDEZ, HUGO RODRIGUEZ, MAYOVANEX RODRIGUEZ, JOHANN ZAPATA, ELVIS TREJO, STEVEN JOAQUIN, IYAURY RODRIGUEZ-ROSARIO, JOWENKY NUNEZ, SR., ARGENIS TAVAREZ, VICTOR COLON, JOSE GUTIERREZ, and NIJMAH MARTE conspired to distribute and possess with intent to distribute fentanyl, heroin, cocaine, crack cocaine, oxycodone, ecstasy, and marijuana.  In addition, these defendants used, carried, and possessed firearms in furtherance of their narcotics trafficking, and aided and abetted the same.

Firearms Trafficking

Between May 2020 and October 2020, JOWENKY NUNEZ, JR., JERRIN PENA, and IYAURY RODRIGUEZ-ROSARIO unlawfully obtained approximately thirteen firearms in Pennsylvania and transported those firearms to New York for use by members of OED.

*          *          *

H. RODRIGUEZ, 26, M. RODRIGUEZ, 27, ZAPATA, 20, TREJO, 21, JOAQUIN, 20, and NUNEZ, SR., 39, were all arrested yesterday, and will be presented today before United States Magistrate Judge Katharine H. Parker.  Today, RODRIGUEZ-ROSARIO, 41, was arrested and will be presented in the Eastern District of Pennsylvania.  NUNEZ, JR., 20, PENA, 20, DEAZA, 21, MENDEZ, 20, HERNANDEZ, 22, COLON, 24, GUTIERREZ, 20, and MARTE, 22, were charged in a prior indictment and have been presented on those charges.  TAVAREZ, 23, has not been arrested at this time.  This case is assigned to United States District Judge J. Paul Oetken.

Charts containing the names, charges, and maximum penalties for the defendants are set forth below.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Williams praised the outstanding investigative work of the NYPD and DEA.  Mr. Williams also thanked the Manhattan District Attorney’s Office, the Bronx District Attorney’s Office, the Office of the Special Narcotics Prosecutor, the New York State Police, and the NYPD Task Force Officers assigned to this Office for their assistance in the investigation.

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

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

COUNT

DEFENDANT(S)

MAX. TERM OF IMPRISONMENT

Count One: Conspiracy to Commit Racketeering

(18 U.S.C. § 1962(d))

Jowenky Nunez, Jr.

Jerrin Pena

Justin Deaza

Wilson Mendez

Brian Hernandez

Hugo Rodriguez

Mayovanex Rodriguez

Johann Zapata

Elvis Trejo

Steven Joaquin

Iyaury Rodriguez-Rosario

Jowenky Nunez, Sr.

Argenis Tavarez

Life Imprisonment

Count Two:  Murder in Aid of Racketeering

(18 U.S.C. §§ 1959(a)(1) and 2)

Jowenky Nunez, Jr.

Brian Hernandez

Iyaury Rodriguez-Rosario

Death or a Mandatory Minimum Sentence of Life Imprisonment

Count Three: Use of a Firearm to Commit Murder (18 U.S.C. § 924(j)(1))

Jowenky Nunez, Jr.

Brian Hernandez

Iyaury Rodriguez-Rosario

Death or Life Imprisonment; Mandatory Minimum Sentence of 5 years

Count Four:  Murder in Aid of Racketeering

(18 U.S.C. §§ 1959(a)(1) and 2)

Jowenky Nunez, Jr.

Brian Hernandez

Iyaury Rodriguez-Rosario

Death or a Mandatory Minimum Sentence of Life Imprisonment

Count Five: Use of a Firearm to Commit Murder

(18 U.S.C. §§ 924(j)(1) and 2)

Jowenky Nunez, Jr.

Brian Hernandez

Iyaury Rodriguez-Rosario

Death or Life Imprisonment; Mandatory Minimum Sentence of 5 years

Count Six:  Murder in Aid of Racketeering

(18 U.S.C. §§ 1959(a)(1) and 2)

Mayovanex Rodriguez

Death or a Mandatory Minimum Sentence of Life Imprisonment

Count Seven: Use of a Firearm to Commit Murder (18 U.S.C. §§ 924(j)(1) and 2)

Mayovanex Rodriguez

Death or Life Imprisonment; Mandatory Minimum Sentence of 5 years

Count Eight: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Brian Hernandez

Argenis Tavarez

20 years’ Imprisonment

Count Nine: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii), and 2)

Brian Hernandez

Argenis Tavarez

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Ten: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Jerrin Pena

Brian Hernandez

Argenis Tavarez

20 years’ Imprisonment

Count Eleven: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii), and 2)

Jerrin Pena

Brian Hernandez

Argenis Tavarez

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Twelve: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Jowenky Nunez, Sr.

20 years’ Imprisonment

Count Thirteen: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii), and 2)

Jowenky Nunez, Sr.

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Fourteen: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Justin Deaza

Wilson Mendez

20 years’ Imprisonment

Count Fifteen: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii), and 2)

Justin Deaza

Wilson Mendez

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Sixteen: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Brian Hernandez

20 years’ Imprisonment

Count Seventeen: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii), and 2)

Brian Hernandez

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Eighteen: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Jowenky Nunez, Jr.

Steven Joaquin

Iyaury Rodriguez-Rosario

20 years’ Imprisonment

Count Nineteen: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii), and 2)

Jowenky Nunez, Jr.

Steven Joaquin

Iyaury Rodriguez-Rosario

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Twenty: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Jowenky Nunez, Jr.

Iyaury Rodriguez-Rosario

20 years’ Imprisonment

Count Twenty-One: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii) and 2)

Jowenky Nunez, Jr.

Iyaury Rodriguez-Rosario

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Twenty-Two: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Jowenky Nunez, Jr.

20 years’ Imprisonment

Count Twenty-Three: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii), and 2)

Jowenky Nunez, Jr.

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Twenty-Four: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Jowenky Nunez, Jr.

Justin Deaza

20 years’ Imprisonment

Count Twenty-Five: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii), and 2)

Jowenky Nunez, Jr.

Justin Deaza

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Twenty-Six: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Hugo Rodriguez

20 years’ Imprisonment

Count Twenty-Seven: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii), and 2)

Hugo Rodriguez

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Twenty-Eight: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Jowenky Nunez, Sr.

20 years’ Imprisonment

Count Twenty-Nine: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii), and 2)

Jowenky Nunez, Sr.

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Hobbs Act Robbery (18 U.S.C. §§ 1951 and 2)

Jowenky Nunez, Jr.

Jerrin Pena

Elvis Trejo

Steven Joaquin

20 years’ Imprisonment

Count Thirty-One: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii), and 2)

Jowenky Nunez, Jr.

Jerrin Pena

Elvis Trejo

Steven Joaquin

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Thirty-Two: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Jowenky Nunez, Jr.

Elvis Trejo

20 years’ Imprisonment

Count Thirty-Three: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii), and 2)

Jowenky Nunez, Jr.

Elvis Trejo

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Thirty-Four: Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3) and 2)

Wilson Mendez

20 years’ Imprisonment

Count Thirty-Five: Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3) and 2)

Justin Deaza

20 years’ Imprisonment

Count Thirty-Six: Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3) and 2)

Justin Deaza

20 years’ Imprisonment

Count Thirty-Seven: Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3) and 2)

Justin Deaza

20 years’ Imprisonment

Count Thirty-Eight: Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3) and 2)

Justin Deaza

Wilson Mendez

20 years’ Imprisonment

Count Thirty-Nine: Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3) and 2)

Hugo Rodriguez

Elvis Trejo

20 years’ Imprisonment

Count Forty: Conspiracy to Distribute Controlled Substances (21 U.S.C. § 846)

Jowenky Nunez, Jr.,

Jerrin Pena

Justin Deaza

Wilson Mendez

Brian Hernandez

Hugo Rodriguez

Mayovanex Rodriguez

Johann Zapata

Elvis Trejo

Steven Joaquin

Iyaury Rodriguez-Rosario

Jowenky Nunez, Sr.

Argenis Tavarez

Victor Colon

Jose Gutierrez

Nijmah Marte

Life Imprisonment; Mandatory Minimum Sentence of 10 years

Count Forty-One: Possession of a Firearm in Furtherance of a Drug Trafficking Crime (18 U.S.C. §§ 924(c)(1)(A)(i) and 2)

Jowenky Nunez, Jr.,

Jerrin Pena

Justin Deaza

Wilson Mendez

Brian Hernandez

Hugo Rodriguez

Mayovanex Rodriguez

Johann Zapata

Elvis Trejo

Steven Joaquin

Iyaury Rodriguez-Rosario

Jowenky Nunez, Sr.

Argenis Tavarez

Victor Colon

Jose Gutierrez

Nijmah Marte

Life Imprisonment; Mandatory Minimum Sentence of 5 years

Count Forty-Two: Interstate Transportation or Receipt of Firearms (18 U.S.C. §§ 922(a)(3), 924(a)(1), and 2)

Jowenky Nunez, Jr.

Jerrin Pena

Iyaury Rodriguez-Rosario

5 years’ Imprisonment

[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.

Damian Williams, the United States Attorney for the Southern District of New York, announced that SETH ANDREW was sentenced to 366 days in prison in connection with his execution of a scheme to defraud Democracy Prep Public Schools (“DPPS”), a charter school network that he founded, of more than $218,000.  United States District Judge John P. Cronan imposed today’s sentence.

U.S. Attorney Damian Williams said: “Seth Andrew was sentenced today for stealing from those who once trusted him.  Andrew committed this crime to attempt to punish non-profit charter schools because they declined his offer to return as their leader.  Thankfully, the victim of Andrew’s crime was resilient, and its important work continues.  Today’s sentence sends a message that those who engage in fraud schemes and steal from others will face appropriate consequences for their conduct.”      

According to previous filings in this case:

In 2005, SETH ANDREW helped to found Democracy Prep Public Schools, a series of public charter schools then based in New York City.  In the Spring of 2013, ANDREW left DPPS and accepted a job in the United States Department of Education and, thereafter, as a senior advisor in the Office of Educational Technology at the White House.  In November 2016, ANDREW left his role at the White House.  Shortly thereafter, in January 2017, ANDREW officially severed his relationship with DPPS.

Under New York state regulations, DPPS’s New York-based charter schools must maintain an “escrow account” that may be accessed only if the school dissolves.  Three such escrow accounts, for three New York City-based-DPPS schools, were opened by ANDREW and other DPPS employees, at  a bank (“Bank-1”) in 2009, 2011 and 2013, respectively (“Escrow Account-1,” “Escrow Account-2,” and “Escrow Account-3”, collectively, the “Escrow Accounts”).  ANDREW was a signatory and had access to the funds in the Escrow Accounts.  However, pursuant to the charter agreement, the funds in the Escrow Accounts were reserved in case the schools dissolved, and the funds could not be moved by ANDREW, or anyone, without proper authorization.

In early 2019, apparently frustrated with decisions made by DPPS, and his inability to exercise control over the organization, ANDREW sought to rejoin DPPS.  On March 10, 2019, ANDREW sent an email to several members of DPPS, including its Chairman, offering to return as “President,” in exchange for “$25k/month as [a] salaried employee and basic frugal expenses,” plus a $250,000 bonus if he met deliverables ANDREW outlined.  ANDREW further stated that “every single day that goes by, this situation becomes exponentially more difficult and the ability to pull out of a nosedive becomes harder. So after 24 hours, my monthly salary expectation will go up every day that we’re not under a signed contract.” 

DPPS declined ANDREW’s offer.  Eighteen days later, on March 28, 2019, ANDREW entered a Bank-1 branch in New York City and closed both Escrow Account-1 and Escrow Account-2.  Bank-1 provided ANDREW a bank check in the amount of $71,881.23 made payable to “Democracy Prep Charter School” (“Check-1”) and a second bank check in the amount of $70,642.98 made payable to “Democracy Prep Harlem Charter” (“Check-2”). 

The same day that ANDREW closed Escrow Account-1 and Escrow Account-2, ANDREW entered a Manhattan branch of a different FDIC-insured bank (“Bank-2”) and opened a business bank account in the name of “Democracy Prep Charter School” (“Fraud Account‑1”).  To open that account, ANDREW misrepresented to a Bank-2 employee that he was a “Key Executive with Control of” DPPS and supported that misrepresentation by sending emails sent to the Bank-2 employee from a DPPS email account.  ANDREW then deposited Check-1 into Fraud Account-1. Five days later, on April 2, 2019, ANDREW used an ATM machine in Baltimore, Maryland to deposit Check-2 into Fraud Account‑1. 

On October 17, 2019, ANDREW closed out Escrow Account-3 and received a check (“Check-3”) made payable to “Democracy Prep Endurance” in the amount of $75,481.10.  On October 21, 2019, ANDREW deposited Check-3 into an account that he opened at a third bank (“Fraud Account-2”). 

Approximately one month later, ANDREW obtained a check from Bank-2 for $144,473.29, which constituted the funds stolen from Escrow Account-1 and Escrow Account-2.  ANDREW ultimately deposited those funds into Fraud Account-2, combing all of the stolen funds, then worth approximately $219,954.  Five days later, ANDREW rolled the stolen funds in Fraud Account-2 into a certificate of deposit.  That certificate of deposit matured on May 20, 2020, which earned ANDREW $2,083.52 in interest.  ANDREW then transferred the funds from the certificate of deposit -- including the funds stolen from the Escrow Accounts -- into a bank account held in the name of Democracy Builders, another nonprofit that ANDREW then-controlled, thereby concealing the money’s association with DPPS, and depositing the stolen money into an account under ANDREW’s complete control.  The next day, ANDREW sent a wire for $225,000, apparently comprised primarily of funds from the Escrow Accounts, for a down payment on a significant purchase of property for Democracy Builders.

In total, DPPS lost $218,005 as a result of Andrew’s actions.

*                      *                     *

ANDREW, 43, previously pled guilty to one count of wire fraud on January 14, 2022, before Judge Cronan.  In addition to this prison sentence, ANDREW was sentenced to 3 years of supervised release.  Prior to today’s sentencing Andrew paid $218,005 in restitution to DPPS, and $22,537 in forfeiture.

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 United States Attorney Ryan B. Finkel is in charge of the prosecution.

Damian Williams, the United States Attorney for the Southern District of New York, announced that JAESON BIRNBAUM, a disbarred lawyer, was sentenced today to 36 months in prison for defrauding investors in his now bankrupt litigation finance firm, “Cash4Cases.”  BIRNBAUM previously pled guilty to securities fraud for misappropriating investors funds and pledging the same lawsuit recoveries as collateral to multiple parties, contrary to his representations.  U.S. District Paul A. Crotty imposed the sentence in Manhattan federal court.

U.S. Attorney Damian Williams stated: “As a lawyer Birnbaum understood the importance of honest dealings and putting his investors first.  Instead, Birnbaum chose to lie to his investors in order to steal their money and cover up his fraud by doctoring company records.  Through today’s sentence, Birnbaum has been held accountable for this serious fraud.”

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

From at least in or about 2017 through in or about 2019, BIRNBAUM obtained more than $3 million in investments for Cash4Cases based on fraudulent misrepresentations.  These investments were in the form of promissory notes, titled “Investor Security Agreements” (“ISAs”), which purported to provide the relevant investors with a security interest in the recoveries associated with certain specified lawsuits that were ostensibly purchased by Cash4Cases.  In fact, in some instances, the lawsuits that were either never funded by Cash4Cases or BIRNBAUM had previously pledged their recoveries to other parties. 

To help carry out his fraud, BIRNBAUM directed an employee to falsify his company’s books and records to make it appear that the recoveries from lawsuits that had already been paid out were still available to be pledged as collateral to new investors.

BIRNBAUM also misappropriated a substantial portion of investors’ funds for his personal use and to make promised payments to earlier investors in Ponzi-like manner.  As one example, BIRNBAUM obtained a $1 million investment for Cash4Cases in September 2019.  Prior to this investment, BIRNBAUM told the investor that Cash4Cases would use the money exclusively for advances to litigants.  However, contrary to this representation, BIRNBAUM used the money to make a $530,000 down payment on the purchase of a house and to pay for other personal expenses and Ponzi-like payments to earlier investors.

*                *                *

BIRNBAUM, 48, of Boca Raton, Florida, was also sentenced to a three-year term of supervised release.  He was further ordered to pay restitution to his victims in the amount of $2,661,072.24 and to forfeit $2,661,072.24 in fraud proceeds.  

Mr. Williams praised the investigative work of the United States Postal Inspection Service and thanked the U.S. Securities and Exchange Commission for its assistance.

This case is being handled by the Office’s Securities and Commodities Fraud Task Force.  Assistant United States Attorney Daniel Loss is in charge of the prosecution.

Damian Williams, the United States Attorney for the Southern District of New York, and Daniel R. Brubaker, Inspector-in-Charge of the New York Office of the U.S. Postal Inspection Service (“USPIS”), announced today the unsealing of an Indictment charging RAQUEL MOURA BORGES with securities fraud, wire fraud, and investment adviser fraud in connection with her scheme to defraud customers of her investment adviser firm, Global Access Investment Advisor LLC (“GAIA”).  BORGES was arrested yesterday morning and presented before Magistrate Judge Sarah Netburn. The case is assigned to U.S. District Judge Lewis J. Liman. 

U.S. Attorney Damian Williams said: “Borges promised her investment advisory clients that she would invest in securities and other investments but in fact stole her clients’ savings and lined her own pockets.  Now, for this alleged violation of the law and of her fiduciary duty to her clients, Borges faces federal criminal charges”

USPIS Inspector-in-Charge Daniel R. Brubaker said:  “The defendant, a native of Brazil, was welcomed by Postal Inspectors with a pair of handcuffs upon her return to the United States yesterday. For years investors trusted Raquel Moura Borges and her company Global Access Investment Advisors in Manhattan with a combined total of over $19 Million. She allegedly violated at least two of those investors’ trust and broke the law by spending their money on a lavish New York City apartment and to cover other clients’ losses. The arrest of Borges should serve as a warning to criminals: no matter where they are, Postal Inspectors and our law enforcement partners will be waiting at the end of that road to bring you to justice. We will commit every resource available to us in the fight against investment fraud and will track down fraudsters whether they are here or abroad.”

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

From at least in or about 2017 until at least in or about 2018, RAQUEL MOURA BORGES represented to Victim-1 that she was making financial investments, including a private placement investment in a particular Brazilian company, on Victim-1’s behalf.  In or about December 2017, over the course of three transactions, BORGES caused approximately $2.7 million to be transferred from Victim-1’s account to accounts controlled by BORGES. Contrary to the representations made by BORGES to Victim-1 and in violation of the duties she owed Victim-1, none of the $2.7 million was actually invested on Victim-1’s behalf.  Instead, BORGES diverted the money to others and spent approximately $160,000 on interior design fees for an apartment in Manhattan, New York that BORGES owned and used personally.  To conceal her misappropriation of Victim-1’s funds, in or about June 2018, BORGES sent Victim-1 a fake bank statement that falsely reflected a transfer of $2.7 million for the purpose of a “private placement purchase.” 

From at least in or about 2016 until at least in or about 2017, BORGES represented to Victim-2 that she was making financial investments on Victim-2’s behalf.  In or about August 2016, BORGES caused approximately $1.95 million to be transferred from Victim-2’s account to a GAIA account controlled by BORGES (the “GAIA Account”).  The purported reason for the transfer was an investment in real estate in New York.  Contrary to the representations made by BORGES to Victim-2, and in violation of the duties she owed Victim-2, none of the $1.95 million was actually invested on Victim-2’s behalf.  Instead, on or about August 23, 2016, the same date that the $1.95 million wire from Victim-2’s account arrived in the GAIA Account, BORGES signed a check drawn on the GAIA Account in the amount of $1,500,000 payable to herself (the “$1.5M Check”).  The “For” line of the $1.5M Check read “RB’s new house.”  Also on or about August 23, 2016, BORGES caused the $1.5M Check to be deposited into her personal account. 

In or about October 2017, in a meeting with a family member of Victim-2 and in a subsequent e-mail communication, BORGES admitted, in substance and relevant part, that she had misappropriated Victim-2’s money. Among other things, BORGES stated, in sum and substance, that BORGES had used Victim-2’s money to cover other clients’ losses and that BORGES would find a way to pay back Victim-2. 

*                      *                      *

BORGES, 55, of Brazil, is charged with one count of securities fraud, which carries a maximum sentence of 20 years in prison, one count of wire fraud, which carries a maximum sentence of 20 years in prison, and one count of investment adviser fraud, which carries a maximum sentence of 5 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 defendant will be determined by the judge.

Mr. Williams praised the investigative work of the USPIS and also thanked the Securities and Exchange Commission, which has filed a civil enforcement action against the defendant, for its assistance in the investigation.

The case is being overseen by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Gina Castellano 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. 

Damian Williams, the United States Attorney for the Southern District of New York, announced today that FRANK OKUNAK, the former chief financial officer of one of the world’s leading global public relations firms, pled guilty in connection with a decade-long scheme to embezzle over $16 million from his employer.

U.S. Attorney Damian Williams stated: “ Frank Okunak, former CFO of one of the world’s leading public relations firms, admitted today to illegally embezzling over $16 million of the firm’s assets to pay for his posh lifestyle. Okunak now awaits sentencing for his decade-long fraud scheme.”

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

For nearly a decade, FRANK OKUNAK, who was the chief financial officer and later chief operating officer of a leading global public relations firms (the “PR Firm”), embezzled over $16 million from the PR Firm and, ultimately, the shareholders of the PR Firm’s publicly traded parent corporation. OKUNAK used the embezzled funds to finance his personal lifestyle and his own private business ventures. OKUNAK concealed and facilitated his theft by preparing and causing others to prepare materially false accounting books and records, including invoices and payment records that falsely described expenditures as having been undertaken for the benefit of the PR Firm, when funds were actually used for OKUNAK’s personal benefit or for the benefit of his personal business associates.

Specifically, from 2011 through 2020, OKUNAK used his authority as an officer of the PR Firm to cause the PR Firm to make unauthorized payments for OKUNAK’s personal and business ventures unrelated to the activities of the PR Firm or its corporate parents. OKUNAK used the PR Firm’s assets to provide the start-up capital for his personal, independent business ventures, to purchase tickets and luxury boxes at sporting events, and even to cover donations to his alma mater. To hide the illicit nature of these expenditures, OKUNAK frequently prepared or caused others to prepare false or misleading invoices and other documentation to suggest, falsely, that the funds were used for legitimate corporate purposes.

*                *                *

OKUNAK, 56, of Lyndhurst, New Jersey, pled guilty to one count of wire fraud and one count of falsification of corporate books and records. Each count carries a maximum sentence of 20 years in prison. As part of his guilty plea, OKUNAK agreed to forfeit $10,823,575.57 and to pay restitution of $16,043,603.71.

Mr. Williams praised the outstanding work of the FBI. Mr. Williams further thanked the U.S. Securities and Exchange Commission and the victim PR Firm and its corporate parent for their cooperation and assistance in this investigation.

The prosecution of this case is being overseen by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Scott Hartman and Matthew Podolsky are in charge of the case.

“Jason Kurland marketed himself to the public as the leading lottery lawyer in the country and was successful in recruiting as clients some of the biggest lottery winners in U.S. history.  But then he used his position as a lawyer—a profession founded on duties of honesty and loyalty—to steer his clients to invest millions of dollars in companies that he secretly owned and took illegal kickbacks based on his clients’ investments without their knowledge. Ultimately, the defendant and his co-conspirators lined their own pockets while his clients suffered massive losses from their crimes.  I want to thank the FBI and the career prosecutors of the Southern District of New York who worked tirelessly to hold the defendant accountable for his crimes.”

Former U.S. Congressman Charged with Insider Trading Based on Inside Information Obtained from Consulting Work

Former FBI Agent Trainee and Friend Charged with Insider Trading Based on Inside Information Stolen from the Trainee’s former Girlfriend

Network of Individuals Charged with Insider Trading based on Inside Information obtained from the Former Chief Information Security Officer of Telecommunications Company

New York-based Investment Banker Charged with Insider Trading for Using Stolen Information about Potential Investments to Tip Trading Friend

Damian Williams, United States Attorney for the Southern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”) announced charges in four separate insider trading cases, collectively charging nine defendants with securities fraud and other related charges, including in some cases, obstruction of justice.  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 made between hundreds of thousands and millions of dollars from illegal securities trading based on material, non-public information that was stolen from numerous sources.

U.S. Attorney Damian Williams said:  “The message of today’s arrests is simple: My Office remains as committed as ever to rooting out insider trading in all forms.  Insider trading erodes the trust and confidence of the investing public in our capital markets.  We will continue to investigate and prosecute those who cheat in the markets by using insider information to line their own pockets.  The four cases charged today–involving a former politician, a former member of law enforcement, California-based technology company executives, and a New York-based investment banker–demonstrate the breadth and scope of our focus on catching and prosecuting these criminals in all areas of our financial system.”

FBI Assistant Director-in-Charge Michael J. Driscoll said:  “The four cases laid out here illustrate insider trading continues to plague our financial markets.  The specifics of each case may vary, however they all have one thing in common - everyone involved let greed dictate their actions and made trades based on material non-public information. The crimes we allege threaten both the integrity of our financial markets and investors’ faith in them. Our actions demonstrate we remain committed to ensuring a level playing field for all.”

According to the allegations contained in the Indictments filed in Federal Court and other publicly available information:[1]

United States v. Buyer

STEPHEN BUYER, a former U.S. Congressman from Indiana, engaged in two separate, but interrelated insider trading schemes to steal material non-public information that he obtained through consulting work and place timely, profitable securities trade based on that stolen information.  First, in or about March and April 2018, BUYER purchased shares of Sprint Corporation (“Sprint”) ahead of the April 29, 2018 public announcement that T-Mobile US, Inc. (“T-Mobile”) and Sprint would merge, in a deal valued at $26.5 billion.  Prior to the public announcement of the transaction by T-Mobile, executives at T-Mobile told a small, trusted group of consultants that they had retained to work on the deal, including BUYER, about the merger and directed them to keep the information confidential.  BUYER breached his duty of confidentiality to T-Mobile and misappropriated that information by purchasing shares of Sprint across several brokerage accounts, including his own accounts, an account held jointly with his cousin, and an account in the name of a close personal friend (“Individual-1”).   Across these accounts, BUYER made more than $126,000 from the purchase and subsequent sale of Sprint stock after the merger was publicly announced. 

In or about June through August 2019, BUYER traded in shares of Navigant Consulting, Inc. (“Navigant”) ahead of Navigant’s acquisition by consulting and advisory firm Guidehouse. As with Sprint, BUYER determined through his consulting work for Guidehouse that Guidehouse intended to acquire Navigant, and misappropriated that information by purchasing Navigant shares ahead of the public announcement of the acquisition.  BUYER purchased Navigant shared across several brokerage accounts, including accounts in his own name, joint accounts held with family members, and Individual-1’s account.   In total, Buyer made more than $223,000 from his illegal Navigant trades.  

BUYER, 63, of Noblesville, Indiana, has been charged with four counts of securities fraud, each of which carries a maximum term of 20 years in.  BUYER was arrested this morning and the case has been assigned to U.S. District Judge Richard M. Berman.

United States v. Markin and Wong

In early 2021, SETH MARKIN and BRANDON WONG together made more than $1.4 million dollars in illegal profits by trading in stock based on inside information that MARKIN misappropriated from his then-girlfriend, who was then an attorney at a major law firm in Washington D.C. assigned to work on the acquisition of Pandion Therapeutics (“Pandion”) by Merck & Co. (“Merck”).  To carry out the illegal insider trading scheme, MARKIN secretly looked through his girlfriend’s confidential work documents, without her permission, and learned that in a matter of weeks, Merck, a publicly traded pharmaceutical company, was going to acquire Pandion, a publicly traded biotechnology company, for approximately three times the value of Pandion’s then-share price.  After misappropriating this material non-public information from his girlfriend, MARKIN purchased shares in Pandion, and tipped several friends and family members, including WONG.  WONG, in turn, purchased hundreds of thousands of dollars’ worth of Pandion shares, and told at least eight other people to purchase Pandion shares.  In total, MARKIN and WONG directly or indirectly caused more than twenty people to trade in Pandion stock based on the material non-public information that MARKIN misappropriated from his girlfriend resulting in millions of dollars of illegally obtained trading profits. 

At the time of the relevant trades, MARKIN had been accepted into the Federal Bureau of Investigation as a new agent trainee.  In addition to perpetrating the insider trading scheme, MARKIN lied to conceal his illegal Pandion trades.  In or about June 2021, after MARKIN and his girlfriend had ended their relationship, and as MARKIN was preparing to begin training as a new agent at the FBI Academy in Quantico, Virginia, MARKIN’s former girlfriend called him to ask why MARKIN’s name had come up in an inquiry by the Financial Industry Regulatory Authority (“FINRA”) into trading in Pandion stock. In response, MARKIN lied to her and falsely claimed that he did not trade in Pandion stock.  In addition, in or about November 2021, MARKIN lied to FBI agents when he was interviewed about his Pandion trading, conduct that forms the basis for a separate charge against MARKIN for making false statements.

MARKIN, 31, of Washington Crossing, Pennsylvania, has been charged with nine counts of securities fraud and eight counts of tender offer fraud, each of which carries a maximum term of 20 years in prison, and one count of conspiracy and one count of making false statements, each of which carries a maximum term of 5 years in prison, and was arrested this morning. 

WONG, 38, of New York, has been charged with eleven counts of securities fraud and ten counts of tender offer fraud, each of which carries a maximum term of 20 years in prison, and one count of conspiracy, which carries a maximum term of 5 years in prison and was arrested this morning.  The case has been assigned to U.S. District Judge Edgardo Ramos.

United States v. Bhardwaj, Kakkera, and Saeedi

From November 2020 through April 2020, AMIT BHARDWAJ, SRINIVASA KAKKERA, ABBAS SAEEDI, engaged in an insider trading scheme in which BHARDWAJ, who was the Chief Information Security Officer (“CISO”) of Lumentum Holdings Inc. (“Lumentum”), misappropriated material, non-public information belonging to Lumentum and then traded on that information himself and tipped his criminal associates, including KAKKERA, SAEEDI, Dhirenkumar Patel, and Ramesh Chitor, in connection with two separate potential acquisitions by Lumentum, Coherent, Inc. (“Coherent”) and Neophotonics Coproration (“Neophotonics”). 

In approximately December 2020, BHARDWAJ learned that Lumentum was considering acquiring Coherent.  Based on this material, non-public information, BHARDWAJ himself purchased Coherent stock and call options, and BHARDWAJ tipped two friends – including Dhirenkumar Patel – and a close family relative and these individuals all traded in Coherent securities as a result.  BHARDWAJ and Patel agreed that Patel would pay BHARDWAJ fifty percent of the profits that Patel earned by trading in Coherent based on the MNPI provided by BHARDWAJ. When Coherent’s stock price increased substantially following the January 19 Announcement, AMIT BHARDWAJ, his close family member, his friend Patel, and another friend, closed their positions in Coherent securities and collectively profited by nearly $900,000.

In or about October 2021, BHARDWAJ learned that Lumentum was engaged in confidential discussions with Neophotonics about a potential acquisition.  BHARDWAJ provided this MNPI to SRINIVASA KAKKERA, ABBAS SAEEDI, and Ramesh Chitor, and these individuals all traded in Neophotonics securities as a result.  In connection with Chitor’s trading, BHARDWAJ and Chitor agreed that Chitor and Bhardwaj would split the profits equally.  When Neophotonics’ stock price increased substantially following the announcement of the acquisition in November 2021, KAKKERA, SAEEDI and Chitor closed their positions in Neophotonics securities and made collectively approximately $4.3 million in realized and unrealized profits.

After they were interviewed by the Federal Bureau of Investigation voluntarily and served with federal grand jury subpoenas on approximately March 29, 2022, BHARDWAJ, KAKKERA and SAEEDI took steps to obstruct the federal investigation of their conduct.  On the day of the March 29, 2022 FBI interviews, BHARDWAJ drove to the homes of certain of his co-conspirators to encourage them not to tell the federal authorities the truth about their insider trading scheme.  BHARDWAJ, KAKKERA, SAEEDI, and Dhirenkumar Patel then met in person on multiple occasions and discussed, among other things, potential false stories that would conceal their insider trading scheme, as well as creating false documents to buttress lies regarding payments that were, in reality, related to the insider trading scheme.  BHARDWAJ also solicited assistance from Patel in seeking to ensure that any potential incriminating information from BHARDWAJ’s work laptop would be deleted. 

BHARDWAJ, 49, of San Ramon, California, who was arrested this morning, has been charged with seven counts of securities fraud and two counts of wire fraud, each of which carries a maximum term of 20 years in prison, and one count of conspiracy to commit securities fraud and wire fraud, and one count of conspiracy to obstruct justice, each of which carries a maximum term of 5 years in prison. 

KAKKERA, 47, of Pleasanton, California, who was arrested this morning, has been charged with one count of securities fraud and one count of wire fraud, each of which carries a maximum term of 20 years in prison, and one count of conspiracy to commit securities fraud and wire fraud, and one count of conspiracy to obstruct justice, each of which carries a maximum term of 5 years in prison. 

SAEEDI, 47, of Fremont, California, who was arrested this morning, has been charged with one count of securities fraud and one count of wire fraud, each of which carries a maximum term of 20 years in prison, and one count of conspiracy to commit securities fraud and wire fraud, and one count of conspiracy to obstruct justice, each of which carries a maximum term of 5 years in prison.

The case has been assigned to U.S. District Judge Gregory H. Woods.

Also unsealed today were charges against Dhirenkumar Patel and Ramesh Chitor, who have separately pled guilty and are cooperating with the Government in this case.

United States v. Goel

BRIJESH GOEL was an investment banker in the financing group at a major international investment bank in New York, New York (the “Investment Bank”).  In that position, GOEL received confidential, internal emails directed to the Investment Bank’s Firmwide Capital Committee, which contained detailed information and analysis about potential mergers and acquisitions transactions the Investment Bank was considering financing.  In violation of the duties that he owed to the Investment Bank, GOEL misappropriated that confidential information and tipped a friend, who worked at another investment bank in New York, New York (“CC-1”), with the names of potential target companies from these FWCC emails, typically during in-person meetings (such as when the two met to play squash).  CC-1 then used that MNPI to trade call options, including short-dated, out-of-the-money call options, in brokerage accounts that were in the name of CC-1’s brother.  GOEL and CC-1 agreed to split the profits from their trading.  Between approximately 2017 and 2018, GOEL tipped CC-1 on at least seven deals in which the Investment Bank was involved, yielding total illegal profits of approximately $280,000. 

Between approximately May and June 2022, GOEL also obstructed investigations by a Grand Jury in the Southern District of New York and the U.S. Securities and Exchange Commission.  Specifically, GOEL deleted and asked CC-1 to delete electronic communications regarding this insider trading scheme, including during an in-person meeting that CC-1 consensually recorded.

GOEL, 37, of New York, New York, has been charged with four counts of securities fraud and one count of obstruction of justice, each of which carries a maximum term of 20 years in prison, and one count of conspiracy to commit securities fraud and tender offer fraud, which carries a maximum term of 5 years in prison.  GOEL was arrested yesterday, and the case has been assigned to U.S. District Judge P. Kevin Castel.

*                *                *

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 Federal Bureau of Investigation and the Department of Justice’s Office of the Inspector General.  He further thanked the Securities and Exchange Commission and the victim law firm and companies for their cooperation and assistance across these investigations.   

These cases are being handled by the Office’s Securities and Commodities Fraud Task Force.  United States v. Buyer is in the charge of Assistant U.S. Attorneys Jordan Estes, Kiersten Fletcher, and Elizabeth Hanft.  United States v. Markin and Wong is in the charge of Assistant U.S. Attorneys Kiersten Fletcher, Nicolas Roos, and Negar Tekeei.  United States v. Bhardwaj, Kakkera, and Saeedi is in the charge of Assistant U.S. Attorneys Richard Cooper and Noah Solowiejczyk.  United States v. Goel is in the charge of Assistant U.S. Attorney Joshua Naftalis.    

[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.

Damian Williams, the United States Attorney for the Southern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of a criminal complaint charging RAI THOMAS with sex trafficking of a minor and use of interstate facilities to promote sex trafficking and prostitution.  THOMAS was arrested this morning and will be presented before United States Magistrate Judge Andrew E. Krause.

U.S. Attorney Damian Williams said: “As alleged, Rai Thomas exploited a teenage girl who lived at a residential facility for vulnerable and at-risk youth, and caused her to engage in commercial sexual activity at hotels throughout the Bronx and Brooklyn for his own profit.  Thomas’s alleged conduct is particularly insidious given his minor victim’s vulnerable status and living situation.  This Office, along with our law enforcement partners at the FBI, will continue to identify, investigate, and prosecute those engaged in the sex trafficking of minors.” 

FBI Assistant Director Michael J. Driscoll said:  "Human traffickers exploit at-risk teenagers, using their vulnerabilities against them. Make no mistake - these criminals are forcing children to have sex so they can make money. We are doing everything we can to help the victim in this case, but she may not be the only one. Please reach out to us at 1-800-CALL-FBI to report any information that could help ensure Thomas faces justice for his alleged crimes."

As alleged in the Complaint:[1]

In January and February 2022, THOMAS recruited Minor Victim-1 to engage in commercial sexual activity and caused her to do so on multiple occasions in hotels within the Bronx and Brooklyn, New York.  THOMAS facilitated and benefited from the scheme in numerous ways, including by recruiting and enticing Minor Victim-1 to engage in commercial sex; coordinating the transportation of Minor Victim-1 to the hotels and reserving the hotel rooms in which she engaged in commercial sex; facilitating the advertisement of Minor Victim-1 on various websites to customers for commercial sex; and profiting from the sex trafficking scheme.

There may be other victims of this alleged conduct.  If you have information to report, contact the Federal Bureau of Investigation through its toll-free Tip Line at 1-800-CALL-FBI.

*                *                *

THOMAS, 27 of Mount Vernon, New York, is charged with (1) sex trafficking of a minor, which carries a mandatory minimum term of 10 years in prison and a maximum term of life in prison, and (2) use of interstate facilities to promote unlawful activity, which carries a maximum sentence of five years in prison. 

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

Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation’s Hudson Valley Safe Streets Task Force, the Town of Poughkeepsie Police Department, the Dutchess County Sheriff’s Office, the City of Poughkeepsie Police Department, and the New York City Police Department.  Mr. Williams noted that the investigation is ongoing.

The case is being prosecuted by the Office’s White Plains Division.  Assistant U.S. Attorney Qais Ghafary 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 herein, constitutes only allegations, and every fact described therein should be treated as an allegation.

Damian Williams, the United States Attorney for the Southern District of New York, Michael J. Driscoll, Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Frank A. Tarentino III, Special Agent-in-Charge of the New York Office of the Drug Enforcement Administration (“DEA”), today announced additional charges against six alleged members of a street gang known as the “Young Bronx Money Getters” or “YBMG” in the Bronx, New York.  SHPENDIM HAXHAJ, a/k/a “White Mike,” YELTSIN BELTRAN, a/k/a “Yells,” BORIS BELTRAN, a/k/a “Bebe,” JEREMY CEDENO, a/k/a “Jerm,” FRANCISCO ORTEGA, a/k/a “Fresh,” and IVIS PERDOMO, a/k/a “Light,” all of whom are members of YBMG, were charged in a Superseding Indictment with racketeering conspiracy, drug trafficking, and firearms offenses.  HAXHAJ, YELTSIN BELTRAN, BORIS BELTRAN, CEDENO, and PERDOMO were also charged with engaging in violent crimes in aid of racketeering.  LUCAS CHAJECKI, a/k/a ‘Luc Luc,” whom members of YBMG allegedly hired to commit a murder, HAXHAJ, and BORIS BELTRAN, are additionally charged with the August 16, 2019 murder of Isael Lagares in the Bronx.  The case is assigned to U.S. District Judge Katherine Polk Failla.

SHPENDIM HAXHAJ, YELTSIN BELTRAN, BORIS BELTRAN, JEREMY CEDENO, FRANCISCO ORTEGA, and IVIS PERDOMO were already in custody in connection with charges contained in a previous indictment related to this prosecution.  LUCAS CHAJECKI is in state custody in connection with his alleged murder of Isael Lagares and will be transferred into federal custody.

U.S. Attorney Damian Williams said: “As alleged in the Superseding Indictment, YBMG was an extremely violent street gang that brutalized the Bronx with guns and drugs for at least 15 years. Among YBMG’s many victims was Isael Lagares, who was allegedly gunned down at the age of 27 by Lucas Chajecki at the direction of Shpendim Haxhaj and Boris Beltran. With this superseding indictment, we take another step towards holding YBMG’s members and leaders accountable for their alleged crimes.”

Special Agent-in-Charge of the New York Office of DEA Frank A. Tarentino III said:  “The DEA’s mission is to keep people safe and healthy.  We accomplish this by holding accountable those who cause the most harm in our communities. Just like defendants in this investigation who are charged with some of the most serious violent crimes imaginable. I applaud the tenacity of the investigative team in bringing these violent offenders to justice and holding them accountable.”

According to the allegations in the Superseding Indictment filed today in federal court:[1]

From at least in or about 2006 to in or about 2021, YBMG was a criminal enterprise centered in the Bronx, New York.  In order to make money for the gang, protect the gang’s territory, and promote the gang’s standing, members of YBMG engaged in, among other things, narcotics trafficking and violence, including murder.  To that end, YBMG members sold heroin,  cocaine, and marijuana, promoted their gang affiliation on social media, possessed firearms, and engaged in shootings as part of their gang membership and narcotics trafficking. 

As alleged in the Superseding Indictment, on or about August 16, 2019, SHPENDIM HAXHAJ and BORIS BELTRAN hired LUCAS CHAJECKI to murder a rival gang member, and CHAJECKI then shot and killed Isael Lagares in the Bronx, New York.

YBMG members also participated in a conspiracy to distribute narcotics in New York and elsewhere. SHPENDIM HAXHAJ, YELTSIN BELTRAN, BORIS BELTRAN, JEREMY CEDENO, FRANCISCO ORTEGA, and IVIS PERDOMO participated in a conspiracy with other individuals to distribute more than one kilogram of heroin, five kilograms of cocaine, and marijuana from at least in or about 2006 up to and including 2021.

Between in or about 2006 and in or about 2021, SHPENDIM HAXHAJ, YELTSIN BELTRAN, BORIS BELTRAN, JEREMY CEDENO, FRANCISCO ORTEGA, and IVIS PERDOMO also possessed, used, brandished, and discharged firearms in furtherance of the narcotics conspiracy in which they all participated. SHPENDIM HAXHAJ, YELTSIN BELTRAN, BORIS BELTRAN, JEREMY CEDENO, and IVIS PERDOMO are further charged with engaging in violent crimes in aid of racketeering, and using, brandishing, and discharging firearms in furtherance of these crimes of violence.

*                      *                     *

A chart containing the names of the defendants who were charged today, and the charges and maximum penalties they face, are attached.  The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants would be determined by a judge.

Mr. Williams praised the outstanding work of the FBI, DEA, and NYPD.

The case is being handled by the Office’s Violent and Organized Crime Unit and White Plains Division.  Assistant United States Attorneys Mathew Andrews, Frank Balsamello, Christopher Brumwell, and Benjamin Gianforti are in charge of the prosecution.

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

Defendant

Age

Charges

Maximum Penalties

SHPENDIM HAXHAJ, a/k/a “White Mike”

30

Racketeering Conspiracy; Narcotics Conspiracy; Use, Brandishing, and Discharge of a Firearm in Furtherance of a Narcotics Conspiracy; Murder in Aid of Racketeering; Murder for Hire; Murder for Hire Conspiracy; Use of a Firearm Resulting in Death; Assault with a Deadly Weapon and Attempted Murder in Aid of Racketeering; Use, Brandishing, and Discharge of a Firearm in Furtherance of a Crime of Violence

Mandatory life in prison

YELTSIN BELTRAN, a/k/a “Yells”

30

Racketeering Conspiracy; Narcotics Conspiracy; Use, Brandishing, and Discharge of a Firearm in Furtherance of a Narcotics Conspiracy; Assault with a Deadly Weapon and Attempted Murder in Aid of Racketeering; Use, Brandishing, and Discharge of a Firearm in Furtherance of a Crime of Violence

Maximum of life in prison; mandatory minimum 30 years in prison (20 years to run consecutive to any other sentence)

BORIS BELTRAN, a/k/a “Bebe”

24

Racketeering Conspiracy; Narcotics Conspiracy; Use, Brandishing, and Discharge of a Firearm in Furtherance of a Narcotics Conspiracy; Murder in Aid of Racketeering; Murder for Hire; Murder for Hire Conspiracy; Use of a Firearm Resulting in Death; Assault with a Deadly Weapon and Attempted Murder in Aid of Racketeering; Use, Brandishing, and Discharge of a Firearm in Furtherance of a Crime of Violence

Mandatory life in prison

JEREMY CEDENO, a/k/a “Jerm”

36

Racketeering Conspiracy; Narcotics Conspiracy; Use, Brandishing, and Discharge of a Firearm in Furtherance of a Narcotics Conspiracy; Assault with a Deadly Weapon and Attempted Murder in Aid of Racketeering; Use, Brandishing, and Discharge of a Firearm in Furtherance of a Crime of Violence

Maximum of life in prison; mandatory minimum 30 years in prison (20 years to run consecutive to any other sentence)

IVIS PERDOMO, a/k/a “Lite”

40

Racketeering Conspiracy; Narcotics Conspiracy; Use, Brandishing, and Discharge of a Firearm in Furtherance of a Narcotics Conspiracy; Assault with a Deadly Weapon and Attempted Murder in Aid of Racketeering; Use, Brandishing, and Discharge of a Firearm in Furtherance of a Crime of Violence

Maximum of life in prison; mandatory minimum 30 years in prison (20 years to run consecutive to any other sentence)

FRANCISCO ORTEGA, a/k/a “Fresh”

33

Racketeering Conspiracy; Narcotics Conspiracy; Use, Brandishing, and Discharge of a Firearm in Furtherance of a Narcotics Conspiracy

Maximum of life in prison; mandatory minimum 20 years in prison (10 years to run consecutive to any other sentence)

LUCAS CHAJECKI, a/k/a “Luc Luc”

26

Murder in Aid of Racketeering; Murder for Hire; Murder for Hire Conspiracy; Use of a Firearm Resulting in Death

Mandatory life in prison

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

Damian Williams, the United States Attorney for the Southern District of New York, and Scott J. Lampert, Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General (“HHS-OIG”) New York Regional Office announced today the arrest of MATTHEW WITKOWSKI on charges of conspiracy and health care fraud. As alleged in a Complaint unsealed today in federal court, and at a presentment held this morning before U.S. Magistrate Judge Jared M. Strauss of the United States District Court for the Southern District of Florida, WITKOWSKI, ran a company dedicated to illegally buying written orders for durable medical equipment (“DME”) such as leg, arm, and back braces, and then selling those written orders to DME supply companies, which in turn used those orders to file fraudulent Medicare claims.  These fraudulent claims are estimated to have resulted in payments to WITKOWSKI’s coconspirators of at least $10 million. WITKOWSKI was arrested yesterday evening at the Ft. Lauderdale-Hollywood International Airport, after he flew in from Santo Domingo, Dominican Republic. Witkowski remains in custody, with a detention hearing scheduled for 10:00 a.m. on July 27, 2022, before the Magistrate Judge is Alicia O. Valle in Fort Lauderdale. 

U.S. Attorney Damian Williams said:  “Medicare is a valuable taxpayer-funded program designed to provide affordable health care to beneficiaries over 65 or with disabilities, not to lining the pockets of those who would enrich themselves through fraud. Here, the defendant is charged with illegally selling written orders for medical equipment used to bilk Medicare out of millions of dollars.”

HHS-OIG Special Agent in Charge Scott J. Lampert said:  “The alleged fraud scheme that the defendant engaged in was motivated by pure greed. HHS-OIG and our law enforcement partners will continue to aggressively pursue all those who seek to unlawfully enrich themselves by victimizing participants of the Medicare program.”  

As alleged in the Complaint and at the detention hearing held this morning:[1]

From at least August 2019 through at least April 2021, WITKOWSKI and an unnamed co-conspirator (“CC-1”) engaged in a scheme to defraud Medicare and to violate the Anti-Kickback Statute, which prohibits the buying and selling of written orders for goods and services paid for by Medicare, including DME. WITKOWSKI illegally purchased fraudulent written orders for DME, and then sold those written orders to pharmacies and DME suppliers, including in New York City.  Those pharmacies and DME suppliers then used those written orders as the basis for millions of dollars of fraudulent claims to Medicare. Many of these fraudulent written orders used names and personal health information of Medicare beneficiaries, without the beneficiaries’ authorization or prior knowledge. Many of these written orders also contained professional information of doctors and other health-care providers enrolled in the Medicare program, as well as the purported electronic signatures of these providers, which were falsified and created without the authorization or knowledge of these providers.

During the course of the scheme, WITKOWSKI and CC-1 took in more than $3.5 million from DME suppliers, who made these payments to True Prospects Marketing, Inc., a company controlled by Witkowski and CC-1. The Government estimates that the orders for DME illegally sold by True Prospects were used to bill Medicare for more than $10 million.

*                *                *

WITKOWSKI, 36, of the Dominican Republic, is charged with one count of conspiracy to commit health care fraud and to violate the Anti-Kickback Statute, which carries a maximum prison sentence of five years; and one count of health care fraud, which carries a maximum prison sentence of 10 years. The maximum potential penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Williams praised the investigative work of HHS-OIG.

This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney David Raymond Lewis is in charge of the prosecution.

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

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

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 today the unsealing of an Indictment charging ISHAN WAHI, a former product manager at Coinbase Global, Inc. (“Coinbase”), NIKHIL WAHI, and SAMEER RAMANI, with wire fraud conspiracy and wire fraud in connection with a scheme to commit insider trading in cryptocurrency assets by using confidential Coinbase information about which crypto assets were scheduled to be listed on Coinbase’s exchanges.  ISHAN WAHI and NIKHIL WAHI were arrested this morning in Seattle, Washington and will be presented today in the United States District Court for the Western District of Washington.  SAMEER RAMANI was also charged today and remains at large.

U.S. Attorney Damian Williams said:  “Today’s charges are a further reminder that Web3 is not a law-free zone.  Just last month, I announced the first ever insider trading case involving NFTs, and today I announce the first ever insider trading case involving cryptocurrency markets.  Our message with these charges is clear: fraud is fraud is fraud, whether it occurs on the blockchain or on Wall Street.  And the Southern District of New York will continue to be relentless in bringing fraudsters to justice, wherever we may find them.”

FBI Assistant Director Michael J. Driscoll said: “Although the allegations in this case relate to transactions made in a crypto exchange - rather than a more traditional financial market – they still constitute insider trading.  As alleged, the defendants made illegal trades in at least 25 different crypto assets and realized ill-gotten gains totaling approximately $1.5 million.  Today’s action should demonstrate the FBI’s commitment to protecting the integrity of all financial markets – both ‘old’ and ‘new.’”           

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

Background

At all relevant times, Coinbase was one of the largest cryptocurrency exchanges in the world.  Coinbase users could acquire, exchange, and sell various crypto assets through online user accounts with Coinbase.  Periodically, Coinbase added new crypto assets to those that could be traded through its exchange, and the market value of crypto assets typically significantly increased after Coinbase announced that it would be listing a particular crypto asset.  Accordingly, Coinbase kept such information strictly confidential and prohibited its employees from sharing that information with others, including by providing a “tip” to any person who might trade based on that information.

Beginning in approximately October 2020, ISHAN WAHI worked at Coinbase as a product manager assigned to a Coinbase asset listing team. In that role, ISHAN WAHI was involved in the highly confidential process of listing crypto assets on Coinbase’s exchanges and had detailed and advanced knowledge of which crypto assets Coinbase was planning to list and the timing of public announcements about those crypto asset listings.  Beginning at least in August 2021 and continuing through May 2022, ISHAN WAHI was a member of a private Coinbase messaging channel reserved for a small number of Coinbase employees with direct involvement in the Coinbase asset listing process.  The private channel was used to discuss, among other things, “exact announcement / launch dates + timelines” that Coinbase did not wish to share with all of its employees.

The Insider Trading Scheme

On at least 14 occasions beginning at least in June 2021 and continuing through April 2022, ISHAN WAHI knew in advance both that Coinbase planned to list particular crypto assets and the timing of Coinbase’s public announcements of those asset listings and misappropriated that Coinbase confidential information by tipping either his brother, NIKHIL WAHI, or ISHAN WAHI’s friend and associate, SAMEER RAMANI, so that they could place profitable trades in those crypto assets in advance of Coinbase’s public listing announcements. 

After getting tips from ISHAN WAHI, NIKHIL WAHI and RAMANI used anonymous Ethereum blockchain wallets to acquire crypto assets shortly before Coinbase publicly announced that it was listing or considering listing these crypto assets on its exchanges.  Following Coinbase public listing announcements, NIKHIL WAHI and RAMANI sold the crypto assets for a profit.  Based on confidential information provided by ISHAN WAHI, NIKHIL WAHI and RAMANI collectively traded shortly in advance of at least 14 separate Coinbase public listing announcements concerning at least 25 different crypto assets.  As a result of the insider trading scheme, NIKHIL WAHI and RAMANI collectively generated realized and unrealized gains totaling at least approximately $1.5 million.

To conceal their purchases of crypto assets in advance of Coinbase listing announcements, NIKHIL WAHI and RAMANI used accounts at centralized exchanges held in the names of others, and transferred funds, crypto assets, and proceeds of their scheme through multiple anonymous Ethereum blockchain wallets.  NIKHIL WAHI and RAMANI also regularly created and used new Ethereum blockchain wallets without any prior transaction history in order to further conceal their involvement in the scheme.

ISHAN WAHI’s Attempt to Flee the United States

On April 11, 2022, Coinbase announced that it was considering potentially listing dozens of crypto assets on its exchanges. Based on Coinbase confidential information provided by ISHAN WAHI, RAMANI caused multiple anonymous Ethereum blockchain wallets to purchase large quantities of at least six of the crypto assets that were to be included in Coinbase’s April 11, 2022 listing announcement. 

Shortly after RAMANI traded in advance of Coinbase’s April 11 listing announcement, on April 12, 2022, a Twitter account that is well known in the crypto community tweeted regarding an Ethereum blockchain wallet “that bought hundreds of thousands of dollars of tokens exclusively featured in the Coinbase Asset Listing post about 24 hours before it was published.”  The trading activity referenced in the April 12 tweet was the trading caused by RAMANI.  Coinbase thereafter publicly replied on Twitter noting that it had already begun investigating the matter and a few weeks later stated in a public blog post that any Coinbase employee who leaked confidential company information would be “immediately terminated and referred to relevant authorities (potentially for criminal prosecution).” 

On May 11, 2022, Coinbase’s director of security operations emailed ISHAN WAHI to inform him that he should appear for an in-person meeting relating to Coinbase’s asset listing process at Coinbase’s Seattle, Washington office on Monday, May 16, 2022. ISHAN WAHI confirmed he would attend the meeting.

On the evening of Sunday, May 15, 2022, ISHAN WAHI purchased a one-way flight to India that was scheduled to depart the next day shortly before ISHAN WAHI was supposed to be interviewed by Coinbase.  Prior to boarding the flight, ISHAN WAHI falsely told Coinbase employees that he had already departed for India when he had not.  In the hours between booking the flight and his scheduled departure, ISHAN WAHI called and texted NIKHIL WAHI and RAMANI about Coinbase’s investigation, and sent both of them a photograph of the messages he had received on May 11, 2022, from Coinbase’s director of security operations.  Prior to boarding the May 16, 2022 flight to India, ISHAN WAHI was stopped by law enforcement and prevented from leaving the country.

*          *          *

ISHAN WAHI, 32, of Seattle, Washington, is charged with two counts of wire fraud conspiracy and two counts of wire fraud, each of which carries a maximum sentence of 20 years. 

NIKHIL WAHI, 26, of Seattle, Washington, is charged with one count of wire fraud conspiracy and one count of wire fraud, each of which carries a maximum sentence of 20 years.

SAMEER RAMANI, 33, of Houston, Texas, is charged with one count of wire fraud conspiracy and one count of wire fraud, each of which carries a maximum sentence of 20 years.

The statutory maximum 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 investigative work of the FBI. He also acknowledged the assistance of the Justice Department’s National Cryptocurrency Enforcement Team, as well as that of the Securities and Exchange Commission, which separately initiated civil proceedings against the defendants today.  Mr. Williams further thanked Coinbase Global, Inc. for its cooperation with the investigation.

This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant United States Attorneys Noah Solowiejczyk and Nicolas Roos are in charge of the prosecution.

The allegations 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.

Damian Williams, the United States Attorney for the Southern District of New York, Daniel B. Brubaker, Postal Inspector in Charge, Postal Service Inspection Service, New York Division, and Thomas P. DiNapoli, New York State Comptroller, announced the arrest of BAKARE DOUKOURE, SANNEH TUNKARA, and LASSANA SYLLA on mail fraud and identity theft charges arising out of their scheme to fraudulently obtain unclaimed funds held by the New York State Comptroller’s Office of Unclaimed Funds.  TUNKARA was arrested on July 19, 2022 and presented before the Hon. Andrew E. Krause, United States Magistrate Judge.  SYLLA surrendered upon learning of an outstanding arrest warrant and was presented before Judge Krause on July 20, 2022.  Earlier today, DOUKOURE also surrendered upon learning of an outstanding arrest warrant and was presented before Judge Krause.

U.S. Attorney Damian Williams said: “As alleged in the Complaint, Bakare Doukoure, Sanneh Tunkara, and Lassana Sylla defrauded over 100 unsuspecting New York residents out of money to which they were entitled that was held in trust by the New York State Comptroller’s Office of Unclaimed Funds. My Office and our partners in law enforcement will not stand idly by when wrongdoers target government programs designed to protect the assets of the people of this State.”

USPIS Inspector-in-Charge of the New York Division Daniel B. Brubaker said: “The defendants thought no one was looking while they carried out their scheme to defraud the New York State Comptroller’s Office, and in an attempt to hide their crimes steal the identities of numerous victims. They gamed the system for over one hundred thousand dollars and tarnished the names of innocent people, all in the pursuit of their greed. However, Postal Inspectors and our law enforcement partners are ever vigilant when it comes to exposing fraudsters. We will commit every resource available to us in the fight against identity theft and fraud. Today’s arrests should also serve as a warning to anyone who uses the mail for illegal purposes: once Postal Inspectors are on the case, it’s game over for the bad guys.”

New York State Comptroller Thomas P. DiNapoli said: “The defendants unconscionably stole people’s identities to submit claims for money that did not belong to them, stealing from those who had unclaimed funds held by the state. Thanks to the work of my investigations team, the United States Attorney’s Office for the Southern District of New York, and the United States Postal Inspection Service, and the New York City Housing Authority’s Office of Inspector General, they have been arrested and will be prosecuted to the full extent of the law.”

According to the allegations in the Complaint filed yesterday and unsealed today[1]:

New York State’s Abandoned Property Law requires banks and other financial institutions to transfer abandoned customer funds in their custody to the Office of Unclaimed Funds after a specified period of time.  The Office of Unclaimed Funds maintains an online database in which anyone can search to see if the Office of Unclaimed Funds is holding any unclaimed funds in someone’s name.  The owner of the funds can recover the money from the Office of Unclaimed Funds by filing a claim and proving he or she is the rightful owner of the money by providing personal identifying information such as a Social Security number or an address.  New York State has approximately $17.5 billion in unclaimed money with more than 46 million account records remaining unclaimed. The Office of Unclaimed Funds returns over $1.5 million to individuals, companies, non-profit organizations, and municipalities daily.

An investigation by the State Comptroller’s Office initially discovered the identity theft and the fraud. State Comptroller investigators brought the matter to the federal authorities and worked jointly with the Postal Inspection Service and the United States Attorney’s Office to fully uncover the scheme.

From at least in or about June 2012 to in or about April 2018, DOUKOURE, TUNKARA, and SYLLA worked together in a fraudulent scheme in which they filed fraudulent claims with the Office of Unclaimed Funds for abandoned monies held in trust by the New York State Comptroller.  Bank records show that, during the relevant period, the Office of Unclaimed Funds issued approximately 170 checks made out to approximately 120 different payees that were deposited into approximately eight different bank accounts that were controlled by either DOUKOURE or TUNKARA.

In connection with the scheme, bank accounts controlled by DOUKOURE and TUNKARA were used to make purchases from online databases that collect public records on individuals, such as names, dates of birth, and addresses. DOUKOURE and TUNKARA also used stolen identities to perpetrate their scheme, including fake driver’s licenses.

*                *                *

DOUKOURE, 54, of the Bronx, New York, has been charged with conspiracy to commit mail fraud, mail fraud, and two counts of aggravated identity theft, which carries a maximum sentence of 40 years in prison and a mandatory minimum sentence of 4 years in prison.  TUNKARA, 38, of the Bronx, New York, has been charged with conspiracy to commit mail fraud, mail fraud and one count of aggravated identity theft, which carries a maximum sentence of 40 years in prison, and a mandatory minimum sentence of 2 years in prison.  SYLLA, 47, of Philadelphia, Pennsylvania, has been charged with conspiracy to commit mail fraud and mail fraud, which carries a maximum sentence of 40 years in prison.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.

The charges in the Complaint are merely accusations, and DOUKOURE, TUNKARA and SYLLA are presumed innocent unless and until proven guilty.

Mr. Williams praised the outstanding investigative work of Postal Inspectors with the United States Postal Inspection Service, Investigators with the Office of the New York State Comptroller, and Investigators with the New York City Housing Authority’s Office of Inspector General.

The prosecution of this case is being handled by the Office’s White Plains Division.  Assistant United States Attorney Benjamin A. Gianforti and James McMahon are in charge of the prosecution.

[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.

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 today the unsealing of a seven-count Indictment in White Plains federal court charging GLENN GRIFFIN, the owner, president, and principal of Griffin’s Landscaping Corporation, in separate bribery and bid rigging schemes, and GRIFFIN and ROBERT DYCKMAN, a former Assistant General Foreman with the Town of Cortlandt, in the bribery scheme in which DYCKMAN allowed GRIFFIN to dump hundreds of truckloads of unauthorized materials at a Cortlandt facility.  GRIFFIN and DYCKMAN were arrested this morning and will be presented before United States Magistrate Judge Andrew E. Krause in White Plains federal court later today.

U.S. Attorney Damian Williams said:  “As alleged, Robert Dyckman, a former Town of Cortlandt employee, used his position of trust to enrich himself by allowing Glenn Griffin to dump unauthorized materials at the Town’s facility, which will cost the Town as much as $1.5 million to clean up.  Griffin is also alleged to have defrauded the village of Croton-on-Hudson and the hamlet of Verplanck in a separate bid rigging scheme.  My Office will continue to ensure that corrupt business leaders and public officials will be brought to justice.”

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

Illegal Dumping Scheme

            From 2018 until February 2020, GRIFFIN and DYCKMAN engaged in an unauthorized dumping scheme.  DYCKMAN gave GRIFFIN and his employees unauthorized access to Arlo Lane, a Cortlandt facility, to dump hundreds of large truckloads of unauthorized materials such as thick concrete, cement with rebar, large rocks, and soil.  Based on estimates provided by third-party vendors, the Town of Cortlandt estimates that it will cost between $600,000 to $1.5 million to remove these materials.

            DYCKMAN generally allowed GRIFFIN and his employees access to Arlo Lane on Saturdays or after working hours.  To carry out the scheme, DYCKMAN would attempt to clear senior Town of Cortlandt management away Arlo Lane around the time of the unauthorized dumping.  When DYCKMAN arranged for a subordinate Town of Cortlandt worker to work overtime when GRIFFIN was dumping unauthorized loads, DYCKMAN would falsely record the worker’s overtime as having occurred during the week in order to conceal the scheme.

            In exchange for access to Arlo Lane, GRIFFIN gave DYCKMAN cash bribes, firewood, flowers and gardening materials and made extensive improvements to DYCKMAN’s home at no cost.  GRIFFIN also gave DYCKMAN a backdated, false invoice for DYCKMAN to give to his insurance company in support of a false insurance claim.

Bid-Rigging Scheme

            Between 2015 and 2018, GRIFFIN also engaged in a bid-rigging scheme.  GRIFFIN defrauded the village of Croton-on-Hudson, for work on its schools, and the hamlet of Verplanck, for work at its fire department.  He made sham, non-competitive, and inflated bids on behalf of entities that GRIFFIN did not work for or have authorization to submit bids on behalf of, so that GRIFFIN would be the low bidder in a pool of purportedly competitive bids and receive public money for work on the projects.  Based on these sham, non-competitive, and inflated bids, GRIFFIN was awarded contracts with a combined value exceeding $133,000. 

*                *                *

           A chart containing the charges and maximum penalties for GRIFFIN, 53, of Cortlandt Manor, New York and DYCKMAN, 51, of Verplanck, New York, are set forth below.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

            Mr. Williams praised the outstanding investigative work of the FBI and the Westchester County Police Department in this investigation.  Mr. Williams also thanked the Westchester County District Attorney’s Office and the New York City Department of Investigation for their assistance in the investigation.

This case is being prosecuted by the Office’s White Plains Division.  Assistant U.S. Attorneys David R. Felton and James McMahon are in charge of the prosecution.

22-233                                                                                                                                                                                                            ###

COUNT

DEFENDANT(S)

MAX. TERM OF IMPRISONMENT

Count One: Conspiracy to Pay and Receive Bribes and Gratuities: Illegal Dumping Scheme (18 U.S.C. § 371)

GLENN GRIFFIN

ROBERT DYCKMAN

5 years in prison

Count Two:  Payment of Bribes and Gratuities in Illegal Dumping Scheme

(18 U.S.C. §§ 666(a)(2) and 2)

GLENN GRIFFIN

10 years in prison

Count Three: Receipt of Bribes and Gratuities in Illegal Dumping Scheme (18 U.S.C. §§ 666(a)(1)(B) and 2)

ROBERT DYCKMAN

10 years in prison

Count Four:  Conspiracy to Misapply and Convert Property of Local Government Receiving Federal Funds in Illegal Dumping Scheme (18 U.S.C. § 371)

GLENN GRIFFIN

ROBERT DYCKMAN

5 years in prison

Count Five: Wire Fraud Conspiracy: Bid-Rigging Scheme (18 U.S.C. § 1349)

GLENN GRIFFIN

20 years in prison

Count Six: Wire Fraud: Bid-Rigging Scheme (18 U.S.C. §§ 1343 and 2)

GLENN GRIFFIN

20 years in prison

Count Seven: Aggravated Identity Theft: Bid-Rigging Scheme (18 U.S.C. §§ 1028A(a)(1), 1028A(b), and 2)

GLENN GRIFFIN

Mandatory minimum of two years in prison

[1] As the introductory phase 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.

Damian Williams, the United States Attorney for the Southern District of New York, and John B. DeVito, Special Agent-in-Charge of the New York Field Division of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”), announced that MELVIN BURROUGHS was charged in a superseding indictment with conspiring to traffic firearms, trafficking firearms, and being a felon in possession of ammunition.

U.S. Attorney Damian Williams said: “As alleged, the defendant—a convicted felon—was in the business of building and selling untraceable ‘ghost guns.’  Thanks to our law enforcement partners, his dangerous ghost gun business has been shut down.”

ATF New York Special Agent-in-Charge John B. DeVito said:  “ATF has no higher priority than stopping the flow of illegal guns of any kind. This case sends a clear message to those who seek to produce ghost guns for the criminal marketplace. The NYC Crime Gun Intelligence allows law enforcement to identify patterns, leads, and potential suspects such as in this case; in order to make our communities safer.   Thanks to the collaboration with the NYPD Major Case Field Intelligence Team, NYSP and Ansonia CT Police Department for their hard work.”

According to the allegations in the Superseding Indictment[1] unsealed today in Manhattan federal court and in other public court documents:

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. 

Based on review of surveillance video capturing the event from multiple angles, 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. 

The Ansonia Police Department searched BURROUGHS’s house the next day.  According to police reports and photographs documenting the search, 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.  A photograph of the rifle is below:

During the search of BURROUGHS’s house, and in addition to the four firearms described above, law enforcement officers also recovered large quantities of ammunition, various gun parts and tools for making ghost guns, and a flamethrower. 

In connection with the shooting and search of his residence, BURROUGHS was charged in Superior Court of Connecticut – Ansonia-Milford Judicial District in Milford, Connecticut with Connecticut state offenses of threatening in the first degree, reckless endangerment in the first degree, criminal mischief in the third degree, illegal discharge of a firearm, criminal use of a weapon, criminal possession of a firearm or ammunition, and attempt to commit first degree assault.  BURROUGHS was released on bail conditions.  

On January 8, 2022, BURROUGHS was arrested in Westchester County, New York with kits to build 17 ghost guns, a completed lower receiver[2] 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, establishes that BURROUGHS has been unlawfully selling firearms since approximately 2019.  In particular, the evidence shows that BURROUGHS’s gun trafficking business involves 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, below, of 15 ghost gun kits that BURROUGHS purchased in approximately February 2021. 

BURROUGHS, 35, of Ansonia, Connecticut, is charged with: (1) one count of conspiracy to traffic firearms, which carries a maximum sentence of five years in prison, (2) one count of trafficking firearms, which carries a maximum sentence of ten years in prison, and (3) one count of being a felon in possession of ammunition.  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 ATF.  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 United States 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 United States Attorney Kevin Mead is in charge of the prosecution.

The charges in the Superseding 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 Superseding Indictment and other assertions in public court documents, and the descriptions of those documents set forth in this release constitute only allegations, and every fact described should be treated as an allegation.

[2] 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.

Damian Williams, the United States Attorney for the Southern District of New York, and Keechant L. Sewell, Police Commissioner for the City of New York (“NYPD”), announced the unsealing of an indictment charging RICARDO AYALA, a/k/a “Richie,” and TERRIS OLIVER, a/k/a “T-Bird,” with murder in furtherance of drug trafficking in connection with the murder of Atari Felton on March 27, 2002 in the Bronx, New York.  AYALA was arrested yesterday and was presented before U.S. Magistrate Judge Ona T. Wang.  OLIVER is still at large.  The case is assigned to U.S. District Judge Alvin K. Hellerstein.

U.S. Attorney Damian Williams said: “We allege that over 20 years ago, Ricardo Ayala and Terris Oliver participated in the murder of Atari Felton, who was just 19 years old.  Thanks to the extraordinary partnership of the NYPD and the Special Agents of our office, the defendants are charged in federal court for this decades-old murder.  No matter how long it takes, we will tirelessly work to hold murderers accountable for their crimes.”

According to the allegations in the Indictment unsealed today in Manhattan federal court[1]:

On March 27, 2002, AYALA and OLIVER planned and carried out the murder of Atari Felton, who was 19 years old.  AYALA and OLIVER committed the murder in furtherance of a conspiracy to distribute more than 280 grams of crack cocaine and quantities of cocaine, heroin, and marijuana.

*                      *                     *

AYALA, 42, and OLIVER, 40, are each charged with one count of murder in furtherance of drug trafficking, which carries a maximum sentence of death or life in prison, and a mandatory minimum sentence of twenty years in prison; and one count of murder through the use of a firearm, which carries a maximum sentence of death or life in prison, and a mandatory minimum sentence of five years in prison. 

Mr. Williams praised the investigative work of the Special Agents of the United States Attorney’s Office for the Southern District of New York and the NYPD’s Cold Case Squad. Mr. Williams added that the investigation is continuing.

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Mathew Andrews, Frank Balsamello, and Andrew K. Chan 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 constitutes only allegations, and every fact described herein should be treated as an allegation.

Damian Williams, the United States Attorney for the Southern District of New York, announced charges against VINOTH PONMARAN for participating in a conspiracy that for several years exploited elderly victims by remotely accessing their computers and convincing victims to pay for computer support services they did not need, and which were never actually provided.  In total, the conspiracy generated more than $10 million in proceeds from at least approximately 7,500 victims.  PONMARAN was arrested on Friday in Blaine, Washington, and will be presented in the Western District of Washington.  The case has been assigned to U.S. District Judge Paul A. Crotty.

U.S. Attorney Damian Williams said:  “As alleged, the defendant was a leader of a sophisticated fraud scheme that preyed on victims, including the elderly.  This conspiracy allegedly caused pop-up windows to appear on victims’ computers—pop-up windows which claimed, falsely, that a virus had infected the victim’s computer.  Through this and other misrepresentations, this fraud scheme deceived thousands of victims, including some of society’s most vulnerable members, into paying a total of more than $10 million.  Thanks to our partners at Homeland Security Investigations, this scheme has been dismantled.”

According to the allegations contained in the Superseding Indictment,[1] as well as court filings and statements made in court in connection with the cases of PONMARAN’s co-defendants:

From approximately March 2015 through December 2018, PONMARAN was a member of a criminal fraud ring (the “Fraud Ring”) based in the United States and India that committed a technical support fraud scheme targeting elderly victims located across the United States and Canada, including in the Southern District of New York.  The Fraud Ring’s primary objective was to trick victims into believing that their computers were infected with malware, in order to deceive them into paying hundreds or thousands of dollars for phony computer repair services.  Over the course of the conspiracy, the Fraud Ring generated more than $10 million in proceeds from at least 7,500 victims.

The scheme generally worked as follows.  First, the Fraud Ring caused pop-up windows to appear on victims’ computers.  The pop-up windows claimed, falsely, that a virus had infected the victim’s computer.  The pop-up window directed the victim to call a particular telephone number to obtain technical support.  In at least some instances, the pop-up window threatened victims that, if they restarted or shut down their computer, it could “cause serious damage to the system,” including “complete data loss.”  In an attempt to give the false appearance of legitimacy, in some instances the pop-up window included, without authorization, the corporate logo of a well-known, legitimate technology company.  In fact, no virus had infected victims’ computers, and the technical support phone numbers were not associated with the legitimate technology company.  Rather, these representations were false and were designed to trick victims into paying the Fraud Ring to “fix” a problem that did not exist.  And while the purported “virus” was a hoax, the pop-up window itself did cause various victims’ computers to completely “freeze,” thereby preventing these victims from accessing the data and files in their computer—which caused some victims to call the phone number listed on the pop-up window.  In exchange for victims’ payment of several hundred or thousand dollars (depending on the precise “service” victims purchased), the purported technician remotely accessed the victim’s computer and ran an anti-virus tool, which is free and available on the Internet.  The Fraud Ring also re-victimized various victims, after they had made payments to purportedly “fix” their tech problems.

PONMARAN was an India-based leader of the Fraud Ring.  Among other things, PONMARAN managed a call center in India that was used to provide purported computer repair services to victims of the scheme.  PONMARAN also recruited co-conspirators in the United States to register fraudulent corporate entities and open bank accounts that were used to receive fraud proceeds from victims of the scheme.  PONMARAN also directed co-conspirators to wire fraud proceeds from the United States to accounts in India.

*                *                *

PONMARAN, 34, a citizen of India, is charged with one count of wire fraud and one count of conspiracy to commit wire fraud, each of which carries a maximum sentence of 20 years in prison.  The statutory maximum 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.

PONMARAN’s co-defendants, Romana Leyva and Ariful Haque, were both sentenced earlier this year, following their respective guilty pleas.  Leyva was sentenced to 100 months in prison and three years of supervised release, and she was ordered to pay forfeiture of $4,679,586.93 and restitution of $2,707,882.91.  Haque was sentenced to one year and one day in prison and three years of supervised release, and he was ordered to pay forfeiture of $38,886.32 and restitution of $470,672.16.

Mr. Williams praised the outstanding work of the New York Office of the Homeland Security Investigations (“HSI”)’s El Dorado Task Force, Cyber Intrusion/Cyber Fraud Group.  Mr. Williams also thanked the New York City Police Department for its assistance on this case. 

This matter is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant United States Attorney Michael D. Neff is in charge of the prosecution.

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

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 today that MIHAI IONUT PAUNESCU, a/k/a “Virus,” a dual Romanian and Latvian national, was extradited from Colombia for allegedly running a “bulletproof hosting” service that enabled cyber criminals to distribute the Gozi Virus, one of the most financially destructive computer viruses in history.  PAUNESCU also allegedly enabled other cybercrimes, such as distributing malware including the “Zeus Trojan” and the “SpyEye Trojan,” initiating and executing distributed denial of service (“DDoS”) attacks, and transmitting spam.  PAUNESCU was initially arrested in Romania in December 2012 and released on bail, and he was arrested again in Colombia last year at the request of the United States.  PAUNESCU was presented yesterday before U.S. Magistrate Judge Gabriel W. Gorenstein and detained.  The case is assigned to U.S. District Judge Lorna G. Schofield.

U.S. Attorney Damian Williams said:  “Mihai Ionut Paunescu is alleged to have run a “bulletproof hosting” service that enabled cyber criminals throughout the world to spread the Gozi Virus and other malware and to commit numerous other cybercrimes.  His hosting service was specifically designed to allow cyber criminals to remain hidden and anonymous from law enforcement.  Even though he was initially arrested in 2012, Paunescu will finally be held accountable inside a U.S. courtroom.  This case demonstrates that we will work with our law enforcement partners here and abroad to pursue cyber criminals who target Americans, no matter how long it takes.”

According to allegations in documents filed in Manhattan federal court[1]:

The Gozi Virus is malicious computer code or “malware” that stole personal bank account information, including usernames and passwords, from the users of affected computers. The Gozi Virus infected over one million victim computers worldwide, among them at least 40,000 computers in the United States, including computers belonging to the National Aeronautics and Space Administration (“NASA”), as well as computers in Germany, Great Britain, Poland, France, Finland, Italy, Turkey and elsewhere, and it caused tens of millions of dollars in losses to the individuals, businesses, and government entities whose computers were infected.  Once installed, the Gozi Virus – which was intentionally designed to be undetectable by anti-virus software – collected data from the infected computer in order to capture personal bank account information, including usernames and passwords.  That data was then transmitted to various computer servers controlled by the cyber criminals who used the Gozi Virus.  These cyber criminals then used the personal bank account information to transfer funds out of the victims’ bank accounts and ultimately into their own personal possession.

“Bulletproof hosting” services helped cyber criminals distribute the Gozi Virus with little fear of detection by law enforcement.  Bulletproof hosts provided cyber criminals using the Gozi Virus with the critical online infrastructure they needed, such as Internet Protocol (“IP”) addresses and computer servers, in a manner designed to enable them to preserve their anonymity.

PAUNESCU operated a “bulletproof hosting” service that helped cyber criminals distribute the Gozi Virus and commit other cybercrimes, such as distributing malware including the “Zeus Trojan” and the “SpyEye Trojan,” initiating and executing DDoS attacks, and transmitting spam.  PAUNESCU rented servers and IP addresses from legitimate Internet service providers and then in turn rented them to cyber criminals; provided servers that cyber criminals used as command-and-control servers to conduct DDoS attacks; monitored the IP addresses that he controlled to determine if they appeared on a special list of suspicious or untrustworthy IP addresses; and relocated his customers’ data to different networks and IP addresses, including networks and IP addresses in other countries, to avoid being blocked as a result of private security or law enforcement scrutiny.

*                *                *

PAUNESCU, 37, of Bucharest, Romania, is charged with one count of conspiracy to commit computer intrusion, which carries a maximum penalty of 10 years in prison; one count of conspiracy to commit bank fraud, which carries a maximum penalty of 30 years in prison; and one count of conspiracy to commit wire fraud, which carries a maximum penalty of 20 years in prison.

The maximum and minimum 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.

Mr. Williams praised the investigative work of the FBI.  Mr. Williams also thanked the NASA Office of Inspector General, and the Columbian National Police.  In addition, Mr. Williams thanked the Department of Justice’s Computer Crime and Intellectual Property Section (CCIPS) for its partnership in this matter.  The U.S. Department of Justice’s Office of International Affairs of the Department’s Criminal Division, the Narcotic and Dangerous Drug Section (NDDS) Judicial Attachés in Bogota, Colombia, and the U.S. Marshal Service provided significant assistance in securing the defendant’s extradition from Colombia.

This case is being handled by the Office’s Complex Frauds & Cybercrime Unit.  Assistant United States Attorney Sarah Lai 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 constitutes only allegations, and every fact described herein should be treated as an allegation.

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 today that FATADE IDOWU OLAMILEKAN, a/k/a “Fatade Olamilekan Idowu,” a/k/a “Olamilekan Idowu Fatade,” a/k/a “Idowu Fatade,” a citizen of Nigeria, was extradited and arrived in the United States yesterday evening.  OLAMILEKAN was extradited on fraud and aggravated identity theft charges in connection with a scheme to fraudulently obtain and attempt to obtain millions of dollars of medical equipment, laboratory products, computer equipment and hardware, and other merchandise from suppliers of such merchandise across the United States by impersonating, among other individuals, procurement officials of U.S. state and local governments and educational institutions.  OLAMILEKAN  will be presented later today before U.S. Magistrate Judge James L. Cott.  The case is assigned to U.S. District Judge Valerie E. Caproni.

            U.S. Attorney Damian Williams said:  “Fatade Idowu Olamilekan is alleged to have carried out a sprawling criminal scheme to fraudulently obtain medical equipment and other merchandise. Olamilekan allegedly identified U.S. procurement officials, including the Chief Procurement Officer for New York, to then impersonate them and use their credentials to request millions of dollars in equipment shipments from various suppliers without advance payment.  Olamileken has now been extradited to the U.S. for his alleged attempt to illegally profiteer from the worldwide pandemic.”

            FBI Assistant Director-in-Charge Michael J. Driscoll said:  “We allege Olamilekan impersonated state procurement officials during the height of the pandemic and stole critically-needed medical equipment that was in high demand and short supply. Fraud can have immediate and direct impacts on people, and we remain determined to bring those who commit it to justice.”

According to the allegations in the Indictment unsealed in Manhattan federal court[1]:

From at least in or about 2018 through at least on or about September 14, 2020, OLAMILEKAN engaged in a scheme to fraudulently obtain and attempt to obtain millions of dollars of medical equipment, laboratory products, computer equipment and hardware, and other merchandise from suppliers of such merchandise across the United States by impersonating, among other individuals, procurement officials of U.S. state and local governments and educational institutions.  In particular, during the coronavirus/COVID-19 pandemic, OLAMILEKAN impersonated the Chief Procurement Officer of New York State in an effort to fraudulently obtain medical equipment, including defibrillators.  OLAMILEKAN engaged in the following conduct to carry out his criminal scheme:

First, OLAMILEKAN engaged in extensive research to identify specific procurement officials of U.S. state and local governments and educational institutions to impersonate and U.S. suppliers of medical, laboratory, and computer equipment to target as part of the scheme.  This research included obtaining information about the current suppliers to the state and local governments and educational institutions OLAMILEKAN sought to impersonate and targeting those suppliers in order to avoid arousing suspicion.  For example, OLAMILEKAN appears to have specifically targeted a medical supplier that was already providing medical equipment to New York State in or to avoid suspicion when OLAMILEKAN, who was impersonating the Chief Procurement Officer of New York State, contacted the supplier to obtain medical equipment.

Second, after OLAMILEKAN identified procurement officials to impersonate, he used aliases and a Lithuanian web hosting company to register email accounts with domains that had slight variations from the legitimate email accounts used by procurement officials in order to “spoof” or impersonate those officials’ email accounts (the “spoofed emailed accounts”).  The spoofed email accounts used by OLAMILEKAN usually had the same username as the procurement official’s email account but added an extra letter or common domain name to the domain of the email account.  These spoofed email accounts were therefore specifically designed to trick suppliers to impersonated procurement officials into thinking the spoofed email accounts were authentic.  In total, OLAMILEKAN registered and used spoofed email accounts impersonating at least (i) eight different procurement officials of state and local governments in California, Illinois, Minnesota, New York, North Carolina, Pennsylvania, Texas, and Vermont; and (ii) three procurement officials of educational institutions located in Georgia and New York.

Third, OLAMILEKAN used the spoofed email accounts to send emails impersonating the procurement official and seeking quotes for medical, laboratory, and computer equipment from targeted suppliers.  These emails typically indicated that the payment terms would be “net 30 days,” which is a standard term of trade credit for government and educational entities that only requires payment for the goods within 30 days of delivery.  OLAMILEKAN therefore impersonated the identities of procurement officials of government entities and educational institutions in order to exploit this industry standard and fraudulently obtain equipment without providing any advance payment information or deposit prior to delivery of the equipment.

Finally, once OLAMILEKAN received a response from a targeted supplier, he provided the supplier with a purchase order containing the forged signature of the impersonated procurement official and an address for a warehouse located in the United States for delivery and storage of the equipment purchased.  Once the purchased items shipped to the warehouse provided by OLAMILEKAN, he typically had the warehouse re-ship the items to another warehouse and, ultimately, from the United States to locations in Australia, the United Kingdom, and/or Nigeria.  OLAMILEKAN also coordinated with the warehouses receiving the shipments from the targeted suppliers using the stolen identity of at least one U.S. resident, thereby further concealing his own identity and avoiding detection of his criminal activity.  Because payment was not due to the suppliers until 30 days after delivery of the equipment, OLAMILEKAN was able to take possession of the equipment prior to detection of the fraud, which typically occurred after payment was not received by the supplier within the 30-day period.

*                *                *

OLAMILEKAN, 40, of Lagos, Nigeria, is charged with one count of wire fraud, which carries a maximum penalty of 27 years in prison, one count of interstate transportation of stolen property, which carries a maximum penalty of 17 years in prison, and 12 counts of aggravated theft, which carry a mandatory minimum penalty of two years in prison to be run consecutively to any other sentence imposed.

The maximum and minimum 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.

Mr. Williams praised the investigative work of the FBI.  Mr. Williams also thanked Nigeria’s Federal Ministry of Justice, Nigeria’s Economic and Financial Crimes Commission (“EFCC”), the Central Authority Unit of Nigeria’s Ministry of Justice, and the Attorney General of the Federal Republic of Nigeria for their assistance in the investigation.  The U.S. Department of Justice’s Office of International Affairs of the Department’s Criminal Division provided significant assistance in securing the defendant’s extradition from Nigeria.

This case is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant United States Attorney Sagar K. Ravi 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 constitutes only allegations, and every fact described herein should be treated as an allegation.

Damian Williams, the United States Attorney for the Southern District of New York, John DeVito, Special Agent-in-Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives, New York Field Division (ATF), and Keechant L. Sewell, Police Commissioner for the City of New York (NYPD), announced today that BRANDY ARIAS was charged with firearms trafficking and traveling interstate with intent to engage in firearms trafficking, in connection with her illegally selling firearms in the Bronx, New York.  ARIAS was arrested yesterday and will be presented today before Magistrate Judge James L. Cott in Manhattan federal court.

U.S. Attorney Damian Williams said:  “As alleged, Brandy Arias was in the business of illegally selling guns on the streets of New York City.  Because of the efforts of our law enforcement partners in this investigation, we have taken twenty guns off the streets and prevented more from coming to New York City from another state.  Arias’s arrest and prosecution should send a message to anyone attempting to illegally traffick guns in our City that they will be found and prosecuted.”

ATF Special Agent-in-Charge John DeVito said:  “This arrest highlights ATF’s mission to stop the flow of illegal firearms into our communities.  We will continue to partner with others to disrupt the shooting cycle and to keep people safe.  Special thanks to the NYPD’s 46th Field Intelligence Unit for their partnership and commitment to this case.”

NYPD Commissioner Keechant L. Sewell said:  “Stopping the flow of illegal guns into New York City is at the forefront of our public-safety mission.  The NYPD and our law-enforcement partners are sending a clear and definitive message: If you traffic in these deadly weapons, you will be arrested and prosecuted to the fullest extent of the law. That is the promise we made to the people we serve, and we will never relent in our fight against gun violence. I want to thank the U.S. Attorney’s Office for the Southern District of New York, the ATF’s New York Field Division, and all of the investigators who worked on this important case.”

According to the allegations contained in the Complaint filed in court today[1]:

From about March 2022 to July 2022, BRANDY ARIAS illegally sold twenty firearms, as well as ammunition and magazines, to an undercover law enforcement officer (the “UC”) in the Bronx, New York.  These sales occurred on eight different occasions, including in the middle of the day near a residential building and outside of a fast-food restaurant. 

As part of the scheme, in or about June 2022 and July 2022, ARIAS traveled between New York and Florida for the purpose of obtaining firearms to illegally resell in New York.  On at least two occasions shortly after traveling to Florida, ARIAS sold firearms to the UC in the Bronx.

On July 14, 2022, ARIAS met the UC outside of a fast-food restaurant in the Bronx with the intent to sell the UC an additional firearm.  At that time, ARIAS was arrested.

*                *                *

BRANDY ARIAS, 21, of the Bronx, New York is charged with one count of firearms trafficking, which carries a maximum penalty of five years in prison, and one count of interstate travel with intent to engage in firearms trafficking, which carries a maximum penalty of ten 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 work of the ATF and the NYPD in this investigation.

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Ni Qian and Madison Reddick Smyser are in charge of the prosecution.

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

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

Damian Williams, the United States Attorney for the Southern District of New York, announced today that JEREMY ORTIZ-MOLINA was sentenced to 204 months in prison today for leading a conspiracy to traffic eight kilograms of methamphetamine to New York City.  U.S. District Judge Lewis J. Liman imposed today’s sentence.

U.S. Attorney Damian Williams said:  “The sentence today reaffirms our judicial system’s unflinching commitment to hold narcotics traffickers accountable.  Methamphetamine promotes violence, ruins lives, and destroys families.  The defendant sought to profit from trafficking significant quantities of this horrific drug and will be justly punished.”

According to court filings and statements made in court proceedings:

In or about February 2021, ORTIZ-MOLINA led a conspiracy to traffic wholesale quantities of methamphetamine from Florida to New York City.  ORTIZ-MOLINA supervised his codefendants DEREK ORTIZ SOCIAS (who is ORTIZ-MOLINA’s son) and PEDRO ROSARIO CARRASQUILLO.

ORTIZ-MOLINA personally negotiated the sale of eight kilograms of methamphetamine for $8,500 per kilogram to a confidential source and then directed ORTIZ SOCIAS and ROSARIO CARRASQUILLO to deliver those drugs to Manhattan inside a trailer.  To conceal their crime, the defendants also loaded motorcycles into the trailer, as part of a cover story that they were making the trip to sell motorcycles.  The bricks of methamphetamine, which laboratory tests determined to be approximately 99 percent pure, were hidden inside a trap in the trailer. 

After his codefendants were arrested, ORTIZ-MOLINA continued trying to sell kilogram quantities of methamphetamine to the confidential source and also offered to sell heroin.  A search of ORTIZ-MOLINA’s phones revealed additional evidence of narcotics trafficking.

*                *                *

Codefendant ROSARIO CARRASQUILLO was previously sentenced to 96 months in prison and codefendant ORTIZ SOCIAS’s case is pending.

Mr. Williams praised the outstanding investigative work of the DEA, New York State Police, and NYPD.  The prosecution of this case is being handled by the Office’s Narcotics Unit.  Assistant United States Attorney Jun Xiang is in charge of the prosecution.­

Joshua Adam Schulte was a CIA programmer with access to some of the country’s most valuable intelligence-gathering cyber tools used to battle terrorist organizations and other malign influences around the globe.  When Schulte began to harbor resentment toward the CIA, he covertly collected those tools and provided them to WikiLeaks, making some of our most critical intelligence tools known to the public – and therefore, our adversaries.  Moreover, Schulte was aware that the collateral damage of his retribution could pose an extraordinary threat to this nation if made public, rendering them essentially useless, having a devastating effect on our intelligence community by providing critical intelligence to those who wish to do us harm.  Today, Schulte has been convicted for one of the most brazen and damaging acts of espionage in American history.

Damian Williams, the United States Attorney for the Southern District of New York, announced the return of a superseding indictment charging WAYNE HICKS, a/k/a “Weez,” BRIAN THOMAS, a/k/a “BT,” and JORDAN WOODBINE, a/k/a “Jay Woods,” for their participation in a brutal beating and robbery of a victim in New City, New York in February 2021. THOMAS and WOODBINE were arrested yesterday and were arraigned before U.S. Magistrate Judge Judith C. McCarthy. WAYNE HICKS had previously been arrested in the case, and will be arraigned on the superseding indictment before Judge Seibel at a later date.

DWAYNE HICKS and TNAIYA WILLIAMS, who both participated in the attack and robbery, were sentenced to 12 years and 44 months, respectively, for participating in a conspiracy to commit Hobbs Act robbery. United States District Judge Cathy Seibel sentenced DWAYNE HICKS on April 18, 2022, and sentenced WILLIAMS on June 24, 2022.

U.S. Attorney Damian Williams said: “As alleged, this was a brazen and brutal robbery, as Judge Seibel recognized in imposing substantial prison sentences on Dwayne Hicks and Tniaya Williams. Our unsealing of charges against the other participants shows our Office’s continued commitment to identifying and prosecuting perpetrators of violent crime in this District. Thanks to the tenacious work of the FBI and the other agencies involved in the FBI’s Westchester County Safe Streets Task Force, the participants in this attack are in custody and facing justice in federal court.”

At the sentencing hearing for DWAYNE HICKS, Judge Seibel remarked that the February 28, 2021 attack was “sickening,” “vicious,” “stomach turning, and the sort of thing that you really can’t imagine how any human being could partake in.”

As alleged in the Superseding Indictment unsealed in White Plains federal court, and various other indictments and complaints in the case[1]:

On February 28, 2021, after a marijuana dealer who worked for WAYNE HICKS, was robbed, WAYNE HICKS contacted his brother DWAYNE HICKS to arrange retribution. Thereafter, DWAYNE HICKS lured a victim, who the conspirators believed had participated in the earlier robbery, to a residence in New City, New York.  Once the victim arrived there, DWAYNE HICKS and multiple other assailants, including WILLIAMS, THOMAS, and WOODBINE, viciously attacked the victim. At times, WAYNE HICKS monitored the attack via a video-chat application. The assailants forced the victim to strip naked, stole his belongings, including a quantity of marijuana the assailants believed the victim had stolen, then beat the victim with a baseball bat, belts, and their hands and feet, and repeatedly slashed and stabbed the victim with a large knife.  The victim ultimately fled, after being left, naked and covered in blood, in a pile of snow.

*                *                *

DWAYNE HICKS, 28, of Spring Valley, New York and TNAIYA WILLIAMS, 27, of New City, New York each pled guilty to one count of conspiracy to commit Hobbs Act robbery. WAYNE HICKS, 32, of Hawthorne, New York, THOMAS, 20, of Haverstraw, New York, and WOODBINE, 22, of Chestnut Ridge, New York, are each charged with one count of conspiracy to commit Hobbs Act robbery, one count of Hobbs Act robbery, and one count of Travel Act Assault, each of which carries a maximum sentence of 20 years in prison, and one count of conspiracy to distribute marijuana, which carries a maximum sentence of 40 years in prison and a mandatory minimum sentence of five years in prison.

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

Mr. Williams praised the investigative work of the Federal Bureau of Investigation and the 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, Putnam County Sheriff's Office, Westchester County DAs Office, Rockland County DAs Office, NYPD, Westchester County PD, and the Yonkers, New Rochelle, Mount Vernon, Greenburgh, White Plains, Peekskill, Ramapo, and Clarkstown Police Department. He added that the investigation is ongoing.  

The case is being handled by the Office’s White Plains Division.  Assistant United States Attorneys Derek Wikstrom and Josiah Pertz are in charge of the prosecution.

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

[1] As the introductory phrase signifies, the description of the Superseding Indictment and the other charging documents set forth in this release constitute only allegations, and every fact described should be treated as an allegation.

Damian Williams, the United States Attorney for the Southern District of New York, announced today that AARON FINN pled guilty to a deprivation of constitutional rights under color of law.  FINN, formerly a correction officer at the Green Haven Correctional Facility, assaulted an inmate in the custody of the State of New York, repeatedly striking and thrashing the inmate’s head and body, while the inmate was restrained with handcuffs.  The assault occurred on March 19, 2020, while FINN was employed as a correction officer. FINN’s actions deprived the inmate of the constitutional right to be free from excessive force amounting to cruel and unusual punishment.  FINN pled guilty today before U.S. Magistrate Judge Judith C. McCarthy.

U.S. Attorney Damian Williams said:  “As he admitted today, former correction officer Aaron Finn violated the constitutional rights of an inmate by using excessive force amounting to cruel and unusual punishment. This conviction should send a loud and clear message—the protections afforded by the U.S. Constitution extend to all Americans, including inmates. When the constitutional rights of inmates are violated, we will act aggressively to bring wrongdoers to justice.”

According to the Superseding Indictment and other documents in the public record, as well as statements made in public court proceedings:

FINN was previously a correction officer assigned to the Green Haven Correctional Facility. On March 19, 2020, while working as a correction officer, FINN used his body to press a handcuffed inmate face-first against a wall, and then repeatedly struck the back of the inmate’s head, causing the inmate’s head to hit a cinder block wall.  FINN then repeatedly thrashed the inmate’s head against steel cell bars.  After the assault, the victim required stitches to multiple lacerations on his face and head.

*                *                *

FINN, 36, of Hyde Park, New York, pled guilty to a deprivation of constitutional rights under color of law, in violation of Title 18 U.S.C. § 242, which carries a maximum sentence of ten 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 the judge.

Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation and the New York State Department of Corrections and Community Supervision Office of Special Investigations.

The case is being handled by the Office’s White Plains Division, and the Civil Rights Unit of the Office’s Civil Division. Assistant United States Attorneys Charles S. Jacob and Lindsey Keenan are in charge of the prosecution.

Damian Williams, the United States Attorney for the Southern District of New York, announced that attorney STUART FINKELSTEIN pled guilty to mail fraud in connection with his filing of fraudulent lawsuits pursuant to the Americans with Disabilities Act (“ADA”)

According to the Indictment and statements made in court filings:

FINKELSTEIN is a lawyer who has filed, or has caused to be filed, over 300 lawsuits pursuant to the ADA on behalf of purported plaintiffs, including Victim-1 and Victim-2.  These lawsuits were filed in the United States District Courts for the Southern District of Florida, the Southern District of New York and the Eastern District of New York against various public establishments (the “Victim Public Establishments”).  Each of these lawsuits made representations that Victim-1 and Victim-2 were represented by FINKELSTEIN or an associate.  Furthermore, each of these lawsuits alleged that Victim-1 and Victim-2 had standing to sue under the ADA.  The lawsuits sought attorney’s fees and injunctive relief to address the alleged noncompliance with the ADA.

FINKELSTEIN’s lawsuits on behalf of Victim-1 and Victim-2, however, were fraudulent.  Victim-1 and Victim-2 neither retained nor authorized FINKELSTEIN to file ADA lawsuits on their behalf.  Instead, FINKELSTEIN stole the identities of Victim-1 and Victim-2, made numerous false representations to the Victim Public Establishments and the courts, obstructed official judicial proceedings, and then settled these fake lawsuits in order to collect approximately $900,000 in attorney’s fees.  

         *                *                *

FINKELSTEIN, 67, of Davie, Florida, pled guilty to one count of mail fraud, which carries a maximum sentence of 20 years in prison. 

The maximum potential sentence is prescribed by Congress and are provided here for informational purposes only, as the sentence will be determined by the court. 

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

The prosecution of this case is being handled by the Office’s General Crimes Unit.  Assistant United States Attorney Rushmi Bhaskaran is in charge of the prosecution.

Damian Williams, the United States Attorney for the Southern District of New York, announced that KASSEM HIJAZI, a citizen of Brazil, was extradited to the United States from Paraguay on July 8, 2022. HIJAZI was extradited on charges of money laundering and operation of an unlicensed money transmitting business, for his involvement in a cross-border money laundering operation.

U.S. Attorney Damian Williams said:  “As alleged, Kassem Hijazi agreed to launder the proceeds of narcotics trafficking, and for years operated an illegal money transmitting business, the proceeds of which were further laundered into and out of the United States.  Thanks to the continued efforts and coordination with our law enforcement counterparts in Paraguay, Hijazi, a Brazilian national, has now been extradited to the U.S. to face the consequences of his crimes.”

HIJAZI was arrested on August 24, 2021, in Paraguay. He was presented and arraigned today before U.S. Magistrate Judge James L. Cott. The case is assigned to U.S. District Judge Gregory H. Woods.    

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

Between 2018 and October 2020, KASSEM HIJAZI orchestrated a money laundering operation and operated an unlicensed money transmission business. Specifically, in December 2019 and between October and December 2020, HIJAZI laundered funds that he believed were proceeds derived from narcotics trafficking. Between 2018 and 2020, HIJAZI operated an unlicensed money transmission business that included sending funds from overseas into and out of the United States, including into the Southern District of New York. HIJAZI, using his illegal money transmission business, further laundered funds related to that business into and out of the United States in support of his crimes.

*                 *                 *

HIJAZI, 49, is charged with two counts of money laundering, each of which carry a maximum penalty of 20 years in prison; two counts of international money laundering, each of which carry a maximum penalty of 20 years in prison; and operation of an unlicensed money transmitting business, which carries a maximum penalty 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 the judge.

U.S. Attorney Williams praised the outstanding investigative work of the Drug Enforcement Administration and Homeland Security Investigations. He also thanked law enforcement partners in Paraguay, particularly the Public Ministry’s Attorney General’s Office and the National Anti-Drug Secretariat. Finally, he thanked the U.S. Department of Justice’s Office of International Affairs and the U.S. Marshals Service, for their support and assistance in the defendant’s extradition.

This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit.  Assistant United States Attorney Sarah Mortazavi is in charge of the prosecution.

[1] The charges in the Indictment and the descriptions of the Indictment set forth herein constitute only allegations and every fact described should be treated as an allegation.

Damian Williams, the United States Attorney for the Southern District of New York, announced the convictions last week of MIRCEA CONSTANTINESCU, NIKOLAOS LIMBERATOS, and ALEXANDRU RADULESCU for their participation in an international conspiracy to commit a variety of offenses, including access device fraud, wire fraud, bank fraud, and aggravated identity theft, following a seven-day trial before the Honorable Sidney H. Stein.

United States Attorney Damian Williams said: “As the jury recognized, these defendants participated in a prolific ATM skimming and money laundering ring that spanned years and continents.  They caused staggering losses by, among other things, stealing account numbers and personal identification numbers of their victims using sophisticated technology.  Because of yesterday’s verdict, they will no longer be able to ‘cash out’ on others’ identities.”

As proven at trial:

MIRCEA CONSTANTINESCU, NIKOLAOS LIMBERATOS, and ALEXANDRU RADULESCU were members of an international “ATM skimming” and money laundering organization (the “Skimming Organization”).  From approximately 2014 to 2019, the Skimming Organization made millions of dollars by installing sophisticated machinery on ATMs and point-of-sale machines, capturing unsuspecting bank customers’ card numbers and PINs, reencoding that information on counterfeit cards, and then “cashing out” those cards to withdraw as much money as they could.

The Skimming Organization sent crews of “install” and “cash out” workers to travel throughout the country, carrying out numerous skimming operations at various banks and on point-of-sale machines.  The operations often lasted a period of days.  After cashing out, the teams would take a cut of the money earned and provide the rest to the Skimming Organization’s leaders. 

LIMBERATOS and RADULESCU were leaders of the Skimming Organization, who ran teams of “install” and “cash out” workers, oversaw the manufacture and repair of skimming devices, cased ideal locations, organized skimming jobs, and made millions of dollars as a result.  LIMBERATOS also participated in laundering the proceeds of the skimming jobs, including through a restaurant business he owned. CONSTANTINESCU helped to send and receive packages containing skimming and skimming-related equipment, worked with an engineer who fashioned skimming devices, and laundered money for the Skimming Organization from the United States to Romania.

CONSTANTINESCU, LIMBERATOS, and RADULESCU were among 33 defendants charged in connection with this case.

*                *                *

CONSTANTINESCU, 48, of Queens, New York, was convicted of one count of conspiring to commit access device fraud, one count of conspiring to commit wire and bank fraud, one count of aggravated identity theft, and one count of conspiring to commit money laundering.  Those counts carry a maximum potential sentence of 59 years and six months in prison, and a mandatory minimum sentence of two years of in prison.

LIMBERATOS, 56, of Deer Park, New York, was convicted of one count of aggravated identity theft. Shortly before trial, LIMBERATOS pled guilty to one count of conspiring to commit access device fraud, one count of conspiring to commit wire and bank fraud, and one count of conspiring to commit money laundering.  Those counts together carry a maximum potential sentence of 59 years and six months of in prison, and a mandatory minimum sentence of two years in prison.

RADULESCU, 36, of Romania, was convicted of one count of aggravated identity theft. Shortly before trial, RADULESCU pled guilty to one count of conspiring to commit access device fraud, one count of conspiring to commit wire and bank fraud, and one count of access device fraud.  Those counts together carry a maximum potential sentence of 54 years and six months in prison, and a mandatory minimum sentence of two years in prison.

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

All three defendants are scheduled to be sentenced by Judge Stein on October 13, 2022, at 2:30 p.m. (CONSTANTINESCU), 3:00 p.m. (LIMBERATOS), and 3:30 p.m. (RADULESCU).

This case is being handled by the Office’s General Crimes Unit.  Assistant U.S. Attorneys Elizabeth Hanft, Samuel P. Rothschild, Maggie Lynaugh, and Robert B. Sobelman are in charge of the prosecution. 

Damian Williams, the United States Attorney for the Southern District of New York, announced that earlier today, JENNIFER SHAH pled guilty to conspiracy to commit wire fraud in connection with telemarketing. 

U.S. Attorney Damian Williams said:  “Jennifer Shah was a key participant in a nationwide scheme that targeted elderly, vulnerable victims.  These victims were sold false promises of financial security but instead Shah and her co-conspirators defrauded them out of their savings and left them with nothing to show for it.  This Office is committed to rooting out these schemes whatever form they take.”

According to the allegations in the Superseding Indictment, and statements made during the plea and other proceedings in the case:

From 2012 until March 2021, JENNIFER SHAH, together with others (collectively, the “Participants”) carried out a wide-ranging telemarketing scheme that defrauded hundreds of victims (the “Victims”) throughout the United States, many of whom were over age 55, by selling those Victims so-called “business services” in connection with the Victims’ purported online businesses (the “Business Opportunity Scheme”). 

In order to perpetrate the Business Opportunity Scheme, Participants, including SHAH, engaged in a widespread, coordinated effort to traffic in lists of potential victims, or “leads,” many of whom had previously made an initial investment to create an online business with other Participants in the Scheme. 

SHAH, among other things, sold leads to other Participants for use by their telemarketing sales floors with the knowledge that the individuals they had identified as “leads” would be defrauded by the other Participants, including by lying to Victims about how much they would earn after purchasing the business services and the purported success of others who had purchased the services.  SHAH received as profit a share of the fraudulent revenue per the terms of their agreement with those Participants.  SHAH often controlled each aspect of the frauds perpetrated by other Participants on the individuals they had identified by, among other things, determining which “coaching” sales floor could buy leads from them, selecting the downstream sales floors to which the “coaching” sales floor was permitted to pass the leads, choosing the firms to provide “fulfillment” services, that is, documents and records purporting to demonstrate that the services the Participants claimed to provide to those Victims were actual and legitimate, setting how much the downstream sales floors could charge, and determining which “products” each of the downstream sales floors could sell. 

In approximately 2017, SHAH began operating a Manhattan-based sales floor that sold downstream “business opportunity” products to victims on lead lists provided by the defendant as part of the Business Opportunity Scheme (the “Manhattan Sales Floor”).  Between 2018 and 2020, SHAH controlled the day-to-day operations of the Manhattan Sales Floor.  Among other things, SHAH, with other Participants, moved certain operations for the Manhattan Sales Floor to Kosovo to avoid law enforcement and regulatory scrutiny.  The salespeople at the Manhattan Sales Floor engaged in the same fraudulent sales practices as other telemarketing floors in the Business Opportunity Scheme: namely, lying to and misleading Victims into purchasing “business opportunity” products to ostensibly advance their non-existent online businesses.  

SHAH undertook significant efforts to conceal her role in the Business Opportunity Scheme.  For example, SHAH, among other things, incorporated her business entities using third parties’ names and instructed other Participants to do the same, used and directed others to use encrypted messaging applications to communicate with other Participants, and made numerous cash withdrawals structured to avoid currency transaction reporting requirements.

*                *                *

SHAH, 48, of Park City, Utah, pled guilty today to one count of conspiracy to commit wire fraud in connection with telemarketing through which she victimized 10 or more persons over the age of 55, which carries a maximum sentence of 30 years in prison.  As part of her guilty plea, SHAH also agreed to forfeit $6.5 million and to pay restitution up to $9.5 million.

The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as SHAH’s sentence will be determined by the judge. 

SHAH is scheduled to be sentenced by U.S. District Judge Sidney H. Stein on November 28, 2022.

Mr. Williams praised the outstanding investigative work of HSI’s El Dorado Task Force.

This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit.  Assistant United States Attorneys Kiersten A. Fletcher, Benet J. Kearney, Robert B. Sobelman, and Sheb Swett are in charge of the prosecution. 

If you believe you have been a victim of the scheme described above, including a victim entitled to restitution, and you wish to provide information to law enforcement and/or receive notice of future developments in the case or additional information, please contact Wendy Olsen-Clancy, the Victim Witness Coordinator at the United States Attorney’s Office for the Southern District of New York, at 866-874-8900 or [email protected].

Damian Williams, the United States Attorney for the Southern District of New York, announced that defendant SETH FISHMAN, DVM, received a sentence of 11 years in prison today for his role at the helm of an approximately twenty-year scheme to manufacture, market, and sell to racehorse trainers and others in the racehorse industry “untestable” performance enhancing drugs for use in professional horseracing. FISHMAN was one of over thirty 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.

U.S. Attorney Damian Williams said: “The sentence today sends a strong message that those looking to profit from the sale of illegal drugs intended to corruptly dope racehorses stand to face serious consequences for their crimes. The defendant earned his livelihood in service of greed and animal abuse, and will face a steep price for his crimes.”

According to the allegations contained in the Superseding Indictment, prior charging instruments, other filings in this case, and as established by the evidence at trial:[1]

FISHMAN was charged in United States v. Navarro, 20 Cr. 160 (MKV), a case arising from an investigation of widespread schemes by racehorse trainers, veterinarians, performance enhancing drug (“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, Ohio, Kentucky, and the United Arab Emirates (“UAE”), all to the detriment and risk of the health and well-being of the racehorses.  Trainers who participated in the schemes 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. Indicted veterinarians profited from the sale and administration of these medically unnecessary, misbranded, and adulterated substances. FISHMAN, acting as the manufacturer and distributor of customized PEDs designed specifically to evade anti-doping controls, reaped millions of dollars from the sale of his drugs to trainers around the United States and across the globe.

FISHMAN specifically targeted clients in the racehorse industry, peddling dozens of unsafe and untested drugs that purported to have performance-enhancing effects on racehorses.  FISHMAN created and marketed these drugs as “untestable” under typical anti-doping drug screens and extolled the virtues of these illegal drugs by describing his method of creating customized products for individual customers in order to silo product lines to reduce the likelihood that detection of doping by trainer would undermine the remainder of FISHMAN’s corrupt clientele.

In the course of nearly twenty years during which he operated his doping company, Equestology, FISHMAN took additional efforts to mislead and lie to regulatory authorities in an effort to shield his illegal activity. FISHMAN incorporated a sham business in Panama designed to appear as if his drug operation was outside the jurisdiction of U.S. authorities; he pressured employees to sign non-disclosure agreements intended to gag them if questioned by regulators; he designed labels that would provide no hint as to the provenance of the unsafe drugs shipped across the country; and he lied to state investigators regarding the nature of his business when asked directly about his role in Equestology during a Delaware state investigation in 2011, while also bragging to others that he had called in a “personal political favor” to quash that investigation.

While claiming to practice as a legitimate veterinarian, FISHMAN used his veterinary license as another form of cover for his illegal drug manufacturing business. In fact, FISHMAN sold illicit drugs, including prescription drugs, under sham prescriptions for animals that he never saw or discussed. Those drugs included intravenous and intramuscular injectables that FISHMAN sold to laypeople for injection into the horses under their purported “care,” many of which were seized at premises throughout the country at the time of the original indictments in this case, including barns located in New York. Those included “blood building” drugs (for example, “BB3” and other Epogen-mimetic substances), vasodilators (for example, “VO2Max”), and bags filled with scores of “bleeder pills,” each designed to covertly increase performance in affected horses.

FISHMAN, 51, of Florida, was convicted at trial of two counts of participation in drug adulteration and misbranding conspiracies, the first in connection with the doping operation of convicted co-defendant Jorge Navarro, and the second in connection with the operation of Equestology, which included FISHMAN’s continuation of that offense even following his release on bail after his initial arrest in October 2019.

       *                *                 *

Mr. Williams praised the outstanding investigative work of the FBI New York 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 United States Attorneys Sarah Mortazavi and Anden Chow are in charge of the prosecution.

[1] As to Fishman’s co-defendants, these facts, including the entirety of the texts of the Indictments and the descriptions of the Indictments set forth herein, constitute only allegations and every fact described should be treated as an allegation.

Damian Williams, the United States Attorney for the Southern District of New York, announced that DENFIELD JOSEPH and KEVIN DELVALLE were sentenced to 30 years in prison and 35 years in prison, respectively, for their 2010 murder of Donnell Harris in the Bronx.  JOSEPH and DELVALLE previously pled guilty.  U.S. District Judge Victor Marrero imposed the sentences. 

U.S. Attorney Damian Williams said:  “Almost twelve years ago, Denfield Joseph and Kevin Delvalle stabbed and strangled Donnell Harris to death in an act of senseless brutality.  Investigators and career prosecutors in my Office worked tirelessly to find and hold accountable the perpetrators of this chilling crime.  This prosecution and today’s sentences show our commitment to pursuing justice for all victims of gang and drug-related violence.”

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

Harris’s murder arose out of JOSEPH and DELVALLE’s involvement in gang-related narcotics trafficking in 2009 and 2010.  JOSEPH and DELVALLE were Bloods gang members based in the Bronx.  In the months leading up to Harris’s murder, JOSEPH, DELVALLE and others committed armed robberies and sold crack, ecstasy, and marijuana near East 173rd Street and Monroe Avenue.

In about March 2010, JOSEPH, DELVALLE, and other members of their crew began spending time with Harris.  At the time, Harris was homeless and living on the roof of JOSEPH’s building.  Harris repeatedly asked to be included in the robberies that JOSEPH and DELVALLE were committing, but they declined his requests.  In late August 2010, Harris learned that JOSEPH and DELVALLE had cheated a drug customer, and that the customer had supposedly returned to the neighborhood with a gun, looking to retaliate.  Harris told JOSEPH and DELVALLE that Harris would give the drug customer their location unless JOSEPH and DELVALLE provided Harris a share of their drug proceeds. 

On or about August 31, 2010, JOSEPH, DELVALLE, and a co-conspirator decided to kill Harris.  After an aborted plan to shoot Harris at Crotona Park, the men brought Harris back to an apartment on LaFontaine Avenue in the Bronx, where they spent the evening with Harris drinking and smoking PCP.  As the night wore on, the men decided to kill Harris using knives they obtained from the kitchen of the apartment.  As Harris was walking toward the door of the apartment, JOSEPH, DELVALLE, and a coconspirator attacked him, repeatedly stabbing Harris in the head, neck, and torso with knives, and beating him with cooking pots as Harris tried to escape.  When they realized that Harris was not dead, the men moved him to the bathtub of the apartment, where they tried unsuccessfully to drown him.  Harris begged for his life.  JOSEPH and a coconspirator tried to strangle Harris with an extension cord around his neck.  Harris broke free and ran for the door, but they pulled him back.  DELVALLE then took the extension cord and strangled Harris to death with it.

After murdering Harris, the men left his body in the bedroom of the apartment.  The next day, they bought cleaning supplies and returned to the apartment with JOSEPH’s girlfriend and DELVALLE’S girlfriend.  While DELVALLE waited outside the apartment building as a lookout, the women dismembered Harris.  JOSEPH, DELVALLE, and the coconspirator cleaned the apartment with bleach, wrapped Harris’s dismembered body in garbage bags, and removed it from the apartment in a shopping cart.

Early in the morning hours of September 1, 2010, the women wheeled the shopping cart containing Harris’s body west on 180th Street to Webster Avenue, while the three men followed them in DELVALLE’s car. After briefly stopping into a gas station convenience store with the shopping cart, the women left the shopping cart containing Harris’s chopped up body on the sidewalk at 4109 Park Avenue.  DELVALLE directed JOSEPH and a coconspirator to get rid of the evidence and gave them a red container with lighter fluid.  The men walked to where the shopping cart was left, poured the lighter fluid on the body, and lit the body on fire.

Surveillance video from that night shows JOSEPH’s and DELVALLE’s girlfriends pushing the shopping cart, and two hooded male figures walking back from the location where Harris’s body was found.  On September 1, 2010, at 3:52 a.m., firefighters called to the scene discovered Harris’s body in the shopping cart.

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In addition to their prison terms, JOSEPH, 31, and DELVALLE, 35, of New York, New York, and Rochester, New York, respectively, were sentenced to four years of supervised release.

Mr. Williams thanked the Special Agents of the U.S. Attorney’s Office for the Southern District of New York for their outstanding work in the investigation and the New York City Police Department for its assistance.

This case is being prosecuted by the Office’s Violent and Organized Crime Unit. Assistant U.S. Attorney Jessica Feinstein is in charge of the prosecution.

Damian Williams, United States Attorney for the Southern District of New York, and Jocelyn E. Strauber, Commissioner of the New York City Department of Investigation (“DOI”), announced today the unsealing of a Complaint charging RUDEAN WEIR and JEROME WEAH, with conspiracy to commit wire fraud, wire fraud, and aggravated identity theft, in connection with a scheme to defraud a program of the New York City Human Resources Administration (“HRA”) which provides cash assistance to homeless veterans of the United States armed services (“Veterans”) seeking permanent housing.  WEAH was presented yesterday in Manhattan federal court before United States Magistrate Judge Valerie Figueredo.  WEIR will be presented today in federal court in Atlanta, Georgia.

U.S. Attorney Damian Williams said:  “As alleged, the defendants abused a New York City program intended to benefit veterans of the United States armed services seeking permanent housing by submitting hundreds of false applications for benefits and causing more than $5 million in fraudulent payments.  Thanks to the efforts of the New York City Department of Investigation, the fraud has been exposed and the defendants will have to answer for their conduct.”

DOI Commissioner Jocelyn E. Strauber said:  “The Enhanced One-Shot Deal program provides critical funding to help New York City’s unhoused veterans obtain permanent housing.  As alleged, defendants Jerome Weah and Rudean Weir stole millions of dollars from the program by fraudulently claiming entitlement to rent, brokers’ fees and other program payments.  I thank the City’s Department of Social Services for referring this investigation to DOI and for their hard work on this matter.  DOI is proud to work with DSS, and our federal partners at the U.S. Attorney's Office for the Southern District of New York and the Office of Inspector General for the U.S. Department of Veterans Affairs, to expose and prevent the theft of precious public funding intended to aid vulnerable New Yorkers.”

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

From at least October 2020 through at least May 2022, RUDEAN WEIR and JEROME WEAH submitted more than 340 fraudulent applications seeking cash assistance pursuant to the Enhanced One Shot Deal (“EOSD”) program administered by the HRA.  The EOSD is an emergency assistance program pursuant to which HRA makes a one-time cash assistance payment to qualifying individuals.  EOSD payments are often used to help individuals move out of homeless shelters and/or other temporary housing into permanent housing.  EOSD payments may be used to cover certain costs associated with the move to permanent housing, including rent, moving expenses, security deposits, broker’s fees, and payments for furniture and other household items.  The HRA also offers and administers services and programs for Veterans, sometimes referred to as “Veteran’s Initiatives.”  In connection with these services, the HRA has a designated group responsible for receiving and reviewing EOSD requests made on behalf of homeless Veterans seeking permanent housing.

Between October 2020 and May 2022, the HRA received at least 340 EOSD applications which claimed that the applicants were homeless Veterans who had entered into a lease agreement with a particular landlord (“Landlord-1”).  Each of these applications (the “Landlord-1 EOSD Applications”) claimed that a particular company provided broker’s services in connection with the lease agreement (“Broker Company-1”).  HRA paid over $5.4 million in EOSD payments and broker’s fees pursuant to the Landlord-1 EOSD Applications.

Based on a review of approximately 60 of the 340 Landlord-1 EOSD Applications, those applications included, among other things, a completed application for “Emergency Assistance” on an HRA designated form; a copy of a purported lease agreement between a Veteran and Landlord-1; forms requesting payment to Landlord-1 and Broker Company-1 for services provided; personal identifying information, such as copies of identification cards and military and/or employment records for the Veteran; and an identification card issued by the New York Department of State reflecting one of two individuals and purporting that each of those individuals was a “Real Estate Salesperson” with Broker Company-1.

The Landlord-1 EOSD Applications were fraudulent.  Specifically, Landlord-1 and the Veterans did not, in fact, enter into the lease agreements submitted to HRA in connection with the Landlord-1 EOSD Applications, and Broker Company-1 did not provide real estate brokerage services to either Landlord-1 and/or the Veterans.  Furthermore, the identification cards reflecting purported individual brokers associated with Broker Company-1 were forged, in that those brokers are not affiliated with Broker Company-1 and did not provide any real estate brokerage services to either Landlord-1 and/or the Veterans.  Therefore, the Landlord-1 EOSD Applications contained fake documentation and information, and fraudulently induced HRA into making EOSD payments.

HRA made EOSD payments of at least $5.4 million in connection with the Landlord-1 EOSD Applications.  Of this $5.4 million, over $3.6 million was deposited into a bank account controlled by WEIR, and over $1 million was deposited into a bank account controlled by WEAH.  In addition, during this period, the bank account controlled by WEIR paid over $1 million to a bank account held in the name of WEAH.

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WEIR, 37, of Atlanta, Georgia, and WEAH, 46, of Edison, New Jersey, are charged with conspiracy to commit wire fraud and wire fraud, each of which carries a maximum sentence of 20 years in prison, and one count of aggravated identity theft, which carries an additional mandatory consecutive two-year sentence. 

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.

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

Mr. Williams praised the outstanding investigative work of the DOI.  Mr. Williams also thanked the DSS and the U.S. Department of Veterans Affairs, Office of Inspector General, for their assistance.

This case is being handled by the Office’s General Crimes Unit.  Assistant United States Attorney Matthew Weinberg is in charge of the prosecution.

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

Damian Williams, the United States Attorney for the Southern District of New York, announced today that CHRISTOPHER NUNEZ was sentenced to 320 months in prison by United States District Judge Kenneth M. Karas for his enticement of three minors to engage in sexual activity.  The sentencing today followed NUNEZ’s guilty plea on February 28, 2022.

U.S. Attorney Damian Williams said:  “Christopher Nunez’s conduct is the nightmare of any parent.  Today’s sentencing illustrates that we will continue to use every tool available to law enforcement to prosecute and punish those who sexually exploit children.”

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

Between in or about early March 2021 up to and including on or about May 1, 2021, NUNEZ communicated online with a 15-year-old minor (“Victim-1”) and persuaded Victim-1 to meet NUNEZ in person to engage in sexual activities with him.   On or about April 30, 2021 and May 1, 2021, NUNEZ travelled to New York from Miami, Florida to meet with Victim-1 in person in Westchester County, New York to engage in sexual activity with her.

On or about May 2, 2021, CHRISTOPHER NUNEZ was charged in the Town of North Salem with Rape in the Third Degree and Endangering the Welfare of a Child.  On October 5, 2021, NUNEZ pled guilty to Rape in the Third Degree.

The federal investigation revealed that, prior to Nunez’s abuse of Victim-1, he abused a 12-year-old girl (“Victim-2”) in Laurel County, Kentucky. Nunez engaged in sexually explicit communications online with Victim-2 beginning in or about January 1, 2021, when she was in 6th grade and 11 years old. During these communications, he persuaded Victim-2 to engage in sexually explicit activity, capture this activity in images and videos, and then transmit the photos and videos to Nunez. On March 6, 2021, Nunez travelled from his home in Florida to Laurel County, Kentucky, where he met Victim-2 in person and engaged in sexual activity with her.

The federal investigation also revealed that, in May and June of 2021, Nunez engaged in sexually explicit communications online with Victim-3, a 16-year-old in New Jersey. During these communications, Nunez persuaded Victim-3 to engage in sexually explicit activity, capture the activity in images and videos, and transmit the images and videos to Nunez.

On February 28, 2022, Nunez entered a guilty plea to a four-count federal Information, charging him with three counts of enticement, in violation of Title 18, United States Code, Section 2422(b) and one count of sexual exploitation, in violation of Title 18, United States Code, Section 2251(a). 

*               *               *

In addition to the prison term, NUNEZ, 27, was sentenced to a lifetime term of supervised release.

Mr. Williams praised the efforts of the Federal Bureau of Investigation, the New York State Police, the Westchester County District Attorney’s Office, and the 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, Putnam County Sheriff's Office, Westchester County DAs Office, Rockland County DAs Office, NYPD, Westchester County PD, and the Yonkers, New Rochelle, Mount Vernon, Greenburgh, White Plains, Peekskill, Ramapo, and Clarkstown Police Departments, in connection with this investigation.    

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

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 Office of the Federal Bureau of Investigation (“FBI”), announced that SUSANA RIVERA, the former Director of Accounting and Human Resources for a kitchen remodeling firm located in Westchester County and Greenwich, Connecticut, pled guilty to wire fraud in connection with her embezzlement of more than $630,000 from her former employer. 

According to the allegations contained in the Information:

In October 2019, RIVERA was hired as the Director of Accounting and Human Resources at the victim company, a family owned kitchen design and remodeling business in Mamaroneck, Bedford and Greenwich, Connecticut.  Starting in November 2019, RIVERA made hundreds of unauthorized charges in a total amount exceeding $175,000 to the victim company’s credit cards for personal expenses, including jewelry, beauty treatments, laser treatments, travel, pets, cosmetic surgery, clothing and cars, including a partial payment on a  $100,000 Corvette.  RIVERA also caused the victim company’s payroll company to make unauthorized payments in a net amount of more than $370,000 to a fake vendor that RIVERA created to receive the money.  RIVERA also caused unauthorized transfers from the victim company’s bank account in an amount exceeding $2,900 to pay her personal utility bills.  To get restrictions on the use of the victim company’s credit cards removed, RIVERA posed as an owner of the victim company in telephone calls with the company’s credit card company.  RIVERA also sent the credit card company photographs of the owner’s driver’s license to cause credit card company personnel to believe she was the owner.

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RIVERA, 40, of the Bronx, New York, pled guilty to one count of wire fraud, which carries a maximum sentence of 20 years in prison. 

The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as the sentence will be determined by the court.

Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation.

This case is being handled by the Office’s White Plains Division.  Assistant United States Attorney James McMahon is in charge of the prosecution.

Damian Williams, the United States Attorney for the Southern District of New York, announced that CHRISTOPHER WRIGHT and STEVEN HOOPER were sentenced to 52 months in prison and 42 months in prison, respectively, for defrauding elderly victims in connection with the fraudulent sale of stock and fake carbon credits as part of an over $16 million international telemarketing scheme.  WRIGHT and HOOPER previously pled guilty before U.S. District Judge Jed S. Rakoff, who imposed the sentences. 

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

From in or about 2009 up to and including in or about 2015, WRIGHT, HOOPER, and other co-conspirators engaged in a scheme to defraud victims in the United Kingdom through the sale of false, fraudulent, and materially misleading investments, and to launder the proceeds of the fraud through bank accounts in the United States and foreign countries.  WRIGHT and HOOPER used the services of telemarketing call centers to identify and cold-call potential victims, who were primarily elderly or retired individuals residing in the United Kingdom.  Over a series of telephone calls, the telemarketers persuaded victims to invest money under various false and misleading pretenses, including the promise of short-term, high-yield, no-risk returns, when in fact the investments were high-risk, illiquid, and in some instances, entirely fictitious.  Many victims were persuaded to make additional investments under the false pretense that they would not be permitted to sell their holdings until they purchased more.  In reliance on the false representations and promises, the victims wired funds to various bank accounts in the United States, including in the Southern District of New York, in the names of corporate entities controlled by one of WRIGHT’s and HOOPER’s co-conspirators.  WRIGHT and HOOPER assisted in emailing of documents related to the fraudulent investments, including purchase contracts and investment certificates, to the victims.  Victims who tried to sell their investments found they were unable to do so.  The victims never received a refund on their principal or any return on their investments. 

In order to conceal the nature, location, source, ownership, and control of the proceeds of the fraudulent scheme, WRIGHT, HOOPER, and their co-conspirators set up overseas bank accounts, including in Cyprus, Switzerland, and the United Kingdom, in the names of various shell companies, which were used to launder a substantial portion of the fraud proceeds.

The nature of the particular fraudulent investment vehicles being marketed to the victims changed over time.  From in or about 2009 until in or about 2011, WRIGHT and his co-conspirators sold the stock of Florida-based corporation DirectView Holdings, Inc. (“DirectView”) to the victims based on telemarketers’ false representations and promises that the shares were a no-risk, short-term investment in a debt-free company, and that the shares were likely to increase over 100 percent in value in a short period of time.  In fact, DirectView’s annual report filed with the United States Securities and Exchange Commission (“SEC”) for the year ending December 31, 2010, contained dire warnings about the poor fiscal health of DirectView and the risk attendant in purchasing stock, including that the company “may be forced to cease operations” due to losses and cash flow problems, and purchasers “may find it extremely difficult or impossible to resell our shares.” 

From in or about 2011 until in or about 2015, WRIGHT, HOOPER, and their co-conspirators engaged in the sale of fraudulent “carbon credits.”  The boiler room callers appealed to victims by claiming that the investments would be environmentally friendly and help address the climate crisis.  “Carbon credits,” which are issued as part of governmental and voluntary regulatory regimes, are permits representing the right to emit a certain number of tons of carbon dioxide into the atmosphere. “Carbon offsets,” which are tied to particular carbon-dioxide emissions reducing projects, represent a reduction in carbon dioxide emissions, and can be purchased by individuals and companies to “offset” their or third parties’ “carbon-footprints.”  The victims were falsely promised that the carbon-related investments they purchased could be easily sold, carried no risk, and would yield a significant, short-term return.  In fact, the carbon credits and offsets that were sold to the victims were fake, and did not represent any actual carbon credits or offsets. 

In total, victims lost over $16 million.

*                *                *

In addition to their prison terms, WRIGHT, 49, and HOOPER, 49, who are both citizens of the United Kingdom, were ordered to pay restitution in the respective amounts of $16,407,459.52 and $14,457,104.19. WRIGHT and HOOPER were also ordered to pay forfeiture in the amount of $1,632,443.10 and $760,977.12, respectively.

Mr. Williams praised the outstanding investigative work of IRS Criminal Investigation in this case.

This case is being prosecuted by the Office’s Money Laundering and Transnational Criminal Enterprises and Complex Frauds and Cybercrime Units. Assistant U.S. Attorneys Jessica Feinstein, Olga I. Zverovich, and David Felton are in charge of the prosecution.

Kristen Clarke, Assistant Attorney General for the Justice Department’s Civil Rights Division, Damian Williams, the United States Attorney for the Southern District of New York, and Breon Peace, the United States Attorney for the Eastern District of New York, announced today a civil pattern or practice investigation into the Special Victims Division (SVD) of the New York City Police Department (NYPD). The investigation will assess whether the SVD engages in a pattern or practice of gender-biased policing. The investigation will include a comprehensive review of the policies, procedures, and training for SVD investigations of sexual assault crimes, including how SVD interacts with survivors and witnesses, collects evidence, and completes investigations; any steps NYPD has taken to address deficiencies in its handling of sexual assault crimes; how SVD allocates staffing and other resources; and the services and support offered to survivors of sexual assault. As part of this investigation, the Justice Department officials will reach out to community groups and members of the public to learn about their experiences with SVD.   

Prior to the announcement, Justice Department (Department) officials notified Mayor Eric Adams, NYPD Commissioner Keechant L. Sewell, and NYC Corporation Counsel Sylvia O. Hinds-Radix, who have pledged to cooperate with the investigation.

Assistant Attorney General Kristen Clarke said:  “Survivors of sexual assault should expect effective, trauma-informed and victim-centered investigations by police departments.  Based on information provided to the Justice Department, we find significant justification to investigate whether the NYPD’s Special Victims Division engages in a pattern or practice of gender-biased policing. Investigations into sexual assault that comply with the Constitution promote accountability, enhance public safety and foster community trust.” 

SDNY U.S. Attorney Damian Williams said:  “Victims of sex crimes deserve the same rigorous and unbiased investigations of their cases that the NYPD affords to other categories of crime.  Likewise, relentless and effective pursuit of perpetrators of sexual violence, unburdened by gender stereotypes or differential treatment, is essential to public safety. We look forward to working with our partners in EDNY and the Civil Rights Division to assess the NYPD’s practices in this area.”

EDNY U.S. Attorney Breon Peace said:  “Respectful, thorough, and complete investigations of sexual assaults are fundamental to a well-functioning justice system.  Over the last several months, we have learned concerning information from a variety of sources of historical issues about the way the Special Victims Division has conducted its investigations for many years.  Our review is intended to ensure that, going forward, survivors of sexual assault in New York City receive fair and just treatment in the criminal justice system, and as a result, those who engage in sexual violence are held accountable.  We appreciate that the NYPD has already taken steps to address these concerns.”

The Department received information alleging deficiencies at SVD that have persisted for more than a decade, depriving survivors and the public of the prompt, thorough, and effective investigations needed to protect public safety. These deficiencies allegedly include failing to conduct basic investigative steps and instead shaming and abusing survivors and re-traumatizing them during investigations. 

The investigation is being conducted pursuant to the Violent Crime Control and Law Enforcement Act of 1994, which prohibits state and local governments from engaging in a pattern or practice of conduct by law enforcement officers that deprives individuals of rights protected by the Constitution or federal law. The Act allows the Justice Department to remedy such misconduct through civil litigation. The Department will be assessing law enforcement practices under the Fourteenth Amendment to the United States Constitution, as well as the Safe Streets Act of 1968.

The Civil Rights Unit in the Civil Division of the U.S. Attorney’s Office for the Southern District of New York, and the Civil Rights Team in the Civil Division of the U.S. Attorney’s Office for the Eastern District of New York, and the Special Litigation Section of the Justice Department’s Civil Rights Division will jointly conduct this investigation. Individuals with relevant information are encouraged to contact the Department via email at [email protected] or by calling 212-637-2746. Individuals can also report civil rights violations regarding this or other matters using the Civil Rights Division’s new reporting portal, available at www.civilrights.justice.gov, to the Eastern District of New York at https://www.justice.gov/usao-edny/civil-rights, or to the Southern District of New York at https://www.justice.gov/usao-sdny/civil-rights.  

Information specific to the Justice Department’s Civil Rights Division’s Police Reform Work can be found here: https://www.justice.gov/crt/file/922421/download.  The Department’s updated guidance on improving law enforcement response to sexual assault and domestic violence can be found here:  Improving Law Enforcement Response to Sexual Assault and Domestic Violence by Identifying and Preventing Gender Bias (justice.gov).

Additional information about the U.S. Attorney’s Office for the Eastern District of New York is available on its website at https://www.justice.gov/usao-edny. Additional information about the U.S. Attorney’s Office for the Southern District of New York is available on its website at https://www.justice.gov/usao-sdny. Additional information about the Civil Rights Division is available on its website at www.justice.gov/crt.

Damian Williams, the United States Attorney for the Southern District of New York, announced that NICHOLAS JOSEPH, a/k/a “Gotti,” a/k/a “Finesse,” was sentenced today to 22 years in prison in connection with his participation in the Castle Hill Crew, a violent street gang based in the Castle Hill Houses in the Soundview neighborhood of the Bronx, including for his role in the shooting of a 12-year old child on April 28, 2017, narcotics trafficking, firearms offenses, fraud, and other acts of violence.  On September 22, 2021, a jury found JOSEPH guilty of racketeering conspiracy, violent crimes in aid of racketeering, and firearms offenses after a seven-day trial.  U.S. District Judge P. Kevin Castel imposed today’s sentence.

U.S. Attorney Damian Williams said:  “For years, Nicholas Joseph actively participated in the Castle Hill Crew, a violent gang that infected the Soundview neighborhood of the Bronx with guns, drug dealing, fraud, and violence.  These crimes included a shooting in a crowded playground next to an elementary school, which seriously injured a 12-year-old child.  Today’s lengthy sentence sends an important message to gang members who commit crimes that they will be apprehended and prosecuted to the fullest extent of the law.”

As alleged in the Indictment and based on the evidence at trial and statements made in open court:

Between in or about 2014 and in or about December 2020, JOSEPH was a member and associate of the Castle Hill Crew, a racketeering enterprise that operated principally in the Castle Hill Houses in the Soundview neighborhood of the Bronx.  In order to enrich the enterprise, preserve and protect the power of the enterprise, and enhance its criminal operations, Castle Hill Crew members and associates committed, conspired, attempted, and threatened to commit acts of violence, including murder; distributed and possessed with intent to distribute narcotics; engaged in fraud; and obtained, possessed, and used firearms.

On or about November 19, 2015, JOSEPH and others stabbed a rival gang member in the head and back.

On or about April 28, 2017, JOSEPH shot at rival gang members in the vicinity of the Story Playground in the Bronx, New York, during which a 12-year-old child was injured.

In addition, on or about July 10, 2020, and in or around November 2020 and December 2020, JOSEPH illegally possessed firearms and ammunition. 

*                *               *

In addition to his prison term, JOSEPH, 23, of the Bronx, was sentenced to five years of supervised release.

Mr. Williams praised the outstanding investigative work of the New York City Police Department, Homeland Security Investigations, and the New York City Department of Investigation.

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Andrew K. Chan, Celia V. Cohen, Emily A. Johnson, and Justin V. Rodriguez are in charge of the prosecution.

Damian Williams, the United States Attorney for the Southern District of New York, and Scott J. Lampert, Special Agent-in-Charge of the New York Regional Office of the U.S. Department of Health and Human Services, Office of the Inspector General (“HHS-OIG”), announced today that the United States has filed and settled a civil healthcare fraud lawsuit against TCPRNC, LLC d/b/a PLAZA REHAB AND NURSING CENTER (“PLAZA REHAB CENTER”) and CITADEL CONSULTING GROUP LLC d/b/a CITADEL CARE CENTERS LLC (“CITADEL”). The lawsuit alleges that PLAZA REHAB CENTER, acting at the direction of CITADEL, fraudulently switched the type of Medicare coverage in which elderly residents were enrolled in order to maximize the Medicare payments that PLAZA REHAB CENTER would receive. As alleged in the Government’s complaint, the residents and their families often did not request, consent to, or know about the change to their healthcare coverage, which had the potential to impact their out-of-pocket payments, the scope of the services and care covered, and their drug coverage plan.

U.S. Attorney Damian Williams said:  “Skilled nursing facility residents have the right to choose their own healthcare insurance coverage.  Plaza Rehab Center frequently changed the insurance of its residents without their consent or knowledge, and without explaining how the change could impact their out-of-pocket costs and the scope of their healthcare coverage.  When facilities unlawfully take advantage of elderly residents in order to maximize their revenue from federal healthcare programs, this Office will hold them accountable.”

HHS-OIG Special Agent-in-Charge Scott J. Lampert said:  “HHS-OIG is committed to safeguarding Medicare and its beneficiaries from fraud.  Those who exploit federal health care programs for financial gain and violate the trust of beneficiaries must be held accountable for their actions.”

Under the settlement, which was approved on June 27, 2022, by U.S. District Judge George B. Daniels, PLAZA REHAB CENTER and CITADEL agreed to pay a total of $7.85 million and made extensive factual admissions regarding their conduct. Specifically, PLAZA REHAB CENTER and CITADEL admitted that their staff often did not obtain the consent of the resident or their authorized representatives prior to disenrolling the resident from their Medicare Advantage Plan. In addition, as part of the settlement, CITADEL agreed to take steps to ensure that all skilled nursing facilities that are Citadel Care Centers comply with applicable guidance on Medicare health plan disenrollments and enrollments. PLAZA REHAB CENTER and CITADEL also entered into a Corporate Integrity Agreement with HHS-OIG, which requires that they maintain a compliance program designed to foster adherence to federal health care program requirements and thereby protect the programs.

Medicare beneficiaries may enroll in the original parts of Medicare, known as Original Medicare, or in Medicare Advantage Plans, which are administered by private companies that contract with the government. Original Medicare and Medicare Advantage Plans differ in how healthcare providers, including skilled nursing facilities, seek and receive reimbursement. Under Original Medicare, the Centers for Medicare & Medicaid Services (“CMS”) directly reimburses providers, like skilled nursing facilities, on a fee-for-service basis. In contrast, when furnishing medical services to a Medicare beneficiary enrolled in a Medicare Advantage Plan, the provider submits claims to the Medicare Advantage Organization (“MAO”) that operates the Medicare Advantage Plan, which in turn pays the provider an agreed-upon amount. CMS pays MAOs a fixed, capitated amount each month for providing coverage for Medicare beneficiaries enrolled in the Medicare Advantage Plan. CMS advises individuals to consider various factors in deciding between a Medicare Advantage Plan and Original Medicare, such as differences in out-of-pocket costs and doctor choice.

As alleged in the Complaint filed in Manhattan federal court:

It is well known within the skilled nursing facility industry that it is typically more profitable to admit residents who are enrolled in Original Medicare than residents enrolled in Medicare Advantage Plans. From September 2016 to February 2019, CITADEL exerted pressure on PLAZA REHAB CENTER staff to increase the number of residents enrolled in Original Medicare in order to increase Medicare reimbursements. PLAZA REHAB CENTER staff disenrolled many residents from their self-selected Medicare Advantage Plans and enrolled them in Original Medicare without obtaining the consent of the residents or their authorized representatives.

PLAZA REHAB CENTER staff were supposed to ensure that residents (or their authorized representatives) signed “disenrollment forms” prior to effectuating any disenrollment of the resident from their Medicare Advantage Plan. However, in many instances, PLAZA REHAB CENTER staff disenrolled residents from their Medicare Advantage Plan and enrolled them in Original Medicare without obtaining a signed disenrollment form reflecting the resident’s consent. Indeed, PLAZA REHAB CENTER employees effectuated numerous disenrollments without ever speaking to the resident or their authorized representative or explaining the consequences of switching to Original Medicare. In addition, in other instances, PLAZA REHAB CENTER staff discussed a disenrollment with the resident and purportedly obtained the resident’s consent, but the resident did not have the capacity to provide consent because of their health condition. 

In the settlement agreement, PLAZA REHAB CENTER and CITADEL admit, acknowledge, and accept responsibility for the following conduct:

• PLAZA REHAB CENTER staff, at the direction and under pressure from a CITADEL manager responsible for the new admission practices, changed PLAZA REHAB CENTER residents’ insurance from Medicare Advantage Plans to Original Medicare after such residents’ admission to PLAZA REHAB CENTER. Among other things, CITADEL set a monthly disenrollment quota for PLAZA REHAB CENTER and identified potential candidates for disenrollment. PLAZA REHAB CENTER earned greater revenues for residents if such residents were enrolled in Original Medicare, as compared to Medicare Advantage Plans.
• PLAZA REHAB CENTER staff often did not obtain the consent of the resident or their authorized legal representatives prior to disenrolling the resident from their Medicare Advantage Plan and enrolling them in Original Medicare.
• In approximately 19 instances, PLAZA REHAB CENTER staff purportedly obtained the residents’ consent before disenrolling them from their Medicare Advantage Plan, but, according to these residents’ mental status assessments, they did not have the capacity to provide consent because of their health condition. PLAZA REHAB CENTER regularly failed to consider the results of these mental health assessments and did not evaluate the capacity of residents to consent to the insurance change.
• PLAZA REHAB CENTER staff effectuated these changes in a resident’s coverage by logging on to the Medicare.gov website using the resident’s personal information. PLAZA REHAB CENTER staff would use this website to disenroll the resident from their self-selected Medicare prescription drug plan, which resulted in the resident automatically being disenrolled from their self-selected Medicare Advantage Plan and being enrolled into Original Medicare. In some instances, when completing the information online to effectuate the disenrollment, PLAZA REHAB CENTER staff misrepresented that they were either: (i) the person listed on the enrollment form; (ii) a person helping the person listed on the enrollment form in completing the form; or (iii) a person authorized to act on behalf of the individual on the enrollment form under the laws of the State where the individual resided.
• PLAZA REHAB CENTER and CITADEL often did not offer Plaza Rehab Center residents assistance in re-enrolling them in a Medicare Advantage Plan upon discharge from the Plaza Rehab Center facility.
• As a result of the conduct described above, the Government made payments under Original Medicare to PLAZA REHAB CENTER for residents who were improperly enrolled in Original Medicare without their consent. PLAZA REHAB CENTER was not entitled to these payments. 

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

Mr. Williams thanked HHS-OIG for its investigative efforts and assistance with the case.   

This case is being handled by the Office’s Civil Frauds Unit. Assistant United States Attorney Charles S. Jacob is in charge of the case.

Damian Williams, the United States Attorney for the Southern District of New York, announced that LEV PARNAS was sentenced today in Manhattan federal court by United States District Judge J. Paul Oetken to 20 months in prison for conspiring to make political contributions by a foreign national along with solicitation and aiding and abetting the making of the same, conspiring to make straw donations, participating in a wire fraud conspiracy, and making false statements and falsifying records.  PARNAS was previously found guilty on October 22, 2021 following a two-week jury trial on campaign finance and false statements offenses, and pled guilty to participating in a wire fraud conspiracy on March 25, 2022. 

U.S. Attorney Damian Williams said:  “Parnas will now serve time in prison for his many crimes.  Not content to defraud investors in his business, Fraud Guarantee, out of more than $2 million dollars, Parnas also defrauded the American public by pumping Russian money into U.S. elections and lying about the source of funds for political contributions.  My office will continue to aggressively prosecute those who put their personal and financial gain above their country and their investors.”

According to the allegations in the Indictment, court documents, and evidence presented at trial:

The Foreign Donor Scheme

In the spring of 2018, PARNAS, Igor Fruman, Andrey Kukushkin and Andrey Muraviev, a Russian oligarch, decided to launch a business aimed at acquiring retail cannabis licenses in the United States. As part of that plan, Muraviev agreed to wire $1 million, through a series of bank accounts, to Fruman and PARNAS to fund hundreds of thousands of dollars in political contributions they had made or promised to make before the election in November 2018.  The purpose of the donations was to curry favor with candidates that might be able to help PARNAS and his co-conspirators obtain cannabis and marijuana licenses.  To obscure the fact that Muraviev was the true donor of the money, the funds were sent to a business bank account controlled by Fruman’s brother, and then the donations were made in PARNAS’s and Fruman’s names.

The Straw Donor and False Statements Scheme

In March 2018, PARNAS and Fruman began attending political fundraising events in connection with federal elections and making substantial contributions to candidates, joint fundraising committees, and independent expenditure committees with the purpose of enhancing their influence in political circles and gaining access to politicians. 

In May 2018, to obtain access to exclusive political events and gain influence with politicians, PARNAS and Fruman made a $325,000 contribution to an independent expenditure committee.  PARNAS and Fruman also made thousands of dollars in contributions to a federal candidate and a joint fundraising committee.  Despite the fact that the Federal Election Commission (“FEC”) forms for these contributions required PARNAS and Fruman to disclose the true donor of the funds, they falsely reported that the $325,000 contribution came from Global Energy Producers, a purported liquefied natural gas import-export business that was incorporated by PARNAS and Fruman around the time the contributions were made.  PARNAS also falsely stated on contribution forms that contributions to the federal candidate and joint fundraising committee were paid for by him.  In truth and in fact, the donations did not come from Parnas or GEP funds.  Rather, the contributions were all straw donations paid for by Fruman. 

In response to a complaint filed with the FEC regarding the $325,000 contribution to the independent expenditure committee, and to further conceal the true source of the funds used to make certain of their donations, in or about October 2018, PARNAS and Fruman submitted sworn affidavits to the FEC that contained false statements, including that the $325,000 contribution “was made with GEP funds for GEP purposes” and that  “GEP is a real business enterprise funded with substantial bona fide capital investment; its major purpose is energy trading, not political activity.”

The Fraud Guarantee Scheme

Between in or about late 2012 and in or about mid-2019, PARNAS and David Corriea conspired to defraud multiple victims by inducing them to invest in their company, known as “Fraud Guarantee,” based on materially false and misleading representations.  Among other things, PARNAS and Correia falsely claimed that the investors’ funds would be used solely for legitimate business expenses of Fraud Guarantee, when in fact the funds were largely withdrawn as cash, transferred to personal accounts, and used for various apparently personal expenditures.  PARNAS and Correia also made materially false representations concerning, among other things, how much money PARNAS had contributed to the company and how much money the company had raised overall.  At least seven victims invested in Fraud Guarantee based at least in part on PARNAS’s and Correia’s false and misleading representations, with each victim being fraudulently induced to pay hundreds of thousands of dollars, for a total of more than $2 million.

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PARNAS, 50, of Boca Raton, Florida, was sentenced to 20 months in prison, three years of supervised release, as well as $2,322,500 restitution.  Igor Fruman was sentenced to 366 days in prison on January 21, 2022 for solicitation of a contribution by a foreign national.  Andrey Kukushkin was sentenced to 366 days in prison on March 15, 2022 for conspiring to make and aiding and abetting the making of a contribution by a foreign national.  David Correia was sentenced to 366 days in prison on February 8, 2021 for making false statements and conspiracy to commit wire fraud.  Andrey Muraviev is believed to be in Russia and remains at large. 

Mr. Williams praised the outstanding investigative work of the FBI and its New York Field Office.

This case is being handled by the Office’s Public Corruption Unit.  Assistant U.S. Attorneys Rebekah Donaleski, Aline R. Flodr, Hagan Scotten, and Nicolas Roos are in charge of the prosecution.                                           

Damian Williams, the United States Attorney for the Southern District of New York, Michael J. Driscoll, Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), Ricky J. Patel, Acting Special Agent-in-Charge of the New York Office of Homeland Security Investigations (“HSI”), Keechant L. Sewell, the Commissioner of the New York City Police Department (“NYPD”), and Jocelyn Strauber, Commissioner of the New York City Department of Investigation (“DOI”), announced the unsealing of a two-count Indictment charging nine defendants with racketeering conspiracy and extortion conspiracy.  Eight of the defendants were arrested yesterday and presented before U.S. Magistrate Judge Stewart D. Aaron in federal court in Manhattan.  Defendant JATIEK SMITH was arrested and presented in the District of Puerto Rico.  The case has been assigned to U.S. District Judge Jed S. Rakoff.

The defendants, who include members of the violent Bloods street gang, took control of First Response Cleaning Corp. (“First Response”), a Brooklyn-based company which provides clean-up services to properties damaged by fire.  The defendants used First Response as a vehicle to extort other participants in the fire mitigation industry and to assert control over the industry using violence and threats of violence. 

U.S. Attorney Damian Williams said:  “We are smoking out corruption and violence in the fire mitigation industry with today’s charges.  As alleged, the defendants used threats and violence to take over a company and then an industry.  Thanks to our law enforcement partners’ work, today’s arrests bring an end to the defendants’ violent scheme.    

FBI Assistant Director Michael J. Driscoll said:  “We allege gang members deployed mob-like tactics, using extortion and violence in their attempts to take over an entire industry designed to help victims after a fire. They employed violence to force other companies and vendors to do their bidding. Thanks to the incredible work by the FBI and our law enforcement partners, this crew can no longer threaten to kill people's families, retaliate against potential witnesses, and profit off of someone else's loss.”

HSI Acting Special Agent-in-Charge Ricky J. Patel said:  “Members of the Bloods allegedly infiltrated the First Response Cleaning Corporation and utilized violence to command dominance and compliance over their competitors within the insurance industry.  This criminal organization took advantage of people in time of personal and professional turmoil to enrich themselves at others expense.  HSI will continue to work alongside our partners to disrupt and dismantle complex criminal organizations who seek to exploit legitimate businesses to further their violent agendas.”

NYPD Police Commissioner Keechant L. Sewell said:  “This indictment is a clear demonstration that those who use violence, force and threats of force to inflict harm on New Yorkers – will be prosecuted to the fullest extent of the law.  Due to the relentless efforts of the NYPD, the U.S. Attorney for the Southern District, and all of our law enforcement partners, these defendants are now forced to answer for their alleged gang-motivated crimes.  I thank everyone who worked on this important case.”

DOI Commissioner Jocelyn Strauber said:  “As alleged, the defendants used violence and threats of violence to seize control of the fire restoration industry in New York City, and submitted false claims to insurance companies in a scheme to ensure insurance coverage for defective restoration work.  DOI is proud to work alongside our law enforcement partners in the U.S. Attorney's Office for the Southern District of New York, the Federal Bureau of Investigation, Homeland Security Investigations and the NYPD to dismantle this charged criminal enterprise and to hold its members accountable for their illegal and violent charged conduct.”

As alleged in the Indictment unsealed yesterday in Manhattan federal court and statements made in court filings[1]:

First Response is an emergency mitigation services (or “EMS”) company which provides clean-up services to properties damaged by fire.  When properties suffer fire damage, property owners often hire an EMS company to clean up the damaged property.  Property owners also often rely upon adjusters—either a “public adjuster” or an “independent adjuster”—to investigate, process, and submit the insurance claims to their insurer.  A public adjuster is paid by the property owner with a percentage of the settlement paid out by the insurer on the insurance claim, while an independent adjuster works for and is paid by the insurer.  

Beginning in 2019, defendants JATIEK SMITH, a/k/a “Tiek,” SEQUAN JACKSON, a/k/a “Supa,” ANTHONY MCGEE, a/k/a “Touch,” KAHEEN SMALL, a/k/a “Biz,” DAMON DORE, a/k/a “Demo,” HASIM SMITH, a/k/a “Hoodie,” RAHMIEK LACEWELL, a/k/a “Ready,” and MANUEL PEREIRA, a/k/a “Manny,” many of whom are members of the Bloods street gang,worked together to take control of First Response.  JATIEK SMITH was the leader of the crew.  After taking control of First Response, SMITH and the others then used force and threats of force against other EMS companies and public adjusters to exert control over the entire fire mitigation industry.  Defendant OCTAVIO PERALTA was a public adjuster who participated in the enterprise’s efforts to defraud and who helped the conspirators solidify their control over the industry.  The enterprise’s threats included threats to kill or shoot their victims and members of the victims’ families.  With the backing of these threats of force, they imposed a system of rules upon other EMS companies and on public adjusters, including a strict rotation system in which the defendants dictated which companies got which losses.  The enterprise also extorted money from EMS companies and public adjusters and required these other companies to pay if they wanted to continue to work without being attacked.  On multiple occasions, the enterprise used force against other EMS companies and public adjusters to ensure that they submitted to the rules, including physically assaulting victims.  They sometimes created video recordings of this violence and distributed the recordings within the industry to threaten other victims.  The enterprise also helped submit false insurance claims for damaged properties and threatened violence or retaliation against potential witnesses who were believed to be cooperating with the federal investigation into the enterprise’s crimes.

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JATIEK SMITH, 37, of Staten Island, New York; JACKSON, 33, of Staten Island, New York; MCGEE, 32, of Staten Island, New York; SMALL, 35, of Brooklyn, New York; DORE, 36, of Staten Island, New York; HASIM SMITH, 29, of Staten Island, New York; LACEWELL, 37, of Staten Island, New York; PEREIRA 38, of Brooklyn, New York; and OCTAVIO PERALTA, 42, of Staten Island, New York, are each charged with one count of conspiracy to commit racketeering and one count of conspiracy to commit extortion.  Each count carries a statutory maximum of 20 years in prison, for a combined statutory maximum of 40 years in prison. 

The statutory maximum sentence is prescribed by Congress and is 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, HSI, NYPD, and DOI.  Mr. Williams also thanked the HSI Puerto Rico Gang Unit and the National Insurance Crime Bureau for their assistance with this investigation. 

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Mollie Bracewell, Rushmi Bhaskaran, and Adam S. Hobson, 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 constitutes only allegations, and every fact described herein should be treated as an allegation.

Damian Williams, the United States Attorney for the Southern District of New York, announced that GHISLANE MAXWELL was sentenced today in Manhattan federal court by United States Circuit Judge Alison J. Nathan to 240 months in prison for her role in a scheme to sexual exploit and abuse multiple minor girls with Jeffrey Epstein over the course of a decade.  MAXWELL was previously found guilty on December 29, 2021, following a one-month jury trial, of conspiracy to entice minors to travel to engage in illegal sex acts, conspiracy to transport minors to participate in illegal sex acts, transporting a minor to participate in illegal sex acts, sex trafficking conspiracy, and sex trafficking of a minor.

U.S. Attorney Damian Williams said:  “Today’s sentence holds Ghislaine Maxwell accountable for perpetrating heinous crimes against children.  This sentence sends a strong message that no one is above the law and it is never too late for justice.  We again express our gratitude to Epstein and Maxwell’s victims for their courage in coming forward, in testifying at trial, and in sharing their stories as part of today’s sentencing.”

According to the allegations in the Indictment, court documents, and evidence presented at trial:

From at least 1994, up to and including in or about 2004, GHISLAINE MAXWELL assisted, facilitated, and participated in Jeffrey Epstein’s abuse of minor girls by, among other things, helping Epstein to recruit, groom, and ultimately abuse victims known to MAXWELL and Epstein to be under the age of 18.  The victims were as young as 14 years old when they were groomed and abused by MAXWELL and Epstein, both of whom knew that their victims were in fact minors.  As a part and in furtherance of their scheme to abuse minor victims, MAXWELL and Epstein enticed and caused minor victims to travel to Epstein’s residences in different states, which MAXWELL knew and intended would result in their grooming for and subjection to sexual abuse.

MAXWELL enticed and groomed minor girls to be abused in multiple ways.  For example, MAXWELL attempted to befriend certain victims by asking them about their lives, their schools, and their families, and taking them to the movies or on shopping trips.  MAXWELL also acclimated victims to Epstein’s conduct simply by being present for victim interactions with Epstein, which put victims at ease by providing the assurance and comfort of an adult woman who seemingly approved of Epstein’s behavior.  Additionally, Epstein offered to help some victims by paying for travel and/or educational opportunities, and MAXWELL encouraged certain victims to accept Epstein’s assistance.  As a result, victims were made to feel indebted and believed that MAXWELL and Epstein were trying to help them.  MAXWELL also normalized and facilitated sexual abuse for a victim by discussing sexual topics, undressing in front of the victim, being present when the victim was undressed, and encouraging the victim to massage Epstein.

As MAXWELL and Epstein intended, these grooming behaviors left minor victims vulnerable and susceptible to sexual abuse by Epstein.  MAXWELL was then present for certain sexual encounters between minor victims and Epstein, such as interactions where a minor victim was undressed, and ultimately was present for sex acts perpetrated by Epstein on minor victims.  That abuse included sexualized massages during which a minor victim was fully or partially nude, as well as group sexualized massages of Epstein involving a minor victim where MAXWELL was present.  In some instances, MAXWELL participated in the sexual abuse of minor victims. 

Ultimately minor victims were subjected to sexual abuse that included, among other things, the touching of a victim’s breasts or genitals, placing a sex toy such as a vibrator on a victim’s genitals, directing a victim to touch Epstein while he masturbated, and directing a victim to touch Epstein’s genitals.  MAXWELL and Epstein’s victims were groomed or abused at Epstein’s residences in New York, Florida, and New Mexico, as well as MAXWELL’s residence in London, England.

In the earlier phase of the conspiracy, from at least approximately 1994 through approximately 2001, MAXWELL and Epstein identified vulnerable girls, typically from single-mother households and difficult financial circumstances.  This earlier phase required the defendant and Epstein to identify one girl at a time to target for grooming and abuse.  In the later phase, from approximately 2001 until at least approximately 2004, MAXWELL and Epstein enticed and recruited, and caused to be enticed and recruited, minor girls to visit Epstein’s Palm Beach Residence to engage in sex acts with Epstein, after which Epstein, MAXWELL, or another employee of Epstein’s would give the victims hundreds of dollars in cash. MAXWELL and Epstein encouraged one or more of those victims to travel with Epstein with the intention that the victim engage in sex acts with Epstein.  Moreover, and in order to maintain and increase his supply of victims, MAXWELL and Epstein also paid certain victims to recruit additional girls to be similarly abused by Epstein.  In this way, MAXWELL and Epstein created a network of underage victims for Epstein to sexually exploit.

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In addition to the prison sentence, MAXWELL, 60, was sentenced to five years of supervised release and ordered to pay a $750,00 fine.

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

This case is being handled by the Office’s Public Corruption Unit.  Assistant U.S. Attorneys Maurene Comey, Alison Moe, Lara Pomerantz, and Andrew Rohrbach are in charge of the prosecution.

Damian Williams, the United States Attorney for the Southern District of New York, announced today that EUGENI TSVETNENKO, a/k/a “Zhenya,” a dual citizen of Australia and Russia, was sentenced to 98 months in prison by U.S. District Judge Analisa Torres.  TSVETNENKO pled guilty on February 18, 2022, for his role in a consumer fraud scheme to charge mobile phone customers millions of dollars in monthly fees for unsolicited, recurring text messages about topics such as horoscopes, celebrity gossip, and trivia facts, without the customers’ knowledge or consent—a practice referred to as “auto-subscribing.”  The portion of the fraudulent scheme that TSVETNENKO and his co-conspirators orchestrated defrauded mobile phone users of approximately $41.3 million and netted TSVETNENKO and his co-conspirators more than $20 million in proceeds.  TSVETNENKO personally earned approximately $15.4 million in connection with the scheme, which he repaid prior to sentencing.

U.S. Attorney Damian Williams said:  “Eugeni Tsvetnenko and his co-defendants made a fortune by fraudulently charging their customers for text messages they didn’t need or approve, in a practice called ‘auto-subscribing,’ then laundering the proceeds through shell companies. Tsvetnenko is paying a steep price for his mobile scam, as he has already paid back over $15 million in forfeiture, and will now spend 98 months in federal prison.”

According to allegations in the Superseding Indictment against TSVETNENKO, evidence presented at the trial of co-conspirators Darcy Wedd (Wedd) and Fraser Thompson (Thompson), and other public filings:

From at least in or about 2012 through in or about 2013, TSVETNENKO, Wedd, Thompson, and others engaged in a multimillion-dollar scheme to defraud consumers by placing unauthorized charges for premium text messaging services on consumers’ cellular phone bills through a practice known as auto-subscribing.  TSVETNENKO owned and operated several content provider companies and mobile industry companies in Australia that, among other things, created and sold premium text messaging content to consumers.  Wedd operated Mobile Messenger, a U.S. aggregation company in the mobile phone industry that served as a middleman between content providers (such as some of TSVETNENKO’s companies) and mobile phone carriers.  Mobile Messenger was responsible for assembling monthly charges incurred by a particular mobile phone customer for premium text-messaging services and placing those charges on that customer’s cellular phone bill.  

Beginning in or about early 2012, Wedd, Thompson, who was the Senior Vice President of Strategic Operations for Mobile Messenger, and two other senior executives of Mobile Messenger (CC-3 and CC-4) recruited TSVETNENKO to their auto-subscribing scheme to increase revenues at Mobile Messenger.  TSVETNENKO agreed and established two new content providers based in Australia, CF Enterprises and DigiMobi, to auto-subscribe on Mobile Messenger’s aggregation platform.  CC-3 furnished lists of phone numbers to TSVETNENKO, along with an auto-subscribing “playbook,” which provided TSVETNENKO with guidance on how to auto-subscribe without being caught.  The “playbook” described how to conceal the fraud scheme by making it appear as if the customers had, in fact, elected to purchase the text-messaging services, when in truth they had not.

The consumers who received the unsolicited text messages typically ignored or deleted the messages, often believing them to be spam.  Regardless, the consumers were billed for the receipt of the messages, at a rate of $9.99 per month, through charges that typically appeared on the consumers’ cellular telephone bills in an abbreviated and confusing form, such as with nonsensical billing descriptors that often consisted of random letter and numbers.  The $9.99 charges recurred each month unless and until consumers noticed the charges and took action to unsubscribe.  Even then, consumers’ attempts to dispute the charges and obtain refunds from CF Enterprises or DigiMobi were often unsuccessful.  Wedd, to whom CC-3, CC-4, and Thompson all reported, oversaw the scheme at Mobile Messenger.

TSVETNENKO, with the assistance of Wedd, Thompson, CC-3, and CC-4, started auto-subscribing consumers in approximately April of 2012.  TSVETNENKO’s auto-subscribing activities, which continued into 2013, victimized hundreds of thousands of mobile phone customers, who were auto-subscribed through Mobile Messenger and charged a total of approximately $41,389,725 for unwanted text messaging services.  Wedd, Thompson, CC-3, and CC-4 agreed that TSVETNENKO would keep approximately 70% of the auto-subscribing proceeds generated by CF Enterprises and DigiMobi, and that the remaining 30% of the auto-subscribing proceeds would be divided evenly among Wedd, Thompson, CC-3, and CC-4.

After obtaining proceeds of the fraud scheme, TSVETNENKO worked with other co-conspirators to launder the proceeds.  TSVETNENKO and his co-conspirators distributed the proceeds of the fraud scheme among themselves and others involved in the scheme by, among other things, causing funds to be transferred through the bank accounts of a series of shell companies and companies held in the names of third parties.  This was done to conceal the nature and source of the payments and TSVETNENKO and his co-conspirators’ participation in the fraud.

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In addition to his prison sentence, TSVETNENKO, 41, of Australia, was ordered to pay forfeiture in the amount of approximately $15.4 million dollars, which he has repaid. 

Mr. Williams praised the outstanding investigative work of the Internal Revenue Service – Criminal Investigation and the Federal Bureau of Investigation.  In addition, Mr. Williams thanked law enforcement partners in Australia, especially the Australian Attorney-General Department’s International Crime Cooperation Central Authority and the Australian Federal Police, as well as the U.S. Department of Justice’s Office of International Affairs, for their significant support and assistance with the defendant’s extradition from Australia. 

The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorneys Jilan Kamal and Olga I. Zverovich are in charge of the prosecution.