Southern District of New York
Press releases recorded for this federal judicial district.
Operator of Unlawful Bitcoin Exchange Sentenced to More Than 5 Years in Prison for Leading Multimillion-Dollar Money Laundering and Fraud SchemeRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that ANTHONY R. MURGIO was sentenced today by U.S. District Judge Alison J. Nathan to 66 months in prison for charges associated with operating Coin.mx, an internet-based Bitcoin exchange, through which MURGIO processed more than $10 million in illegal Bitcoin transactions. MURGIO pled guilty on January 9, 2017, to conspiring to operate an unlicensed money transmitting business, conspiring to commit wire fraud and bank fraud, and conspiring to obstruct an examination of the Helping Other People Excel Federal Credit Union (“HOPE FCU”) by the National Credit Union Administration (“NCUA”) in furtherance of the illegal Coin.mx scheme.
Acting U.S. Attorney Joon H. Kim said: “Anthony Murgio’s criminal business model consisted of a phony front company hiding an illegal internet Bitcoin exchange. Murgio laundered money, lied to banks, and took over a federal credit union to further his scheme. Murgio’s was an age-old fraud by new age means. And for his crimes, the court has sentenced him to over five years in federal prison.”
According to the Superseding Indictment to which MURGIO pled guilty, statements made during the plea and sentencing proceedings, and evidence admitted at a trial of two co-defendants:
The Unlawful Bitcoin Exchange
Between 2013 and July 2015, MURGIO knowingly operated Coin.mx, an unlawful internet-based Bitcoin exchange that he had founded, in violation of federal anti-money laundering laws and regulations, including those requiring money services businesses like Coin.mx to meet state licensing and federal registration requirements set forth by the United States Treasury Department. MURGIO and his co-conspirators engaged in substantial efforts to evade detection of their unlawful Bitcoin exchange by operating through a phony front company called the “Collectables Club.” MURGIO used the Collectables Club to open financial accounts in order to trick financial institutions into believing the unlawful Bitcoin exchange was simply a members-only association of individuals who discussed, bought, and sold collectible items and memorabilia.
In addition to lying to banks to open accounts, MURGIO and his co-conspirators deceived financial institutions by deliberately misidentifying and miscoding Coin.mx customers’ credit and debit card transactions, in violation of bank and credit card company rules and regulations. MURGIO and his co-conspirators also instructed Coin.mx customers to mislead banks about the nature of the credit and debit card transactions the customers executed through Coin.mx. For example, MURGIO and his co-conspirators caused customers to mislead banks by reporting that the transactions in which they engaged with Coin.mx were for collectibles items, when in reality they were for Bitcoin. Through the illegal Coin.mx scheme, MURGIO and his co-conspirators caused more than $10 million in Bitcoin-related transactions to be processed illegally through financial institutions.
The Federal Credit Union Scheme
In 2014, in an effort further to evade scrutiny from financial institutions about the nature of the business engaged in by Coin.mx, MURGIO and his co-conspirators gained control of HOPE FCU, a federal credit union in New Jersey with primarily low-income members. After making more than $150,000 in illegal bribes at the direction of Trevon Gross, the then-chairman and CEO of HOPE FCU, MURGIO and his co-conspirators took control of HOPE FCU. With Gross’s assistance, MURGIO installed various co-conspirators on HOPE FCU’s board of directors and transferred Coin.mx’s banking operations to HOPE FCU. Gross also ceded operational control of the credit union to the board members installed by MURGIO. Thereafter, MURGIO and others worked to process tens of millions of dollars of Automated Clearing House (“ACH”) transactions through the credit union without adequate controls, thus putting its financial condition at risk.
MURGIO and his co-conspirators also obstructed an examination of HOPE FCU by the NCUA and made false statements to the NCUA in order to perpetuate MURGIO’s control of the credit union. These included deliberately failing to disclose the bribe payments; misrepresenting the location of Coin.mx-affiliated businesses, including the “Collectables Club,” so as to claim that they were eligible to be members of the credit union and to serve as Board members; and manipulating the accounting at HOPE FCU so as to hide its true financial condition and the fact that it was processing tens of millions of dollars of transactions without adequate controls. HOPE FCU was operated as a captive bank by MURGIO and his co-conspirators until the end of 2014.
In October 2015, the NCUA placed HOPE FCU into conservatorship, and subsequently liquidation.
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In addition to the prison sentence, MURGIO, 33, of Tampa, Florida, was sentenced to three years of supervised release.
All five of MURGIO’s co-defendants have been convicted and have been sentenced or are awaiting sentence by Judge Nathan.
Jose M. Freundt pled guilty on October 13, 2016, to operating an unlicensed money transmitting business, conspiring to operate an unlicensed money transmitting business, making corrupt payments to an officer of a financial institution, conspiring to make corrupt payments to an officer of a financial institution, wire fraud, and conspiring to commit wire fraud. Freundt is scheduled to be sentenced on September 15, 2017.
Michael J. Murgio pled guilty on October 27, 2016, to conspiring to obstruct an NCUA examination of a financial institution, and was sentenced on January 27, 2017, to one year of probation and a $12,000 fine.
Ricardo Hill pled guilty on January 17, 2017, to operating an unlicensed money transmitting business; conspiring to operate an unlicensed money transmitting business; making corrupt payments to an officer of a financial institution; conspiring to make corrupt payments to an officer of a financial institution, to receive corrupt payments by an officer of a financial institution, to obstruct an NCUA examination of a financial institution, and to make false statements to the NCUA; wire fraud; bank fraud; and conspiring to commit wire fraud and bank fraud. Hill is scheduled to be sentenced on July 17, 2017.
Trevon Gross and Yuri Lebedev were convicted after trial by a jury on March 17, 2017, of conspiring to make corrupt payments to an officer of a financial institution, to receive corrupt payments by an officer of a financial institution, to obstruct an NCUA examination of a financial institution, and to make false statements to the NCUA. Gross was also convicted of the receipt of corrupt payments by an officer of a financial institution. Lebedev was also convicted of making corrupt payments to an officer of a financial institution, wire fraud, bank fraud, and conspiring to commit wire fraud and bank fraud. Gross and Lebedev are scheduled to be sentenced on September 1, 2017.
Mr. Kim praised the outstanding investigative work of the Federal Bureau of Investigation and the United States Secret Service. He also thanked the NCUA for its assistance with the investigation and prosecution.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Eun Young Choi, Daniel S. Noble, and Won S. Shin are in charge of the prosecution.
More Than $23 Million in Assets Recovered from the Estates of Bernard Madoff’s Sons and from His Daughter-In-LawRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, Irving Picard, the Securities Investor Protection Act (“SIPA”) Trustee, and William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Division of the Federal Bureau of Investigation (“FBI”), today announced the recovery of more than $23 million in assets from the Estates of Andrew and Mark Madoff, and from Mark Madoff’s widow, Stephanie Mack, representing funds transferred to them by Bernard Madoff. A Stipulation and Order of Settlement effecting the recovery was signed yesterday by U.S. District Judge P. Kevin Castel. The assets will be liquidated and distributed to victims either through the Madoff Victim Fund, which was established by the Department of Justice, or through the BLMIS Customer Fund, which is administered and the SIPA Trustee.
Acting Manhattan U.S. Attorney Joon H. Kim said: “To date, this Office has recovered more than $9 billion in funds for victims of Bernard Madoff’s fraud. Today’s agreement, one of the final pieces in the Government’s eight-year effort to provide justice for Madoff’s victims, demonstrates our commitment not only to holding wrongdoers accountable, but also compensating victims of criminal fraud.”
SIPA Trustee Irving Picard said: “Today’s announcement is the culmination of years of ongoing investigations by our legal teams and our negotiations with the Madoff family. The outcome marks another significant milestone in the eight years of the Madoff Recovery Initiative, during which we have recovered or reached agreements to recover more than $11.5 billion and distributed more than $9 billion to Madoff’s victims.”
FBI Assistant Director William F. Sweeney Jr. said: “The investment scheme of Madoff’s was so devastating to so many investors who trusted his firm with their money. Today’s announcement of more than $23 million recovered is another small step we can take to try to make things right for the victims of Madoff’s massive Ponzi scheme.”
According to the Stipulation and Order of Settlement (the “Stipulation”) and other documents filed in connection with the criminal and civil forfeiture cases relating to the Madoff fraud:
For decades, Bernard L. Madoff (“MADOFF”) used his position as Chairman of Bernard L. Madoff Investment Securities (“BLMIS”), the investment advisory business he founded in 1960, to steal billions from his clients. On March 12, 2009, MADOFF pled guilty to 11 federal felonies, admitting that he had turned his wealth management business into the world’s largest Ponzi scheme, benefitting himself, his family, and select members of his inner circle.
MADOFF’s sons, Andrew and Mark Madoff (“ANDREW” and “MARK”), worked for MADOFF at BLMIS, amassing substantial assets from their employment there. To fuel their luxurious lifestyle, MADOFF frequently provided money to members of his family, including millions of dollars to ANDREW and MARK. As part of these transfers, ANDREW and MARK issued a series of seven promissory notes, with face value of $28.15 million in total (the “Notes”), to MADOFF, promising to repay the money provided by MADOFF, with interest, after the period of years specified in each Note. Included in this amount is one Note for $6.5 million that was co-signed by MARK’s wife, Stephanie Mack (“MACK”).
Following MADOFF’s arrest, his property was seized. On June 29, 2009, United States District Judge Denny Chin sentenced MADOFF to 150 years in prison for running the largest fraudulent scheme in history. Describing MADOFF’s crimes as “extraordinarily evil,” Judge Chin ordered MADOFF to forfeit $170,799,000,000 as part of MADOFF’s sentence. In a final order of forfeiture dated February 16, 2016, Judge Chin ordered the Notes forfeited to the United States.
MARK passed away in 2010, and ANDREW passed away in 2014. The Stipulation resolves the Government’s claims against the Estates of ANDREW and MARK (the “ESTATES”) and MACK based on the Notes, as well as various claims asserted against them by the SIPA Trustee. Pursuant to the terms of the Stipulation, the agreement must also be approved by U.S. Bankruptcy Judge Stuart M. Bernstein, who oversees the SIPA Trustee’s efforts in bankruptcy court.
The Stipulation requires the ESTATES and MACK to relinquish cash, securities, and liquid assets worth a total of more than $23 million, as well as various interests in additional corporate assets held by the ESTATES. These additional corporate assets will be liquidated and the proceeds added to the total recovery. The total recovery will be split evenly between the Government and the SIPA Trustee, and then distributed to victims of the Madoff fraud.
The Government’s portion will be distributed to victims through the Madoff Victim Fund. The Madoff Victim Fund is funded through recoveries by the U.S. Attorney’s Office in various criminal and civil forfeiture actions, and is overseen by Richard Breeden, the former Chairman of the United States Securities and Exchange Commission, in his capacity as Special Master appointed by the Department of Justice to assist in connection with the victim remission proceedings.
Mr. Kim praised the work of the Federal Bureau of Investigation and the SIPA Trustee.
The case is being handled by the Office’s Tax and Bankruptcy Unit and Money Laundering and Asset Forfeiture Unit. Assistant United States Attorneys Jonathan Cohen, Louis A. Pellegrino, and Niketh Velamoor are in charge of the case.
Bronx “YGz” Gang Member Sentenced to More Than 33 Years in Prison for Murdering an Innocent Bystander and Other CrimesRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that TERRANCE WILLIAMS, a/k/a “TA,” was sentenced this afternoon in Manhattan federal court to a prison term of 399 months for his crimes as a member of the “Young Gunnaz” or “YGz” gang, including the murder of Curtis Smith on June 3, 2011, in the Bronx. WILLIAMS was sentenced by U.S. District Judge Valerie E. Caproni, before whom he previously pled guilty.
Acting Manhattan U.S. Attorney Joon H. Kim said: “In broad daylight, Terrance Williams shot and killed Curtis Smith, a 23-year-old man, ending the life of an innocent bystander who was simply in the wrong place at the wrong time. We hope that the victim’s family finds justice, and a measure of solace, in this prosecution and today’s sentence. Together with our law enforcement partners, we will continue aggressively to prosecute those who bring violence to our communities.”
According to the charging and other documents filed in the case, as well as statements made during WILLIAMS’s guilty plea and sentencing proceedings and other court proceedings in this case:
WILLIAMS was a member of the Bronx-based street gang known as the YGz. From at least 2005 to 2016, members and associates of the YGz enriched themselves by committing robberies and by selling drugs, such as crack cocaine, heroin, and marijuana, and committing acts of violence, including the murder of rival gang members, rival drug traffickers, and innocent bystanders. As part of his involvement in the YGz gang, WILLIAMS participated in numerous acts of violence, as well as crack cocaine distribution, in the South Bronx.
In particular, on July 3, 2011, WILLIAMS shot a rival gang member in the stomach and arm, in broad daylight, in front of a bodega on the corner of 158th Street and Park Avenue while numerous bystanders were outside for cookouts and celebrations leading up to the 4th of July holiday. Moments later, while WILLIAMS was fleeing from the area, he fired gunshots at a group of bystanders, including Curtis Smith. WILLIAMS shot Smith in the head, and Smith died several days later.
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WILLIAMS, 24, of the Bronx, is the third defendant to be sentenced this year by Judge Caproni for participation in a YGz-related murder. Judge Caproni sentenced WILLIAMS’s co-defendant Anthony Scott, a/k/a “Tyson,” to 23 years in prison primarily for Scott’s role in shooting and killing Darrel Ledgister on June 27, 2009, in the South Bronx during an attempted robbery. Judge Caproni also sentenced WILLIAMS’s co-defendants Paul Gilbert, a/k/a “2Fly Tay,” to more than 30 years in prison primarily for Gilbert’s role in the murder of Cody Dubose on September 27, 2014, near the Taft Houses in Manhattan during an attempted robbery.
Mr. Kim praised the outstanding work of the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration, and the New York City Police Department in the investigation of this case. He also thanked the Bronx County District Attorney’s Office for their support in this case.
This case is being handled by this Office’s Violent and Organized Crime Unit. Assistant United States Attorneys Samson Enzer, Gina M. Castellano, and Andrew C. Adams are in charge of the prosecution.
Two Afghan Men Plead Guilty in Manhattan Federal Court to Conspiring to Import Hundreds of Kilograms of Heroin into the United StatesRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that LAJBAR LAJAWARD KHAN, a/k/a “Haji Lajaward,” and AMAL SAID SAID ALAM SHAH, a/k/a “Haji Zar Mohammad,” pled guilty to conspiring to import heroin into the United States, and to distributing heroin intending that the heroin would be imported into the United States. LAJAWARD and SAID pled guilty earlier today to a Superseding Indictment in Manhattan federal court before U.S. District Judge Kimba M. Wood.
Acting U.S. Attorney Joon H. Kim said: “As these two defendants admitted today, they conspired and attempted to import heroin into the United States from Afghanistan. Indeed, as the investigation revealed, they intended to import so much heroin into the United States from Afghanistan that their ‘sample’ shipment, meant as a test run for future shipments to the U.S., was three kilograms of heroin. We will continue to work with the DEA to curb the importation of heroin, a lethal drug that plagues every community right now.”
According to the allegations contained in the Superseding Indictment to which LAJAWARD and SAID pled guilty, statements made during the plea and other court proceedings, and other documents in the public record:
LAJAWARD and SAID, two Afghan nationals, were part of a drug trafficking organization (the “DTO”) based in Afghanistan that produced and distributed large quantities of heroin. Between approximately May 2014 and June 2015, LAJAWARD and SAID worked together in an effort to import large quantities of heroin – in the range of 1,000 kilograms – from Afghanistan into the United States.
In August 2014, LAJAWARD began communicating by telephone with an individual he understood to be a New York-based narcotics trafficker, who was in fact an undercover agent of the DEA (the “UC”). LAJAWARD, in sum and substance, told the UC that he was interested in supplying large quantities of high-quality heroin for importation into the United States, where it would be sold for millions of dollars. In the course of the calls between LAJAWARD and the UC, LAJAWARD introduced the UC to one of LAJAWARD’s heroin-trafficking associates, SAID.
On October 30, 2014, LAJAWARD and the UC met in person in Dubai, United Arab Emirates. In the course of that recorded meeting, in sum and substance, LAJAWARD continued to express his interest in supplying large quantities of heroin to the UC for importation into the United States, and LAJAWARD offered to supply a sample of heroin to the UC, as a test shipment to be sold in the United States. In the months following that meeting in Dubai, in the course of recorded telephone calls with the UC, LAJAWARD and SAID arranged to supply a three-kilogram sample of heroin in Kabul, Afghanistan (the “Heroin Sample”).
During those recorded calls, LAJAWARD, SAID, and the UC agreed that the delivery of the three-kilogram Heroin Sample would occur in Kabul on or about January 15, 2015. On that day, an undercover Afghan law enforcement officer, acting at the direction of the DEA and posing as an associate of the UC, met with LAJAWARD and one of LAJAWARD’s associates in Kabul and received delivery of the three-kilogram Heroin Sample. In parallel, over 1,000 miles away in Dubai, the UC met with another associate of LAJAWARD to pay for the Heroin Sample, as had been arranged during recorded calls between the UC and LAJAWARD. At that meeting, which was recorded, the UC paid $10,500 to the associate for the Heroin Sample.
About two weeks later, on January 28, 2015, SAID met with the UC in Dubai. During that recorded meeting, in sum and substance, SAID discussed the Heroin Sample that the DTO had recently supplied for importation into the United States, stated that the DTO was prepared to supply 1,000 kilograms of heroin to the UC, and indicated that it would only take the DTO about 15 days to produce 100 kilograms of heroin for shipment to the United States.
On April 2, 2015, SAID met again with the UC in Dubai. During that recorded meeting, SAID and the UC negotiated additional details of the agreement for the DTO to supply massive quantities of heroin for importation into the United States, including that LAJAWARD and SAID would share in the profits generated from the sale of the heroin in the United States. SAID also agreed, in sum and substance, that he and LAJAWARD would meet the UC in Thailand, for purposes of finalizing the heroin deal, and for LAJAWARD and SAID to receive their share of the profits generated from the purported sale in the United States of the three-kilogram Heroin Sample previously supplied by the DTO.
In June 2015, LAJAWARD and SAID traveled to Bangkok, Thailand, to meet with the UC. On June 13, 2015, LAJAWARD and SAID were arrested in Bangkok by Thai authorities based on the charges in this case, at the request of U.S. authorities. LAJAWARD and SAID were later brought to the United States to face the charges against them.
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LAJAWARD, 52, of Afghanistan, and SAID, 46, also of Afghanistan, each pled guilty to one count of conspiring to import one kilogram and more of heroin into the United States, and to one count of distributing or attempting to distribute one kilogram and more of heroin, knowing and intending that it would be imported into the United States. LAJAWARD and SAID each face a maximum sentence of life in prison and a mandatory minimum sentence of 10 years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge. Sentencing is scheduled for November 1, 2017, at 3:30 p.m., before Judge Wood.
Mr. Kim praised the outstanding investigative work of the DEA’s Special Operations Division; the DEA’s Kabul, Dubai, Tokyo, and Bangkok Country Offices; the DEA’s New York Field Division; the CNP-A Sensitive Investigative Unit of the Afghan Ministry of the Interior; the Dubai Police Department and the Anti-Narcotics Unit of the Emirati Ministry of Interior; Japan’s National Police Agency and the Saitama Prefectural Police; Thailand’s Sensitive Investigative Unit of the Royal Thai Police Narcotics Suppression Bureau; Thailand’s Attorney General’s Office; Thailand’s Ministry of Foreign Affairs; INTERPOL; the U.S. Department of State; and the U.S. Department of Justice’s Office of International Affairs.
This prosecution is being handled by the Office’s Terrorism and International Narcotics Unit. Assistant U.S. Attorneys Rebekah Donaleski and George D. Turner are in charge of the prosecution.
Two Sex Money Murder Gang Members Convicted in Connection with Murder of Rival Gang MemberRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that a federal jury late yesterday found COREY BROWN guilty of murder in aid of racketeering, conspiracy to commit murder in aid of racketeering, racketeering conspiracy, and firearms charges, and found JOSNEL RODRIGUEZ guilty of conspiracy to commit murder in aid of racketeering and racketeering conspiracy.
Acting U.S. Attorney Joon H. Kim said: “As a unanimous jury found after trial, Corey Brown ordered the murder of Vincent Davis, a rival gang member, and Josnel Rodriguez participated in that murder. Sex Money Murder has terrorized residents of the Bronx with years of drug dealing, gang violence, and murder. This prosecution ensures that Brown and Rodriguez will no longer be able to do so. We will continue to be relentless in working to make our communities safer by investigating and prosecuting gang violence.”
According to the allegations in the Indictment and the evidence presented in court during the trial:
Between 2011 and 2016, BROWN and RODRIGUEZ were members of Sex Money Murder, a gang that operates mainly in and around several housing developments in the Bronx, New York. Sex Money Murder (“SMM”) members enriched themselves by selling drugs, such as crack cocaine, cocaine, heroin, and marijuana, and engaged in acts of violence, including murder. BROWN, who was a leader of Sex Money Murder, ordered the murder of fellow gang member Vincent Davis. On or about July 15, 2012, JOSNEL RODRIGUEZ and another SMM member participated in the murder of Vincent Davis, in the vicinity of 566 Pugsley Avenue, Bronx, New York, in order to maintain, and increase, their standing within SMM.
Mr. Kim thanked the Federal Bureau of Investigation and the New York City Police Department for their work on the investigation.
The case is being prosecuted by the Office’s Violent and Organized Crime Unit. Assistant U.S. Attorneys Margaret Graham, Brooke Cucinella, and Jordan Estes are in charge of the prosecution.
New York Man Arrested for Attempting to Provide Material Support to ISISRead the Press Release
Saddam Mohamed Raishani, a/k/a “Adam Raishani,” 30, of the Bronx was arrested last night at John F. Kennedy International Airport (“JFK Airport”) in Queens, New York. Raishani was charged by a criminal Complaint earlier today with attempting to provide material support to the Islamic State of Iraq and al-Sham (“ISIS” or the “Islamic State”), a designated foreign terrorist organization. Raishani is expected to be presented later today before Magistrate Judge James L. Cott in Manhattan federal court.
Acting Assistant Attorney General for National Security Dana Boente, Acting U.S. Attorney Joon H. Kim for the Southern District of New York, Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office, and Commissioner James P. O’Neill of the NYPD made the announcement.
“According to the complaint, Raishani attempted to travel overseas to join ISIS and to provide material support to the designated terrorist organization,” said Acting Assistant Attorney General Boente. “The National Security Division’s highest priority is countering terrorist threats, and we will continue to work to stem the flow of foreign fighters abroad and bring to justice those who attempt to provide material support to designated foreign terrorist organizations. I would like to thank all of the agents, analysts and prosecutors who are responsible for this case.”
“As alleged, Saddam Mohamed Raishani, a Bronx man, plotted to travel to Syria to join and train with the terrorist organization ISIS,” said Acting Manhattan U.S. Attorney Kim. “Having already helped another man make that trip to ISIS’s heartland, Raishani allegedly acted on his own desire to wage violent jihad, planning to leave his family and life in New York City for the battlefields of the Middle East. Thanks to the excellent work of the FBI and NYPD, Raishani’s alleged plan to support this deadly terrorist organization was cut short at the airport and now he will face federal terrorism charges.”
“This case is another alleged instance of the nature of the terrorism threat and its reach into communities here at home,” said Assistant Director in Charge Sweeney Jr. “It is also a great example of the coordination which exists among local and federal law enforcement partners who work together to stop these alleged threats and interdict individuals allegedly determined on joining a terrorist organization intent on conducting violence around the globe. The FBI’s JTTF will continue to work with our partners, both here and abroad, to prevent acts of terrorism.”
“As we have seen many times before, allegedly attempting to join a designated terrorist organization usually has one outcome: arrest,” said Commissioner O’Neill. “Thank you to the NYPD detectives and FBI agents who, through the original Joint Terrorism Task Force, remain relentless in their focus to keep New York City safe.”
As alleged in the criminal Complaint,[1] filed today in Manhattan federal court:
In January 2017, Raishani contacted an individual who was, unbeknownst to Raishani, a confidential source working at the direction of law enforcement (the “CS”). During a meeting with the CS, Raishani told the CS that Raishani had a friend (“Person-1”), who had left New York to join the Islamic State some time ago.[2] Raishani told the CS that prior to Person-1’s departure, Raishani took Person-1 shopping to buy supplies to bring to the Islamic State. Riashani also said to the CS that, on the day of Person-1’s departure, Raishani gave money to Person-1 and drove Person-1 to JFK Airport. In later meetings with the CS, Raishani expressed his regret at not having traveled with Person-1 to join ISIS. Raishani also indicated his desire to wage jihad and his belief that the Quran can be read to justify the violence, including beheadings, engaged in by ISIS.
As part of the investigation, the CS introduced Raishani to an undercover law enforcement officer (“UC-1”), who was posing as an individual who wanted to travel abroad to fight for ISIS. During meetings with the CS and UC-1, Raishani expressed his desire to travel abroad to join ISIS. For example, Raishani stated that he had been in contact with other ISIS supporters and no longer felt comfortable in the United States. He also showed UC-1 a video that appeared to depict ISIS supporters discussing their desire to travel overseas to join ISIS and its ongoing fight. Raishani further showed the CS and UC-1 an ISIS video that appeared to depict ISIS members in Yemen killing civilians who did not support ISIS.
In addition, Raishani advised the CS and UC-1 as to how they could avoid detection by law enforcement. For example, Raishani advised the CS to cover the camera on the CS’s computer and turn off the computer’s microphone when watching pro-ISIS videos online. Raishani also advised the CS to use a particular Internet browser (the “Browser”) to hide their online activity, and explained that he used the Browser to watch ISIS and jihadi videos online. Furthermore, Raishani himself put on gloves when using a laptop and viewing pro-ISIS and pro-jihadi videos online. Moreover, Raishani told UC-1 that if they traveled together to join ISIS, Raishani, a home health aide, could pose as a nurse and UC-1 could pose as a refugee aid worker, in order to cross international borders without being stopped and questioned by authorities. Finally, Raishani told the CS and UC-1 that he (Raishani) had to be careful because he believed that federal authorities were monitoring his activities.
By April 2017, Raishani was actively planning to travel abroad to join ISIS. The CS told Raishani that, through a family acquaintance, the CS might be able to obtain contact information for an ISIS affiliate capable of facilitating travel to join ISIS. In reality, the purported facilitator was an FBI employee acting in an undercover capacity (“UC-2”). In May 2017, Raishani contacted UC-2 and said that he had previously helped another individual travel to join ISIS. Raishani further told UC-2 that he was seeking guidance for his own “hijrah,” an Arabic term normally used to refer to migration, but which is also used by ISIS supporters to refer to traveling overseas to join ISIS and engage in jihad. In subsequent conversations with the CS, UC-1, and/or UC-2, Raishani stated that he aspired to travel to Syria to join ISIS and that he aimed to travel before the end of Ramadan, an Islamic holy month that runs from approximately May 26 through June 24 this year. He indicated that he would be in contact with UC-2 about his travel. Raishani also stated that if he is “locked up,” he will not care, as “Allah will reward [him] for attempting jihad.”
In June 2017, Raishani told the CS that he was making preparations to leave, including paying off his remaining debts. Subsequently, Raishani and UC-1 purchased clothing that they intended to wear for their training with ISIS. Earlier this week, Raishani revealed to UC-2 his (Raishani’s) intention to meet an ISIS member in Turkey in the next few days, who would facilitate Raishani’s joining the terrorist organization. Raishani also purchased an airline ticket for a flight scheduled to depart on June 21, 2017, from JFK Airport to Istanbul, Turkey, via Lisbon, Portugal. On June 21, 2017, Raishani traveled to JFK Airport, where he was arrested by the FBI after he attempted to board that flight to Lisbon. * * *
Raishani, is charged with one count of attempting to provide material support to a designated foreign terrorist organization, which carries a maximum sentence of 20 years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge. The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Mr. Kim praised the outstanding efforts of the FBI’s New York Joint Terrorism Task Force, which principally consists of agents from the FBI and detectives from the NYPD, and the NYPD’s Intelligence Division. Mr. Kim also thanked the Counterterrorism Section of the Department of Justice’s National Security Division.
This prosecution is being handled by the Office’s Terrorism and International Narcotics Unit. Assistant U.S. Attorneys George D. Turner, Sidhardha Kamaraju, and Jane Kim are in charge of the prosecution, with assistance from Trial Attorney Kevin C. Nunnally of the National Security Division’s Counterterrorism Section.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth below are only allegations, and every fact described should be treated as an allegation.
[2] Communications and conversations discussed herein are described in substance and in part.
Founder of Purported Investment Company Charged with Commodities Fraud and Wire FraudRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and William F. Sweeney Jr., Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the filing of a criminal complaint charging MICHAEL WRIGHT with commodities fraud and wire fraud in connection with WRIGHT’s operation of an investment company, Wright Time Capital Group (“WTCG”). WRIGHT is alleged to have misrepresented to investors the trading performance of WTCG, and, after acquiring investor funds, misappropriating a large portion of those funds for his personal benefit. Additionally, after losing most of the funds he actually invested in foreign currency (“forex”) transactions, WRIGHT allegedly began operating WTCG as a Ponzi scheme, using funds obtained from investors to make payments to other investors. WRIGHT was arrested this morning and will be presented before the U.S. Magistrate Judge James L. Cott later today.
Acting U.S. Attorney Joon H. Kim said: “As alleged, Michael Wright used his investment company as a personal piggy bank and issued fraudulent account statements to cover up foreign exchange trading losses, ultimately operating a classic Ponzi scheme. Thanks to the dedicated work of the FBI, Wright's alleged scheme has been brought to an end and he will now be held to account.”
FBI Assistant Director William F. Sweeney Jr. said: “Wright allegedly lured investors to Wright Time Capital Group by falsely representing his trading performance. Most of the currency received was used for his personal benefit; some of it was actually invested in foreign currency transactions. But when this money was eventually lost, he created another layer in his litany of crimes—a Ponzi scheme. For anyone who thinks they can manipulate people’s investments in this way, we remind you today that’s simply not the case.”
According to the Complaint[1]:
WRIGHT started WTCG in January 2011, and ultimately obtained more than $400,000 from various investors (the “Victims”). While WRIGHT did initially conduct some forex trades on behalf of the Victims, he then began to steal their money, using it to cover his personal expenses, including hotel and travel expenses. From the outset of WTCG, WRIGHT misrepresented to WTCG’s investors the gains he had achieved. WRIGHT claimed in statements to Victims that he had achieved double-digit gains for them through forex trading in WTCG’s first six months of existence. In reality, however, WRIGHT earned little to no money through his forex trading. WRIGHT also operated WTCG as a Ponzi scheme by using the Victims’ funds to make payments to other Victims who were demanding the return of their investments.
* * *
WRIGHT, 30, of Rockville Centre, New York, was arrested this morning in New Jersey. WRIGHT was charged with commodities fraud, which carries a maximum sentence of 10 years in prison, and wire fraud, which carries a maximumsentence of 20 years in prison. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Kim praised the efforts of the FBI in this investigation.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant United States Attorney Jacob Warren 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 forth herein constitute only allegations, and every fact described should be treated as an allegation.
Founder and Former CEO of Technology Firm Pleads Guilty to Multimillion-Dollar Fraud on InvestorsRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, today announced that MARYSE LIBURDI pled guilty to defrauding investors in a technology company founded and operated by LIBURDI. As a result of LIBURDI’s fraud, the victim-investors lost more than $6 million. LIBURDI pled guilty earlier today in Manhattan federal court before United States District Judge Denise L. Cote, who is scheduled to sentence LIBURDI on September 29, 2017, at 10:00 a.m.
Acting U.S. Attorney Joon H. Kim said: “For at least five years, while her company earned little or no revenue, Maryse Liburdi, the founder and former CEO of a technology company, lied to investors about her company’s success and converted the funds they invested to her own use. In this way, Liburdi stole more than $1 million, and used it to pay rent on her Manhattan apartment, purchase luxury clothing, and pay spa bills. We are committed to fully enforcing the laws that ensure that executives are truthful with investors.”
According to the allegations in the Indictment to which LIBURDI pled guilty, a criminal complaint filed against LIBURDI, and statements made during the plea and other court proceeding proceedings:
Since at least in or about 2010, LIBURDI perpetrated a multi-year scheme to defraud individuals into investing in a technology company (the “Company”) founded and run by LIBURDI. LIBURDI repeatedly made misrepresentations to investors about the Company’s revenue and assets, manipulated Company bank accounts to hide the Company’s true financial condition and, contrary to LIBURDI’s express promises to the investors, converted investor funds to her own use.
While LIBURDI repeatedly told investors that the Company had millions of dollars in revenue, the Company’s bank records show that, from at least 2008 until the Company ceased operating in January 2015, the Company earned little or no revenue. Moreover, as reflected in the Company’s bank records, LIBURDI misappropriated investor funds, transferring over $1 million to her and her former husband’s bank accounts and to pay LIBURDI’s personal expenses, including luxury clothing. For example, LIBURDI used funds from one victim investor for, among other things, transfers to a personal bank account in the name of LIBURDI and her former husband; rental payments for LIBURDI’s three-bedroom Manhattan apartment; payments for personal credit cards; and substantial personal expenditures on corporate credit cards, including, among other things, expenditures at various retail clothing, accessories, and cosmetics stores, salons and spas, and wine and liquor stores.
In order to hide her scheme, LIBURDI manipulated the Company’s bank accounts by, on at least three occasions, writing checks for hundreds of thousands of dollars drawn on accounts with insufficient funds in order to fraudulently inflate the balance of a Company bank account and thereby hide the Company’s true cash balance from the investors. For example, in October 2013, LIBURDI wrote and deposited into the Company’s bank account a $700,000 check drawn on a different account that had a balance of only about $2,000. LIBURDI then falsely represented to the victims that the Company’s bank account held approximately $700,000 and showed investors a bank statement for the Company account listing the inflated balance. As result of LIBURDI’s fraud, victim-investors in the Company lost more than $6 million.
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LIBURDI, 45, formerly of Victoria, Minnesota, and New York, New York, pled guilty to one count of wire fraud, which carries a maximum sentence of 20 years in prison and three years of supervised release. 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. Kim praised the investigative work of the FBI. He also thanked Italian law enforcement authorities, including Interpol Rome, for their assistance in LIBURDI’s arrest, as well as the Department of Justice’s Attaché at the U.S. Embassy in Rome and the DOJ Office of International Affairs.
The prosecution of this case is being overseen by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney Elisha J. Kobre is in charge of the prosecution.
Former Hoboken, New Jersey, City Council President Found Guilty After Trial for His Participation in A $7 Million Dollar Car Loan SchemeRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that a federal jury today found former Hoboken, New Jersey, City Council President and attorney CHRISTOPHER CAMPOS guilty of bank and wire fraud and conspiracy to commit bank and wire fraud. CAMPOS and his co-conspirators fraudulently obtained millions of dollars in car loans by using at least 20 straw buyers to acquire more than 200 new automobiles based on false representations that, among other things, the straw buyers would use the cars for their personal use when, in truth and in fact, CAMPOS and his co-conspirators obtained the vehicles in order to lease as livery cabs. The week-long trial took place before U.S. District Judge Valerie E. Caproni, who is scheduled to sentence CAMPOS on September 20, 2017.
CAMPOS’s co-defendant, Julio Alvarez, pled guilty to bank and wire fraud and conspiracy to commit bank and wire fraud on June 9, 2017. Alvarez is scheduled to be sentenced on September 8, 2017, before Judge Caproni.
Acting Manhattan U.S. Attorney Joon H. Kim stated: “As a unanimous jury found, Christopher Campos, an attorney and former Hoboken City Council President, defrauded lenders out of millions of dollars. He recruited straw buyers to obtain loans for cars supposedly for ‘personal use,’ when in fact they made up a fleet of over 200 vehicles Campos and his co-conspirators leased to livery drivers. Campos now awaits sentencing for this massive fraud.”
According to the allegations contained in the Complaint, Indictment, and the evidence presented in Court during the trial:
Between approximately October 2012 and September 2013, CAMPOS and Alvarez, among others, orchestrated a scheme to fraudulently obtain new automobiles that they intended to lease to livery cab drivers. In order to secure financing in connection with the purchase of these new cars, CAMPOS and other co-conspirators enlisted and aided individuals with good credit histories (“straw buyers”) to submit fraudulent car loan applications to numerous lenders. In order to obtain the new vehicles, CAMPOS and other co-conspirators sent straw buyers to several car dealerships located throughout the New York City area, where dealership employees helped straw buyers submit fraudulent loan applications.
The auto loan applications submitted by the straw buyers falsely represented that the vehicles would be used for the buyers’ personal use, rather than as part of the defendants’ leasing business. In addition, in many cases, the car loan applications misrepresented personal information about the straw buyers, including their incomes and assets. CAMPOS also caused financing applications to be sent to multiple financial institutions at the same time so that the lenders would not know that the straw buyers were incurring obligations to other lenders in connection with the purchase of multiple new automobiles.
In total, the scheme carried out by CAMPOS, Alvarez, and others involved at least approximately 20 straw buyers, the purchase of more than approximately 200 new vehicles, and more than $7 million in fraudulently obtained loans from a variety of financial institutions. Most of the loans ultimately went into default.
* * *
CAMPOS, 40, of Palisades Park, New Jersey, was convicted of conspiracy to commit bank and wire fraud, bank fraud, and wire fraud. The conspiracy and bank fraud charges each carry a maximum sentence of 30 years in prison and the wire fraud charge carries a maximum sentence of 20 years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Kim praised the outstanding investigative work of the FBI. Mr. Kim also thanked the National Insurance Crime Bureau, the New York Automobile Insurance Plan, and the New York State Department of Motor Vehicles for their substantial assistance in the investigation and trial.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorneys Dina McLeod, Sagar K. Ravi, and Niketh Velamoor are in charge of the prosecution.
Doctor and Two Others Charged in Manhattan Federal Court for Illegal Distribution of Oxycodone PillsRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, James J. Hunt, Special Agent in Charge of the U.S. Drug Enforcement Administration’s New York Division (“DEA”), James P. O’Neill, the Commissioner of the New York City Police Department (“NYPD”), and Scott J. Lampert, Special Agent in Charge of the New York Office of the U.S. Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), announced the unsealing of an indictment charging of DAVID TAYLOR, a state-licensed doctor, with writing medically unnecessary prescriptions for oxycodone over a five-year period. In addition to TAYLOR, VITO GALLICCHIO, and DANIEL GARCIA were arrested on charges that, from January 2012 through at least June 2017, they conspired with TAYLOR to distribute oxycodone. All three defendants are expected to be presented before U.S. Magistrate Judge James L. Cott later today. The case has been assigned to United States District Court Judge Andrew L. Carter, Jr.
Acting Manhattan U.S. Attorney Joon Kim said: “As the opioid epidemic wreaks havoc on too many of our communities, for years, Dr. David Taylor and his co-conspirators allegedly wrote prescriptions for and distributed medically unnecessary oxycodone. Doctors should be advancing the health of our citizens, not allegedly fueling the biggest health crisis facing the country, the opioid abuse epidemic. We are committed to holding accountable everyone involving in the illegal distribution of opioids, including allegedly corrupt doctors.”
DEA Special Agent-in-Charge James J. Hunt said: “It is alleged that millions of dollars’ worth of pain medication was diverted onto the streets of Staten Island, enabling addiction and overdoses on the borough. These arrests will impact Staten Island’s opioid market by shutting down an illicit pill distribution operation located at the heart of the borough, along Hylan Boulevard.”
NYPD Commissioner James P. O’Neill said: “As alleged, the defendants distributed Oxycodone for at least five years, at the expense of those addicted to these pain killers. The NYPD will aggressively pursue those who distribute illegal prescription drugs.”
According to the allegations in the Indictment unsealed today in federal court:[1]
From January 2012 through at least June 2017, in the Southern District of New York and elsewhere, DAVID TAYLOR, VITO GALLICCHIO, and DANIEL GARCIA, and others conspired to distribute and possess with the intent to distribute oxycodone.
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TAYLOR, 74, GALLICCHIO, 48, and GARCIA, 57, are charged with one count of conspiring to distribute and possess with intent to distribute oxycodone. This offense carries a maximum sentence of 20 years in prison. The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.
Mr. Kim praised the outstanding investigative work of the DEA’s Tactical Diversion Squad (Group TDS-NY), which comprises agents and officers from the DEA, the NYPD, the New York State Police, New York State Department of Financial Services, and New York City Department of Investigation. He also acknowledged the assistance of HHS-OIG and the National Insurance Crime Bureau.
The case is being prosecuted by the Office’s Narcotics Unit. Assistant U.S. Attorneys Kiersten A. Fletcher and Dina Y. McLeod 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 Indictments and the descriptions of the Indictments set forth below constitute only allegations, and every fact described should be treated as an allegation.
Bronx Man Arrested for Attempting to Provide Material Support to ISISRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, Dana Boente, the Acting Assistant Attorney General for National Security, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and James P. O’Neill, the Commissioner of the Police Department for the City of New York (“NYPD”), announced that SADDAM MOHAMED RAISHANI, a/k/a “Adam Raishani,” was arrested last night at John F. Kennedy International Airport (“JFK Airport”) in Queens, New York. RAISHANI was charged by a criminal Complaint earlier today with attempting to provide material support to the Islamic State of Iraq and al-Sham (“ISIS” or the “Islamic State”), a designated foreign terrorist organization. RAISHANI is expected to be presented later today before Magistrate Judge James L. Cott in Manhattan federal court.
Acting Manhattan U.S. Attorney Joon H. Kim said: “As alleged, Saddam Mohamed Raishani, a Bronx man, plotted to travel to Syria to join and train with the terrorist organization ISIS. Having already helped another man make that trip to ISIS’s heartland, Raishani allegedly acted on his own desire to wage violent jihad, planning to leave his family and life in New York City for the battlefields of the Middle East. Thanks to the excellent work of the FBI and NYPD, Raishani’s alleged plan to support this deadly terrorist organization was cut short at the airport and now he will face federal terrorism charges.”
Acting Assistant Attorney General Dana Boente said: “According to the complaint, Raishani attempted to travel overseas to join ISIS and to provide material support to the designated terrorist organization. The National Security Division’s highest priority is countering terrorist threats, and we will continue to work to stem the flow of foreign fighters abroad and bring to justice those who attempt to provide material support to designated foreign terrorist organizations. I would like to thank all of the agents, analysts and prosecutors who are responsible for this case.”
FBI Assistant Director-in-Charge William F. Sweeney Jr. said: “This case is another alleged instance of the nature of the terrorism threat and its reach into communities here at home. It is also a great example of the coordination which exists among local and federal law enforcement partners who work together to stop these alleged threats and interdict individuals allegedly determined on joining a terrorist organization intent on conducting violence around the globe. The FBI’s JTTF will continue to work with our partners, both here and abroad, to prevent acts of terrorism.”
NYPD Commissioner James P. O’Neill said: “As we have seen many times before, allegedly attempting to join a designated terrorist organization usually has one outcome: arrest. Thank you to the NYPD detectives and FBI agents who, through the original Joint Terrorism Task Force, remain relentless in their focus to keep New York City safe.”
As alleged in the criminal Complaint,[1] filed today in Manhattan federal court:
In January 2017, RAISHANI contacted an individual who was, unbeknownst to RAISHANI, a confidential source working at the direction of law enforcement (the “CS”) During a meeting with the CS, RAISHANI told the CS that RAISHANI had a friend (“Person-1”), who had left New York to join the Islamic State some time ago.[2] RAISHANI told the CS that prior to Person-1’s departure, RAISHANI took Person-1 shopping to buy supplies to bring to the Islamic State, and that on the day of Person-1’s departure, RAISHANI gave money to Person-1 and drove Person-1 to JFK Airport. In later meetings with the CS, RAISHANI expressed his regret at not having traveled with Person-1 to join ISIS. RAISHANI also indicated his desire to wage jihad and his belief that the Quran can be read to justify the violence, including beheadings, engaged in by ISIS.
As part of the investigation, the CS introduced RAISHANI to an undercover law enforcement officer (“UC-1”), who was posing as an individual who wanted to travel abroad to fight for ISIS. During meetings with the CS and UC-1, RAISHANI expressed his desire to travel abroad to join ISIS. For example, RAISHANI indicated that he had been in contact with other ISIS supporters and no longer felt comfortable in the United States. He also showed UC-1 a video that appeared to depict ISIS supporters discussing their desire to travel overseas to join ISIS and its ongoing fight. RAISHANI further showed the CS and UC-1 an ISIS video that appeared to depict ISIS members in Yemen killing civilians who did not support ISIS.
In addition, RAISHANI advised the CS and UC-1 as to how they could avoid detection by law enforcement. For example, RAISHANI advised the CS to cover the camera on the CS’s computer and turn off the computer’s microphone when watching pro-ISIS videos online. RAISHANI also advised the CS to use a particular Internet browser (the “Browser”) to hide their online activity, and explained that he used the Browser to watch ISIS and jihadi videos online. Furthermore, RAISHANI himself put on gloves when using a laptop and viewing pro-ISIS and pro-jihadi videos online. Moreover, RAISHANI conveyed to UC-1 that if they traveled together to join ISIS, RAISHANI, a home health aide, could pose as a nurse and UC-1 could pose as a refugee aid worker, in order to cross international borders without being stopped and questioned by authorities. Finally, RAISHANI told the CS and UC-1 that he (RAISHANI) had to be careful because he believed that federal authorities were monitoring his activities.
By April 2017, RAISHANI was actively planning to travel abroad to join ISIS. The CS told RAISHANI that, through a family acquaintance, the CS might be able to obtain contact information for an ISIS affiliate capable of facilitating travel to join ISIS. In reality, the purported facilitator was an FBI employee acting in an undercover capacity (“UC-2”). In May 2017, RAISHANI contacted UC-2 and indicated that he had previously helped another individual travel to join ISIS. RAISHANI further told UC-2 that he was seeking guidance for his own “hijrah,” an Arabic term normally used to refer to migration, but which is also used by ISIS supporters to refer to traveling overseas to join ISIS and engage in jihad. In subsequent conversations with the CS, UC-1, and/or UC-2, RAISHANI stated that he aspired to travel to Syria to join ISIS and that he aimed to travel before the end of Ramadan, an Islamic holy month that runs from approximately May 26 through June 24 this year. He indicated that he would be in contact with UC-2 about his travel. RAISHANI also stated that if he was arrested he will not care, because Allah would know that he tried.
In June 2017, RAISHANI told the CS that he was making preparations to leave, including paying off his remaining debts. Subsequently, RAISHANI and UC-1 purchased clothing that they intended to wear for their training with ISIS. Earlier this week, RAISHANI revealed to UC-2 his (RAISHANI’s) intention to meet an ISIS member in Turkey in the next few days, who would facilitate RAISHANI’s joining the terrorist organization in Syria. RAISHANI also purchased an airline ticket for a flight scheduled to depart on June 21, 2017, from JFK Airport to Istanbul, Turkey, via Lisbon, Portugal. On June 21, 2017, RAISHANI traveled to JFK Airport, where he was arrested by the FBI after he attempted to board that flight to Lisbon.
* * *
RAISHANI, 30, of the Bronx, is charged with one count of attempting to provide material support to a designated foreign terrorist organization, which carries a maximum sentence of 20 years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.
Mr. Kim praised the outstanding efforts of the FBI’s New York Joint Terrorism Task Force, which principally consists of agents from the FBI and detectives from the NYPD, and the NYPD’s Intelligence Division. Mr. Kim also thanked the Counterterrorism Section of the Department of Justice’s National Security Division, as well as the New York Office of U. S. Customs and Border Protection.
This prosecution is being handled by the Office’s Terrorism and International Narcotics Unit. Assistant U.S. Attorneys George D. Turner, Sidhardha Kamaraju, and Jane Kim are in charge of the prosecution, with assistance from Trial Attorney Kevin C. Nunnally of the National Security Division’s Counterterrorism Section.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
17-186
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth below are only allegations, and every fact described should be treated as an allegation.
[2] Communications and conversations discussed herein are described in substance and in part.
Middleman Pleads Guilty in Foreign Bribery and Fraud Scheme Involving Potential $800 Million International Real Estate DealRead the Press Release
The middleman in a foreign bribery scheme pleaded guilty today to wire fraud and money laundering charges for his role in a scheme to bribe a foreign official in the Middle East to land a real estate deal, and to defrauding his co-schemers.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney Joon H. Kim for the Southern District of New York, and Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office made the announcement.
Malcolm Harris pleaded guilty to wire fraud and money laundering charges arising from his role as a middleman in a corrupt scheme to pay millions of dollars in bribes to a foreign official (“Foreign Official-1”) of a country in the Middle East (“Country-1”). The bribes were intended to facilitate the sale by South Korean construction company Keangnam Enterprises Co., Ltd. (“Keangnam”) of a 72-story commercial building known as Landmark 72 in Hanoi, Vietnam, to Country-1’s sovereign wealth fund (the “Fund”) for $800 million. Instead of paying an initial $500,000 bribe to Foreign Official-1 as he had promised, Harris simply pocketed the money and spent it on himself. Harris pleaded guilty before U.S. District Judge Edgardo Ramos who is scheduled to sentence Harris on September 27.
According to the allegations contained in the Indictment to which Harris pleaded guilty, and statements made during the plea and other court proceedings:
From in or about March 2013 through in or about May 2015, Harris co-defendants Joo Hyun Bahn, a/k/a “Dennis Bahn” (“Bahn”) and his father Ban Ki Sang (“Ban”) engaged in an international conspiracy to bribe Foreign Official-1 in connection with the attempted $800 million sale of a building complex in Hanoi, Vietnam, known as Landmark 72.
During this time, Ban was a senior executive at Keangnam, a South Korean construction company that built and owned Landmark 72. Ban convinced Keangnam to hire his son Bahn, who worked as a broker at a commercial real estate firm in Manhattan, to secure an investor for Landmark 72.
Instead of obtaining financing through legitimate channels, Bahn and Ban engaged in a corrupt scheme to pay bribes to Foreign Official-1, through Harris, who held himself out as an agent of Foreign Official-1, to induce Foreign Official-1 to use his influence to convince the Fund to acquire Landmark 72 for approximately $800 million. In furtherance of the scheme, Harris sent Bahn numerous emails purportedly sent by Foreign Official-1 and bearing Foreign Official-1’s name. In or about April 2014, following communications with Harris, Bahn and Ban agreed to pay, through Harris, a $500,000 upfront bribe and a $2,000,000 bribe upon the close of the sale of Landmark 72 to Foreign Official-1 on behalf of Keangnam.
Unbeknownst to Bahn or Ban, however, Harris did not have the claimed relationship with Foreign Official-1 and did not intend to pay the bribe money to Foreign Official-1. Instead, Harris simply stole the $500,000 upfront bribe arranged by Bahn and Ban, which Harris then spent on lavish personal expenses, including rent for a luxury penthouse apartment in Williamsburg, Brooklyn.
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Harris, 53, of San Miguel de Allende, Mexico, pleaded guilty to one count of wire fraud, which carries a maximum sentence of 20 years in prison, and one count of conducting monetary transactions in illicit funds, which carries a maximum sentence of 10 years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only as any sentencing of the defendant will be determined by the judge.
The case against Bahn is pending before Judge Ramos, and Ban is a fugitive believed to be residing in South Korea. All defendants are presumed innocent unless and until convicted beyond a reasonable doubt in a court of law.
The FBI’s International Corruption Squad in New York City investigated the case. In 2015, the FBI formed International Corruption Squads across the country to address national and international implications of foreign corruption. Trial Attorney Dennis R. Kihm of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Daniel S. Noble of the Southern District of New York are prosecuting the case. The Criminal Division’s Office of International Affairs also provided substantial assistance in this matter.
The Fraud Section is responsible for investigating and prosecuting all FCPA matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal-fraud/foreign-corrupt-practices-act.
Middleman Pleads Guilty in Foreign Bribery and Fraud Scheme Involving Potential $800 Million International Real Estate DealRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and Kenneth A. Blanco, Acting Assistant Attorney General of the Criminal Division of the U.S. Department of Justice, announced that MALCOLM HARRIS pled guilty to wire fraud and money laundering charges arising from his role as a middleman in a corrupt scheme to pay millions of dollars in bribes to a foreign official (“Foreign Official-1”) of a country in the Middle East (“Country-1”). The bribes were intended to facilitate the sale by South Korean construction company Keangnam Enterprises Co., Ltd. (“Keangnam”) of a 72-story commercial building known as Landmark 72 in Hanoi, Vietnam, to Country-1’s sovereign wealth fund (the “Fund”) for $800 million. Instead of paying an initial $500,000 bribe to Foreign Official-1 as he had promised, HARRIS simply pocketed the money and spent it on himself. HARRIS pled guilty before U.S. District Judge Edgardo Ramos, who is scheduled to sentence HARRIS on September 27, 2017.
Acting U.S. Attorney Joon H. Kim said: “As he has now admitted, Malcolm Harris schemed to bribe a foreign official, and then double-crossed even his own co-conspirators, pocketing $500,000 intended as a bribe. Harris then spent that money on his own lavish personal expenses. As the saying goes, there is no honor among thieves, and Harris confirmed that today with his guilty plea.”
According to the allegations contained in the Indictment to which HARRIS pled guilty, and statements made during the plea and other court proceedings:
From in or about March 2013 through in or about May 2015, HARRIS’s co-defendants Joo Hyun Bahn, a/k/a “Dennis Bahn” (“Bahn”), and his father Ban Ki Sang (“Ban”) engaged in an international conspiracy to bribe Foreign Official-1 in connection with the attempted $800 million sale of a building complex in Hanoi, Vietnam, known as Landmark 72. During this time, Ban was a senior executive at Keangnam, a South Korean construction company that built and owned Landmark 72. Ban convinced Keangnam to hire his son Bahn, who worked as a broker at a commercial real estate firm in Manhattan, to secure an investor for Landmark 72.
Instead of obtaining financing through legitimate channels, Bahn and Ban engaged in a corrupt scheme to pay bribes to Foreign Official-1, through HARRIS, who held himself out as an agent of Foreign Official-1, to induce Foreign Official-1 to use his influence to convince the Fund to acquire Landmark 72 for approximately $800 million. In furtherance of the scheme, HARRIS sent Bahn numerous emails purportedly sent by Foreign Official-1 and bearing Foreign Official-1’s name. In or about April 2014, following communications with HARRIS, Bahn and Ban agreed to pay, through HARRIS, a $500,000 upfront bribe and a $2 million bribe upon the close of the sale of Landmark 72 to Foreign Official-1 on behalf of Keangnam.
Unbeknownst to Bahn or Ban, however, HARRIS did not have the claimed relationship with Foreign Official-1 and did not intend to pay the bribe money to Foreign Official-1. Instead, HARRIS simply stole the $500,000 upfront bribe arranged by Bahn and Ban, which HARRIS then spent on lavish personal expenses, including rent for a luxury penthouse apartment in Williamsburg, Brooklyn.
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HARRIS, 53, of San Miguel de Allende, Mexico, and formerly of New York, New York, pled guilty to one count of wire fraud, which carries a maximum sentence of 20 years in prison, and one count of conducting monetary transactions in illicit funds, which carries a maximum sentence of 10 years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only as any sentencing of the defendant will be determined by the judge.
The case against Bahn is pending before Judge Ramos, and Ban is a fugitive believed to be residing in South Korea. All defendants are presumed innocent unless and until convicted beyond a reasonable doubt in a court of law.
Mr. Kim praised the outstanding investigative work of the International Corruption Squad of the FBI’s New York Field Office. Mr. Kim also thanked the Department of Justice’s Office of International Affairs for its ongoing assistance in this investigation.
The case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Daniel S. Noble and Trial Attorney Dennis R. Kihm of the Fraud Section of the Justice Department’s Criminal Division are in charge of the prosecution.
Former Treasurer of Mahopac Volunteer Fire Department Sentenced to 77 Months in Prison in Connection with Embezzlement of More Than $5.6 MillionRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that MICHAEL KLEIN, the former treasurer of the Mahopac Volunteer Fire Department (“MVFD”), was sentenced today by U.S. District Judge Cathy Seibel to 77 months in prison for wire fraud, subscription to false tax returns, obstruction of the grand jury, and false statement charges arising out of his embezzlement of more than $5.6 million from the MVFD.
Acting U.S. Attorney Joon H. Kim said: “On hundreds of occasions over more than 13 years, Michael Klein stole from the volunteer fire department he was elected to serve. Klein took more than $5 million of the fire department’s money, and used it to buy himself several boats, luxury cars, cruises, and tens of thousands of dollars of jewelry. Then he lied about it on his taxes, and obstructed the investigation of his crimes. Now, Michael Klein has been sentenced to the lengthy prison term that his crimes merit.”
According to documents filed in court:
MICHAEL KLEIN was first elected treasurer of the MVFD in 2001. From in or about January 2002 to in or about September 2015, KLEIN embezzled MVFD funds under his control by writing checks to his two businesses, Abbie Graphic Services, Ltd. (“Abbie Graphic”) and Buckshollow Emergency Equipment Corp. (“BEEC”). KLEIN then deposited the checks to bank accounts held by Abbie Graphic and BEEC. He entered these checks into the MVFD’s books as having been made payable to various vendors other than Abbie Graphic or BEEC that sold firefighting equipment or services used by fire departments. To satisfy the MVFD’s auditors, KLEIN prepared numerous false invoices to match the entries in the MVFD’s books.
KLEIN embezzled more than $5.6 million by writing more than 275 checks over a period of more than 13 years. He used the money to purchase, among other things, a 37-foot Thunderbird Formula boat; a 29-foot Everglades boat; a 55-foot Neptunus motor yacht named “K’Bam;” a second residence in Palm City, Florida; a 2010 Mercedes-Benz S550; a 2008 Jeep Liberty; and an antique fire truck. In January 2013, KLEIN went on what appears to be a Caribbean vacation and made $38,658.46 worth of jewelry and cruise purchases within two weeks. KLEIN also used the money he stole from the MVFD to support Abbie Graphic and BEEC.
KLEIN failed to report most of this income on his personal tax returns for the period from 2009 through 2014, thereby subscribing to false tax returns for each of those years.
Following law enforcement’s discovery of KLEIN’s embezzlement in September 2015, KLEIN obstructed the grand jury’s investigation of his conduct by making false statements regarding his finances and by concealing and dissipating assets. In September 2015, KLEIN concealed the proceeds he received from the sale of a Corvette by giving the money to a relative for deposit to her bank account and then arranging for the relative to pay his household bills. KLEIN also concealed an antique fire truck to prevent law enforcement from seizing it; sold a 2012 Victory motorcycle, converting the proceeds to cash; and transferred $58,000 to his mother as purported repayment of a college loan. In April 2016, KLEIN sold his yacht “K’Bam,” which he had purchased for $260,000 in 2012, for $136,850.46. In May 2016, KLEIN gave the United States Attorney a financial statement in which he falsely claimed, among other things, that BEEC had a delinquent loan of $275,000, and that, as a result of that loan, a lien was filed against KLEIN’s Florida property.
On March 7, 2017, KLEIN pled guilty to one count of wire fraud, which carries a maximum sentence of 20 years in prison; six counts of subscribing to false tax returns, each of which carries a maximum sentence of three years in prison; one count of obstructing the grand jury’s investigation, which carries a maximum sentence of 20 years in prison; and one count of making false statements to the United States Attorney, which carries a maximum sentence of five years in prison.
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In addition to the prison sentence, KLEIN, 49, of Mahopac, New York, and Palm City, Florida, was sentenced to three years of supervised release. Judge Seibel also ordered KLEIN to forfeit $5,675,360.49 in ill-gotten gains, as well as various assets, including his residence in Palm City, Florida. Judge Seibel also ordered KLEIN to pay $5,675,360.49 in restitution.
Mr. Kim praised the outstanding investigative work of the IRS, FBI, New York State Comptroller, and New York State Police. He thanked the Putnam County District Attorney’s Office for its assistance in the investigation.
This case is being handled by the Office’s White Plains Division. Assistant United States Attorneys Olga Zverovich, James McMahon, Andrew Dember, Maurene Comey, Michael Maimin, and Lauren Schorr are in charge of the prosecution.
U.N. Employee Charged in Manhattan Federal Court with Fraud Offenses in Connection with Employment of Bangladeshi Domestic WorkerRead the Press Release
UPDATE
The charges against the defendant in this case, Hamidur Rashid, were dismissed on November 20, 2017.
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and Christian Schurman, Acting Director of the U.S. Department of State’s Diplomatic Security Service (“DSS”), announced the arrest of HAMIDUR RASHID, an economist working at the United Nations Secretariat in the Development Policy and Analysis Division of the Department of Economic and Social Affairs, on fraud and theft charges in connection with RASHID’s hiring of, and obtaining a visa for, a Bangladeshi national employed as a domestic worker at RASHID’s home in New York, New York. RASHID was arrested today and will be presented this afternoon in Manhattan federal court before U.S. Magistrate Judge James C. Francis IV.
Acting Manhattan U.S. Attorney Joon H. Kim said: “Domestic workers brought to our country from abroad find themselves in a vulnerable position, far from home and facing a huge power imbalance relative to their employers. As alleged, Hamidur Rashid, an employee of the United Nations, took cruel advantage of his position of power, grossly overworking his domestic worker while paying her well below the wage he reported to the State Department and to the U.N. Rashid also allegedly obtained the visa for his domestic worker through lies about the wages he intended to pay her, and once she was brought here, he allegedly set up a sham bank account to spend for himself the wages he purported to pay her. In this country, even the most powerless have the same human rights as the most powerful. And everyone is subject, in an equal way, to the rule of law. We thank the Diplomatic Security Service for their commitment to this important principle of justice.”
Acting DSS Director Christian Schurman said: “As the lead agency in this investigation, the Diplomatic Security Service demonstrated its commitment to maintaining the integrity of U.S. travel documents and the rights of visitors to the United States. We pursue those who fraudulently use domestic worker visas, like the G-5, to manipulate and exploit their employees for personal gain. Diplomatic Security Service’s strong relationship with our law enforcement partners and the U.S. Attorney’s Office for the Southern District of New York, continues to be essential in the pursuit of justice.”
According to the allegations in the Complaint unsealed today in Manhattan federal court[1]:
Employees of international organizations such as the United Nations (the “UN”) may obtain G-5 visas for their domestic workers if they meet the requirements set out in 9 Foreign Affairs Manual (“FAM”) 41.21 and 41.22. As part of the application process, an interview of the domestic worker at the embassy or consulate is required. Proof is required that the applicant will receive a fair wage by U.S. and State Department standards. To apply for a G-5 visa, the visa applicant must submit an employment contract that must include, among other things, the number of hours of work per week and the hourly wage, which must be the greater of the minimum wage under U.S. federal and state law, or the prevailing wage. The employment contract must also state that, after the first 90 days of employment, all wage payments must be made by check or electronic transfer to the domestic worker’s bank account, to which the employer should not have access.
RASHID made false promises to a Bangladeshi national (“Witness-1”), who was to be RASHID’s domestic employee at an address in Manhattan, New York, about Witness-1’s salary in order to procure her employment in the United States. In order to obtain a G-5 visa for Witness-1, RASHID caused false statements about Witness-1’s salary to be transmitted to the State Department in the form of an employment contract (the “First Employment Contract”) that satisfied the State Department’s requirements for payment of a lawful wage. The First Employment Contract stated, among other things, that RASHID would pay Witness-1 $420 per week, which equates to a rate of $10.50 per hour, that the prevailing hourly wage for domestic employees in the New York City metropolitan area is $9.63, and that Witness-1 was not to work in excess of eight hours a day, five days a week.
RASHID then entered into a second employment contract (the “Second Employment Contract”) with Witness-1 with a substantially lower rate of pay, which did not meet State Department requirements for payment of a lawful wage. The Second Employment Contract stated, among other things, that RASHID would pay Witness-1 $290 per week, which equates to a rate of $7.25 per hour.
Witness-1 worked for RASHID as a domestic employee in New York, New York, from approximately January 2013 through approximately October 2013. Notwithstanding the terms of the First Employment Contract, Witness-1 worked far more than 40 hours per week, and Witness-1 was paid substantially less than what was required by both the First Employment Contract and the Second Employment Contract. In order to deceive the UN into believing that RASHID was paying Witness-1 a lawful wage, RASHID created a sham bank account (“Bank Account-1”) purportedly belonging to Witness-1, into which RASHID deposited what would have amounted to a lawful wage. RASHID then provided bank statements to the UN as proof that RASHID was paying Witness-1 as required. However, RASHID never gave Witness-1 access to Bank Account-1 and instead used Bank Account-1 as RASHID’s own account.
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HAMIDUR RASHID, 50, of New York, New York, is charged with one count of visa fraud, which carries a maximum sentence of 10 years in prison; one count of access device fraud, which carries a maximum sentence of 15 years in prison; one count of aggravated identity theft, which carries a mandatory sentence of two years in prison; and one count of fraud in foreign labor contracting, which carries a maximum 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 defendant will be determined by the judge.
Mr. Kim praised the efforts of DSS in this investigation. He added that the investigation is continuing.
This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorneys Richard Cooper and Lara Pomerantz are in charge of the prosecution.
The allegations contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint, and the description of the Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
Nigerian Man Pleads Guilty in Manhattan Federal Court to Participating in Business Email Compromise ScamsRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and William F. Sweeney Jr., Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced today that DAVID CHUKWUNEKE ADINDU pled guilty this morning before U.S. District Judge Paul A. Crotty in Manhattan federal court to a superseding Information that charged him with one count of conspiracy to commit wire fraud and one count of conspiracy to use a means of identification in connection with a federal crime. These charges stemmed from ADINDU’s participation in fraudulent business email compromise scams that targeted thousands of victims around the world, including the United States. Collectively, the scams attempted to defraud victims of millions of dollars.
Acting U.S. Attorney Joon H. Kim said: “As he has now admitted, David Chukwuneke Adindu participated in thousands of business email compromise scams, trying to trick various businesses into wiring millions of dollars to his overseas bank accounts. Cyber is increasingly becoming a powerful tool for criminals, including those like Adindu who indiscriminately target businesses around the world with scams. We are committed to tracking down and holding these cyber fraudsters accountable.”
FBI Assistant Director William F. Sweeney Jr. said: “Adindu targeted his victims from afar, but the pain he likely inflicted upon them hit too close to home. Most people assume they won't become a victim of a business email scam, but this case should remind the public that everyone is at risk. Today's guilty plea is yet another example of our efforts to confront cyber crime worldwide.”
According to the Information and statements made at public court proceedings:
Between 2014 and 2016, ADINDU participated in Business Email Compromise scams (“BEC scams”) targeting thousands of victims around the world, including in the United States. As part of the BEC scams, emails were sent to employees of various companies directing that funds be transferred to specified bank accounts. The emails purported to be from supervisors at those companies or third party vendors that did business with those companies. The emails, however, were not legitimate. Rather, they were either from email accounts with a domain name that was very similar to a legitimate domain name, or the metadata in the emails had been modified so that the emails appeared as if they were from legitimate email addresses. After victims complied with the fraudulent wiring instructions, the transferred funds were quickly withdrawn or moved into different bank accounts. In total, the BEC scams attempted to defraud millions of dollars from victims.
ADINDU and others carried out BEC scams by exchanging information regarding: (1) bank accounts used for receiving funds from victims; (2) email accounts for communicating with victims; (3) scripts for requesting wire transfers from victims; and (4) lists of names and email addresses for contacting and impersonating potential victims.
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ADINDU, 29, of Lagos, Nigeria, and Guangzhou, China, was arrested on November 22, 2016. ADINDU pled guilty today to one count of conspiracy to commit wire fraud, which carries a maximum penalty of 20 years in prison, and one count of conspiracy to use a means of identification in connection with a federal crime, which carries a maximum penalty of 15 years in prison.
The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
ADINDU is scheduled to be sentenced by Judge Crotty on September 26, 2017 at 3:30 p.m.
Mr. Kim praised the investigative work of the FBI. Mr. Kim also thanked the Yahoo! E-Crime Investigations Team, and noted that the investigation is continuing.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Andrew K. Chan is in charge of the prosecution.
Chief Digital Officer of Premium Cable Network Pleads Guilty in Manhattan Federal Court to Defrauding His Employer of More Than $7 MillionRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, today announced that EMIL RENSING pled guilty in connection with his scheme to defraud his employer, a premium cable network (the “Network”), of more than $7 million through false statements about purported services to be provided to the Network by companies RENSING owned and controlled that were, in large part, never performed. RENSING pled guilty earlier today before United States Magistrate Judge James L. Cott in Manhattan federal court.
Acting U.S. Attorney Joon H. Kim said: “Emil Rensing, an executive at a premium cable network, defrauded his employer out of more than $7 million by causing the network to pay companies Rensing controlled for services that were never rendered. To conceal his role in the payments, Rensing used false and stolen identities and dummy email accounts. I want to thank the FBI for their work to hold Rensing accountable for his crimes.”
According to the allegations in the Indictment to which RENSING pled guilty, a criminal Complaint filed against RENSING, and statements made during the plea and other court proceeding proceedings:
EMIL RENSING defrauded the Network of more than $7 million over the course of his five-year employment with the Network. Through his position as Chief Digital Officer of the Network, RENSING caused the Network to contract with vendor companies owned and controlled by RENSING to perform digital media services for the Network and to perform those services through vendor personnel identified in the contracts. In truth and in fact, however, the promised services were, in large part, never performed, and the vendor personnel designated in the contracts to perform the services – which included several of RENSING’s former professional associates and business partners – had never heard of the vendors or performed services for the Network. These individuals were further unaware that their names were being used by RENSING in this manner.
RENSING concealed his fraudulent scheme by, among other things, using false and stolen identities to hide his own involvement in the scheme. As to one of the vendors used to perpetrate the scheme (“Vendor-1”), RENSING provided the Network with a false name and email address as the “contact” to be used by the Network to communicate with Vendor-1. As to a second vendor, (“Vendor-2”), provided the Network with the name of a personal acquaintance as a “project manager” and “contact” for Vendor-2 when, in truth and in fact, this acquaintance had nothing to do with Vendor-2. Unbeknownst to this personal acquaintance, also established an email account in that acquaintance’s name that RENSING, posing as the acquaintance, used regularly to communicate with the Network about the vendor’s billing and other administrative matters.
After the Network learned of RENSING’s fraudulent scheme, RENSING was interviewed by attorneys for the Network. During this interview, which was recorded at the request of RENSING and his counsel, RENSING made multiple false statements to further conceal his fraudulent scheme.
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RENSING, 43, of Manhattan, pled guilty to one count of wire fraud, which carries a maximum sentence of 20 years in prison and three years of supervised release. 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. Kim praised the outstanding investigative work of the FBI.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Elisha Kobre is in charge of the prosecution.
Brooklyn Man Sentenced to More Than 20 Years in Prison for Murder Committed in Broad Daylight in January 2016Read the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, Ashan M. Benedict, the Special Agent in Charge of the New York Field Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”), and James P. O’Neill, Commissioner of the Police Department for the City of New York (“NYPD”), announced that RAYSHAWN DEMOSTHENE, a/k/a “Smooth,” was sentenced today in Manhattan federal court to a prison term of 244 months for the murder of Michael Morris in Brooklyn, New York, on January 11, 2016. DEMOSTHENE pled guilty before U.S. Magistrate Judge Barbara C. Moses on December 29, 2016, to murdering Morris. DEMOSTHENE was sentenced today by U.S. District Judge P. Kevin Castel.
Acting Manhattan U.S. Attorney Joon H. Kim stated: “In broad daylight, on a residential street in Brooklyn, Rayshawn Demosthene executed Michael Morris. Demosthene’s cold-blooded murder and utter disregard for a fellow human life was driven by greed, a desire to steal drug money. Thanks to the hard work and dedication of the SPARTA Joint Robbery Task Force of the NYPD and the ATF, Demosthene has been brought to justice and will serve a lengthy sentence for his crime.”
ATF Special Agent-in-Charge Ashan M. Benedict stated: “The defendant and his co-conspirators committed a cold-blooded, ambush murder of the victim in order to steal money the victim intended to use to purchase narcotics. In the process, they turned the streets into a shooting gallery, endangering the lives of any number of innocent bystanders. This investigation highlights the ever-present danger of violence that goes along with the narcotics trade, and how invariably that violence plays out on the streets. I would like to extend my gratitude to the ATF Special Agents and NYPD Detectives assigned to the ATF SPARTA Joint Robbery Task Force, and the U.S. Attorney’s Office for their outstanding work in ensuring that this killer faced the justice he so overwhelmingly deserved.”
NYPD Commissioner James P. O’Neill stated: “The individual involved in this case not only participated in the illegal drug trade but compounded his actions by engaging in the wanton murder of another human being for nothing more than his own greed. Murder, no matter what the circumstances, can never be tolerated in a civilized society.”
According to the Indictment and other documents filed in the case, as well as statements made during the plea and sentencing proceedings:
On the morning of January 11, 2016, RAYSHAWN DEMOSTHENE walked along a residential street in Brooklyn toward the car in which Michael Morris was sitting and opened fire. Morris, who was a resident of Virginia, had traveled to Brooklyn that day in the belief that he would purchase drugs in exchange for approximately $30,000 in cash. But the supposed drug transaction was a ruse. Unbeknownst to Morris, DEMOSTHENE and his co-conspirators had agreed beforehand to murder Morris and take his money. After Morris arrived in Brooklyn, DEMOSTHENE carried out the homicide by shooting Morris in the head and killing him.
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In addition to his prison term, DEMOSTHENE, 24, of Brooklyn, New York, was also sentenced to five years of supervised release.
Mr. Kim praised the investigative work of the NYPD and the ATF, and in particular the Strategic Patterned Armed Robbery Technical Apprehension (“SPARTA”) Task Force, which is composed of agents and officers of the ATF and the NYPD.
This case is being handled by the Office’s Violent and Organized Crime Unit. Assistant United States Attorneys Scott A. Hartman and David Zhou are in charge of the prosecution.
Former Orange County School Bus Driver Sentenced in White Plains Federal Court to Seven Years in Prison for Distributing Child PornographyRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that MATTHEW HAMILL was sentenced Friday by U.S. District Judge Kenneth M. Karas to seven years in prison in connection with his distribution and possession of child pornography. HAMILL pled guilty in January 2017 to one count of transportation of child pornography before U.S. Magistrate Judge Judith C. McCarthy.
Acting Manhattan U.S. Attorney Joon H. Kim said: “Matthew Hamill, a school bus driver entrusted with the safety of children, admitted that he possessed and distributed child pornography. Protecting children from predators is one of our most important missions, and that becomes all the more important when the defendant is someone in regular contact with children. Hamill, having admitted his crime of distributing child pornography, now has received a significant prison sentence.”
According to the Complaint and Information filed in White Plains federal court, as well as materials submitted in connection with the plea and sentencing proceedings:
From March 2012 to March 2014, HAMILL traded images and videos of child pornography via email. HAMILL continued to possess child pornography on his computer through August 2015, by which time he had become a school bus driver for the Minisink Valley Central School District in Orange County, New York. After HAMILL became aware of the federal investigation in this case, he attempted to delete evidence of the child pornography. However, a forensic examination of HAMILL’s computer, which was seized during the execution of a search warrant at HAMILL’s residence, recovered 493 child pornography images; and a review of HAMILL’s emails obtained by search warrant showed that HAMILL sent 94 emails attaching a total of 135 images and 14 videos of child pornography.
In addition to the prison sentence, HAMILL, 26, of Wurtsboro, New York, and Garner, North Carolina, was sentenced to five years of supervised release. Judge Karas also ordered HAMILL to pay $15,000 in restitution to victims of his crime.
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Mr. Kim praised the outstanding investigative work of the FBI.
This case is being handled by the Office’s White Plains Division. Assistant United States Attorney Won S. Shin is in charge of the prosecution.
Daryl Campbell, A/K/A “Taxstone,” Pleads Guilty to Illegally Possessing A Semiautomatic Handgun at Irving PlazaRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that DARYL CAMPBELL, a/k/a “Taxstone,” pled guilty yesterday to two federal weapons charges in connection with his possession of a semiautomatic handgun at Irving Plaza on May 25, 2016, the night a man was shot and killed there and three others were wounded.
Acting U.S. Attorney Joon H. Kim said: “As he has now admitted, Daryl Campbell illegally carried a semiautomatic handgun into the Irving Plaza music venue. That night Ronald McPhatter was shot and killed there, and three others were wounded. We will continue to work with the NYPD, the FBI, and all our partners in law enforcement to protect New Yorkers from gun violence.”
According to the Indictment, Complaint, other documents filed in the case, and statements made during the plea proceedings:
Sometime between October 2015 and May 25, 2016, CAMPBELL unlawfully received a Keltec 9mm semiautomatic handgun from outside the State of New York. Although his prior felony conviction made it a federal crime for CAMPBELL to possess firearms, CAMPBELL nonetheless carried that gun to the Irving Plaza music venue on May 25, 2016. At Irving Plaza, CAMPBELL confronted a rap music artist with whom CAMPBELL had been engaged in a long-running feud. After that confrontation, the rap artist’s bodyguard and friend, Ronald McPhatter, was shot and killed, and the rap artist and two innocent bystanders were wounded.
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CAMPBELL, 31, of Brooklyn, New York, was arrested on January 17, 2017, in Brooklyn, and has been in federal custody since. CAMPBELL pled guilty today to both counts of the Indictment, which charged him with receiving a firearm in interstate commerce with the intent to commit another felony, and possessing a firearm after having previously been convicted of a felony. The maximum sentence for each count is 10 years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as the defendant’s sentence will be determined by the court.
Mr. Kim praised the outstanding work of the NYPD’s Manhattan South Homicide Squad and the 13th Precinct Detective Squad, and the Federal Bureau of Investigation.
This case is being handled by the Office’s Violent and Organized Crime Unit and the White Plains Division. Assistant United States Attorneys Hagan Scotten, Andrew Adams, and Christopher Clore are in charge of the prosecution.
Acting Manhattan U.S. Attorney Settles Race Discrimination Lawsuit Against New York CityRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced today that the United States settled a federal civil rights lawsuit alleging that the CITY OF NEW YORK (the “City”), and specifically the NEW YORK CITY DEPARTMENT OF TRANSPORTATION (“NYCDOT”), violated Title VII of the Civil Rights Act of 1964 (“Title VII”) by engaging in a pattern or practice of racial discrimination and retaliation in its Fleet Services unit (“Fleet Services”). The consent decree was approved yesterday by U.S. District Judge John G. Koeltl.
Acting U.S. Attorney Joon H. Kim said: “For almost a decade, in clear violation of federal law, supervisors in New York City’s Department of Transportation engaged in a pattern and practice of discrimination against racial minorities. They tolerated the use of racial epithets, systematically excluded racial minorities from preferred assignments, and discriminated against minority candidates for promotions. When the discrimination was brought to the attention of the Department of Transportation’s management, they inexcusably failed to take proper corrective action, and retaliated against those brave enough to speak out. This type of workplace discrimination is unacceptable, plain and simple, not now, not ever. This settlement reflects the Office’s continued commitment to vigorously enforcing our nation’s civil rights laws.”
The Complaint, which was filed in Manhattan federal court on January 18, 2017, alleges that from at least October 2007 through May 2016, Fleet Services management engaged in a pattern or practice of racial discrimination in violation of Title VII. Fleet Services is a unit within NYCDOT that employs approximately 200 individuals in a range of trades, such as machinists, auto mechanics, electricians, blacksmiths, and engineers. Specifically, the Complaint alleges that:
As of October 2007, all personnel within Fleet Services reported to an individual (“Executive Director I”) who routinely and openly used racial epithets, such as “monkey,” “nigger,” and “gorilla” to describe African American employees. In addition to overseeing all of Fleet Services operations, Executive Director I also served as the Equal Employment Opportunity (“EEO”) counselor to whom complaints of discrimination were directed. One illustrative example of Executive Director I’s conduct involved an incident where, in response to an African American employee’s request for a cell phone, Executive Director I stated, “that nigger gets nothing.”
In October 2009, NYCDOT’s EEO Office (“NYCDOT EEO”) received a complaint alleging that Executive Director I had engaged in race discrimination. In the course of investigating the complaint, NYCDOT EEO interviewed numerous current NYCDOT employees who stated that Executive Director I had routinely used racial epithets to describe African Americans. Following its investigation, NYCDOT EEO recommended that Executive Director I be demoted, suspended, and removed from his responsibilities as a NYCDOT EEO counselor. In response, Executive Director I chose to voluntarily retire. However, the Deputy Commissioner overseeing Fleet Services then promoted the individual who had been Executive Director I’s second-in-command (“Executive Director II”), who was complicit in the discrimination, to serve as the Executive Director of Fleet Services.
Beginning in 2010, and throughout his tenure, Executive Director II routinely and systematically excluded minorities from preferred assignments and special projects. Executive Director II instead exclusively chose white candidates for the assignments that would provide the best opportunity for further advancement within Fleet Services. Furthermore, at some point in 2010, and then again in 2013, NYCDOT took steps to promote auto mechanics to supervisory positions. In spite of a large number of minority applicants, including minority applicants who were already serving in a supervisory capacity within NYCDOT, only one minority candidate was ever selected for promotion. Rather, NYCDOT management actively took steps that discriminated against minority applicants and promoted the candidacy of white applicants. These steps included imposing new pretextual requirements for promotion and removing from decision-making those supervisors who advocated for minority candidates.
Throughout all time periods relevant to the Complaint, individuals who spoke out against the discriminatory practices at Fleet Services were subjected to retaliatory conduct by Executive Director II. Such retaliatory conduct included Executive Director II threatening to take an African American Fleet Services employee outside to “kick” his “fucking ass” when the employee complained about the discrimination in the promotion selection process. Several other members of Fleet Services’ executive leadership witnessed that threat and yet failed to take any action to discipline Executive Director II.
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Under the consent decree approved by the Court, the City has agreed to offer monetary compensation to 14 individuals who the City agrees are entitled to relief. These individuals are entitled to back pay and compensatory damages awards ranging from $60,000 to in excess of $168,000. In addition, the City has agreed to pay the complainant who brought this case to the attention of the Equal Employment Opportunity Commission (the “Complainant”) a total of $150,000 in compensatory damages and attorney’s fees. The City will also offer the Complainant and two other minority candidates, all of whom were promoted by the City after the U.S. Attorney’s Office informed the City of its investigation, retroactive seniority benefits commensurate with having been promoted during the time period relevant to the Complaint. The consent decree also requires the City to take steps to ensure that it complies with Title VII in its future promotional selection processes.
As part of the consent decree, the City also stipulates to admissions of fact relating to the allegations in the Complaint. These admissions include that:
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During a 2009 investigation into allegations of racial discrimination, employees reported to the City that Executive Director I had used racial epithets to describe African American employees and had taken personnel actions that were motivated by racial animus.
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At the time of his retirement, Executive Director I had never been subject to any formal disciplinary sanctions imposed by the City.
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During the time he served as the Executive Director of Fleet Services, Executive Director II instructed the Complainant’s direct supervisor to reassign Complainant’s supervisory duties to a non-minority auto mechanic who had fewer years of experience as an auto mechanic than Complainant. Executive Director II gave this instruction over the expressed preference of Complainant’s direct supervisor.
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During Executive Director II’s tenure, non-minority applicants were selected for promotion over minority applicants, even when the minority applicants had more years of automotive experience and had been serving in a supervisory capacity without commensurate compensation or title.
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When management employees challenged Executive Director II’s promotional decisions, they were removed from the promotional decision-making process. Moreover, when a non-management employee accused Executive Director II of discriminating against racial minorities within Fleet Services, Executive Director II verbally threatened the employee, including a threat of physical violence. This verbal threat of physical violence was made in the presence of several other supervisory personnel within Fleet Services.
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Up until June 2, 2016, the date on which the City was informed that the U.S. Attorney’s Office had conducted an investigation regarding the allegations in the Complaint, Executive Director II continued to serve as the Executive Director of Fleet Services.
Mr. Kim thanked the Equal Employment Opportunity Commission for its initial investigation of the Complaint.
The case is being handled by the Office’s Civil Rights Unit. Assistant United States Attorney Jessica Jean Hu is in charge of the case.
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Twenty Defendants Charged in White Plains Federal Court with Racketeering, Narcotics, and Firearms Offenses in Connection with the Southside Gang in NewburghRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, David M. Hoovler, the Orange County District Attorney, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), Ashan M. Benedict, the New York Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”), Carl E. DuBois, Orange County Sherriff, and Joseph Cortez, the Acting Chief of the City of Newburgh Police Department, today announced the unsealing of an Indictment charging a total of 20 defendants with various racketeering, narcotics, and firearms offenses in connection with a street gang known as “Southside,” in Newburgh, New York.
Acting U.S. Attorney Joon H. Kim stated: “The defendants, members of the Southside gang, allegedly pumped dangerous drugs into their community and controlled their Newburgh neighborhoods with violence. Some of the defendants allegedly protected their drug territory with shootings. Today’s arrests stand as a testament to cooperation among our federal, state, and local partners and our shared commitment to stamping out gang violence and the drug trade in Newburgh.”
FBI Assistant Director-in-Charge William F. Sweeney Jr. stated: “As alleged, evidence in this case shows the gang members arrested today by the FBI Hudson Valley Safe Streets Task Force used shooting other people as a way to maintain their standing in the gang. These gangs show no respect for human lives, and they have a direct impact on our communities. Our goal as law enforcement is to take out the leaders of these gangs, and make sure they can't recruit more members.”
ATF New York Special Agent in Charge Ashan M. Benedict stated: “The Southside gang and its members are alleged to be a criminal organization which spread poison on the streets of Newburgh. Some members are also alleged to have used firearms, with reckless and dangerous abandon, to protect their criminal operations, and to have engaged in other acts of violence. This investigation highlights how criminal gangs peddle violence and fear along with their narcotics. Thanks to the outstanding cooperative efforts of ATF, FBI, NPD, the U.S. Attorney’s Office, and the District Attorney’s Office, the City of Newburgh is safer today than it was yesterday. Targeting and dismantling violent street gangs remains one of ATF’s top priorities, and today’s arrests should serve as a clear warning to the gangs and criminals that we in law enforcement know who you are, and that it is only a matter of time before you face the same fate as the defendants in this investigation.”
District Attorney David M. Hoovler stated: “Narcotics is the number one driver of all types of crimes, particularly those involving weapons and violence. It is only through the coordinated efforts of police and prosecutors, on both the federal and local level, that violent street gangs can be effectively eliminated. I am pleased that we were able to coordinate our efforts with the United States Attorney's Office on this operation, and look forward to working with our Federal and local law enforcement partners, as we continue to combat violent street gangs and the opioid epidemic.”
Orange County Sherriff Carl E. DuBois stated: “We are committed to continue the fight to clean up our communities and fight the war on drugs and gun violence with our partners in the Federal Bureau of Investigation.”
Acting Chief of the City of Newburgh Police Department Joseph Cortez stated: "Once again, the City of Newburgh Police has been able to work with our federal, state and county partners to investigate and arrest individuals responsible for extreme violence within our City. While leadership may change, this department’s commitment to keeping Newburgh safe is unwavering. Violence committed by a few that has the potential to hurt many cannot be tolerated. It takes the efforts of all of us, including the Safe Streets Task Force, the Orange County Sheriff’s Office, US Attorney’s Office and the Orange County District Attorney’s Office, to arrest and prosecute these individuals and continue our crime reduction efforts in Newburgh."
As alleged in the Indictment filed today in White Plains federal court[1]:
From at least 2014 through June 2017, SKYLAR DAVIS, a/k/a “S-Dot,” ARDAE HINES, a/k/a “Young Money,” a/k/a “YM,” DAVONTE HAWKINS, a/k/a “Dirty D,” MICHAEL SIMMONS, a/k/a “LoSo,” DEMETRICE MCLEAN, a/k/a “Blocks,” a/k/a “Demit,” CHRISTOPHER DAVIS, a/k/a “Whitebread” DIAMANTE FRAZIER, a/k/a “Bro God,” DITAVIOUS WILLIAMS, a/k/a “Glock Doc,” DONTE NUGENT, a/k/a “Wildman,” CALVIN LEMBHARD, a/k/a “Forty,” and PARADISE BRANCH, a/k/a “Bigga,” a/k/a “Petey,” were all members of the Southside gang, whose territory centered around the intersection of South Street and Chambers Street in an area of Newburgh known as the “Southside.” In order to fund the gang, protect its territory, and promote its standing, members of Southside engaged in, among other things, narcotics trafficking, robbery, and acts involving murder. Southside members sold heroin, crack cocaine, and marijuana in the gang’s territory, promoted their gang affiliation on social media sites such as Facebook, possessed firearms, and engaged in shootings as part of their gang membership.
One of those shootings took place on or about December 11, 2015, when SKYLAR DAVIS, a/k/a “S-Dot,” shot at a car in which members of a rival Newburgh gang, known as the Yellow Tape Money Gang, or “YTMG,” were driving. Those shots caused the car to crash, which injured those YTMG members in the vicinity of South Street and Liberty Street in the City of Newburgh, New York.
Several members of the Southside gang also participated in conspiracies to distribute narcotics in and around Newburgh. In particular, HINES, FRAZIER, WILLIAMS, DONTE NUGENT, and BRANCH participated in a conspiracy with WILLIAM FENELL, a/k/a “Mills,” DAVANTE NUGENT, a/k/a “Trap God,” a/k/a “Tay Tay,” WILFREDO RUIZ, a/k/a “Pop,” and ROBERT ZUCHOWSKI to distribute more than one kilogram of heroin and/or more than 280 grams of crack cocaine from at least in or about 2012 up to and including in or about June 2017. TEVON ADAMS, a/k/a “Cooj,” DWIGHT McCARDLE a/k/a “Ike,” TRISTAN HILGERS, SETH BLAIN, and KYLE BLAIN participated in the same conspiracy, agreeing to distribute more than 100 grams of heroin and/or more than 28 grams of crack cocaine. Meanwhile, HINES and CHRISTOPHER DAVIS participated in separate a conspiracy to distribute more than 280 grams of crack cocaine from at least in or about 2014 up to and including in or about June 2017.
Between in or about 2015 and in or about May 2017, MCLEAN, FRAZIER, and LEMBHARD also possessed firearms in furtherance of the Southside racketeering conspiracy in which they all participated and the narcotics conspiracy in which FRAZIER participated.
* * *
Eighteen defendants were taken into federal custody this morning. The defendants will be presented in White Plains federal court today before U.S. Magistrate Judge Paul E. Davison. MICHAEL SIMMONS and DWIGHT MCARDLE remain at large. The case has been assigned to U.S. District Judge Cathy Seibel.
Charts 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 the respective judges.
Mr. Kim praised the outstanding investigative work of the FBI, ATF, the Orange County Sheriff’s Department, and the City of Newburgh Police Department. Mr. Kim thanked the Orange County District Attorney’s Office for its invaluable ongoing assistance in the case. Mr. Kim also thanked the Town of Newburgh Police Department, the New York State Police, the Town of New Windsor Police Department, and the New York Department of Corrections and Community Supervision for their assistance in the case.
This case is being handled by the Office’s White Plains Division. Assistant United States Attorneys Maurene Comey, Jacqueline Kelly, and Allison Nichols 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.
United States v. Skylar Davis, et al., 17 Cr. 364
COUNT
CHARGES
DEFENDANT(S)
MAXIMUM PENALTIES
1
Racketeering Conspiracy
SKYLAR DAVIS,
a/k/a “S-Dot,”
ARDAE HINES,
a/k/a “Young Money,”
a/k/a “YM,”
DAVONTE HAWKINS,
a/k/a “Dirty D,”
MICHAEL SIMMONS,
a/k/a “LoSo,”
DEMETRICE MCLEAN,
a/k/a “Blocks,”
a/k/a “Demit,”
CHRISTOPHER DAVIS,
a/k/a “Whitebread”
DIAMANTE FRAZIER,
a/k/a “Bro God,”
DITAVIOUS WILLIAMS,
a/k/a “Glock Doc,”
DONTE NUGENT,
a/k/a “Wildman,”
CALVIN LEMBHARD,
a/k/a “Forty,” and
PARADISE BRANCH,
a/k/a “Bigga,”
a/k/a “Petey”
20 years in prison
2
Assault with a Deadly Weapon and Attempted Murder in Aid of Racketeering
SKYLAR DAVIS,
a/k/a “S-Dot”
20 years in prison
3
Narcotics Conspiracy
(Conspiracy to distribute and possess with intent to distribute 1 kilogram or more of heroin and/or 280 grams or more of crack cocaine.)
WILLIAM FENELL,
a/k/a “Mills,”
ARDAE HINES,
a/k/a “Young Money,”
a/k/a “YM,”
DIAMANTE FRAZIER,
a/k/a “Bro God,”
DITAVIOUS WILLIAMS,
a/k/a “Glock Doc,”
DONTE NUGENT,
a/k/a “Wildman,”
DAVANTE NUGENT,
a/k/a “Trap God,”
a/k/a “Tay Tay,”
PARADISE BRANCH,
a/k/a “Bigga,”
a/k/a “Petey”
WILFREDO RUIZ,
a/k/a “Pop,” and
ROBERT ZUCHOWSKI
Life in prison
Mandatory minimum:
10 years in prison
(Conspiracy to distribute and possess with intent to distribute 100 grams or more of heroin and/or 28 grams or more of crack cocaine.)
TEVON ADAMS,
a/k/a “Cooj,”
DWIGHT McCARDLE
a/k/a “Ike,”
TRISTAN HILGERS, SETH BLAIN, and
KYLE BLAIN
40 years in prison
Mandatory minimum:
5 years in prison
4
Narcotics Conspiracy
(Conspiracy to distribute and possess with intent to distribute 280 grams or more of crack cocaine.)
ARDAE HINES,
a/k/a “Young Money,”
a/k/a “YM,” and
CHRISTOPHER DAVIS,
a/k/a “Whitebread”
Life in prison
Mandatory minimum:
10 years in prison
5
Possession and discharge of a firearm in furtherance of a crime of violence
SKYLAR DAVIS,
a/k/a “S-Dot”
Life in prison
Mandatory minimum:
10 years in prison
6
Possession of a firearm in furtherance of a crime of violence or a drug trafficking crime
DEMETRICE MCLEAN,
a/k/a “Blocks,”
a/k/a “Demit,”
DIAMANTE FRAZIER,
a/k/a “Bro God,” and
CALVIN LEMBHARD,
a/k/a “Forty”
Life in prison
Mandatory minimum:
five years in prison, to be imposed consecutively to any other sentence
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the descriptions of the Indictment set forth below constitute only allegations, and every fact described should be treated as an allegation.
Former Visium Portfolio Manager Stefan Lumiere Sentenced to 18 Months in Prison Following Conviction at Trial for Securities Mismarking SchemeRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced today that STEFAN LUMIERE, a former portfolio manager at Visium Asset Management, L.P. (“Visium”), was sentenced to 18 months in prison in connection with his conviction following a jury trial for engaging in a securities mismarking scheme from 2011 to 2013. The jury convicted LUMIERE on securities and wire fraud charges relating to his mismarking of securities in a fixed-income hedge fund, which inflated the net asset value (“NAV”) of the fund and overstated the fund’s liquidity. LUMIERE was sentenced today by U.S. District Judge Jed S. Rakoff, who presided over the six-day jury trial.
Acting U.S. Attorney Joon H. Kim said: “As the evidence at trial established and as a jury unanimously found, Stefan Lumiere engaged in securities and wire fraud, routinely mismarking by millions of dollars the value of his book at Visium. For his greed-driven lies, Lumiere stands a convicted securities fraudster and has been sentenced to time in a federal prison.”
According to the allegations in the charging documents, evidence admitted at trial, court filings, and statements made in open court:
Visium managed hedge funds specializing in healthcare-related investments. One such fund operated from 2009 until September 2013 and invested primarily in debt instruments issued by healthcare companies (the “Credit Fund”).
From June 2011 through September 2013, LUMIERE and others participated in a scheme to defraud the Credit Fund’s investors and potential investors by deceptively mismarking each month the value of certain securities held by the Credit Fund. The objective of the scheme was two-fold: (1) to inflate the Credit Fund’s NAV; and (2) to mislead investors about the liquidity of the Credit Fund’s holdings (i.e., how actively traded the securities were). Visium assessed performance fees to be paid by investors each year based on the Credit Fund’s profits and losses. LUMIERE’s mismarking was in violation of Visium’s internal valuation procedures and contrary to Visium’s representations to investors. The effect of the scheme was to overstate the Credit Fund’s NAV, often by tens of millions of dollars as calculated at the end of each month, which resulted in higher payments to Visium, among other benefits. The effect of the scheme was also to deceive investors into believing that certain securities were properly categorized as Level II securities, that is, securities that fell within an intermediate level in terms of their liquidity, when, in fact, these securities were highly illiquid Level III investments.
LUMIERE and others accomplished these goals through two principal methods. First, LUMIERE and others solicited, obtained, and relied on false and fraudulent price quotes from employees of broker-dealers in order to improperly override prices calculated by the Credit Fund’s administrator and artificially inflate the Credit Fund’s NAV each month. For each month-end valuation, LUMIERE and others would begin by reviewing an inventory of the Credit Fund’s investments and proposed valuations prepared by the Credit Fund’s administrator and Visium’s back office. LUMIERE and others would then identify relatively illiquid securities and create a list reflecting the prices at which they wanted each security to be marked for month-end valuation purposes. That price was often significantly higher or lower than the price available from public price data. LUMIERE and others would then contact one or two “friendly” brokers and dictate price quotes that they needed. The brokers would then parrot back the price quotes, giving the price quotes the appearance that they had come from an independent broker, and thus were in compliance with the Credit Fund’s pricing methodology. The friendly brokers’ sham quotes were then submitted to Visium’s accounting department as purportedly independent bases for a security’s valuation, for the eventual submission to the Credit Fund’s administrator.
By obtaining these sham quotes, LUMIERE and others caused a number of the Credit Fund’s securities to be misclassified in order to mislead investors about the liquidity of the securities. Specifically, for a number of illiquid bonds, LUMIERE and others fraudulently caused Visium to assign a classification that led investors to believe that the bonds were relatively liquid, when in fact they were entirely illiquid. This was done contrary to disclosures to investors about the Credit Fund’s percentage of illiquid investments, in order to induce investors to invest in or keep their money in the Credit Fund.
Second, LUMIERE purchased additional quantities of certain securities – in which the Credit Fund had an established position – at a deceptively inflated price, markedly higher than the prevailing market was offering that security, in a practice known as “painting the tape.” The inflated price was then reported to Visium’s accounting department for NAV purposes. In both cases – the sham broker quotes and the inflated purchase prices – it was LUMIERE’s intent to increase the price of certain securities in order to inflate the Credit Fund’s month-end valuation.
* * *
As part of the sentence imposed today by Judge Rakoff, LUMIERE, 46, of New York, New York, was further sentenced to three years of supervised release and ordered to pay a fine of $1,000,000.
Mr. Kim praised the work of the Federal Bureau of Investigation, and thanked the Securities and Exchange Commission for its assistance.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Ian McGinley, Damian Williams, and Joshua A. Naftalis are in charge of the prosecution.
Juan Thompson Pleads Guilty in Manhattan Federal Court to Cyberstalking and Making Fake Bomb Threats to JCCs and Other Organizations That Serve the Jewish CommunityRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that JUAN THOMPSON pled guilty today to one count of cyberstalking and one count of making hoax bomb threats as part of THOMPSON’s campaign to harass and intimidate a particular woman (“Victim-1”), by, among other things, communicating at least 12 threats to Jewish Community Centers (“JCCs”) and other Victim Organizations in Victim-1’s name.
Acting U.S. Attorney Joon H. Kim said: “Fueling fear and distress, Juan Thompson made fake bomb threats to over a dozen Jewish Community Centers and organizations around the country. As he admitted today in pleading guilty, Thompson made these threats as part of a cruel campaign to cyberstalk a victim with whom he previously had a relationship. Thompson’s threats not only inflicted emotional distress on his victim, but also harmed Jewish communities around the country. Thanks to the dedicated work of the FBI and NYPD, Thompson will now be held to account for his crimes.”
According to the Complaint, the Information, and other statements made in open court:
In July 2016, THOMPSON began a months-long campaign of harassment targeting Victim-1 after Victim-1 ended their relationship. THOMPSON’s conduct culminated with a series of hoax threats, including hoax bomb threats, targeting JCCs, organizations that provide service to and on behalf of the Jewish community, schools, and police departments.
THOMPSON started his campaign of harassment of Victim-1 in 2016. In July of that year, an email was sent to Victim-1’s employer, which made false allegations about Victim-1, including that she had broken the law, using an internet protocol (“IP”) address that THOMPSON had previously used to access his social media account. On October 15, 2016, an IP address that traced back to THOMPSON’s residence was used to falsely report that Victim-1 possessed child pornography. When confronted by law enforcement on November 22, 2016, THOMPSON claimed that his email account had been hacked a few weeks earlier.
THOMPSON also made at least 12 hoax threats targeting JCCs, organizations that provide service to and on behalf of the Jewish community, schools, and police departments. For instance, on or about February 21, 2017, the Anti-Defamation League (“ADL”) received an emailed threat at their midtown Manhattan office, which indicated that “[Victim-1’s name and birthdate] is behind the bomb threats against jews. She lives in nyc and is making more bomb threats tomorrow.” The next day, the ADL received a phone call claiming that explosive material had been placed in the ADL’s midtown Manhattan office.
Some of THOMPSON’s threats were made in his own name, as part of an effort to claim that Victim-1 was trying to frame THOMPSON for a crime. For instance, on or about February 7, 2017, a JCC in Manhattan received an emailed bomb threat from an anonymous email account that stated: “Juan Thompson [THOMPSON’s birthday] put two bombs in the office of the Jewish center today. He wants to create Jewish newtown tomorrow.” The email’s use of the phrase “Jewish newtown” appeared to refer to a December 2012 school shooting in Newtown, Connecticut, in which a gunman murdered 26 victims.
In February 2017, a Twitter account used by THOMPSON (the “Thompson Twitter Account”) was used to accuse Victim-1 of responsibility for the JCC Threats and to claim that Victim-1 was trying to frame THOMPSON for her crimes. For instance, on February 24, 2017, the Thompson Twitter Account posted: “[s]he [Victim-1], though I can’t prove it, even sent a bomb threat in my name to a Jewish center, which was odd given her antisemitic statements. I got a visit from the FBI. So now I’m battling the racist FBI and this vile, evil, racist white woman.” On February 26, 2017, the Thompson Twitter Account posted “The hatred of Jews goes across all demos. Ask NYC’s [Victim-1’s employer]. They employ a filthy anti-Semite in [Victim-1]. These ppl are evil.”
* * *
THOMPSON, 32, of Saint Louis, Missouri, pled guilty to one count of cyberstalking, which carries a maximum sentence of five years in prison, and one count of hoax threats, which also carries a maximum sentence of five years in prison. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the Judge.
THOMPSON is scheduled to be sentenced by U.S. District Judge Kevin P. Castel on September 15, 2017.
Mr. Kim praised the outstanding investigative work of the FBI, and thanked the United States Secret Service, New York City Police Department, and Saint Louis Police Department for their ongoing investigative assistance.
The prosecution is being handled by the Office’s Terrorism and International Narcotics Unit. Assistant U.S. Attorneys Jacob Warren and Andrew DeFilippis are in charge of the prosecution.
Bronx Man Convicted After Trial of Murder in Front of Bronx Daycare CenterRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that a federal jury today found RUBEN PIZZARO guilty of murder, participating in a narcotics conspiracy, and firearms charges.
Acting U.S. Attorney Joon H. Kim said: “As a unanimous jury found, Ruben Pizzaro shot and killed David Rivera in broad daylight in front of a daycare center in the Bronx. The prosecution of this type of gang and drug violence helps make our communities safer, and we are committed to that. I commend the FBI and the NYPD for their dogged work in this case and in all their work in keeping New York City safe.”
According to the allegations contained in the Complaint and the Indictment and the evidence presented in court during the trial:
Between August 2015 and January 2016, PIZZARO was a member of a street gang that sold cocaine and crack cocaine in the vicinity of 180th Street and Arthur Avenue in the Bronx, New York. PIZZARO and his crew of drug dealers were in competition with a neighboring drug crew on Hughes Avenue in the Bronx. That competition played out in several violent shootings in late 2015. For example, on at least three occasions in October and November 2015, PIZZARO and his drug crew committed at least three shootings at members of the Hughes Avenue drug crew. Individuals were shot during two of those three incidents, and the third occurred in the immediate vicinity of a Bronx middle school.
On November 24, 2015, in broad daylight at 9:15 in the morning, PIZZARO shot and killed rival drug dealer David Rivera in front of a daycare center in the vicinity of 175th Street and Crotona Avenue in the Bronx.
* * *
PIZZARO, 25, of the Bronx, New York, was found guilty of one count of conspiring to distribute cocaine and crack cocaine, which carries a mandatory minimum sentence of five years in prison and a maximum sentence of 40 years in prison; one count of causing the death of another person through use of a firearm, which carries a mandatory minimum sentence of 25 years in prison and a maximum sentence of life in prison; and one count of using firearms, which were brandished and discharged, in furtherance of a narcotics conspiracy, which carries a mandatory minimum sentence of 10 years in prison and a maximum sentence of life 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. Kim thanked the Federal Bureau of Investigation and the New York City Police Department for their work on the investigation.
The case is being prosecuted by the Office’s Violent and Organized Crime Unit. Assistant U.S. Attorneys Shawn Crowley, Max Nicholas, and Robert Allen are in charge of the prosecution.
Manhattan Tax Attorney and Florida CPA Plead Guilty to Multimillion-Dollar Tax Evasion SchemeRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that HAROLD LEVINE, a Manhattan tax attorney, and RONALD KATZ, a Florida certified public accountant, pled guilty today in Manhattan federal court to tax crimes based upon their roles in a corrupt multi-year tax evasion scheme involving the failure to report to the Internal Revenue Service (“IRS”) millions of dollars in fee income stemming from tax shelter transactions. LEVINE and KATZ are scheduled to be sentenced by Judge Rakoff on October 11, 2017.
Acting U.S. Attorney Joon H. Kim said: “As tax professionals, both Harold Levine and Ronald Katz well knew their obligations to report their income to the IRS. As they have now admitted, they instead engaged in a corrupt scheme to evade taxes on millions of dollars of income. Now both defendants will be held to account for their crimes.”
According to the allegations in the Indictment to which LEVINE and KATZ pleaded guilty, and statements made during the plea proceedings and other court proceedings:
Between 2004 and 2012, LEVINE, a tax attorney and former head of the tax department at a major Manhattan Law Firm (the “Law Firm”), schemed with KATZ, a certified public accountant, to obstruct and impede the due administration of the Internal Revenue laws by evading income taxes on millions of dollars of fee income generated from tax shelter and related transactions that LEVINE worked on while a partner of the Law Firm. Specifically, LEVINE failed to report approximately $3 million in income to the IRS on his personal tax returns during the period 2005-2011. For his involvement in this scheme, KATZ received and failed to report to the IRS over $1.2 million in income on his personal tax returns.
As part of the scheme, for example, LEVINE caused tax shelter fees paid by a Law Firm client to be routed to a partnership entity he co-owned with KATZ and thereafter used those fees – totaling approximately $500,000 – to purchase a home in Levittown, on Long Island. LEVINE caused the home to be purchased as a residence for a Law Firm employee (the “Law Firm Employee”) with whom he had a close personal relationship. Although LEVINE allowed the Law Firm Employee to reside in the Levittown house for over five years without paying rent, LEVINE and KATZ prepared tax returns for the entity through which the home was purchased that claimed false deductions as a rental property.
In or about 2013, LEVINE was questioned by IRS agents concerning his involvement in certain tax shelter transactions and the fees received by LEVINE and KATZ from those transactions. During that questioning, LEVINE falsely represented that the Law Firm Employee paid him $1,000 per month in rent while living in the Levittown home. In addition, when the Law Firm Employee was contacted by the IRS and summoned to appear for testimony, LEVINE urged the employee to falsely represent to the IRS that she had paid $1,000 per month in rent to LEVINE.
* * *
LEVINE, 59, of New York, New York, and KATZ, 59, of Boca Raton, Florida, each pled guilty to one count of corruptly endeavoring to obstruct and impede the due administration of the Internal Revenue laws, which carries a maximum sentence of three years in prison, and one count of tax evasion, which carries a maximum sentence of five years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.
Mr. Kim thanked the IRS for its assistance in this investigation and praised the outstanding investigative work of both IRS-CI and IRS Civil – Large Business & International.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Special Assistant United States Attorney Stanley J. Okula and Assistant United States Attorney Daniel S. Noble are in charge of the prosecution.
Florida Man Sentenced in Manhattan Federal Court to 18 Months in Prison for Attempting to Gain Unauthorized Access and Cause Damage to the Computer Network of A Charitable OrganizationRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that TIMOTHY SEDLAK was sentenced in Manhattan federal court to 18 months in prison for attempting to access without authorization the computer network of a global charitable organization based in New York, New York (the “Organization”), and as a result of such conduct, recklessly causing damage to computers of the Organization. He was convicted on February 23, 2017, and was sentenced today by U.S. District Judge Ronnie Abrams.
Acting Manhattan U.S. Attorney Joon H. Kim said: “Timothy Sedlak used dozens of computers and electronic devices to unlawfully access others’ computer networks, making hundreds of thousands of attempts to steal information from one charitable organization. Although he was ultimately unsuccessful, Sedlak’s efforts impaired the organization’s ability to operate. I want to thank our partners at the Secret Service for their work to combat cyber attacks like this one.”
According to the Superseding Information, other documents filed in Manhattan federal court, and statements made at various proceedings in this case, including the guilty plea:
SEDLAK made hundreds of thousands of attempts to gain access without authorization to the computer network systems of the Organization, and in so doing, impaired the availability of the email accounts and web-based applications of more than 10 employees of the Organization.
From June 2015 to July 2015, computers associated with two internet protocol addresses subscribed to SEDLAK at SEDLAK’s residence in Florida (the “IP Addresses”) made nearly 400,000 attempts to gain unauthorized access to the Organization’s computer network. As a result, numerous Organization employees experienced difficulty accessing their Organization email accounts, and were disrupted in their ability to conduct regular business functions. In particular, between June 22 and July 8, 2015, from one of the IP Addresses, there were approximately 195,000 attempts to log into approximately 20 email accounts of the Organization. Between July 8 and July 10, 2015, from the other IP Address, there were an additional approximately 195,000 attempts to log into approximately six email accounts of the Organization. SEDLAK has never been employed by the Organization, and was not authorized to access any email accounts of the Organization.
On September 11, 2015, U.S. Secret Service (“USSS”) agents executed a search warrant at the Sedlak Residence, from which they seized 42 computers and electronic devices (the “Sedlak Computers”). The forensic examination of the Sedlak Computers revealed that 31 devices contained known hacking software and/or artifacts, indicating they were used in attempts to gain unauthorized access to a network. The forensic examination of the Sedlak Computers also revealed that at least 11 personal email accounts were successfully accessed without authorization. The email accounts belong to individuals in the United States and abroad, none of whom are known to be associated with the Organization. In addition, unsuccessful attempts to gain unauthorized access to over 1,000 entities and IP addresses were uncovered. SEDLAK targeted international and domestic victim entities, including charitable organizations, political organizations, law firms, financial firms, and businesses. When he was interviewed by USSS agents, Sedlak claimed that he hoped to sell the information he found.
* * *
SEDLAK, 44, of Ocoee, Florida, was sentenced to 18 months in prison, to be followed by three years of supervised release. The defendant’s right, title, and interest in specific property seized by the USSS – including 31 electronic devices – was ordered to be forfeited to the United States.
Mr. Kim praised the investigative work of the United States Secret Service.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorneys Kristy J. Greenberg and Jennifer L. Beidel are in charge of the prosecution.
Two Men Arrested for Terrorist Activities on Behalf of Hizballah's Islamic Jihad OrganizationRead the Press Release
Ali Kourani, 32, of the Bronx, New York, and Samer el Debek, 37, of Dearborn, Michigan, aka, “Samer Eldebek,” were arrested on Thursday, June 1, on charges related to their alleged activities on behalf of Hizballah, a designated foreign terrorist organization.
Acting Assistant Attorney General for National Security Dana Boente, Acting U.S. Attorney Joon H. Kim for the Southern District of New York, Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Office, and Commissioner James P. O’Neill of the NYPD made the announcement.
Acting U.S. Attorney Kim said: “Today, we announce serious terrorism charges against two men who allegedly trained with and supported the Islamic Jihad Organization, a component of the foreign terrorist organization Hizballah. Recruited as Hizballah operatives, Samer El Debek and Ali Kourani allegedly received military-style training, including in the use of weapons like rocket-propelled grenade launchers and machine guns for use in support of the group’s terrorist mission. At the direction of his Hizballah handlers, El Debek allegedly conducted missions in Panama to locate the U.S. and Israeli Embassies and to assess the vulnerabilities of the Panama Canal and ships in the Canal. Kourani allegedly conducted surveillance of potential targets in America, including military and law enforcement facilities in New York City. Thanks to the outstanding work of the FBI and NYPD, the allegedly destructive designs of these two Hizballah operatives have been thwarted, and they will now face justice in a Manhattan federal court.”
Assistant Director in Charge Sweeney Jr. said: “The charges announced today reveal once again that the New York City region remains a focus of many adversaries, demonstrated as alleged in this instance by followers of a sophisticated and determined organization with a long history of coordinating violent activities on behalf of Hizballah. Our announcement today also reveals, however, that the dozens of agencies working together with our FBI JTTFs nationwide are just as determined to disrupt the plans of those working to harm our communities. I’d like to thank the hundreds of investigators who comprise the FBI’s New York JTTF and display constant vigilance on our behalf, and I encourage the public to remain engaged and to immediately report suspicious activity to law enforcement.”
Commissioner O’Neill said: “As part of his work for Hezbollah, Kourani and others allegedly conducted covert surveillance of potential targets, including U.S. military bases and Israeli military personnel here in New York City. Pre-operational surveillance is one of the hallmarks of Hezbollah in planning for future attacks. As alleged, Kourani, on at least two occasions, received sophisticated military training overseas, including the use of a rocket propelled grenade. In addition, El Debek is charged in an unrelated complaint, for allegedly possessing extensive bomb making training received from Hezbollah. Today’s charges of two for their work on behalf of Hezbollah is a tribute to the collaborative work of the agents and detectives of the Joint Terrorism Task Force.”
Kourani was arrested in the Bronx for providing, attempting, and conspiring to provide material support to Hizballah; receiving and conspiring to receive military-type training from Hizballah; a related weapons offense that is alleged to have involved, among other weapons, a rocket-propelled grenade launcher and machine guns; violating and conspiring to violate the International Emergency Economic Powers Act (IEEPA); and naturalization fraud to facilitate an act of international terrorism. Kourani was presented on Friday, June 2, before Magistrate Judge Barbara Moses in Manhattan federal court.
El Debek was arrested in Livonia, Michigan, outside of Detroit, for providing, attempting and conspiring to provide material support to Hizballah; receiving and conspiring to receive military-type training from Hizballah; use of weapons in connection with a crime of violence that is alleged to have involved, among other weapons, explosives, a rocket-propelled grenade launcher, and machine guns; and violating and conspiring to violate IEEPA. El Debek was presented on June 5, before Magistrate Judge Henry Pitman in Manhattan federal court.
As alleged in the criminal Complaints against Kourani and el Debek,[1] both of which were unsealed today in Manhattan federal court:
Background on Hizballah and the Islamic Jihad Organization
Hizballah is a Lebanon-based Shia Islamic organization with political, social, and terrorist components. Hizballah was founded in the 1980s with support from Iran after the 1982 Israeli invasion of Lebanon, and its mission includes establishing a fundamentalist Islamic state in Lebanon. Since Hizballah’s formation, the organization has been responsible for numerous terrorist attacks that have killed hundreds, including U.S. citizens and military personnel. In 1997, the U.S. Department of State designated Hizballah a Foreign Terrorist Organization, pursuant to Section 219 of the Immigration and Nationality Act, and it remains so designated today. In 2001, pursuant to Executive Order 13224, the U.S. Department of State designated Hizballah a Specially Designated Global Terrorist entity. In 2010, State Department officials described Hizballah as the most technically capable terrorist group in the world, and a continued security threat to the U.S.
The Islamic Jihad Organization (“IJO”), which is also known as the External Security Organization and “910,” is a component of Hizballah responsible for the planning and coordination of intelligence, counterintelligence, and terrorist activities on behalf of Hizballah outside of Lebanon. In July 2012, an IJO operative detonated explosives on a bus transporting Israeli tourists in the vicinity of an airport in Burgas, Bulgaria, which killed six people and injured 32 others. Law enforcement authorities have disrupted several other IJO attack-planning operations around the world, including the arrest of an IJO operative surveilling Israeli targets in Cyprus in 2012, the seizure of bomb-making precursor chemicals in Thailand in 2012, including chemicals manufactured by a medical devices company based in Guangzhou, China (“Guangzhou Company-1”), and a similar seizure of chemicals manufactured by Guangzhou Company-1 in Cyprus in May 2015 in connection with the arrest of another IJO operative.
Kourani’s Alleged Support of Hizballah
Kourani, who was born in Lebanon, attended Hizballah-sponsored weapons training in Lebanon in 2000 when he was approximately 16 years old. After lawfully entering the U.S. in 2003, Kourani obtained a Bachelor of Science in biomedical engineering in 2009, and a Masters of Business Administration in 2013.
Kourani and certain of his relatives were present during the summer 2006 conflict between Israel and Hizballah in Lebanon, when a residence belonging to his family was destroyed. Kourani was subsequently recruited to join the IJO by 2008. In August 2008, Kourani submitted an application for naturalization in the U.S. in which he falsely claimed, among other things, that he was not affiliated with a terrorist organization. In April 2009, Kourani became a naturalized citizen and was issued a U.S. passport. Despite claiming in his passport application that he had no travel plans, Kourani traveled to Guangzhou, China – the location of Guangzhou Company-1 – on May 3, 2009. He later claimed to the FBI that the purpose of the trip was to meet with medical device manufacturers and other businessmen.
Kourani was assigned an IJO handler, or mentor, responsible for providing him with taskings, debriefings, and arranging training. Kourani sometimes communicated with his handler using coded email communications, including messages sent by the handler that informed Kourani of the need to return to Lebanon. In order to establish contact with his handler when Kourani returned to Lebanon, Kourani called a telephone number associated with a pager (the “IJO Pager”) and provided a code that he understood was specific to him. After Kourani called the IJO Pager, the handler would contact Kourani to set up an in-person meeting by calling a phone belonging to one of Kourani’s relatives. The IJO also provided Kourani with additional training in tradecraft, weapons, and tactics. In 2011, for example, Kourani attended an IJO military training camp located in the vicinity of Birkat Jabrur, Lebanon, where he was provided with military-tactics and weapons training, including training in the use of a rocket propelled grenade launcher, an AK-47 assault rifle, an MP5 submachine gun, a PKS machine gun (a Russian-made belt-fed weapon), and a Glock pistol.
Based on other taskings from IJO personnel, which were conveyed during periodic in-person meetings when Kourani returned to Lebanon, Kourani conducted operations that included searching for weapons suppliers in the U.S. who could provide firearms to support IJO operations, identifying individuals affiliated with the Israeli Defense Force, gathering information regarding operations and security at airports in the U.S. and elsewhere, and surveilling U.S. military and law enforcement facilities in Manhattan and Brooklyn. Kourani transmitted some of the products of his surveillance and intelligence-gathering efforts back to IJO personnel in Lebanon using digital storage media.
El Debek’s Alleged Support of Hizballah
El Debek, a naturalized U.S. citizen, was first recruited by Hizballah in late 2007 or early 2008, began to receive a salary from Hizballah shortly thereafter, and was paid by Hizballah through approximately 2015. In July 2006, shortly before he was recruited by Hizballah, el Debek expressed by email his support for Hassan Nasrallah, the leader of Hizballah.
El Debek received military training from Hizballah in Lebanon on several occasions, from approximately 2008 through approximately 2014. El Debek received training in basic military tactics, the handling of various weapons, surveillance and counter-surveillance techniques, and the creation and handling of explosives and explosive devices. Based on information el Debek provided to the FBI, FBI bomb technicians have assessed that el Debek received extensive training as a bomb-maker, has a high degree of technical sophistication in the area, and was trained in techniques and methods similar to those used to construct the improvised explosive device used in Hizballah’s 2012 Burgas, Bulgaria, bus bombing, a bombing that el Debek reported was carried out by a relative of his. El Debek received by email in 2010 a list of raw materials that could be sent from Syria or Dubai, including items often used in explosives and improvised explosive devices.
El Debek also conducted missions for Hizballah in Thailand and Panama. In May 2009, el Debek traveled from Lebanon, through Malaysia, to Thailand, where his mission was to clean up explosive precursors in a house in Bangkok that others had left because they were under surveillance. El Debek used his U.S. passport to enter and leave Thailand, consistent with his instructions from Hizballah to use his U.S. passport so he could travel from Malaysia to Thailand without obtaining a visa.
El Debek first traveled to Panama for Hizballah in 2011, where his operational tasks included locating the U.S. and Israeli Embassies, casing security procedures at the Panama Canal and the Israeli Embassy, and locating hardware stores where explosive precursors could be purchased. Shortly before traveling to Panama, el Debek updated his status on Facebook with a post that read, in part, “Do not make peace or share food with those who killed your people.”
In early 2012, el Debek again traveled to Panama for Hizballah, passing through New York and New Jersey, and was asked to identify areas of weakness and construction at the Panama Canal, as well as provide information about how close someone could get to a ship passing through the Canal. Upon his return from Panama, el Debek’s IJO handlers asked him for photographs of the U.S. Embassy there and details about its security procedures.
El Debek has told the FBI that he was detained by Hizballah from December 2015 to April 2016 and falsely accused of spying for the U.S. Between November 2014 and February 2017, el Debek, who received religious training from Hizballah, has conducted more than 250 Facebook searches using search terms such as “martyrs of the holy defense,” “martyrs of Islamic resistance,” “Hizballah martyrs,” and “martyrs of the Islamic resistance in Lebanon.”
* * *
Kourani is charged with providing and attempting to provide material support to a designated foreign terrorist organization, which carries a maximum sentence of 20 years in prison; conspiracy to provide material support and resources to a designated foreign terrorist organization, which carries a maximum sentence of 20 years in prison; receiving military-type training from a designated foreign terrorist organization, which carries a sentence of 10 years in prison or a fine; conspiracy to receive military-type training from a designated foreign terrorist organization, which carries a maximum sentence of five years in prison; conspiracy to possess, carry, and use firearms and destructive devices during and in relation to crimes of violence, which carries a maximum sentence of life in prison; making and receiving a contribution of funds, goods, and services to and from Hizballah, in violation of IEEPA, which carries a maximum sentence of 20 years in prison; conspiracy to make and receive a contribution of funds, goods, and services to and from Hizballah, in violation of IEEPA, which carries a maximum sentence of 20 years in prison; and naturalization fraud in connection with an act of international terrorism, which carries a maximum sentence of 25 years in prison.
El Debek is charged with providing and attempting to provide material support to a designated foreign terrorist organization, which carries a maximum sentence of 20 years in prison; conspiracy to provide material support and resources to a designated foreign terrorist organization, which carries a maximum sentence of 20 years in prison; receiving military-type training from a designated foreign terrorist organization, which carries a sentence of 10 years in prison or a fine; conspiracy to receive military-type training from a designated foreign terrorist organization, which carries a maximum sentence of five years in prison; possessing, carrying, and using firearms and destructive devices during and in relation to crimes of violence, which carries a maximum sentence of life in prison; making and receiving a contribution of funds, goods, and services to and from Hizballah, in violation of IEEPA, which carries a maximum sentence of 20 years in prison; and conspiracy to make and receive a contribution of funds, goods, and services to and from Hizballah, in violation of IEEPA, which carries a maximum sentence of 20 years in prison.
The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.
Mr. Kim praised the outstanding efforts of the FBI’s New York Joint Terrorism Task Force, which principally consists of agents from the FBI and detectives from the NYPD. Mr. Kim also thanked the FBI’s Detroit Office and the Counterterrorism Section of the Department of Justice’s National Security Division.
These prosecutions are handled by the Office’s Terrorism and International Narcotics Unit. Assistant U.S. Attorneys Emil J. Bove III and Amanda L. Houle for the Southern District of New York are in charge of the prosecution of Kourani. Assistant U.S. Attorneys Andrew D. Beaty and Stephen J. Ritchin for the Southern District of New York are in charge of the prosecution of el Debek. Trial Attorneys Lolita Lukose and Alexandra Hughes of the National Security Division’s Counterterrorism Section are assisting the prosecutions.
The charges contained in the Complaints 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 Complaints and the description of the Complaints set forth below constitute only allegations, and every fact described should be treated as an allegation.
Nine Members of Rockland County Drug Trafficking Organization Charged in Manhattan Federal Court with Distribution of Cocaine, Crack, Heroin, and FentanylRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, Thomas Zugibe, the Rockland County District Attorney, and James J. Hunt, Special Agent in Charge of the New York Field Division of the Drug Enforcement Administration (“DEA”), today announced the unsealing of an indictment charging nine defendants with participating in a drug trafficking organization that distributed a variety of narcotics, including heroin, fentanyl, cocaine, and crack cocaine, in and around Rockland County, New York, and obtained those narcotics for resale from the Bronx, Brooklyn, and Queens, New York. The indictment alleges that the use of heroin distributed by defendant ROBERT DIAZ, a/k/a “Facey,” a/k/a “Face,” resulted in serious bodily injury to a particular victim (“Victim-1”) on or about December 15, 2016, in Queens, New York.
All but one of the defendants were arrested last night and today. RENE SANCHEZ, PABLO PEREZ, CHRISTIAN CARDENAS, DAVID ALMONTE, and RONALD BOLANOS were presented in federal court in Manhattan before U.S. Magistrate Judge Gabriel W. Gorenstein this afternoon. ROBERT DIAZ, THERESA KEEFE, and NICOLE MUNDERVILLE will be presented tomorrow before Judge Gorenstein. ROLANDO PAULINO remains at large.
Acting U.S. Attorney Joon H. Kim stated: “As alleged, the defendants conspired to sell deadly drugs, including heroin and fentanyl, even though some of them knew that users were overdosing on their drugs. The opioid epidemic, and in particular, overdoses on fentanyl, is on the rise in too many of our communities, including Rockland County. Together with our partners at the DEA and the Rockland County District Attorney’s Office, we are working to combat this deadly epidemic.”
Rockland County District Attorney Thomas Zugibe stated: “Sadly, we're seeing high numbers of fentanyl and heroin related overdoses in Rockland County. Dealers selling heroin-laced fentanyl or replacing the heroin entirely with fentanyl are a major threat to our community. Often times, users never know that the substance they purchased has been cut with this opioid, which is 50 times more powerful than regular heroin. Today’s arrests help to stem the flow of heroin and fentanyl into our neighborhoods. Along with our law enforcement partners, the Rockland County District Attorney's Office is committed to holding dealers accountable with the full force of the law.”
DEA Special Agent in Charge James J. Hunt stated: “The after effects of this Rockland County drug crew added casualties to the number of opioid overdoses nationwide, as they callously discussed doing the ‘fentanyl dance.’ In addition to dismantling drug trafficking organizations, law enforcement and our community partners are collaborating to alert the public on the dangers of drug dealers pushing heroin and fentanyl into our neighborhoods.”
According to the Indictment[1] unsealed in Manhattan federal court:
ROBERT DIAZ, a/k/a “Facey,” a/k/a “Face,” RENE SANCHEZ, a/k/a “Renny,” PABLO PEREZ, a/k/a “Menor,” CHRISTIAN CARDENAS, a/k/a “Chris,” a/k/a “Spoonie,” DAVID ALMONTE, a/k/a “Elli,” RONALD BOLANOS, a/k/a “Ronny,” a/k/a “ET,” ROLANDO PAULINO, a/k/a “Santana Paulino,” THERESA KEEFE, a/k/a “Terry,” and NICOLE MUNDERVILLE, a/k/a “Nicki,” conspired to distribute significant amounts of narcotics, including heroin, cocaine, crack cocaine, and fentanyl, in and around Rockland County, New York, from 2012 to May 2017 as members of a drug trafficking organization (the “Rockland DTO”). CARDENAS, ALMONTE, PEREZ, PAULINO, and BOLANOS acted as suppliers for the Rockland DTO, while DIAZ, SANCHEZ, KEEFE, and MUNDERVILLE distributed and assisted in distributing the narcotics to customers in and around Rockland County. The Rockland DTO distributed narcotics on a daily basis, and obtained narcotics for resale from the Bronx, Brooklyn, and Queens.
Some members of the Rockland DTO were aware of the potency and danger of the narcotics they were distributing. For example, from December 2016 to May 2017, DIAZ indicated to certain other members of the Rockland DTO that the narcotics he, KEEFE, and MUNDERVILLE were selling, and that CARDENAS was supplying, contained fentanyl, were particularly dangerous, and had caused adverse reactions in multiple customers, including at least one overdose that had required the administration of naloxone to Victim-1 on or about December 15, 2016. Also, as described in the Indictment, on January 5, 2017, DIAZ told CARDENAS that “three people fell out” from the drugs DIAZ had provided. DIAZ subsequently informed KEEFE and MUNDERVILLE that the drugs they were selling, thought by customers to be heroin, actually contained fentanyl. In addition, on March 20, 2017, DIAZ, in a conversation with PEREZ, laughed as he discussed doing the “fentanyl dance,” telling PEREZ that he had a “new connect” for “straight up fentanyl” and that customers “love it.”
* * *
Each defendant is charged with one count of conspiracy to distribute narcotics, which carries a maximum sentence of life in prison and a mandatory minimum sentence of 10 years in prison. DIAZ also faces a mandatory minimum sentence of 20 years in prison for having distributed heroin resulting in serious bodily injury to a victim. 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 the judge. A chart with the defendants’ ages and residences is below.
Mr. Kim thanked the DEA’s Westchester Tactical Diversion Squad, the Rockland County Drug Task Force, the Rockland County REACT Team, and the Rockland County District Attorney’s Office for their work on the investigation. The DEA’s Westchester TDS comprises agents and officers of the DEA, Westchester County Police Department, Town of Orangetown Police Department, Rockland County Sheriff’s Office, Rockland County District Attorney’s Office, Yonkers Police Department, New Windsor Police Department, Putnam County Sheriff’s Office and U.S. Health and Human Services.
This matter is being handled by the Office’s Narcotics Unit. Assistant United States Attorneys Jane Kim, Jason Richman, and Elizabeth Hanft are in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
DEFENDANT
AGE
RESIDENCE
ROBERT DIAZ, a/k/a “Facey,” a/k/a “Face”
49
Haverstraw, New York
RENE SANCHEZ, a/k/a “Renny”
52
Haverstraw, New York
PABLO PEREZ, a/k/a “Menor”
37
Bronx, New York
CHRISTIAN CARDENAS, a/k/a “Chris,” a/k/a “Spoonie”
41
Queens, New York
DAVID ALMONTE, a/k/a “Elli”
36
Bronx, New York
RONALD BOLANOS, a/k/a “Ronny,” a/k/a “ET”
47
Queens, New York
ROLANDO PAULINO, a/k/a “Santana Paulino”
46
Manhattan, New York
THERESA KEEFE, a/k/a “Terry”
55
Haverstraw, New York
NICOLE MUNDERVILLE, a/k/a “Nicki”
34
Haverstraw, New York
[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.
Bronx Man and Michigan Man Arrested for Terrorist Activities on Behalf of Hizballah’s Islamic Jihad OrganizationRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, Dana Boente, the Acting Assistant Attorney General for National Security, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and James P. O’Neill, the Commissioner of the Police Department for the City of New York (“NYPD”), announced that ALI KOURANI and SAMER EL DEBEK, a/k/a “Samer Eldebek,” were arrested on Thursday, June 1, 2017, on charges related to their alleged activities on behalf of Hizballah, a designated foreign terrorist organization.
KOURANI was arrested in the Bronx for providing, attempting, and conspiring to provide material support to Hizballah; receiving and conspiring to receive military-type training from Hizballah; a related weapons offense that is alleged to have involved, among other weapons, a rocket-propelled grenade launcher and machine guns; violating and conspiring to violate the International Emergency Economic Powers Act (“IEEPA”); and naturalization fraud to facilitate an act of international terrorism. KOURANI was presented on Friday, June 2, 2017, before Magistrate Judge Barbara Moses in Manhattan federal court.
EL DEBEK was arrested in Livonia, Michigan, outside of Detroit, for providing, attempting, and conspiring to provide material support to Hizballah; receiving and conspiring to receive military-type training from Hizballah; use of weapons in connection with a crime of violence that is alleged to have involved, among other weapons, explosives, a rocket-propelled grenade launcher, and machine guns; and violating and conspiring to violate IEEPA. EL DEBEK was presented on Monday, June 5, 2017, before Magistrate Judge Henry Pitman in Manhattan federal court.
Acting Manhattan U.S. Attorney Joon H. Kim said: “Today, we announce serious terrorism charges against two men who allegedly trained with and supported the Islamic Jihad Organization, a component of the foreign terrorist organization Hizballah. Recruited as Hizballah operatives, Samer El Debek and Ali Kourani allegedly received military-style training, including in the use of weapons like rocket-propelled grenade launchers and machine guns for use in support of the group’s terrorist mission. At the direction of his Hizballah handlers, El Debek allegedly conducted missions in Panama to locate the U.S. and Israeli Embassies and to assess the vulnerabilities of the Panama Canal and ships in the Canal. Kourani allegedly conducted surveillance of potential targets in America, including military and law enforcement facilities in New York City. Thanks to the outstanding work of the FBI and NYPD, the allegedly destructive designs of these two Hizballah operatives have been thwarted, and they will now face justice in a Manhattan federal court.”
FBI Assistant Director-in-Charge William F. Sweeney Jr. said: “The charges announced today reveal once again that the New York City region remains a focus of many adversaries, demonstrated as alleged in this instance by followers of a sophisticated and determined organization with a long history of coordinating violent activities on behalf of Hizballah. Our announcement today also reveals, however, that the dozens of agencies working together with our FBI JTTFs nationwide are just as determined to disrupt the plans of those working to harm our communities. I’d like to thank the hundreds of investigators who comprise the FBI’s New York JTTF and display constant vigilance on our behalf, and I encourage the public to remain engaged and to immediately report suspicious activity to law enforcement.”
NYPD Commissioner James P. O’Neill said: “As part of his work for Hezbollah, Kourani and others allegedly conducted covert surveillance of potential targets, including U.S. military bases and Israeli military personnel here in New York City. Pre-operational surveillance is one of the hallmarks of Hezbollah in planning for future attacks. As alleged, Kourani, on at least two occasions, received sophisticated military training overseas, including the use of a rocket propelled grenade. In addition, El Debek is charged in an unrelated complaint, for allegedly possessing extensive bomb making training received from Hezbollah. Today’s charges of two for their work on behalf of Hezbollah is a tribute to the collaborative work of the agents and detectives of the Joint Terrorism Task Force.”
As alleged in the criminal Complaints against KOURANI and EL DEBEK,[1] both of which were unsealed today in Manhattan federal court:
Background on Hizballah and the Islamic Jihad Organization
Hizballah is a Lebanon-based Shia Islamic organization with political, social, and terrorist components. Hizballah was founded in the 1980s with support from Iran after the 1982 Israeli invasion of Lebanon, and its mission includes establishing a fundamentalist Islamic state in Lebanon. Since Hizballah’s formation, the organization has been responsible for numerous terrorist attacks that have killed hundreds, including United States citizens and military personnel. In 1997, the U.S. Department of State designated Hizballah a Foreign Terrorist Organization, pursuant to Section 219 of the Immigration and Nationality Act, and it remains so designated today. In 2001, pursuant to Executive Order 13224, the U.S. Department of State designated Hizballah a Specially Designated Global Terrorist entity. In 2010, State Department officials described Hizballah as the most technically capable terrorist group in the world, and a continued security threat to the United States.
The Islamic Jihad Organization (“IJO”), which is also known as the External Security Organization and “910,” is a component of Hizballah responsible for the planning and coordination of intelligence, counterintelligence, and terrorist activities on behalf of Hizballah outside of Lebanon. In July 2012, an IJO operative detonated explosives on a bus transporting Israeli tourists in the vicinity of an airport in Burgas, Bulgaria, which killed six people and injured 32 others. Law enforcement authorities have disrupted several other IJO attack-planning operations around the world, including the arrest of an IJO operative surveilling Israeli targets in Cyprus in 2012, the seizure of bomb-making precursor chemicals in Thailand in 2012, including chemicals manufactured by a medical devices company based in Guangzhou, China (“Guangzhou Company-1”), and a similar seizure of chemicals manufactured by Guangzhou Company-1 in Cyprus in May 2015 in connection with the arrest of another IJO operative.
KOURANI’s Alleged Support of Hizballah
KOURANI, who was born in Lebanon, attended Hizballah-sponsored weapons training in Lebanon in 2000 when he was approximately 16 years old. After lawfully entering the United States in 2003, KOURANI obtained a Bachelor of Science in biomedical engineering in 2009, and a Masters of Business Administration in 2013.
KOURANI and certain of his relatives were present during the summer 2006 conflict between Israel and Hizballah in Lebanon, when a residence belonging to his family was destroyed. KOURANI was subsequently recruited to join the IJO by 2008. In August 2008, KOURANI submitted an application for naturalization in the United States in which he falsely claimed, among other things, that he was not affiliated with a terrorist organization. In April 2009, KOURANI became a naturalized citizen and was issued a United States passport. Despite claiming in his passport application that he had no travel plans, KOURANI traveled to Guangzhou, China – the location of Guangzhou Company-1 – on May 3, 2009. He later claimed to the FBI that the purpose of the trip was to meet with medical device manufacturers and other businessmen.
KOURANI was assigned an IJO handler, or mentor, responsible for providing him with taskings, debriefings, and arranging training. KOURANI sometimes communicated with his handler using coded email communications, including messages sent by the handler that informed KOURANI of the need to return to Lebanon. In order to establish contact with his handler when KOURANI returned to Lebanon, KOURANI called a telephone number associated with a pager (the “IJO Pager”) and provided a code that he understood was specific to him. After KOURANI called the IJO Pager, the handler would contact KOURANI to set up an in-person meeting by calling a phone belonging to one of KOURANI’s relatives. The IJO also provided KOURANI with additional training in tradecraft, weapons, and tactics. In 2011, for example, KOURANI attended an IJO military training camp located in the vicinity of Birkat Jabrur, Lebanon, where he was provided with military-tactics and weapons training, including training in the use of a rocket propelled grenade launcher, an AK-47 assault rifle, an MP5 submachine gun, a PKS machine gun (a Russian-made belt-fed weapon), and a Glock pistol.
Based on requests from IJO personnel, which were conveyed during periodic in-person meetings when KOURANI returned to Lebanon, KOURANI also conducted operations that included searching for weapons suppliers in the United States who could provide firearms to support IJO operations, identifying individuals affiliated with the Israeli Defense Force, gathering information regarding operations and security at airports in the United States and elsewhere, and surveilling U.S. military and law enforcement facilities in Manhattan and Brooklyn. KOURANI transmitted some of the products of his surveillance and intelligence-gathering efforts back to IJO personnel in Lebanon using digital storage media.
EL DEBEK’s Alleged Support of Hizballah
EL DEBEK, a naturalized U.S. citizen, was first recruited by Hizballah in late 2007 or early 2008, began to receive a salary from Hizballah shortly thereafter, and was paid by Hizballah through approximately 2015. In July 2006, shortly before he was recruited by Hizballah, EL DEBEK expressed by email his support for Hassan Nasrallah, the leader of Hizballah.
EL DEBEK received military training from Hizballah in Lebanon on several occasions, from approximately 2008 through approximately 2014. EL DEBEK received training in basic military tactics, the handling of various weapons, surveillance and counter-surveillance techniques, and the creation and handling of explosives and explosive devices. Based on information EL DEBEK provided to the FBI, FBI bomb technicians have assessed that EL DEBEK received extensive training as a bomb-maker, and has a high degree of technical sophistication in the area. EL DEBEK received by email in 2010 a list of raw materials that could be sent from Syria or Dubai, including items often used in explosives and improvised explosive devices.
EL DEBEK also conducted missions for Hizballah in Thailand and Panama. In May 2009, EL DEBEK traveled from Lebanon, through Malaysia, to Thailand, where his mission was to clean up explosive precursors in a house in Bangkok that others had left because they were under surveillance. EL DEBEK used his U.S. passport to enter and leave Thailand, consistent with his instructions from Hizballah to use his U.S. passport in that manner, so he could travel from Malaysia to Thailand without obtaining a visa.
EL DEBEK first traveled to Panama for Hizballah in 2011, where his operational tasks included locating the U.S. and Israeli Embassies, casing security procedures at the Panama Canal and the Israeli Embassy, and locating hardware stores where explosive precursors could be purchased. Shortly before traveling to Panama, EL DEBEK updated his status on Facebook with a post that read, in part, “Do not make peace or share food with those who killed your people.”
In early 2012, EL DEBEK again traveled to Panama for Hizballah, passing through New York and New Jersey, and was asked to identify areas of weakness and construction at the Panama Canal, as well as provide information about how close someone could get to a ship passing through the Canal. Upon his return from Panama, EL DEBEK’s IJO handlers asked him for photographs of the U.S. Embassy there and details about its security procedures.
EL DEBEK has told the FBI that he was detained by Hizballah from December 2015 to April 2016 and falsely accused of spying for the United States. Between November 2014 and February 2017, EL DEBEK, who received religious training from Hizballah, has conducted more than 250 Facebook searches using search terms such as “martyrs of the holy defense,” “martyrs of Islamic resistance,” “Hizballah martyrs,” and “martyrs of the Islamic resistance in Lebanon.”
* * *
KOURANI, 32, of the Bronx, is charged with providing material support and resources to a designated foreign terrorist organization, which carries a maximum sentence of 20 years in prison; conspiracy to provide material support and resources to a designated foreign terrorist organization, which carries a maximum sentence of 20 years in prison; receiving military-type training from a designated foreign terrorist organization, which carries a sentence of 10 years in prison or a fine; conspiracy to receive military-type training from a designated foreign terrorist organization, which carries a maximum sentence of five years in prison; conspiracy to possess, carry, and use firearms and destructive devices during and in relation to crimes of violence, which carries a maximum sentence of life in prison; making and receiving a contribution of funds, goods, and services to and from Hizballah, in violation of IEEPA, which carries a maximum sentence of 20 years in prison; conspiracy to make and receive a contribution of funds, goods, and services to and from Hizballah, in violation of IEEPA, which carries a maximum sentence of 20 years in prison; and naturalization fraud in connection with an act of international terrorism, which carries a maximum sentence of 25 years in prison.
EL DEBEK, 37, of Dearborn, Michigan, is charged with providing material support and resources to a designated foreign terrorist organization, which carries a maximum sentence of 20 years in prison; conspiracy to provide material support and resources to a designated foreign terrorist organization, which carries a maximum sentence of 20 years in prison; receiving military-type training from a designated foreign terrorist organization, which carries a sentence of 10 years in prison or a fine; conspiracy to receive military-type training from a designated foreign terrorist organization, which carries a maximum sentence of five years in prison; possessing, carrying, and using firearms and destructive devices during and in relation to crimes of violence, which carries a maximum sentence of life in prison; making and receiving a contribution of funds, goods, and services to and from Hizballah, in violation of IEEPA, which carries a maximum sentence of 20 years in prison; and conspiracy to make and receive a contribution of funds, goods, and services to and from Hizballah, in violation of IEEPA, which carries a maximum sentence of 20 years in prison.
The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.
Mr. Kim praised the outstanding efforts of the FBI’s New York Joint Terrorism Task Force, which principally consists of agents from the FBI and detectives from the NYPD. Mr. Kim also thanked the FBI’s Detroit Office and the Counterterrorism Section of the Department of Justice’s National Security Division.
These prosecutions are handled by the Office’s Terrorism and International Narcotics Unit. Assistant U.S. Attorneys Emil J. Bove III and Amanda L. Houle are in charge of the prosecution of KOURANI, and Assistant U.S. Attorneys Andrew D. Beaty and Stephen J. Ritchin are in charge of the prosecution of EL DEBEK. Trial Attorneys Lolita Lukose and Alexandra Hughes of the National Security Division’s Counterterrorism Section are assisting the prosecutions.
The charges contained in the Complaints 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 Complaints and the description of the Complaints set forth below constitute only allegations, and every fact described should be treated as an allegation.
Acting Manhattan U.S. Attorney Announces Charges Against New York Man in Phony Bail Scheme That Targeted Elderly VictimsRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and James P. O’Neill, Commissioner of the New York City Police Department (“NYPD”), announced today the unsealing of a complaint charging PAUL IFEANYICHUKWU ONWUVUARIRI with conspiracy to commit wire fraud in connection with a scheme that targeted and victimized elderly people across the United States. As alleged, ONWUVUARIRI and his co-conspirators tricked victims, by phone, into believing that they were speaking to the NYPD or another law enforcement agency, and that the victims’ grandchildren or relatives had been arrested and needed bail money immediately to avoid prison. ONWUVUARIRI was arrested last night and will be presented later today in federal court in Manhattan.
Manhattan U.S. Attorney Joon H. Kim said: “As alleged, Paul Ifeanyichukwu Onwuvuariri and his co-conspirators targeted vulnerable grandparents, callously preying on their emotions by convincing them that their loved ones were in trouble. Participants in this scheme allegedly swindled elderly victims out of thousands of dollars by pretending to be members of law enforcement, including the NYPD, and falsely claiming that victims’ family members were in custody and needed bail. We urge victims of this type of fraud to contact law enforcement, including our Office’s Victim/Witness unit.”
NYPD Commissioner James P. O’Neill said: “As alleged, the defendant and his co-conspirators exploited victims’ trust in law enforcement to defraud the elderly. Tricking someone into thinking that a family member is in trouble, to further their fraud, is a particularly low bar. I want to thank the US Attorney’s Office, the Utica Police Department, and the detectives from the NYPD for their work on this case.”
According to the allegations in the Complaint unsealed in Manhattan federal court:[1]
Beginning in approximately 2015, ONWUVUARIRI and his co-conspirators perpetrated a scheme to defraud elderly people around the United States by tricking them into believing their grandchildren or other relatives had been arrested and needed immediate bail money. A member of the conspiracy typically contacted the victim by phone, purported to be either the relative or a law enforcement official, and falsely claimed that the victim’s grandchild or relative had been taken into custody for a narcotics offense and would not be released unless the victim paid thousands of dollars in purported bail money. A member of the conspiracy also frequently posed on the call as the victim’s grandchild, pleading with the elderly victim to send money to secure the grandchild’s release from jail, and asking the victim not to contact any other family members because the grandchild felt ashamed. In each case, the defrauded victim has sent thousands of dollars, at a minimum, as instructed, to certain individuals who, among other things, have provided that money to ONWUVUARIRI. After paying the “bail” money as directed, victims have learned that their grandchild or relative had not, in fact, been arrested, that the grandchild or relative knew nothing about the claims made on the call to the victim, and that the call appeared to be fraudulent.
For example, among the examples set forth in the complaint, one 82-year-old victim in Brooklyn, New York, received a phone call in November 2015 from an individual who identified himself as the victim’s grandson and claimed that he had been arrested. The victim then spoke to an individual who identified himself as an NYPD sergeant and said the victim’s grandson would be released if the victim wired $7,600 in bail money. The victim deposited the money as directed, and then received additional calls the next day asking for additional money and the victim’s credit card number. The victim subsequently spoke with the victim’s daughter, and learned that the victim’s grandson had not been arrested, and knew nothing about the purported sergeant or the basis for his request for bail money.
In fact, the victim’s money was wired to an individual working with ONWUVUARIRI who collected the wired funds on ONWUVUARIRI’s behalf and provided the money to ONWUVUARIRI.
* * *
ONWUVUARIRI, 29, of Utica, New York, is charged with one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Acting U.S. Attorney Kim praised the outstanding investigative work of the Criminal Investigators for the United States Attorney’s Office for the Southern District of New York and the New York City Police Department. He also thanked the Utica Police Department for its assistance.
If you believe you were a victim of this crime, 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]. For additional information, go to: http://www.usdoj.gov/usao/nys/victimwitness.html.
This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorney Nicolas Landsman-Roos is in charge of the prosecution.
The charge contained in the Complaint is merely an accusation, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Acting Manhattan U.S. Attorney Announces Charges Against Brooklyn Man Who Preyed on Vulnerable Victims at A Manhattan BarRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and James P. O’Neill, Commissioner of the New York City Police Department (“NYPD”), announced today the unsealing of a complaint charging WILLIE WHITE with access device fraud and aggravated identity theft in connection with a scheme that targeted vulnerable young men and women whom he met at a bar in Manhattan. As alleged, WHITE identified intoxicated victims he met at the bar, and then took them to an apartment in Brooklyn where he forced them to inhale a controlled substance that appeared to be crack cocaine. WHITE took the victims’ credit and debit card information and made unauthorized purchases for his own benefit. WHITE was arrested this morning and will be presented later today in federal court in Manhattan.
Manhattan U.S. Attorney Joon H. Kim said: “Willie White allegedly took advantage of intoxicated men and women at a Manhattan bar by taking them to another location and then further incapacitated them by forcing them to take drugs. White then allegedly stole their debit and credit cards and made unauthorized purchases. We thank the NYPD for their work in putting a stop to White’s crimes.”
According to the allegations in the Complaint unsealed in Manhattan federal court:[1]
Between April and May of 2017, WHITE stole or otherwise improperly obtained the credit or debit cards of individuals whom he met in a Manhattan bar, and then used the stolen bank information to make purchases and cash withdrawals without the authorization or consent of the victims. In connection with the scheme, WHITE took at least two victims to an apartment in Brooklyn, where he forced the victims to ingest what they believed to be crack cocaine. While the victims were under the influence of the controlled substance, WHITE used the victims’ credit and debit cards to make purchases of clothing, shoes, and cash withdrawals without the victims’ knowledge or consent. WHITE detained the victims without their consent for hours, and in one case for over a day, while engaged in shopping sprees at the victims’ expense.
* * *
WHITE, 46, of Brooklyn, New York, is charged with one count of access device fraud, which carries a maximum sentence of 15 years in prison, and one count of aggravated identity theft, which carries a mandatory sentence of two years in prison that must be imposed consecutively to any other sentence. 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.
Acting U.S. Attorney Kim praised the outstanding investigative work of the New York City Police Department, particularly Detective John McAuliffe and Detective Gregg Licari.
If you believe you were a victim of this crime, 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]. For additional information, go to: http://www.usdoj.gov/usao/nys/victimwitness.html.
This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorney Aline R. Flodr is in charge of the prosecution.
The charge contained in the Complaint is merely an accusation, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Town of Monroe Justice Arrested for False Statements and Obstruction of JusticeRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that LURLYN A. WINCHESTER, a Justice for the Town Court of Monroe, was charged with making false statements in connection with an application for a loan to purchase a residence in Monroe which satisfied the residency requirement of her position as Town Justice. She was also charged with obstruction of justice for providing law enforcement officers, who questioned her about her mortgage loan, with false documents, including fabricated rent payment receipts. WINCHESTER was arrested this morning at her home in New City, New York, and was presented before U.S. Magistrate Judge Lisa Margaret Smith in White Plains federal court this morning.
Acting Manhattan U.S. Attorney Joon H. Kim said: “As alleged, Lurlyn Winchester, a municipal court judge for the Town of Monroe, lied and provided fake documents to secure a mortgage on a Monroe condominium in an attempt to falsely satisfy the judicial residency requirement. We should expect and demand integrity in our government. This Office is committed to pursuing corruption in all forms and in all three branches of government, including the judiciary. I thank our partners at the FBI for their work in exposing this fraud and holding accountable our public officials.”
FBI Assistant Director-in-Charge William F. Sweeney Jr. stated: “As alleged, Lurlyn Winchester falsely represented her primary residence in order to fulfill requirements for her position as justice for the Town of Monroe. Winchester, who claimed she had relocated her primary residence from New City to Monroe, allegedly remained in her New City home, despite representations to the contrary. She allegedly provided false information to her mortgage company, claiming her New City property was being rented to a prospective tenant, and later lied to federal agents who interviewed her about her claims. If anyone should have respect for the rule of law, it should most certainly be those entrusted to uphold it. Many thanks to our partners in this investigation as we continue to reinforce our commitment to uncover illegal activity on behalf of public officials at every level.”
According to the allegations contained in the Complaint[1] unsealed today:
In or about 1997, LURLYN A. WINCHESTER, the defendant, and her husband purchased a home in New City, New York (the “New City Home”), which they continue to own. On or about October 6, 2013, WINCHESTER, an attorney practicing in New City, was nominated to be the democratic candidate for Town of Monroe Justice. At that time, she provided an address in Monroe, New York (“Monroe Residence-1”), as her residence, and on or about October 7, 2013, she registered to vote in Monroe, New York. WINCHESTER was then elected Town of Monroe Justice on or about November 5, 2013.
On or about October 14, 2014, Hudson United Mortgage, LLC (“Hudson United”), a mortgage broker located in New City, New York, received a letter from WINCHESTER indicating that she had been elected Town Justice for the Town of Monroe and that she was relocating to Monroe in order to comply with a residency requirement attached to that position. In or about December 2014, the defendant and her husband submitted an application for a residential loan to Hudson United, and indicated that the loan was to be used to purchase a condominium located in Monroe, New York (“Monroe Residence-2”). On both the loan application and a disclosure notice, signed by the defendant and her husband, they asserted that Monroe Residence-2 would be their primary residence.
WINCHESTER also represented to Hudson United that she and her husband were going to rent out their New City Home to a tenant. Specifically, on or about February 6, 2015, Hudson United received a letter from the defendant in which she identified the New City Home as her “current primary residence” and she stated that she and her husband intended to rent the New City Home and they “already had a prospective tenant” who was “anxiously awaiting to take occupancy of the residence.”
In or about March 2015, WINCHESTER learned that the ultimate loan issuer, Plaza Home Mortgage Inc. (“Plaza”), was going to decline to issue the loan due to insufficient income. In response, WINCHESTER again represented that she and her husband were going to rent out the New City Home and indicated they would have rental income of $4,500 a month. Plaza requested copies of a fully executed 12-month lease and a canceled check for a security deposit. WINCHESTER provided a copy of a lease agreement, signed by the defendant, her husband, and a tenant (the “Tenant”). She also submitted a copy of two $4,500 checks for the security deposit and one month’s rent, made out to the defendant, and drawn on the Tenant’s bank account, as well as other documents reflecting that the checks were deposited into WINCHESTER’s bank account. In or about April 2015, Plaza issued the loan.
Contrary to the defendant’s representations, WINCHESTER did not intend to and did not lease the New City Home to Tenant in 2015; instead she fabricated a 2015 lease and caused checks to be issued and deposited to make it falsely appear that Tenant had paid rent and a security deposit. Tenant did not sign a lease in March 2015, never moved in to the New City Home, and WINCHESTER provided the $9,000 that covered the two $4,500 checks purportedly provided by Tenant.
Further, Monroe Residence-2 was not intended to be, and has not been, the primary residence of the defendant and her husband. Interviews with neighbors, cellphone records, and credit card records indicate that WINCHESTER did not move to Monroe. Finally, in a statement to agents, WINCHESTER admitted that: she resided at the New City Home, she had informed Hudson United that she would be renting the New City Home, she submitted rental checks and other documents relating to renting the New City Home, and the Tenant never moved into the New City Home.
With respect to the obstruction charge, during an interview with members of the FBI Task Force relating to WINCHESTER’s statements and submissions in connection with her loan, she provided them with, among other things, purported receipts for rent payments she claimed to have received from the Tenant for rent of the New City Home. The Tenant, however, indicated that he did not know anything about the receipts and never gave WINCHESTER the cash payments supposedly memorialized in them.
* * *
WINCHESTER, 58, of New City, New York, is charged with one count of making false statements to a mortgage lending business, which carries a maximum sentence of 30 years in prison, as well as falsifying records in a federal investigation, with the intent to impede, obstruct, or influence the investigation or proper administration of any matter within the jurisdiction of a federal department or agency, which carries a maximum sentence of 20 years in prison. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Kim praised the outstanding investigative work of the FBI. He also thanked the Orange County Sheriff’s Office and the Orange County District Attorney’s Office for their assistance.
The case is being prosecuted by the Office’s White Plains Division. Assistant U.S. Attorney Margery B. Feinzig is in charge of the prosecution.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth below constitute only allegations, and every fact described should be treated as an allegation.
Members and Associates of Russian Crime Syndicate Arrested for Racketeering, Extortion, Robbery, Murder-For-Hire Conspiracy, Fraud, Narcotics, and Firearms OffensesRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, William F. Sweeney Jr., Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), Leon Hayward, Acting Director of the New York Field Office of U.S. Customs and Border Protection, and James P. O’Neill, the Commissioner of the New York City Police Department (“NYPD”), announced the unsealing of three Indictments and one Complaint charging 33 defendants with a variety of racketeering, fraud, narcotics, firearms, and stolen property offenses.
Of the charged defendants, 27 are associated with a nationwide racketeering enterprise led by RAZHDEN SHULAYA and ZURAB DZHANASHVILI and are charged in United States v. Razhden Shulaya, et al. (the “Shulaya Indictment”) and an accompanying superseding indictment, which has been assigned to U.S. District Judge Katherine B. Forrest. Of those defendants, 23 were taken into federal custody. 18 will be presented before U.S. Magistrate Judge Gabriel W. Gorenstein today. One defendant will be presented in the District of Nevada. Three defendants will be presented in the Southern District of Florida. DENIS SAVGIR, EREKLE KERESELIDZE, GIORGI LOMISHVILI, MAMUKA CHAGANAVA, and SEMYON SARAIDAROV remain at large. One defendant, TIMUR SUYUNOV, is currently detained in federal custody and will be brought to Manhattan federal court on a writ.
Two additional defendants are charged in United States v. Nikoloz Jikia, et al. (the “Marat-Uulu Complaint”), with conspiracy to commit murder-for-hire and with additional firearms offenses. Of those defendants, one of whom is also charged in the Shulaya Indictment, both were taken into federal custody last evening and will be presented before Judge Gorenstein today.
Three additional defendants are charged in United States v. Alex Fishman, et al. (the “Fishman Indictment”), which has been assigned to U.S. District Judge Richard J. Sullivan. Each of those three defendants was taken into federal custody today and will be presented before Judge Gorenstein this afternoon.
Finally, one additional defendant was charged in United States v. Sergey Gindinov (the “Gindinov Indictment”), which has been assigned to U.S. District Judge Alison J. Nathan. GINDINOV was taken into federal custody today and will be presented this afternoon before Judge Gorenstein.
Acting Manhattan U.S. Attorney Joon H. Kim said: “Today, we have charged 33 members and associates of a Russian organized crime syndicate allegedly engaging a panoply of crimes around the country. The indictments include charges against the alleged head of this national criminal enterprise, one of the first federal racketeering charges ever brought against a Russian ‘vor.’ The dizzying array of criminal schemes committed by this organized crime syndicate allegedly include a murder-for-hire conspiracy, a plot to rob victims by seducing and drugging them with chloroform, the theft of cargo shipments containing over 10,000 pounds of chocolate, and a fraud on casino slot machines using electronic hacking devices. Thanks to the remarkable interagency partnership of FBI, CBP, and NYPD, we have charged and arrested 33 defendants allegedly involved in this criminal enterprise.”
FBI Assistant Director-in-Charge William F. Sweeney Jr. said: “The suspects in this case cast a wide net of criminal activity, aiming to make as much money as possible, all allegedly organized and run by a man who promised to protect them. But that protection didn't include escaping justice and being arrested by the agents and detectives on the FBI New York Eurasian Organized Crime Task Force. Our partnerships with other FBI field offices, the NYPD and CBP allows us to do everything we can to go after criminals who don't believe the law applies to them.”
Acting CBP New York Director Leon Hayward said: “U.S. Customs and Border Protection is extremely proud to have assisted our federal partners in this operation. It is through our interagency partnerships, and collaborative approaches like the one leading to today’s arrests, that law enforcement successfully combats modern criminal organizations.”
NYPD Commissioner James P. O’Neill said: “The Thief-in-Law allegedly established an extensive cross country criminal enterprise from Brighton Beach to Las Vegas that engaged in bribes, gambling, and murder for hire. Thanks to all whose work resulted in the arrest and indictment of 33 today.”
According to the allegations in the Indictments and Complaint unsealed today in Manhattan federal court:[1]
The Shulaya Enterprise was an organized criminal group operating under the direction and protection of RAZHDEN SHULAYA a/k/a “Brother,” a/k/a “Roma,” a “vor v zakonei” or “vor,” which are Russian phrases translated roughly as “thief-in-law” or “thief,” and which refer to an order of elite criminals from the former Soviet Union who receive tribute from other criminals, offer protection, and use their recognized status as vor to adjudicate disputes among lower-level criminals. As a vor, SHULAYA had substantial influence in the criminal underworld and offered assistance to and protection of the members and associates of the Shulaya Enterprise. Those members and associates, and SHULAYA himself, engaged in widespread criminal activities, including acts of violence, extortion, the operation of illegal gambling businesses, fraud on various casinos, identity theft, credit card frauds, and trafficking of large quantities of stolen goods.
The Shulaya Enterprise comprised groups of individuals, often with overlapping members or associates, dedicated to particular criminal tasks. While many of these crews were based in New York City, the Shulaya Enterprise had operations in various locations throughout the United States (including in New Jersey, Pennsylvania, Florida, and Nevada) and abroad. Most members and associates of the Shulaya Enterprise were born in the former Soviet Union and many maintained substantial ties to Georgia, the Ukraine, and the Russian Federation, including regular travel to those countries, communication with associates in those countries, and the transfer of criminal proceeds to individuals in those countries.
The Shulaya Enterprise was led principally by SHULAYA and ZURAB DZHANASHVILI, a/k/a “Zura,” his lieutenant. Along with SHULAYA and DZHANASHVILI, AKAKI UBILAVA, a/k/a “Ako,” HAMLET UGLAVA, MAMUKA CHAGANAVA, MIKHEIL TORADZE, NAZO GAPRINDASHVILI, a/k/a “Anna,” ARTUR VINOKUROV, a/k/a “Rizhy,” EVGHENI MELMAN, TIMUR SUYUNOV, ZURAB BUZIASHVILI, GIORGI LOMISHVILI, AZER ARSLANOUK, IVAN AFANASYEV, a/k/a “Vanya,” DENIS SAVGIR, DIEGO GABISONIA, LEVAN MAKASHVILI, SEMYON SARAIDAROV, a/k/a “Sammy,” and VACHE HOVHANNISYAN are charged in Count One of the Shulaya Indictment with racketeering conspiracy.
The Enterprise’s criminal activities included:
- The operation of illicit poker businesses in Brighton Beach;
- The extortion of gamblers who became indebted to the Shulaya Enterprise;
- Attempts to extort local business owners;
- Efforts to defraud casinos in Atlantic City and Philadelphia by using electronic devices and computer servers to predict and exploit the behavior of electronic slot machines;
- The theft of cargo shipments, including a shipment containing approximately 10,000 pounds of chocolate confections;
- The use of a female member of the Shulaya Enterprise to seduce men, incapacitate them with gas, and then rob them;
- Attempts to create an after-hours nightclub that would host, among other things, the sale of narcotics;
- The transportation and sale of numerous cases of untaxed cigarettes;
- Plans to pay bribes to local law enforcement; and
- Creation and use of forged identification documents, checks, and invoices.
SHULAYA, DZHANASHVILI, UGLAVA, CHAGANAVA, TORADZE, VINOKUROV, SUYUNOV, BUZIASHVILI, LOMISHVILI, AFANASYEV, KANADASHVILI are charged in Count Two of the Shulaya Indictment with conspiring to sell and transport stolen goods in a scheme involving contraband cigarettes, falsified bills of lading, and assorted stolen merchandise.
SHULAYA, DZHANASHVILI, UGLAVA, CHAGANAVA, TORADZE, KANADASHVILI, and VINOKUROV are charged in Count Three of the Shulaya Indictment in connection with a multi-year conspiracy to transport and sell purportedly stolen contraband cigarettes.
SHULAYA, DZHANASHVILI, SUYUNOV, AFANASYEV, SAVGIR, HOVHANNISYAN, DAVYDOV, KERESELIDZE, and MITSELMAKHER are charged in Count Four of the Shulaya Indictment in connection with a conspiracy to create and use false identification documents.
SHULAYA, UBILAVA, UGLAVA, MELMAN, GABISONIA, and MAKASHVILI are also charged in Count Five with wire fraud in connection with their plot to defraud casinos through the use of electronic devices and software designed to predict the behavior of particular models of electronic “slot” machines, thereby removing the element of chance from play of those machines.
LOMISHVILI, MARAT-UULU, and PETRUSHYN are charged in Count Six of the Shulaya Indictment with narcotics conspiracy in connection with their efforts to sell cocaine and heroin.
LERNER is charged in Count Seven of the Shulaya Indictment with obstruction of justice for lying to the FBI about information LERNER provided the Shulaya Enterprise about the FBI’s investigation.
MARAT-UULU and JIKIA are charged in the Jikia Complaint with conspiring to commit a murder-for-hire, and with firearms offenses.
GINDINOV is charged in the Gindinov Indictment with conspiring to sell narcotics in Manhattan and Brooklyn.
ALEX FISHMAN, STEVEN FISHMAN, and MELNYK are charged in the Fishman Indictment with conspiring to transport and sell contraband cigarettes in Manhattan and Brooklyn.
A detailed chart with the defendants’ ages, residences, and maximum sentences are attached.
* * *
Mr. Kim praised the outstanding work of the FBI, including the Atlantic City, New York, Los Angeles, Las Vegas, and Miami offices, the CBP, the NYPD, and the St. Pierce, Florida, Field Office of Homeland Security Investigations for their investigative efforts and ongoing support and assistance with the case.
The prosecution of this case is being overseen by the Office’s Violent and Organized Crime Unit. Assistant U.S. Attorneys Andrew C. Adams and Andrew Thomas are in charge of the case.
The charges contained in the Indictments and Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
United States v. Shulaya, et al.
COUNT
CHARGE
DEFENDANTS
MAX. PENALTIES
1
RICO Conspiracy
18 U.S.C. § 846
RAZHDEN SHULAYA
ZURAB DZHANASHVILI
AKAKI UBILAVA
HAMLET UGLAVA
MAMUKA CHAGANAVA
MIKHEIL TORADZE
ATVANDIL KANADASHVILI
NAZO GAPRINDASHVILI
ARTUR VINOKUROV
EVGHENI MELMAN
TIMUR SUYUNOV
ZURAB BUZIASHVILI
GIORGI LOMISHVILI
AZER ARSLANOUK
IVAN AFANASYEV
DENIS SAVGIR
DIEGO GABISONIA
LEVAN MAKASHVILI
ANDRIY PETRUSHYN
SEMYON SARAIDAROV
VACHE HOVHANNISYAN BAKAI MARAT-UULU
AVTANDIL KHURTSIDZE
20 years in prison; 3 years supervised release; $250,000 fine, or twice gross pecuniary gain/loss
2
Conspiracy to transport and sell stolen goods
18 U.S.C. § 371
RAZHDEN SHULAYA
ZURAB DZHANASHVILI
HAMLET UGLAVA
MAMUKA CHAGANAVA
MIKHEIL TORADZE
ATVANDIL KANADASHVILI
ARTUR VINOKUROV
TIMUR SUYUNOV
ZURAB BUZIASHVILI
GIORGI LOMISHVILI
IVAN AFANASYEV
5 years in prison; 3 years supervised release; $250,000 fine, or twice gross pecuniary gain/loss
3
Conspiracy to transport and sell contraband cigarettes
18 U.S.C. § 371
RAZHDEN SHULAYA
ZURAB DZHANASHVILI
HAMLET UGLAVA
MAMUKA CHAGANAVA
MIKHEIL TORADZE
AVTANDIL KANADASHVILI
ARTUR VINOKUROV
5 years in prison; 3 years supervised release; $250,000 fine, or twice gross pecuniary gain/loss
4
Conspiracy to commit identity fraud
18 U.S.C. § 1028(f)
RAZHDEN SHULAYA
ZURAB DZHANASHVILI
TIMUR SUYUNOV
IVAN AFANASYEV
DENIS SAVGIR
VACHE HOVHANNISYAN
DENYS DAVYDOV
EREKLE KERESELIDZE
ALEX MITSELMAKHER
15 years in prison; 3 years supervised release; $250,000 fine, or twice gross pecuniary gain/loss
5
Conspiracy to commit wire fraud
18 U.S.C. 1349
RAZHDEN SHULAYA
AKAKI UBILAVA
HAMLET UGLAVA
EVGHENI MELMAN
DIEGO GABISONIA
LEVAN MAKASHVILI
AVTANDIL KHURTSIDZE
20 years in prison; 3 years’ supervised release; $250,000 fine, or twice gross pecuniary gain/loss
6
Narcotics conspiracy
21 U.S.C. § 846
GIORGI LOMISHVILI
BAKAI MARAT-UULU
ANDRIY PETRUSHYN
40 years in prison; mandatory 5 five years in prison; mandatory 4 years supervised release; the greater of $5,000,000 or twice the gross loss/gain
7
Obstruction of justice
18 U.S.C. § 1001
YURIY LERNER
5 years in prison; 3 years supervised release; $250,000 fine
DEFENDANT
AGE
RESIDENCE
Razhden Shulaya
a/k/a “Brother”
a/k/a “Roma”
40
Edgewater, NJ
Zurab Dzhanashvili
a/k/a “Zura”
37
Brooklyn, NY
Avtandil Khurtsidze,
a/k/a “the Kickboxer”
33
Brooklyn, NY
Akaki Ubilava
a/k/a “Ako”
32
Brooklyn, NY
Hamlet Uglava
39
Brooklyn, NY
Mamuka Chaganava
38
Brooklyn, NY
Mikheil Toradze
36
Brooklyn, NY
Avtandil Kanadashvili
36
Brooklyn, NY
Nazo Gaprindashvili
a/k/a “Anna”
33
Brooklyn, NY
Artur Vinokurov
a/k/a “Rizhy”
37
Brooklyn, NY
Evgheni Melman
22
Brooklyn, NY
Timur Suyunov
28
Brooklyn, NY
Zurab Buziashvili
37
Manhattan, NY
Giorgi Lomishvili
29
Brooklyn, NY
Azer Arslanouk
27
Brooklyn, NY
Ivan Afanasyev
a/k/a “Vanya”
59
Brooklyn, NY
Denis Savgir
34
Brooklyn, NY
Bakai Marat-Uulu
25
Brooklyn, NY
Andriy Petrushyn
24
Brooklyn, NY
Diego Gabisonia
28
Brooklyn, NY
Levan Makashvili
28
Brooklyn, NY
Semyon Saraidarov
a/k/a “Sammy”
50
Rego Park, NY
Vache Hovhannisyan
30
Brooklyn, NY
Denys Davydov
32
Brooklyn, NY
Erekle Kereselidze
23
Brooklyn, NY
Alex Mitselmakher
a/k/a “Globus”
44
Brooklyn, NY
Yuriy Lerner
a/k/a “Yuri”
44
Brooklyn, NY
United States v. Fishman, et al.
COUNT
CHARGE
DEFENDANTS
MAX. PENALTIES
1
Conspiracy to transport, receive, and sell contraband cigarettes
18 U.S.C. § 371
ALEX FISHMAN
KOSTYANTYN MELNYK
STEVEN FISHMAN
5 years in prison; 3 years supervised release; $250,000 fine, or twice gross pecuniary gain/loss
DEFENDANT
AGE
RESIDENCE
ALEX FISHMAN
51
Brooklyn, NY
KOSTYANTYN MELNYK
54
Brooklyn, NY
STEVEN FISHMAN
23
Brooklyn, NY
United States v. Jikia, et al.
COUNT
CHARGE
DEFENDANTS
MAX. PENALTIES
1
Murder for hire conspiracy
18 U.S.C. § 1958
NIKOLOZ JIKIA
BAKAI MARAT-UULU
10 years in prison
2
Possession of firearms in furtherance of a crime of violence
18 U.S.C. § 924
Life in prison
3
Conspiracy to sell firearms to a felon
18 U.S.C. § 371
5 years in prison
DEFENDANT
AGE
RESIDENCE
NIKOLOZ JIKIA
26
Brooklyn, NY
BAKAI MARAT-UULU
25
Brooklyn, NY
United States v. Gindinov
COUNT
CHARGE
DEFENDANTS
MAX. PENALTIES
1
Narcotics conspiracy
18 U.S.C. § 846
SERGEY GINDINOV
40 years in prison; mandatory 5 five years in prison; mandatory 4 years supervised release; the greater of $5,000,000 or twice the gross loss/gain
DEFENDANT
AGE
RESIDENCE
SERGEY GINDINOV
48
Brooklyn, NY
[1] As the introductory phrase signifies, the entirety of the text of the Indictments and Complaint, and the description of the Indictments and Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
Shalom Lamm Pleads Guilty in White Plains Federal Court to Conspiracy to Corrupt the Electoral Process in BloomingburgRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, today announced that SHALOM LAMM pled guilty to conspiracy to corrupt the electoral process, in connection with an election in Bloomingburg, New York. LAMM pled guilty earlier today before United States District Judge Vincent Briccetti in White Plains federal court.
Acting Manhattan U.S. Attorney Joon H. Kim said: “As he has now admitted, Shalom Lamm conspired to advance his real estate development project by corrupting the democratic process, specifically by falsely registering voters. The integrity of our electoral process must be inviolate at every level; our democracy depends on it.”
According to the allegations contained in the Indictment, as well as statements made in related court filings and proceedings:
Starting in 2006, SHALOM LAMM, a real estate developer, sought to build and sell real estate in Bloomingburg, New York. From these real estate development projects, LAMM and others hoped for and anticipated making hundreds of millions of dollars. But by late 2013, the first of their real estate developments had met local opposition, and still remained under construction and uninhabitable. When met with resistance, rather than seek to advance their real estate development project through legitimate means, LAMM and others instead decided to corrupt the democratic electoral process in Bloomingburg by falsely registering voters and paying bribes for voters who would help elect public officials favorable to their project.
Specifically, in advance of an election in March 2014 for Mayor of Bloomingburg and other local officials, LAMM and others, and people working on their behalf, developed and worked on a plan to falsely register numerous people who were not entitled to register and vote in Bloomingburg because they actually lived elsewhere. Those people included some who never intended to live in Bloomingburg, some who had never kept a home in Bloomingburg, and indeed, some who had never set foot in Bloomingburg in their lives. LAMM and others took steps to cover up their scheme to register voters who did not actually live in Bloomingburg by, among other things, creating and back-dating false leases and placing items like toothbrushes and toothpaste in unoccupied apartments to make it seem as if the falsely registered voters lived there.
LAMM and others also bribed potential voters by offering payments, subsidies, and other items of value to get non-residents of Bloomingburg to register unlawfully and vote there.
* * *
LAMM, 57, of Bloomingburg, New York, pled guilty to one count of conspiracy to corrupt the electoral process, which carries a maximum sentence of five 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.
LAMM's sentencing is scheduled for September 28, 2017, at 10:00 a.m.
Co-defendant Kenneth Nakdimen pled guilty on May 25, 2017, to one count of conspiracy to corrupt the electoral process. His sentencing is scheduled for September 7, 2017, at 2:00 p.m.
Mr. Kim praised the outstanding investigative work of the FBI-Hudson Valley White Collar Crime Task Force, the Sullivan County District Attorney’s Office, the Sullivan County Sherriff’s Office, the Orange County Sheriff’s Office, the Orange County District Attorney’s Office, the Internal Revenue Service, and the United States Postal Inspection Service. Mr. Kim also thanked the Department of Justice’s Public Integrity Section, Election Crimes Branch, for its assistance in the case.
This case is being handled by the Office’s White Plains Division. Assistant United States Attorneys Kathryn Martin, Benjamin Allee, and Perry Carbone are in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the remaining charged defendant is presumed innocent unless and until proven guilty.
Two Bloods Gang Member Brothers Sentenced in Manhattan Federal Court, One for Committing A 2005 MurderRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that brothers BURNELL SCOTT, a/k/a “B.U.,” and BURCHANTI SCOTT, a/k/a “Napp,” were sentenced in Manhattan federal court today. BURCHANTI SCOTT was sentenced to 11 years in prison for distributing heroin, while BURNELL SCOTT was sentenced to 25 years in prison in connection with the 2005 drug-related murder of Kason Pinnick, a/k/a “Marijuana” (“Pinnick”) in Paterson, New Jersey. U.S. District Judge Laura Taylor Swain imposed both sentences.
Acting U.S. Attorney Joon H. Kim said: “As they admitted in their guilty pleas, Burnell and Burchanti Scott, brothers and longtime members of the Bloods street gang, distributed heroin and used violence to protect their drug distribution territory. Burnell Scott in fact shot and killed Kason Pinnick over a territorial dispute in Paterson, New Jersey. Today, each brother was sentenced to the lengthy prison term their crimes merit.”
BURCHANTI SCOTT previously pled guilty to participating in a conspiracy to distribute and possess with the intent to distribute more than 100 grams of heroin.
BURNELL SCOTT previously pled guilty to participating in a conspiracy to distribute and possess with the intent to distribute more than one kilogram of heroin.
According to the indictments and the felony information previously filed in Manhattan federal court, and public information:
BURNELL SCOTT, a long-time member of the G-Shine set of the Bloods street gang, was arrested on October 30, 2013, in Paterson, New Jersey. On February 24, 2016, SCOTT pled guilty to participating in a conspiracy to distribute and possess with the intent to distribute more than one kilogram of heroin, from 2005 through 2014. SCOTT admitted that, as part of the charged narcotics distribution offense, he and his co-conspirators were engaged in an ongoing dispute concerning, inter alia, drug distribution territory in Paterson. In connection with that ongoing dispute, on or about September 28, 2005, SCOTT encountered Pinnick in the vicinity of Twelfth Avenue and East 23rd Street, in Paterson. SCOTT pulled out a firearm, and discharged multiple rounds at Pinnick at point-blank range, striking Pinnick in the head, and killing him.
BURCHANTI SCOTT, the brother of BURNELL SCOTT and a high-ranking member of the Fruit Town Brims set of the Bloods street gang, who used violence or the threat of violence to protect his drug distribution territory, was writted into federal custody on March 18, 2014, from the New Jersey Department of Corrections, where he was incarcerated. On August 17, 2016, BURCHANTI SCOTT pled guilty to participating in a conspiracy to distribute and possess with the intent to distribute more than 100 grams of heroin, from 2012 through 2014.
* * *
Mr. Kim praised the outstanding investigative work of the Federal Bureau of Investigation (“FBI”) Safe Streets Task Force, Newark Division, the Paterson Police Department, the Passaic County Prosecutor’s Office, the Clifton Police Department, and the New Jersey State Police.
The Office’s Violent and Organized Crime Unit is overseeing the case. Assistant U.S. Attorney Justina L. Geraci is in charge of the prosecution.
Member of Bronx Gang Sentenced to 42 Years in Prison for Murder, Racketeering, and Drug TraffickingRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced today that JAMES CAPERS, a/k/a “Mitch,” was sentenced to 42 years in prison for the murder of Allen McQueen and participating in racketeering and narcotics conspiracies, all in connection with a violent street gang known as the “Leland Avenue Crew,” which is based primarily in and around the New York City’s 43rd Precinct in the Bronx, New York. The sentence was imposed by United States District Judge William H. Pauley III, after CAPERS was convicted following a jury trial in December 2016.
Acting Manhattan U.S. Attorney Joon H. Kim said: “Gangs do enormous damage to our communities through drug dealing and the violence that often accompanies it. Today, James Capers, a gang member who sold drugs and participated in that violence, was sentenced to 42 years in prison for the horrific murder of a rival gang member, whom Capers shot and killed while the victim was holding his one-year-old daughter. Our Office remains committed to eradicating senseless violence from our city streets.”
According to the Indictment and other documents filed in the case, as well as evidence presented at trial and statements made during the sentencing proceedings:
CAPERS was a member of the Leland Avenue Crew, which controlled the distribution of crack cocaine in and around Leland Avenue in the Bronx, New York. As a member of the Crew, CAPERS sold crack cocaine and marijuana, carried weapons, and committed robberies of unsuspecting members of the public. To protect its drug-selling turf, the Leland Avenue Crew engaged in a long-running dispute with members of a rival gang based two streets over on Taylor Avenue. This dispute resulted in multiple shootings, some of which were fatal. On or about July 7, 2015, in connection with the ongoing dispute between Leland and Taylor, CAPERS went looking for Allen McQueen, a rival gang member on Taylor Avenue. After finding McQueen, who was walking down the street holding his one-year-old daughter, CAPERS ran up behind McQueen and fired several shots, striking McQueen once and killing him.
* * *
Mr. Kim praised the extraordinary investigative work of the New York City Police Department, the Drug Enforcement Administration, and Homeland Security Investigations. He also thanked the Bronx County District Attorney’s Office for their participation and support in this case.
The case is being handled by the Office’s Violent and Organized Crime Unit. Assistant United States Attorneys Scott Hartman, Jessica Lonergan, and Jason Swergold are in charge of the prosecution.
School Security Guard Charged in White Plains Federal Court with Four Murders in Connection with Cocaine Distribution ConspiracyRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), George P. Beach II, the Superintendent of the New York State Police (“NYSP”), and Peter J. Graziano Jr., Chief of the Village of Chester Police Department (“Chester PD”), announced the arrest of JOSEPH BIGGS, a security guard at a school in Hastings-On-Hudson, New York, for a quadruple murder committed in Chester, New York in April 2016. BIGGS was charged in a 17-count Superseding Indictment, along with NICHOLAS TARTAGLIONE, a retired police officer who was previously arrested and charged in this case, for their participation in a conspiracy to distribute five kilograms and more of cocaine and for the murders of Martin Luna, Urbano Santiago, Miguel Luna, and Hector Gutierrez in furtherance of that conspiracy. The new indictment also includes firearms and kidnapping charges against both defendants in connection with the murders.
Acting U.S. Attorney Joon H. Kim stated: “As alleged, Joseph Biggs, a school security officer, participated in the brutal drug-related kidnapping and murder of four people in a bar in Chester, New York. Biggs allegedly committed these cold-blooded crimes with Nicholas Tartaglione, a retired police officer. Murders are always frightening, but when allegedly committed by people entrusted with the safety of others, it is all the more disturbing.”
FBI Assistant Director-in-Charge William F. Sweeney Jr. stated: “The FBI and our law enforcement partners in this investigation are following leads wherever they take us, and we will continue to search out any information that will help us solve the case. We are purposefully methodical, and careful about gathering facts and evidence, and we won’t stop until we bring to justice all of those responsible for the murders of these four men.”
NYSP Superintendent George P. Beach II said: “I praise the work of law enforcement in bringing these two suspected men to justice. Illicit drugs can not only be fatal to their users, but the crimes that surround these illegal operations are deadly and dangerous to our communities. With these two alleged actors charged, dangerous drugs are not making it to our streets, and those streets are now safer. The State Police pledge to continue to work and partner with other law enforcement agencies. The work we are doing will make a difference in the lives of the people we serve.”
Village of Chester Police Chief Peter J. Graziano Jr. said: “We are fortunate and humbled to be able to work with such talented people as a team in the arrest of Mr. Biggs in connection with the unspeakable and callous murder of these victims. That Mr. Bigs is alleged to be involved in a case such as this and be entrusted with the safety of children defies explanation.”
As alleged in the Indictment filed today in White Plains federal court[1]:
From at least in or about June 2015 up to and including April 2016, NICHOLAS TARTAGLIONE, JOSEPH BIGGS, and others conspired to sell five kilograms or more of cocaine. In April 2016, NICHOLAS TARTAGLIONE and JOSEPH BIGGS participated in the killing of Martin Luna, Urbano Santiago, Miguel Luna, and Hector Gutierrez in furtherance of that cocaine distribution conspiracy. Specifically, on April 11, 2016, TARTAGLIONE and BIGGS lured Martin Luna to a bar called the Likquid Lounge in Chester, New York under false pretenses, where he was held captive and killed. The other three victims – Urbano Santiago, Miguel Luna, and Hector Gutierrez – accompanied Martin Luna to the bar, where they were then held captive, shot, and killed.
* * *
JOSEPH BIGGS, 55, of Nanuet, New York, was taken into federal custody this morning. BIGGS was presented in White Plains federal court today before U.S. Magistrate Judge Judith McCarthy and ordered detained. His case has been assigned to United States District Judge Kenneth M. Karas. NICHOLAS TARTAGLIONE was previously arrested on December 19, 2016, and has been detained in federal custody since that date.
A chart containing the charges and maximum penalties the defendants face is attached. 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. Kim praised the outstanding investigative work of the FBI, the New York State Police, and the Village of Chester Police Department. Mr. Kim also thanked the City of Middletown Police Department for its assistance in the case.
This case is being handled by the Office’s White Plains Division. Assistant United States Attorneys Maurene Comey and Michael Gerber 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.
United States v. Nicholas Tartaglione and Joseph Biggs, S3 16 Cr. 832 (KMK)
COUNT
CHARGES
MAXIMUM PENALTIES
1
Conspiracy to distribute and possess with intent to distribute 5 kilograms or more of cocaine.
Life in prison
Mandatory minimum:
10 years in prison2
Murder of Martin Luna in furtherance of a conspiracy to distribute 5 kilograms or more of cocaine.
Life in prison or death
Mandatory minimum:
20 years in prison3
Murder of Urbano Santiago in furtherance of a conspiracy to distribute 5 kilograms or more of cocaine.
Life in prison or death
Mandatory minimum:
20 years in prison
4
Murder of Miguel Luna in furtherance of a conspiracy to distribute 5 kilograms or more of cocaine.
Life in prison or death
Mandatory minimum:
20 years in prison
5
Murder of Hector Gutierrez in furtherance of a conspiracy to distribute 5 kilograms or more of cocaine.
Life in prison or death
Mandatory minimum:
20 years in prison
6
Use of a firearm in furtherance of drug trafficking crime resulting in the death of Urbano Santiago.
Life in prison or death
Mandatory minimum:
10 years in prison
7
Use of a firearm in furtherance of drug trafficking crime resulting in the death of Miguel Luna.
Life in prison or death
Mandatory minimum:
10 years in prison
8
Use of a firearm in furtherance of drug trafficking crime resulting in the death of Hector Gutierrez.
Life in prison or death
Mandatory minimum:
10 years in prison
9
Kidnapping conspiracy.
Life in prison
10
Kidnapping resulting in the death of Martin Luna.
Life in prison or death
Mandatory minimum:
Life in prison
11
Kidnapping resulting in the death of Urbano Santiago.
Life in prison or death
Mandatory minimum:
Life in prison
12
Kidnapping resulting in the death of Miguel Luna.
Life in prison or death
Mandatory minimum:
Life in prison
13
Kidnapping resulting in the death of Hector Gutierrez.
Life in prison or death
Mandatory minimum:
Life in prison
14
Travel or use of interstate facility with intent to commit crime of violence, resulting in death of Martin Luna.
Life in prison
15
Travel or use of interstate facility with intent to commit crime of violence, resulting in death of Urbano Santiago.
Life in prison
16
Travel or use of interstate facility with intent to commit crime of violence, resulting in death of Miguel Luna.
Life in prison
17
Travel or use of interstate facility with intent to commit crime of violence, resulting in death of Hector Gutierrez.
Life in prison
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the descriptions of the Indictment set forth below constitute only allegations, and every fact described should be treated as an allegation.
Drug Dealer Charged with Heroin Overdose Deaths in the Bronx and New RochelleRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, James P. O’Neill, the Commissioner of the New York City Police Department (“NYPD”), and Patrick Carroll, the Commissioner of the New Rochelle Police Department (“NRPD”), announced the arrest of and unsealing of an indictment against FRANKIE BEQIRAJ charging him with conspiracy to distribute heroin, cocaine, oxycodone, and alprazolam. The indictment alleges that heroin distributed by BEQIRAJ and his co-conspirators resulted in the deaths of Robert Vivolo and Leonides Madrid.
BEQIRAJ was presented in federal court in Manhattan before U.S. Magistrate Judge Barbara C. Moses today and ordered detained. The case has been assigned to U.S. District Judge Richard M. Berman.
Acting U.S. Attorney Joon H. Kim stated: “As alleged in the Indictment, Frankie Beqiraj worked with others to sell a whole range of drugs, including heroin, cocaine, oxycodone, and alprazolam. As alleged, two young people are dead, victims of Beqiraj’s alleged heroin dealing and of the opioid epidemic that is sweeping the country. Thanks to the exceptional work of our partners at the New York City Police Department, the New Rochelle Police Department, and the Westchester County District Attorney’s Office, Beqiraj will be held accountable for the drugs he allegedly peddled and the tragic deaths that resulted.”
NYPD Commissioner James P. O’Neill stated: “The defendant in this case faces a mandatory minimum sentence of 20 years in prison – and a maximum of life behind bars – after investigators linked the heroin that he distributed to two overdose deaths, one in the Bronx and one in New Rochelle. It is the latest example of our commitment to holding drugs dealers criminally responsible. I want to thank the NYPD and the New Rochelle PD investigators, as well as the Southern District, for their work on this case.”
NRPD Commissioner Patrick Carroll stated: “The arrest and indictment of Frankie Beqiraj, holding him accountable for the death of New Rochelle resident Leonides Madrid, is an example of the New Rochelle Police Department’s commitment to fight against the opioids epidemic that our community faces today. Working collaboratively with our law enforcement partners, the NYPD, the Westchester County District Attorney’s Office, and the United States Attorney sends a strong message to drug dealers that we will do all we can to arrest and prosecute those selling drugs in our community.”
As alleged in the Indictment against BEQIRAJ [1]:
From July 2016 up to January 2017, in the Southern District of New York and elsewhere, FRANKIE BEQIRAJ and others conspired to sell one kilogram and more of heroin, as well as cocaine, oxycodone, and alprazolam. The use of heroin distributed by BEQIRAJ and his co-conspirators resulted in the deaths of Robert Vivolo, 25, of the Bronx, New York, on October 21, 2016, and of Leonides Madrid, 28, of New Rochelle, New York, on January 9, 2017.
* * *
FRANKIE BEQIRAJ, 27, faces a maximum sentence of life in prison, and a mandatory sentence of 20 years in prison.
The statutory maximum sentence is prescribed by Congress and is provided here for information purposes only, as any sentencing of the defendant would be determined by the judge.
Mr. Kim praised the outstanding investigative work of the NYPD, the NRPD, and the Westchester County Overdose Response Initiative. Mr. Kim thanked the Westchester County District Attorney’s Office for its assistance in the investigation.
This matter is being handled by the Office’s Narcotics Unit. Assistant United States Attorneys David W. Denton Jr. and Elizabeth Hanft 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.
Chairman and CEO of Purported Oil and Gas Company Charged in Manhattan Federal Court with $300 Million International Fraud SchemeRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that RAHEEM J. BRENNERMAN, a/k/a “Jefferson R. Brennerman,” a/k/a “Ayodeji Soetan,” has been charged with conspiracy to commit bank and wire fraud, bank fraud, wire fraud, and visa fraud in connection with a wide-ranging international scheme to fraudulently obtain multimillion-dollar business loans for several companies controlled by BRENNERMAN, including The Blacksands Pacific Group, Inc. BRENNERMAN was arrested yesterday in New Jersey, presented today before United States District Judge Richard Sullivan, and ordered detained.
Acting Manhattan U.S. Attorney Joon H. Kim said: “As alleged, for years Raheem J. Brennerman conned financial institutions and investors into extending loans to his phony businesses. Instead of using that money on actual business deals, Brennerman spent millions on himself, paying personal expenses including on international travel, luxury hotels and fine jewelry. Having perpetrated this multi-million dollar fraud, Brennerman allegedly took elaborate steps to cover it up. We thank our law enforcement partners for their excellent work in uncovering this fraud.”
According to the allegations in the Indictment[1] unsealed today in Manhattan federal court:
BRENNERMAN, from at least in or about 2011, has orchestrated a scheme to defraud financial institutions through his operation of a purported oil and gas company called The Blacksands Pacific Group, Inc. (“Blacksands Pacific”), as well as several subsidiaries and associated corporate entities. BRENNERMAN sought financing for purported business deals by falsely representing that Blacksands Pacific had significant worldwide involvement in the exploration and development of oil and gas reserves, produced over 10,000 barrels of oil per day, had over $1 billion in long-term assets and over 100 million barrels of proved oil reserves, and employed approximately 100 employees, when, in fact, BRENNERMAN knew that Blacksands Pacific lacked any long-term assets, and had, at most, a few employees and minimal involvement in the oil and gas industry. As part of the fraudulent scheme, BRENNERMAN also lied about his name, place of birth, citizenship, and finances, and invented fake employees. Once BRENNERMAN received financing from victims based on his false statements, BRENNERMAN used significant amounts of the money to pay his own personal expenses, including the lease of a luxury condominium in Las Vegas, Nevada, and stays at expensive hotels (including thousands of dollars’ worth of in-room dining service), as well as the purchase of international flights to Europe, chartered car services, fine jewelry, high-end designer clothing, and spa treatments. In total, BRENNERMAN attempted to defraud financial institutions of more than $300 million.
* * *
BRENNERMAN, 39, of Las Vegas, Nevada, is charged with one count of conspiracy to commit bank and wire fraud and one count of bank fraud, each of which carries a maximum sentence of 30 years in prison; one count of wire fraud, which carries a maximum sentence of 20 years in prison; and one count of visa fraud, which carries a maximum sentence of 10 years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Kim praised the outstanding investigative work of the Criminal Investigators for the United States Attorney’s Office for the Southern District of New York. He also thanked the United States Department of State’s Diplomatic Security Service, United States Immigration and Customs Enforcement’s Homeland Security Investigations, the United States Postal Inspection Service, the United States Attorney’s Office for the Central District of California, and the United States Attorney’s Office for the District of Nevada for their assistance.
On March 3, 2017, BRENNERMAN and Blacksands Pacific were charged in a separate case in Manhattan federal court with criminal contempt of court. That case is pending before United States District Judge Lewis A. Kaplan and is scheduled for trial on September 7, 2017.
* * *
If you have any information regarding BRENNERMAN, please report it by phone at 212-637-2267 or by email at [email protected].
This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorneys Nicolas Landsman-Roos and Robert B. Sobelman 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.
Bronx Man Sentenced to 18 Years in Prison for Sex Trafficking of Minors and Related OffensesRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that DAVID HOPE, a/k/a “Capo,” was sentenced yesterday to 18 years in prison for running a criminal sex trafficking and prostitution enterprise involving minor girls, as well as possession of child pornography and possession of a firearm as a convicted felon. In addition, KEMAR WILLIAMS, a/k/a “K-bag,” a co-defendant in the case, was sentenced yesterday to 42 months in prison for conspiracy to commit sex trafficking of minors with Hope. HOPE and WILLIAMS pled guilty on December 1, 2016, and December 8, 2016, respectively, before United States District Judge Sidney H. Stein, who also imposed yesterday’s sentences.
Acting Manhattan U.S. Attorney Joon H. Kim said: “David Hope sexually exploited and trafficked vulnerable women and minor girls, and Kemar Williams assisted in the exploitation. Hope and Williams used physical violence, weapons, coercion, and intimidation to exert control over their trafficking victims. Both have now received the significant sentences that their crimes deserve.”
According to the Indictment, Complaint, and other documents filed in the case, as well as statements made during the plea and sentencing proceedings:
Since at least 2013, HOPE directed and conducted a criminal sex trafficking and prostitution enterprise (the “Enterprise”) that recruited and exploited minor girls and young women, and then prostituted them using an online classifieds website for his own profit. HOPE, who was wheelchair-bound, operated the Enterprise at his apartment in the Bronx, New York (the “Hope Apartment”), Connecticut, and elsewhere. WILLIAMS participated and engaged in the Enterprise and facilitated the prostitution of minor girls.
HOPE recruited minors who looked up to him to participate in the Enterprise and other criminal activity. HOPE, who was known to carry a firearm, employed myriad tactics – including manipulation, intimidation, coercion, threats, and violence – to recruit and maintain the girls and young women he sold for sex. For example, on at least two occasions, HOPE physically beat one of the adult women he prostituted, and on at least one occasion, threatened that victim with a firearm. At least four minor victims were exploited by HOPE’s Enterprise.
In or about November 2015 when he was arrested, HOPE also possessed on his cellphone a sexually explicit video of one of the minor girls whom he trafficked.
In or about January 2015, HOPE possessed a defaced firearm (the “Firearm”) after he had been previously convicted of a felony crime. Specifically, on January 16, 2015, when New York City Police Department (“NYPD”) officers were executing a search warrant at the Hope apartment, HOPE instructed a minor female to throw the loaded Firearm out the rear window of the HOPE Apartment. Before it was thrown out the window, the Firearm was in the bed where HOPE was sleeping.
* * *
Mr. Kim praised the investigative work of the Federal Bureau of Investigation. He thanked the NYPD for its assistance throughout the investigation, and the United States Attorney’s Office for the District of Connecticut and the Connecticut Child Exploitation Task Force for their assistance with investigating HOPE’s operations in Connecticut. Mr. Kim also thanked the United States Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”) and the ATF/NYPD Joint Robbery Task Force (SPARTA) for its assistance in the early stages of the investigation.
Any individuals who believe they have information concerning the exploitation of children may contact the Federal Bureau of Investigation at 1-212-384-1000 or https://tips.fbi.gov/.
The case is being handled by the Office’s Violent and Organized Crime Unit. Assistant United States Attorney Sagar K. Ravi is in charge of the prosecution.
CEO and President of Premium Ticket Resale Business Charged with Engaging in A Multimillion-Dollar Ponzi Scheme Resulting in Losses of at Least $70 MillionRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and William F. Sweeny Jr., Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that JASON NISSEN was arrested and charged in Manhattan federal court today with defrauding victims of at least $70 million by falsely representing that he was using the victims’ money to further a profitable, multimillion-dollar wholesale ticket business. NISSEN was arrested this morning and will be presented in Manhattan federal court later today.
Acting Manhattan U.S. Attorney Kim said: “Jason Nissen claimed he was investing in premium tickets for events like the Super Bowl, the World Cup and the Broadway hit ‘Hamilton,’ but as alleged, Nissen was actually cheating his investors out of over $70 million and spending it on himself. The veneer of a successful and interesting business was allegedly just that, an alleged cover for a massive Ponzi scheme.”
FBI Assistant Director-in-Charge William F. Sweeney Jr. said: “As charged today, Nissen represented his business as an investment opportunity for those willing to finance the purchase of large quantities of premium tickets to a number of sporting events and entertainment venues. The tickets were supposed to be sold for profit, but they weren’t. As alleged, Nissen eventually defrauded his victims out of at least $70 million collectively, all of which he used in furtherance of his scheme and for his own personal gain. For Nissen, the final quarter didn’t prove as profitable as anticipated; he must now face the penalty for his actions.”
According to the Complaint filed in Manhattan federal court:[1]
Since 2012, NISSEN has operated a ticket resale business (the “Ticket Company”) located in Manhattan, New York, through which NISSEN purchased large quantities of premium tickets for sporting and entertainment events, and then resold such tickets for a profit. NISSEN was the Ticket Company’s chief executive officer and president.
The Ticket Company’s website states that “[The Ticket Company] is an industry leader in providing VIP access and premium tickets to all concerts, Broadway theatre, red carpet premieres and sporting events worldwide . . . the Ticket Company stocks one of the largest revolving inventories for sports, concerts, and theatre worldwide.”
From 2015 to May 2017, NISSEN defrauded multiple victims of tens of millions of dollars through the Ticket Company. NISSEN represented to victims that he would use money lent to him and his ticket business by victims to purchase bulk quantities of premium tickets to sporting and entertainment events such as the Super Bowl, the World Cup, the U.S. Open, and “Hamilton,” and then resell the tickets at a profit. However, in truth and in fact, NISSEN used the victims’ money in large part to repay other victims and to enrich himself.
For example, one victim, referred to as “Victim-2” in the Complaint, gave NISSEN and his ticket business more than $1.9 million to be used for the bulk purchase of tickets to a UFC fight in New York to be resold by NISSEN. Instead of purchasing tickets, NISSEN used the money as follows: (i) he made two cash withdrawals – one for $20,000 and the other for $23,250; (ii) he transferred $383,000 to the bank account of another company he controlled to bring that company’s account balance out of a negative balance of about $382,000 to a positive balance of about $578; and (iii) he transferred $1,500,050 to his personal bank account, which had a balance of $88 at the time, and then that same day, NISSEN transferred $1,500,025 from his personal account to another victim to whom he owed money.
To further perpetuate his fraudulent scheme and to raise additional sums from victims, NISSEN falsified financial documents and inflated accounts receivable ledgers, which NISSEN presented to certain victims as purported proof that their money was being used to purchase premium tickets for resale.
On May 7, 2017, unable to obtain more financing to continue the scheme through existing or new victims, NISSEN admitted to an executive of Victim-2 that he had been operating a Ponzi scheme. When the CFO of Victim-2 asked NISSEN the next day whether a bank document that NISSEN had previously provided to Victim-2 was forged, NISSEN admitted he had fabricated the bank document. When asked how he had done so, NISSEN replied: “Photoshop. Ever hear of it?”
Two days later, on May 10, 2017, NISSEN told another victim, referred to in the Complaint as “Victim-1,” that he had been committing a fraud and that he had fabricated the income numbers of the Ticket Company that he had been reporting to Victim-1.
In total, JASON NISSEN defrauded victims of at least $70 million.
* * *
NISSEN, 44, of Roslyn, New York, has been charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison. The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Kim praised the investigative work of the FBI and noted that the investigation is continuing.
This case is being handled by the Office’s Public Corruption Unit. Assistant United States Attorneys Kan M. Nawaday, Lauren B. Schorr, and Russell Capone are in charge of the prosecution.
The charges contained in the Complaint are merely accusations and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Alleged Street Boss and Underboss of La Cosa Nostra Family Charged with Murder and Racketering Offenses in White Plains Federal CourtRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, William F. Sweeney Jr., Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), Angel M. Melendez, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (“HSI”), James P. O’Neill, Commissioner of the New York City Police Department (“NYPD”), and Walter M. Arsenault, Executive Director of the Waterfront Commission of New York Harbor, announced today the filing of a Superseding Indictment charging 19 members and associates of the Luchese Family of La Cosa Nostra with racketeering, murder, narcotics, and firearms offenses.
The Superseding Indictment builds on charges previously filed against Luchese soldier CHRISTOPHER LONDONIO and Luchese associate TERRENCE CALDWELL, who were charged in February 2017 with racketeering offenses, including the murder of Michael Meldish, a Luchese associate who was killed in the Bronx on November 15, 2013.
The Superseding Indictment charges MATTHEW MADONNA, the alleged street boss of the Luchese Family, STEVEN CREA SR., the alleged underboss of the Family, and STEVEN CREA JR., LONDONIO’s alleged captain in the Family, with ordering the murder of Meldish. The Superseding Indictment also contains additional racketeering charges against MADONNA, CREA SR., and CREA JR., as well as the alleged consigliere of the Luchese Family, JOSEPH DiNAPOLI, and numerous other members and associates of La Cosa Nostra.
Fifteen of the defendants charged were taken into custody today. CHRISTOPHER LONDONIO, TERRENCE CALDWELL, and VINCENT BRUNO were already in federal custody on other charges. MATTHEW MADONNA was already in custody on state charges and was transferred today to federal custody. All defendants arrested today will be presented in White Plains federal court before U.S. Magistrate Judge Judith C. McCarthy this afternoon. The case is assigned to United States District Judge Cathy Seibel, who will hold an initial conference on Thursday, June 1, 2017, at 2:00 p.m.
Acting U.S. Attorney Joon H. Kim said: “As today’s charges demonstrate, La Cosa Nostra remains alive and active in New York City, but so does our commitment to eradicate the mob’s parasitic presence. We have charged 19 members and associates of the Luchese Crime Family, including its entire administration – the street boss, underboss and consigliere – with serious racketeering offenses. The defendants allegedly used violence and threats of violence, as the mob always has, to make illegal money, to enforce discipline in the ranks, and to silence witnesses. The mob members and associates charged today will answer for their alleged misdeeds in a court of law.”
FBI Assistant Director-in-Charge William F. Sweeney Jr. said: “Organized crime families believe their way of life is acceptable and continue to show through their criminal behavior that they don’t plan to stop. Their crimes aren’t victimless, and this case proves they’re willing to use murder and many other violent tactics to enforce their dominance. The FBI/NYPD Joint Organized Crime Task Force and our other law enforcement partners, who have done exceptional work in this case, don’t plan to stop our pursuit of these crime families because they have a direct negative impact on communities and neighborhoods where they operate.”
HSI Special Agent in Charge Angel M. Melendez said: “The Luchese Family and its associates are alleged to be linked to guns, drugs, racketeering, and murder. They are also alleged to have used their criminal enterprise to launder money, tamper with witnesses and extortion. It is clear that this ‘family’ business is of no benefit to its community or to this great city. HSI will continue to strengthen its partnership with the FBI and NYPD to ensure that alleged criminals like the Luchese Family face the consequences of their actions.”
NYPD Commissioner James P. O’Neill said: “The allegations and extent of the criminal behavior are extraordinary. The Luchese Family operated with seeming impunity, allegedly carrying out murder, robberies, extortion, among a myriad of other charges unsealed today. We will not stop until violence has been eradicated – be it from a street gang or the mob.”
Waterfront Commission Executive Director Walter M. Arsenault said: “The Waterfront Commission will continue to work with all of its law enforcement partners to eliminate Organized Crime wherever it is found.”
According to the allegations in the Superseding Indictment[1], which was filed in White Plains federal court on May 24, 2017, and was unsealed today:
La Cosa Nostra or “the Mafia” is a criminal organization composed of leaders, members, and associates who work together and coordinate to engage in criminal activities.
La Cosa Nostra operates through entities known as “Families.” In the New York City area, those families include the Genovese, Gambino, Luchese, Bonanno, Colombo, and Decavalcante Families. Each Family operates through groups of individuals known as “crews” and “regimes.” Each “crew” has as its leader a person known as a “Caporegime,” “Capo,” “Captain,” or “Skipper,” who is responsible for supervising the criminal activities of his crew and providing “Soldiers” and associates with support and protection. In return, the Capo typically receives a share of the illegal earnings of each of his crew’s Soldiers and associates, which is sometimes referred to as Atribute.@
Each crew consists of “made” members, sometimes known as “Soldiers,” “wiseguys,” “friends of ours,” and “good fellows.” Soldiers are aided in their criminal endeavors by other trusted individuals, known as “associates,” who sometimes are referred to as “connected” or identified as “with” a Soldier or other member of the Family. Associates participate in the various activities of the crew and its members. In order for an associate to become a made member of the Family, the associate must first be of Italian descent and typically needs to demonstrate the ability to generate income for the Family and/or the willingness to commit acts of violence.
At most times relevant to the charges in the Superseding Indictment, MATTHEW MADONNA was the street boss of the family – that is, the individual who managed the affairs of the Family on behalf of the formal boss, who is serving a life sentence in federal prison. STEVEN CREA SR., a/k/a “Wonder Boy,” was the Underboss of the Luchese Family, and JOSEPH DINAPOLI was the Consigliere of the Luchese Family. Additionally, STEVEN CREA JR., DOMINIC TRUSCELLO, JOHN CASTELUCCI, a/k/a “Big John,” and TINDARO CORSO, a/k/a “Tino,” were Captains or Acting Captains in the Luchese Family. JOSEPH VENICE, JAMES MAFFUCCI, a/k/a “Jimmy the Jew,” JOSEPH DATELLO, a/k/a “Big Joe,” a/k/a “Joey Glasses,” PAUL CASSANO, a/k/a “Paulie Roast Beef,” and CHRISTOPHER LONDONIO were Soldiers in the Luchese Family.
The Superseding Indictment alleges that from at least in or about 2000 up to and including in or about 2017, MATTHEW MADONNA, STEVEN CREA SR., JOSEPH DINAPOLI, STEVEN CREA JR., DOMINIC TRUSCELLO, JOHN CASTELUCCI, TINDARO CORSO, JOSEPH VENICE, JAMES MAFFUCCI, JOSEPH DATELLO, PAUL CASSANO, CHRISTOPHER LONDONIO, TERRENCE CALDWELL, a/k/a “T,” VINCENT BRUNO, BRIAN VAUGHAN, CARMINE GARCIA, a/k/a “Spanish Carmine,” RICHARD O’CONNOR, ROBERT CAMILLI, and JOHN INCATASCIATO, along with other members and associates of La Cosa Nostra, committed a wide array of crimes in connection with their association with the mafia, including murder, attempted murder, assault, robbery, extortion, gambling, narcotics trafficking, witness tampering, fraud, money laundering, and trafficking in contraband cigarettes.
Of particular significance, on or about November 15, 2013, MADONNA, CREA SR. CREA JR., LONDONIO, and CALDWELL murdered and procured the murder of Michael Meldish in order to maintain or increase their status in La Cosa Nostra.
The Superseding Indictment also alleges the following additional violent incidents:
In late 2012, PAUL CASSANO and VINCENT BRUNO, acting at the direction of CREA SR. and CREA JR., attempted to murder a mafia associate who had shown disrespect toward CREA SR.
As charged in the initial Indictment, on May 29, 2013, TERRENCE CALDWELL attempted to murder a Bonanno Soldier in the vicinity of First Avenue and 111th Street, in Manhattan.
In or about October 2016, STEVEN CREA SR. and JOSEPH DATELLO attempted to murder a witness who had previously provided information regarding the activities of La Cosa Nostra to state and federal law enforcement.
* * *
A chart containing the ages, residency information, and charges against the defendants, as well as the maximum penalties they face, is attached.
Mr. Kim praised the outstanding investigative work of the FBI’s Organized Crime Task Force, which comprises agents and detectives of the FBI, NYPD, Homeland Security Investigations, and the Waterfront Commission of New York Harbor. He also thanked the Bronx County District Attorney’s Office, the New York County District Attorney’s Office, the Queens County District Attorney’s Office, the New York State Inspector General's Office, the Chesterfield County (VA) Police Department, and the Guardia Civil (Spain). He added that the investigation is continuing.
Assistant U.S. Attorneys Scott Hartman, Hagan Scotten, and Jacqueline Kelly are in charge of the prosecution. The case is being handled by the Office’s Violent and Organized Crime Unit and White Plains Division.
The charges contained in the Superseding Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
United States v. Mathew Madonna, et al., S1 17 Cr. 89 (CS)
DEFENDANT
AGE
CITY OF RESIDENCE
CHARGES
MAX SENT.
Madonna, Matthew
81
Incarcerated
18 U.S.C. § 924(c)
18 U.S.C. § 924(j)
18 U.S.C. § 1959(a)(1)
18 U.S.C. § 1959(a)(5)
18 U.S.C. § 1962(d)
Life
Crea, Sr., Steven
69
Crestwood, NY
18 U.S.C. § 924(c)
18 U.S.C. § 924(j)
18 U.S.C. § 1959(a)(1)
18 U.S.C. § 1959(a)(3)
18 U.S.C. § 1959(a)(5)
18 U.S.C. § 1962(d)
Life
DiNapoli, Joseph
81
Bronx, NY
18 U.S.C. § 924(c)
18 U.S.C. § 1962(d)
Life
Crea, Jr., Steven
45
New Rochelle, NY
18 U.S.C. § 924(c)
18 U.S.C. § 924(j)
18 U.S.C. § 1959(a)(1)
18 U.S.C. § 1959(a)(3)
18 U.S.C. § 1959(a)(5)
18 U.S.C. § 1962(d)
Life
Truscello, Dominic
83
Staten Island, NY
18 U.S.C. § 924(c)
18 U.S.C. § 1962(d)
Life
Castelucci, John
57
Staten Island, NY
18 U.S.C. § 924(c)
18 U.S.C. § 1962(d)
Life
Corso, Tindaro
56
Staten Island, NY
18 U.S.C. § 924(c)
18 U.S.C. § 1962(d)
Life
Venice, Joseph
56
Yonkers, NY
18 U.S.C. § 924(c)
18 U.S.C. § 1962(d)
Life
Maffucci, James
69
Manhattan, NY
18 U.S.C. § 924(c)
18 U.S.C. § 1962(d)
21 U.S.C. § 846
Life
Datello, Joseph
66
Staten Island, NY
18 U.S.C. § 924(c)
18 U.S.C. § 1959(a)(3)
18 U.S.C. § 1962(d)
21 U.S.C. § 846
Life
Londonio, Christopher
43
Incarcerated
18 U.S.C. § 924(c)
18 U.S.C. § 924(j)
18 U.S.C. § 1959(a)(1)
18 U.S.C. § 1959(a)(5)
18 U.S.C. § 1962(d)
21 U.S.C. § 846
Life
Cassano, Paul
38
Yonkers, NY
18 U.S.C. § 924(c)
18 U.S.C. § 1959(a)(3)
18 U.S.C. § 1962(d)
Life
Caldwell, Terrence
59
Incarcerated
18 U.S.C. § 924(c)
18 U.S.C. § 924(j)
18 U.S.C. § 1959(a)(1)
18 U.S.C. § 1959(a)(3)
18 U.S.C. § 1959(a)(5)
18 U.S.C. § 1962(d)
Life
Bruno, Vincent
33
Incarcerated
18 U.S.C. § 924(c)
18 U.S.C. § 1959(a)(3)
18 U.S.C. § 1962(d)
Life
Vaughan, Brian
51
Matawan, NJ
18 U.S.C. § 924(c)
18 U.S.C. § 1962(d)
21 U.S.C. § 846
Life
Garcia, Carmine
65
Hawthorne, NJ
18 U.S.C. § 924(c)
18 U.S.C. § 1962(d)
21 U.S.C. § 846
Life
O’Connor, Richard
63
Staten Island, NY
18 U.S.C. § 924(c)
18 U.S.C. § 1962(d)
21 U.S.C. § 846
Life
Camilli, Robert
60
Briarcliff Manor, NY
18 U.S.C. § 1962(d)
20 Years
Incatasciato, John
42
Elmsford, NY
18 U.S.C. § 1962(d)
20 Years
[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.
25 Members and Associates of Bronx Drug-Distribution Organizations Charged with Narcotics, Robbery, and Firearms OffensesRead the Press Release
Joon Kim, the Acting United States Attorney for the Southern District of New York, Darcel Clark, the Bronx County District Attorney, Ashan Benedict, Special Agent-in-Charge of the New York Field Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”), Angel M. Melendez, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (“HSI”) New York, and James P. O’Neill, the Commissioner of the New York City Police Department (“NYPD”), today announced the unsealing of two Indictments charging 25 defendants with a variety of narcotics, firearms, and robbery-related offenses.
Of the 25 defendants, 21 are associated with a drug-distribution organization operating primarily in the Hunts Point neighborhood in the Bronx and are charged in United States v. Hector Palermo, et al. (the “Palermo Indictment”), which has been assigned to U.S. District Judge Gregory H. Woods. Of those defendants, 14 were taken into federal custody today and were presented before Magistrate Judges Barbara C. Moses today. One defendant, FREDERICK BURGOS, was presented in the Eastern District of Pennsylvania. MIGUEL RAMIREZ, FELIX CORDERO SR., KHAALIQ HARRIS, ANGEL BERMUDEZ, ELVIN MALDONADO, AND STEVEN VEGA remain at large.
The remaining four defendants are charged in United States v. Lattine Clark, et al. (the “Clark Indictment”), which has been assigned to U.S. District Judge Vernon S. Broderick. Of those defendants, three were taken into federal custody today and were presented before Magistrate Judges Barbara C. Moses today. One defendant, TREVON NEDD, is currently detained in federal custody on unrelated charges and will be brought into federal custody on a writ.
Manhattan Acting U.S. Attorney Joon Kim said: “One by one, our office, along with our law enforcement partners, is identifying and prosecuting the violent gangs and drug dealing crews operating in the Bronx. These alleged gangs and drug crews – including the ones charged today – bring narcotics, guns, and violence to our neighborhoods. The residents of the communities they harm deserve better.”
ATF Special Agent-in-Charge Ashan Benedict said: “Today's arrests are the culmination of a nearly two-year long investigation by ATF's Joint Firearms Task Force, NYPD, and HSI into alleged narcotics trafficking, armed robberies, and the illicit possession of firearms by criminal elements operating in the Hunts Point area of the Bronx. Through the cooperative efforts of law enforcement, these individuals are off the streets and will face justice in federal court for their alleged crimes. Today it is a better day to be a resident of Hunts Point, and all of us will continue our efforts to ensure it stays that way. I would like to extend my gratitude to the ATF and HSI Special Agents, NYPD Detectives, and Assistant United States Attorneys for their hard work and dedication throughout this investigation.”
HSI Special Agent-in-Charge Angel M. Melendez, said: “It’s a good day when more than two dozen alleged gun-wielding drug pushers are taken off the street. These individuals are alleged to deal crack cocaine and heroin in their own backyards and commit robberies at gunpoint. Today’s arrests are another great example of law enforcement working together in the interest of justice and making our communities safer.”
NYPD Commissioner James P. O’Neill said: “We will continue to pursue those who commit violence in our streets. This morning’s arrest of 25 defendants in the Bronx is just the latest example. I’m thankful to the help and cooperation from our many law enforcement partners in this takedown and many others.”
The Indictments arise from a joint investigation by the NYPD, ATF, and HSI into several drug trafficking organizations operating in the Hunts Point area of the Bronx, New York. As alleged in the Palermo Indictment, the 21 defendants charged in that case are responsible for the distribution of large amounts of crack cocaine and heroin, and used, carried, and possessed firearms in connection with that drug trafficking.
As alleged in the Clark Indictment, LATTINE CLARK, MICHAEL PATTERSON, and TREVON NEDD participated in a conspiracy to distribute crack cocaine in the Hunts Point area, and RUBEN VIZCARRANDO participated in another conspiracy to distribute crack cocaine in Hunts Point. As further alleged, CLARK was a participant in a shootout, during which he fired a gun, in the vicinity of Coster Street and Spofford Avenue, on October 16, 2016. PATTERSON, NEDD, and VIZCARRANDO are all alleged to have participated in a Hobbs Act robbery conspiracy, and a gunpoint Hobbs Act robbery of suspected narcotics traffickers in the Marble Hill area on June 22, 2016, during which robbery PATTERSON and another unnamed co-conspirator fired their weapons.
Count One of the Palermo Indictment unsealed today in Manhattan federal court,[1] charges HECTOR PALERMO, MIGUEL GUZMAN, MIGUEL RAMIREZ, FELIX CORDERO SR., MATTHEW PRESTOL, CHRIS ALICEA, KHAALIQ HARRIS, ADRIAN QUINONES, FREDERICK BURGOS, RAFAEL GONZALEZ, ANGEL BERMUDEZ, JUAN CARLOS RODRIGUEZ, JESUS ANDINO, ELVIN MALDONADO, JOSE AYALA, ESTEBAN MARTINEZ, CHRISTIAN RIVERA, STEVEN VEGA, DENISE ORTIZ, CARMEN ROMAN, and ASHLEY RODRIGUEZ with conspiring to distribute and possess with intent to distribute crack cocaine and heroin.
Count Two charges GUZMAN, RAMIREZ, CORDERO SR., PRESTOL, ALICEA, BURGOS, GONZALEZ, RODRIGUEZ, and VEGA, with using, possessing, and carrying firearms in furtherance of the drug conspiracy charged in Count One.
Count Three charges RAMIREZ with possessing ammunition, which had previously been shipped in interstate commerce, after a prior felony conviction.
Count One of the Clark Indictment unsealed today in Manhattan federal court,[2] charges LATTINE CLARK, TREVON NEDD, and MICHAEL PATTERSON with conspiring to distribute and possess with intent to distribute crack cocaine.
Count Two charges CLARK with using, possessing, and carrying firearms in furtherance of the drug conspiracy charged in Count One.
Count Three charges RUBEN VIZCARRONDO with conspiring to distribute and possess with intent to distribute crack cocaine.
Count Four charges NEDD, PATTERSON, and VIZCARRONDO with participating in a conspiracy to commit Hobbs Act Robbery between 2015 and May 2017. Count Four charges that this conspiracy involved armed robberies of suspected narcotics traffickers and others involved in commercial activities that affected interstate commerce.
Count Five charges NEDD, PATTERSON, and VIZCARRONDO with committing a robbery of suspected narcotics traffickers on June 22, 2016, in the vicinity of Marble Hill, New York.
* * *
Charts containing the names, ages, residences, 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. Kim praised the outstanding investigative work of the NYPD, ATF, and HSI, and expressed gratitude for the coordinated efforts of the NYPD’s Violent Crime Squad and 41st Precinct.
This case is being handled by the Office’s Violent and Organized Crime Unit. Assistant United States Attorneys Sarah Krissoff and Jason A. Richman are in charge of the prosecution.
The charges contained in the Indictments are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
United States v. Hector Palermo, et al.
COUNT
CHARGE
DEFENDANTS
MAX. PENALTIES
1
Narcotics conspiracy
21 U.S.C. § 846
HECTOR PALERMO MIGUEL GUZMAN
MIGUEL RAMIREZ
FELIX CORDERO SR. MATTHEW PRESTOL CHRIS ALICEA
KHAALIQ HARRIS
ADRIAN QUINONES FREDERICK BURGOS RAFAEL GONZALEZ ANGEL BERMUDEZ
JUAN CARLOS RODRIGUEZ
JESUS ANDINO
ELVIN MALDONADO
JOSE AYALA
ESTEBAN MARTINEZ CHRISTIAN RIVERA STEVEN VEGA
DENISE ORTIZ
CARMEN ROMAN
ASHLEY RODRIGUEZ
Life in prison
Mandatory minimum of 10 years in prison
2
Using, carrying, possessing firearms in furtherance of narcotics conspiracy
18 U.S.C. §§ 924(c) and 2
MIGUEL GUZMAN
MIGUEL RAMIREZ
FELIX CORDERO SR.
MATTHEW PRESTOL
CHRIS ALICEA
FREDERICK BURGOS
RAFAEL GONZALEZ
JUAN CARLOS RODRIGUEZ
STEVEN VEGA
Life in prison
Mandatory minimum of 5 years in prison
3
Felon in possession of ammunition
18 U.S.C. §§ 922(g) and 2
MIGUEL RAMIREZ
10 years’ imprisonment
DEFENDANT
AGE
RESIDENCE
HECTOR PALERMO,
a/k/a “Hec”
35
Newark, New Jersey
MIGUEL GUZMAN
29
Bronx, New York
MIGUEL RAMIREZ,
a/k/a “Mickey”
27
Bronx, New York
FELIX CORDERO SR.,
a/k/a “Pops”
50
Bronx, New York
MATTHEW PRESTOL,
a/k/a “Wiz”
19
Bronx, New York
CHRIS ALICEA
18
Bronx, New York
KHAALIQ HARRIS,
a/k/a “Rooster”
21
Bronx, New York
ADRIAN QUINONES,
a/k/a “Five”
24
Bronx, New York
FREDERICK BURGOS,
a/k/a “Flee,”
a/k/a “Lee”
37
Bethlehem, Pennsylvania
RAFAEL GONZALEZ,
a/k/a June”
45
Bronx, New York
ANGEL BERMUDEZ,
a/k/a “Para”
21
Bronx, New York
JUAN CARLOS RODRIGUEZ,
a/k/a “J.C.”
20
Bronx, New York
JESUS ANDINO,
a/k/a “Chico”
32
Bronx, New York
ELVIN MALDONADO,
a/k/a “LV”
30
Bronx, New York
JOSE AYALA
49
Bronx, New York
ESTEBAN MARTINEZ,
a/k/a “Esco”
34
Bronx, New York
CHRISTIAN RIVERA,
a/k/a “Rico”
23
Bronx, New York
STEVEN VEGA,
a/k/a “Nene”
25
Bronx, New York
DENISE ORTIZ
36
Bronx, New York
CARMEN ROMAN
56
Bronx, New York
ASHLEY RODRIGUEZ
20
Bronx, New York
United States v. Lattine Clark, et al.
COUNT
CHARGE
DEFENDANTS
MAX. PENALTIES
1
Narcotics conspiracy
21 U.S.C. § 846
LATTINE CLARK
TREVON NEDD
MICHAEL PATTERSON
Life in prison
Mandatory minimum of 10 years in prison
2
Using, carrying, possessing, brandishing, and discharging firearms
18 U.S.C.
§§ 924(c)(1)(A)(i), (ii), and (iii), 2LATTINE CLARK
Life in prison
Mandatory minimum of 10 years in prison
3
Narcotics conspiracy
21 U.S.C. § 846
RUBEN VIZCARRONDO
Life in prison
Mandatory minimum of 10 years in prison
4
Robbery Conspiracy
18 U.S.C. § 1951
TREVON NEDD
MICHAEL PATTERSON
RUBEN VIZCARRONDO
20 years in prison
5
Robbery
18 U.S.C. § 1951
TREVON NEDD
MICHAEL PATTERSON
RUBEN VIZCARRONDO
20 years in prison
DEFENDANT
AGE
RESIDENCE
LATTINE CLARK,
a/k/a “Dutts”
20
Bronx, New York
TREVON NEDD,
a/k/a “Hat Boy”
31
Federal Custody
MICHAEL PATTERSON
22
Bronx, New York
RUBEN VIZCARRONDO
26
Bronx, New York
[1] As the introductory phrase signifies, the entirety of the text of the Indictments, and the description of the Indictments set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
[2] As the introductory phrase signifies, the entirety of the text of the Indictments, and the description of the Indictments set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
Former Managing Director at New York Broker-Dealer Pleads Guilty in “Pay-To-Play” Bribery Scheme Involving Public Pension FundRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced today that DEBORAH KELLEY, a former managing director of institutional fixed income sales at a New York-based broker-dealer (the “Broker-Dealer”), pled guilty today before U.S. District Judge J. Paul Oetken for participating in a “pay-to-play” bribery scheme involving the New York State Common Retirement Fund (“NYSCRF”), the nation’s third largest public pension fund.
Acting U.S. Attorney Joon H. Kim said: “As she admitted today, Deborah Kelley bribed Navnoor Kang to steer state pension business to her brokerage firm, reaping hundreds of thousands of dollars in additional commissions for the firm. In the process, she was complicit in defrauding New York pensioners and depriving them of Kang’s honest services. The hard-earned retirement savings of New Yorkers should not be a vehicle for corrupt pension administrators and securities brokers to profit.”
According to allegations contained in the Indictment charging KELLEY and statements made during her plea proceeding:
The NYSCRF
The NYSCRF is a pension fund administered for the benefit of public employees of the State of New York. From January 2014 through February 2016, Navnoor Kang served as Director of Fixed Income and Head of Portfolio Strategy for the NYSCRF. In that capacity, Kang was responsible for investing more than $53 billion in fixed-income securities on behalf of the NYSCRF. Kang owed a fiduciary duty to the NYSCRF and its members and beneficiaries, and was required to make investment decisions in their best interests and free of any conflict of interest. New York State law and NYSCRF policies prohibited Kang and other NYSCRF employees from receiving any bribes, gifts, benefits, or consideration of any kind, as KELLEY well knew.
The Scheme to Steer NYSCRF Fixed-Income Business in Exchange for Secret Bribes
From 2014 through 2016, Kang, KELLEY, and others participated in a scheme to defraud the NYSCRF and its members and beneficiaries, and to deprive the NYSCRF of its intangible right to Kang’s honest services. The scheme involved, among other things, an agreement among Kang, KELLEY, and others to pay Kang bribes – in the form of entertainment, travel, and lavish meals, among other things – in exchange for fixed-income business from the NYSCRF. Such bribes were strictly forbidden by the NYSCRF, and were paid secretly and without any disclosure to the NYSCRF and its members and beneficiaries concerning the conflicts of interests inherent therein.
In exchange for the bribes paid by KELLEY, Kang used his position as Director of Fixed Income and Head of Portfolio Strategy at the NYSCRF to promote the interests of KELLEY and her brokerage firm. Kang, in exchange for the bribes he received, agreed to steer fixed-income business to the Broker-Dealer. In so doing, Kang, with KELLEY’s knowledge and approval, breached his fiduciary duty to make investment decisions in the best interest of the NYSCRF and its members and beneficiaries, and free of conflict, and deprived the NYSCRF of its intangible right to Kang’s honest services.
As KELLEY paid bribes to KANG, the Broker-Dealer’s fixed-income business with the NYSCRF skyrocketed. The value of NYSCRF’s domestic bond transactions with the Broker-Dealer increased from zero in the fiscal year ending March 1, 2014, to approximately $156 million in the fiscal year ending March 1, 2015, and to approximately $179 million in the fiscal year ending March 1, 2016. Kang’s trades resulted in the payment of hundreds of thousands of dollars in commissions to the Broker-Dealer, of which KELLEY personally earned approximately 35 to 40 percent.
Obstruction of Justice
In late 2015, the Securities and Exchange Commission (“SEC”) opened an investigation into the entertainment and benefits that KELLEY had provided Kang, and the SEC subpoenaed both KELLEY and Kang for their testimony. In advance of their testimony, KELLEY and Kang agreed to align their stories and testify falsely before the SEC in order to conceal their scheme. In late 2015 and early 2016, KELLEY and Kang each falsely testified under oath before the SEC about expenses KELLEY had paid for Kang.
* * *
KELLEY, 58, of Piedmont, California, pled guilty to one count of conspiracy to commit securities fraud and honest services wire fraud, which carries a maximum sentence of five years in prison and three years of supervised release.
In December 2016, Gregg Schonhorn, a former a vice president of fixed income sales at another New York-based broker-dealer, pled guilty for his participation in the scheme. Kang, against whom charges for conspiracy, securities fraud, honest services wire fraud, and obstruction of justice are currently pending, is presumed innocent unless and until proven guilty.
Mr. Kim praised the investigative work of the Federal Bureau of Investigation and noted that the investigation is continuing. He also thanked the SEC, which filed civil charges against Kang, KELLEY, and Schonhorn in a separate civil action, and the Office of Inspector General for the Office of the New York State Comptroller.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Edward A. Imperatore and Joshua A. Naftalis are in charge of the prosecution.
Acting U.S. Attorney Announces Agreement with the NY State Education Department to Change State Guidelines on Parental Involvement in Medication Adjustments at School for Children with DiabetesRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced today that the United States has resolved its investigation into complaints alleging that the New York State Education Department (the “NYSED”) violated Title II of the Americans with Disabilities Act of 1990 (the “ADA”), 42 U.S.C. §§ 12131-12134, and related regulations by refusing to permit parent and guardian involvement in the adjustment of a child’s diabetes medication, with the approval of the child’s doctor, during school or at school-sponsored events.
Acting U.S. Attorney Joon H. Kim said: “Parents of children with diabetes have a right to play a role in the treatment of their children while at school. We are pleased to have reached an agreement with the New York State Education Department that will help students with diabetes receive during school the same adjustments to their medication that they receive outside of school, as their doctors direct.”
This Office’s investigation found that, in September 2015, the NYSED issued Guidelines for Medication Management in Schools that caused schools to reject certain types of orders issued by physicians treating children with diabetes authorizing parents and guardians to be involved in the adjustment of their child’s diabetes medication administered by the school healthcare team. The rejected orders included model orders developed by national diabetes organizations such as the National Diabetes Education Project and the American Diabetes Association by which a physician could authorize a parent or guardian to direct a school healthcare professional to adjust, within limits, the dosage and timing of correction doses of insulin, insulin-to-carbohydrate ratios, and fixed insulin doses. As these model orders reflect, it is common for parents and guardians of children with diabetes to have particularized knowledge with respect to their child’s recent activities, food intake, reaction to medication, and the like, and, through training and experience, to develop expertise regarding the adjustment of the dosage and timing of their child’s diabetes medication, information that is essential to the provision of necessary medical care for children with diabetes at all times, including at school. The investigation found that the Guidelines were hindering the communication of this vital information and in certain instances preventing necessary adjustments to diabetes medication from occurring at school. This Office detailed its conclusions in a Letter of Findings dated January 18, 2017.
In response to the investigation, the NYSED agreed to amend the Guidelines. The NYSED has also agreed to provide a model form for a physician to use to authorize the involvement of the parents/guardians in adjustment decisions where appropriate. The final decision with respect to the dosage and timing of diabetes medication shall remain with the school nurse as a matter of the nurse’s exercise of professional judgment, which will include consideration of the information communicated by the parent or guardian.
Specifically, under the resolution, NYSED has agreed to take the following actions: (i) amend the provisions of the Guidelines that were identified by the investigation as causing concerns; (ii) include additional language in the Guidelines explaining the respective roles of the school nurse and the parents/guardians who have been authorized to recommend adjustments of their child’s diabetes medication within specified limits; and (iii) provide a link to a model form through which physicians can provide such authorization to the parent/guardian (provided that the student’s Diabetes Medical Management Plan also includes authorization of the school nurse to make adjustments within the same range(s) as a matter of the nurse’s professional judgment). These changes, which resolve the issues addressed in the Letter of Findings, are explained in more detail in the attachments to the Office’s resolution letter. An amended version of the Guidelines reflecting these changes appears on the NYSED website at the following address: http://www.p12.nysed.gov/sss/schoolhealth/schoolhealthservices/.
Mr. Kim also thanked NYSED for its cooperation. The case is being handled by the Office’s Civil Rights Unit. Assistant United States Attorney Michael J. Byars is in charge of the matter.
Acting U.S. Attorney Reaches Agreement with Architecture Firm over Failure to Ensure Accessibility in Manhattan Apartment ComplexRead the Press Release
Joon H. Kim, Acting United States Attorney for the Southern District of New York, announced that the United States has settled a federal civil rights lawsuit against SLCE ARCHITECTS, LLP (“SLCE”), by consent decree. The suit alleges that SLCE violated the federal Fair Housing Act (“FHA”) by failing to design the Verdesian Apartments (“The Verdesian”), a Manhattan residential apartment complex, with the features required by the FHA to ensure accessibility for persons with disabilities.
Under the settlement, SLCE agrees to establish procedures, including the appointment of a Coordinator for Accessibility Education, to ensure that its ongoing and future development projects will comply with the accessibility requirements of the federal Fair Housing Act (“FHA”). Further, as part of the consent decree, SLCE has agreed to provide up to $15,000 to compensate aggrieved persons and to pay a civil penalty of $30,000. The consent decree was entered on May 24, 2017, by U.S. District Judge Jed S. Rakoff.
The developer of The Verdesian, Albanese Organization, Inc., and three of its affiliates, North End Associates, LLC, River Terrace Associates, LLC, and Chelsea Associates, LLC (together, the “Developer Defendants”), were also named as defendants in the suit, and Judge Rakoff approved a consent decree between the Government and the Developer Defendants on February 12, 2017, under which the Developer Defendants, among other remedial measures, agreed to make retrofits to The Verdesian.
Acting U.S. Attorney Joon H. Kim said: “Through this lawsuit, the Office continues its efforts to require not only developers, but also architects, to comply with the law by creating rental properties that are accessible to New Yorkers with disabilities. This settlement ensures that future projects designed by SLCE will comply with the FHA and can be fully enjoyed by individuals with disabilities.”
The FHA’s accessible design and construction provisions require new multifamily housing complexes constructed after January 1993 to have basic features accessible to persons with disabilities. According to the allegations in the Complaint, The Verdesian, a rental complex located at 211 North End with 253 rental units, was designed and constructed with numerous inaccessible features, including excessively high thresholds interfering with accessible routes in the public and common areas as well as into and within individual units, and insufficient widths, clearance, and clear floor space in bedrooms, bathrooms, closets, and kitchens for maneuvering by people who use wheelchairs.
To ensure future FHA compliance, the settlement requires SLCE to certify its plans, drawings, and blueprints as adhering to the requirements of the FHA and to institute policies and training to ensure that its employees and agents will comply with the FHA’s accessibility requirements.
Finally, the settlement requires SLCE to pay a civil penalty of $30,000 and to provide up to $15,000 to compensate aggrieved persons.
Aggrieved individuals may be entitled to monetary compensation from the fund created through the settlement. Aggrieved individuals may include those who:
- Were discouraged from living at The Verdesian because of the lack of accessible features;
- Have been hurt in any way by the lack of accessible features at The Verdesian;
- Paid to have an apartment at The Verdesian made more accessible to persons with disabilities; or
- Otherwise were discriminated against on the basis of disability at The Verdesian as a result of the inaccessible design and construction of the properties.
People who may be entitled to compensation should file a claim by contacting the Civil Rights Complaint Line at (212) 637-0840, using the Civil Rights Complaint Form available on the United States Attorney’s Office’s website http://www.justice.gov/usao/nys/civilrights.html, or by sending a written claim to:
U.S. Attorney’s Office, Southern District of New York
86 Chambers Street, 3rd Floor
New York, New York 10007
Attention: Chief, Civil Rights Unit
The case is being handled by the Office’s Civil Rights Unit. Assistant U.S. Attorneys Natasha W. Teleanu, Lauren Almquist Lively, Li Yu, and Jacob Lillywhite are in charge of the case.
Two Gang Members Charged with Murder of A Bronx ManRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, William F. Sweeney Jr., the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and James P. O’Neill, the Commissioner of the New York City Police Department (“NYPD”), announced today the indictment of two former members of the BSM gang, PARIS SOTO, a/k/a “P,” and “JOSEPH DENFIELD,” a/k/a “Denfield Joseph,” a/k/a “Denny,” for the gang-related murder of Donnell Harris on August 31, 2010. The case has been assigned to United States District Judge Victor Marrero. DENFIELD was presented yesterday before Magistrate Judge Ronald L. Ellis; SOTO is currently in state custody.
As alleged in the Indictment[1]:
BSM, which stands for “Brim Stone Mafia,” and later “Blood Stone Mafia,” was a criminal enterprise that operated mainly in and around the Bronx, New York, including in the vicinity of East 173rd Street and Topping Avenue. Members and associates of BSM engaged in the sale of narcotics, robberies, credit card fraud, and murder.
On August 31, 2010, BSM members SOTO and DENFIELD participated in the murder of Donnell Harris in order to maintain and increase their standing within BSM.
SOTO and DENFIELD are each charged with one count of murder in aid of a racketeering conspiracy, which carries a maximum sentence of death, or life in prison. The statutory maximum 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. Kim praised the outstanding investigative work of the FBI and the NYPD.
This case is being handled by the Office’s Violent and Organized Crime Unit. Assistant United States Attorneys Jessica Feinstein, Michael Gerber, and Hadassa Waxman 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.
Real Estate Developer Pleads Guilty in White Plains Federal Court to Conspiracy to Corrupt the Electoral Process in BloomingburgRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, today announced that KENNETH NAKDIMEN pled guilty to conspiracy to corrupt the electoral process, in connection with an election in Bloomingburg, New York. NAKDIMEN pled guilty earlier today before United States District Judge Vincent Briccetti in White Plains federal court.
Acting Manhattan U.S. Attorney Joon H. Kim stated: “Fair elections are the bedrock of democracy. As he has now admitted, Kenneth Nakdimen devised a scheme to advance his real estate project by falsely registering voters and corrupting this sacred process. We will not allow greed to influence elections at any level.”
According to the allegations contained in the Indictment, as well as statements made in related court filings and proceedings:
Starting in 2006, KENNETH NAKDIMEN, a real estate developer, sought to build and sell real estate in Bloomingburg, New York. From these real estate development projects, NAKDIMEN and others hoped for and anticipated making hundreds of millions of dollars. But by late 2013, the first of their real estate developments had met local opposition, and still remained under construction and uninhabitable. When met with resistance, rather than seek to advance their real estate development project through legitimate means, NAKDIMEN and others instead decided to corrupt the democratic electoral process in Bloomingburg by falsely registering voters and paying bribes for voters who would help elect public officials favorable to their project.
Specifically, in advance of an election in March 2014 for Mayor of Bloomingburg and other local officials, NAKDIMEN and others, and people working on their behalf, developed and worked on a plan to falsely register numerous people who were not entitled to register and vote in Bloomingburg because they actually lived elsewhere. Those people included some who never intended to live in Bloomingburg, some who had never kept a home in Bloomingburg, and indeed, some who had never set foot in Bloomingburg in their lives. NAKDIMEN and others took steps to cover up their scheme to register voters who did not actually live in Bloomingburg by, among other things, creating and back-dating false leases and placing items like toothbrushes and toothpaste in unoccupied apartments to make it seem as if the falsely registered voters lived there.
NAKDIMEN and others also bribed potential voters by offering payments, subsidies, and other items of value to get non-residents of Bloomingburg to register unlawfully and vote there.
* * *
NAKDIMEN, 64, of Monsey, New York, pled guilty to one count of conspiracy to corrupt the electoral process, which carries a maximum sentence of five 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.
NAKDIMEN’s sentencing is scheduled for September 9, 2017.
Mr. Kim praised the outstanding investigative work of the FBI-Hudson Valley White Collar Crime Task Force, the Sullivan County District Attorney’s Office, the Sullivan County Sherriff’s Office, the Orange County Sheriff’s Office, the Orange County District Attorney’s Office, the Internal Revenue Service, and the United States Postal Inspection Service. Mr. Kim also thanked the Department of Justice’s Public Integrity Section, Election Crimes Branch, for its assistance in the case.
This case is being handled by the Office’s White Plains Division. Assistant United States Attorneys Kathryn Martin, Benjamin Allee, and Perry Carbone are in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the remaining charged defendants are presumed innocent unless and until proven guilty.
Manhattan U.S. Attorney Announces Charges Against Operator of Online Retailer for Running Fraudulent Eyewear WebsiteRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and Philip R. Bartlett, Inspector in Charge of the New York Office of the U.S. Postal Inspection Service (“USPIS”), announced the arrest of VITALY BORKER, the operator of “OpticsFast.com,” an online retailer of purported designer eyewear. BORKER was arrested pursuant to a complaint charging him with mail and wire fraud in connection with a scheme to defraud unsuspecting customers by misrepresenting the authenticity and condition of eyeglasses sold through the website, and to harass customers who complained or attempted to return their purchases. BORKER was arrested this morning and will be presented later today before the Honorable Ronald L. Ellis.
Acting Manhattan U.S. Attorney Joon H. Kim said: “As alleged, Vitaly Borker ran his eyewear business, OpticsFast.com, as an online platform for fraud, selling defective and counterfeit merchandise. And as alleged, when his customers rightfully complained or tried to get their money back, Borker harassed and abused them. Borker’s shameless brand of alleged abuse cannot be tolerated, and we are committed to protecting consumers from becoming victims of such criminal behavior. We thank our partners at the U.S. Postal Inspection Service for their shared commitment to this mission.”
USPIS Inspector in Charge Philip R. Bartlett said: “As the adage goes, what goes around comes around - Mr. Borker took this to the extreme when he allegedly devised his fraud scheme to cheat consumers attempting to purchase eyewear. His cool shades couldn’t shield him from the bright light of law enforcement who illuminated his alleged illicit scheme. He should have realized he could never outwit Postal Inspectors.”
According to the allegations in the Complaint unsealed in Manhattan federal court:[1]
BORKER operates the eyewear website “OpticsFast.com” that purported to sell “brand new and 100% authentic” luxury eyewear, and that advertised itself as “the planet’s biggest online website for designer discount sunglasses and eyeglasses.” But customers of OpticsFast.com frequently received damaged and counterfeit items, were refused refunds, charged unauthorized restocking fees, or never sent eyewear for which they had been charged. When those customers tried to return merchandise, BORKER, using an alias, subjected them to a campaign of abusive emails and text messages. BORKER also insulted customers, called them names, and threatened to refer disputed sales to debt collectors.
* * *
BORKER, 41, of Brooklyn, New York, is charged with mail fraud and wire fraud, each of which carries a maximum sentence of 20 years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Acting U.S. Attorney Kim praised the efforts of the USPIS in this case. He added that the investigation is ongoing.
This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorneys Nicolas Landsman-Roos and Danielle R. Sassoon are in charge of the prosecution.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.