Northern District of Ohio
Press releases recorded for this federal judicial district.
Former Employee Charged with Defrauding Smucker of $4.1 MillionRead the Press Release
A former employee was charged with mail fraud for a 16-year scheme to defraud J.M. Smucker Company, of Orville, Ohio, of more than $4.1 million, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office.
Mark R. Kershey, age 54, of Akron and formerly of Massillon, was employed as Smucker’s chief airplane mechanic at the Akron-Canton airport when, from approximately October 1997 through January 2013, he devised a false billing scheme using a fictitious entity he controlled, under the name of Aircraft Parts Services, Co., according to the one-count criminal information filed in federal court.
Kershey submitted false invoices to Smucker in the name of Aircraft Parts Services, which in all or nearly all instances were for nonexistent parts and/or for purported outside services that he actually performed as part of his salaried employment duties. Kershey submitted most invoices in amounts less than $10,000, which he was authorized to approve. A supervisor approved a few larger invoices based on his trust in Kershey, according to the information.
Kershey maintained a P.O. Box under the fake company name in Greentown, Ohio, to receive checks mailed by Smucker in reliance on the fraudulent invoices. Kershey used the proceeds of his scheme for personal uses, including the purchase and maintenance of two airplanes, the purchase of several automobiles, and payments for his personal residence, according to the information.
The information describes Kershey’s efforts in late 2012 to deceive Smucker with respect to the final three checks payable to Aircraft Parts Services totaling $44,000, which Kershey had failed to negotiate. Kershey told the employee that Aircraft Parts Services had been sold to another Smucker vendor (referred to in the information as SAI), and submitted a letter to Smucker purportedly from SAI’s owner, that Kershey fabricated and forged, falsely confirming the purported sale to SAI. Smucker then issued replacement checks to SAI, that SAI deposited after discussion between Kershey and SAI’s owner.
If convicted, the defendant’s sentence will be determined by the court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
In addition, the information seeks forfeiture from Kershey of his two airplanes, three automobiles, and a truck, which are alleged to be proceeds traceable to his mail fraud scheme.
The case is being handled by Special Assistant United States Attorney John M. Siegel following investigation by the Federal Bureau of Investigation, Canton, Ohio.
An information is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.Assistant U.S. Attorneys Bridget M. Brennan and Ava Rotell Dustin Honored for Toledo Mosque Arson ProsecutionRead the Press Release
Attorney General Eric Holder presented Assistant U.S. Attorneys Bridget M. Brennan and Ava M. Rotell Dustin the John Marshall Award for Participation in Litigation today at a ceremony in Washington, D.C., honoring them for successfully prosecuting the arson at the Islamic Center of Greater Toledo last year.
The annual Attorney General Awards recognize department employees and other individuals for their dedication to carrying out the Department of Justice’s mission.
“With this important event, we come together to honor some of our nation’s most distinguished, dedicated, and deserving public servants,” said Attorney General Holder. “The hard work and impressive achievements of these 278 award recipients have inspired their colleagues at every level of the U.S. Department of Justice – including me. Their leadership has been indispensable in defining the past year as one of historic accomplishment in the face of nearly unprecedented challenge.”
“The hard work of these talented prosecutors and agents deserves national recognition, both because of their success but even more because of what they were fighting for,” said U.S. Attorney for the Northern District of Ohio Steven M. Dettelbach. “Religious freedom is at the core of our community and nation, and those who would commit acts of violence based on a how someone prays also do violence to our American ideals.”
The John Marshall Award for Participation in Litigation is presented for superior performance in the litigation and prosecution of Randolph Linn, the Islamic Center of Greater Toledo arsonist. Award recipients include, from the U.S. Attorney’s Office for the Northern District of Ohio, Assistant U.S. Attorneys Bridget M. Brennan and Ava M. Rotell Dustin.
On Sept. 30, 2012, Linn, armed with gas cans and a handgun, set fire to the Islamic Center of Greater Toledo, the largest mosque in northwest Ohio. This horrific act resulted in more than $1.4 million in damage, displaced the congregation and a full-time elementary school for over a year, and caused a wave of fear to spread throughout the Muslim community in the region. Less than three months after the fire was set, the recipients skillfully negotiated a binding plea agreement resulting in Linn pleading guilty to damage to religious property, use of a fire to commit a felony and use of a firearm to commit a crime of violence. On April 16, 2013, Linn was sentenced to serve 20 years in prison for these hate crimes.
Columbia Station Man Sentenced to 20 Years in Prison for Child Pornography and Related CrimesRead the Press Release
A Columbia Station man was sentenced to 20 years in prison for production of child pornography, child exploitation, extortion, identity theft and related crimes, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation's Cleveland office.
William T. Koch, age 25, previously pleaded guilty to 18 counts, including sexual exploitation of children, extortion, identity theft, receipt and distribution of minors engaged in sexually explicit conduct and unauthorized distribution of live musical performance.
Koch attempted to coerce more than a dozen minors to engage in sexually explicit conduct between 2010 and 2013 for the purpose of producing visual depictions of such conduct; knowing and having reason to know that such visual depictions would be transmitted, using any means or facility of interstate and foreign commerce, and in and affecting interstate and foreign commerce, according to court documents.
Koch used, persuaded, induced, enticed, and coerced a minor to engage in sexually explicit conduct for the purpose of transmitting a live visual depiction of such conduct, knowing and having reason to know that such visual depiction would be transmitted, using any means or facility of interstate and foreign commerce, and in and affecting interstate and foreign commerce, according to court documents.
Koch attempted to coerce a minor to engage in sexually explicit conduct with his 10-year-old brother, for the purpose of transmitting a live visual depiction of such conduct, knowing and having reason to know that such visual depiction would be transmitted, using any means or facility of interstate and foreign commerce, and in and affecting interstate and foreign commerce, according to court documents.
Koch distributed, in and affecting interstate and foreign commerce, by computer, any material in a manner that reflected the belief and was intended to cause another to believe that the material was a visual depiction of an actual minor engaging in sexually explicit conduct, according to court documents.
Koch, with the intent to extort a thing of value from some of the aforementioned minors, transmitted in interstate and foreign commerce, communications threatening to injure the reputations of said minors. He knowingly used, without lawful authority, in and affecting interstate and foreign commerce, a means of identification of another person, with the intent to commit, and in connection with, the offenses charged in the indictment.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan.
The case was investigated by the Federal Bureau of Investigation and the Department of Homeland Security, Homeland Security Investigations.
Sixty People Indicted, 110 Firearms Seized as Part of Summer Enforcement Action in Greater ClevelandRead the Press Release
Sixty people were indicted and 110 firearms were seized as part of a months-long enhanced enforcement initiative targeting the criminal possession, use and sale of firearms in Greater Cleveland, law enforcement officials announced.
The indictments were announced by ATF Director B. Todd Jones, U.S. Attorney Steven M. Dettelbach, Cleveland Mayor Frank G. Jackson, ATF Special Agent in Charge Michael Boxler, Cleveland Police Chief Calvin Williams and Cuyahoga County Prosecutor Timothy J. McGinty.
Forty-two people were indicted in federal court while 18 people were indicted in state court. Charges include engaging in the business of dealing firearms without a license, being a felon in possession of firearms and ammunition, possession of unregistered firearms that had been modified (sawed-off shotguns), possession and sale of firearms with obliterated serial numbers and related drug counts.
The indictments are the result of “Operation Samson II,” a summer-long initiative organized around three operational groups. The first used undercover operations to investigate people known to criminally possess, use and sell firearms, as well as people possessing firearms while conducting drug activities. The second group, referred to as the “Follow the Gun Group,” used firearms trace data and ballistics information from the National Ballistics Information Network (NIBIN) to pursue leads related to firearms that have been diverted from legal commerce to criminal use. Many of those investigations remain ongoing. The third group involved ATF Industry Operations conducting inspections at Cleveland-area federal firearms licensees to ensure that dealers are selling firearms in accordance with federal law and regulations.
This initiative was a cooperative effort between the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Cleveland Division of Police, the Ohio Adult Parole Authority, the U.S. Marshals Service, the U.S. Attorney’s Office and the Cuyahoga County Prosecutor’s Office.
“Preventing violent crime and apprehending violent offenders are vital components of ATF’s commitment to public safety because firearms-related violence should not be considered part of everyday life. This collective operation is helping make that possible for the citizens of Cleveland,” Director Jones said.
“Gun crime is far too prevalent in our community, and the Department of Justice is working with the City to not just talk about that problem, but to do something about it,” U.S. Attorney Dettelbach said. “This summer, our office and the ATF have doubled down on that commitment here, by targeting some of Cleveland's most violent felons and working with our local partners to take them, and some of their considerable weaponry, off our streets. We need an all-of-the-above approach to fighting gun violence, and today's announcement reminds us that targeted enforcement remains and important part of that approach.”
“Gun violence in Cleveland is often the result of guns in the hands of felons who do not have the right to have a gun. I’d like to thank the Bureau of Alcohol, Tobacco, Firearms and Explosives for working with our Cleveland police this year to take a significant number of these illegal firearms off our streets,” said Mayor Jackson.
“These arrests will destabilize the market in the illegal gun trade,” Prosecutor McGinty said. “These weapons are constantly found to be used by those who deal in illegal drugs and commit other violent offenses. This program is a step toward a safer community.”
Below are details of selected cases:
United States v. Kali Alexander et. al.: An 11-count indictment was filed charging five people with using firearms as part of a drug conspiracy, conspiracy to distribute cocaine and felons in possession of firearms.
Alexander, 24, of Willoughby Hills, recruited Rasheam Nichols, 24, Justin Maxwell, 26, Terrance Chappell, 22, and Kenneth Flowers, 21, all of Cleveland, to steal up to nine kilograms of cocaine from a stash house in Cleveland. The group planned to rob the stash house, then Alexander would sell the stolen cocaine and split the profits, according to the indictment.
Alexander met with an undercover ATF agent in August and expressed an interest and willingness to commit the robbery. “I promise you, I know what I’m doing, I’m about to holler at my big brother, then we going to orchestrate it from there.” On September 3, Alexander, Nichols, Maxwell, Chappell and Flowers met with the ATF undercover and discussed the strategy for the robbery. Then the five men drove to agreed-upon location in anticipation of acquiring a specific vehicle to use during the robbery, at which point they were arrested, according to the indictment.
United States v. Juan Davis: Davis, 25, of Cleveland, was not a licensed firearms dealer but sold five firearms on three dates in August – a Ruger .40-caliber pistol, an HS 9mm pistol, a Chinese SKS 7.62-caliber rifle, a Firearms International .22-caliber pistol and a Bersa .45-caliber pistol, according to the indictment.
United States v. Jesse Pawlak: Pawlak, 32, of Parma, has prior convictions for drug trafficking and burglary, but in July possessed an AK-47 7.62-caliber rifle, a Sar Arms 9mm pistol and a Bersa .380-caliber pistol, and in August possessed a Professional Ordnance 5.56-caliber rifle, according to the indictment.
United States v. Moises Perez: Perez, 45, of Cleveland, had a Ruger 9 mm pistol and H&R .22-caliber revolver and assorted ammunition in August, despite prior felony convictions for burglary, attempted felonious assault, unlawful sexual conduct with a minor, attempted felonious assault with a firearm, attempted intimidation, drug trafficking, robbery and being a felon in possession of a firearm. Perez was indicted as an armed career criminal, which would carry a mandatory minimum sentence of 15 years in prison if convicted, according to the indictment.
United States v. James Smith et. al.: A seven-count indictment was filed charging James Smith, 25, of Cleveland, Brandon Talley, 32, of Garfield Heights, and Lorenzo White, 22, of Cleveland, with multiple offenses. Talley possessed a 12-gauge shotgun in August, despite a previous conviction for rape and aggravated robbery with firearms specifications. Talley, Smith and White aided and abetted each other in the possession of unlicensed shotguns which had been modified (sawed-off), according to the indictment.
United States v. Gilberto Torres, et. al: A six-count indictment was filed charging Gilberto Torres, 33, Juan Hernandez, 23, both of Cleveland, and Antonio Turner, 33, of Shaker Heights, with firearms offenses. All three men at various times sold firearms without a license. Torres and Turner did so despite felony convictions – aggravated assault for Torres and attempted felonious assault, burglary, abduction and robbery with a firearm for Turner. Hernandez also sold a HiPoint .40-caliber pistol with an obliterated serial number, according to the indictment.
State of Ohio v. Michael Lukach: Lukach, 24, of Cleveland, was charged in state court with two counts of carrying a concealed weapon, fourth-degree felonies; two counts of improperly handling firearms in a motor vehicle, also fourth-degree felonies; and unlawful possession of dangerous ordnance, a fifth-degree felony. These charges stem from undercover investigations in which Lukach, also known as “Russian Mike,” sold eight firearms to an agent – six semiautomatic pistols and two shotguns, according to the indictment.
The federal cases were presented for indictment by Assistant U.S. Attorney Kelly Galvin.
An indictment is only a charge and is not evidence of guilt. The defendant is entitled to a fair trial in which it will be the government’s burden to prove guilty beyond a reasonable doubt.
Former Kirtland Hills Police Chief Charged with Fraud and FalsificationRead the Press Release
The former police chief of Kirtland Hills was charged with defrauding the village out of at least $80,000 by making unauthorized purchases of clothing, tools and goods for his own personal use, said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office.
A two-count criminal information was filed in federal court charging Gerald Smith, Jr., 57, of Kirtland, with one count of mail fraud and one count of destruction, alteration or falsification of records in a federal investigation.
“This defendant stole from the people he swore to serve,” Dettelbach said. “He used the public coffers to furnish his condo and pay for his meals. There will be consequences for public officials who violate the public’s trust.”
“To serve others and pursue justice is the oath all law enforcement promise to abide by,” Anthony said. “Unfortunately, this chief's self-interest and greed overrode his ethical conscious and his commitment to serve his community.”
Smith joined the Kirtland Hills police department in 1978 and served as chief from 1988 until April 4, 2014. In this capacity, Smith was authorized to reimburse officers for work-related expenses and use village funds to procure necessary supplies, including the use of several village credit cards or lines of credit, according to the information.
The department also had petty cash fund, maintained in Smith’s office, in which employees submitted receipts with their name and the purpose of the expense written on it, for which they were then reimbursed, according to the information.
Smith made approximately $80,000 in personal expenditures using village credit cards between 2007 and 2014. Some of the items were used to partially furnish his Florida condominium. Items purchased include ceiling fans, plumbing supplies, vacuum cleaners, children’s lunch boxes and story books, clothing, televisions, book shelves, personal hygiene items, firearms, car repairs and more, according to the information.
Smith concealed these purchases by making false entries on receipts to make it appear they were made by others or made for official police business. By spreading the purchases out among different funds, he prevented the village from readily noticing large amounts of expenditures from one particular fund, according to the information.
For example, Smith went on a hunting trip to Pennsylvania in 2007. While on vacation, he made the following purchases on a Kirtland Hills credit card: knife sharpening ($70), items at an Army Navy store ($269.96), and items at a sporting goods store, including Pro Hunter pants and jacket and a shirt ($209.97). He then falsely wrote on the receipt that the sporting goods clothing was SWAT clothing for a Kirtland Hills officer, according to the information.
In 2007, Smith ordered several items online, including a $107.96 pair of women’s tan Ugg boots with the village Mastercard. Smith falsely wrote on the receipt “Road Dept Boots and Boots for (a Kirtland Hills police officer),” knowing the officer did not receive the boots, according to the information.
Smith also obtained Kirtland Hills money by submitting false claims to the petty cash fund. When Kirtland Hills officers went out to lunch, or when Smith took personal trips with officers and the group stopped for food, Smith at times asked for the receipts. He then submitted the receipts for petty cash reimbursement under the officers’ names but without their knowledge, taking the cash for himself, according to the information.
On March 17, 2014, Smith was placed on leave by Kirtland Hills and required to surrender his access badges, keys and all village property. He was also served by FBI agents with a federal grand jury subpoena, which required the production of certain documents and items.
On March 20, 2014, Smith secretly brought more than 50 items from his residence to a village storage shed and placed the items on the shelves, to give the appearance that these items belonged to the Village of Kirtland Hills. Among the items Smith returned were a drill, heater, dehumidifier, air purifier, camouflage tarps, socket set, channel locks, extension cords, hammer, hand saw and other items, according to the information.
The case is being prosecuted by Assistant United States Attorney Antoinette T. Bacon following an investigation by the Federal Bureau of Investigation.
An information is only a charge and is not evidence of guilt. The defendant is entitled to a fair trial in which it will be the government’s burden to prove guilty beyond a reasonable doubt.
Ashtabula Man Faces Firearms and Heroin Charges; Madison Woman Charged with Firearms ViolationsRead the Press Release
A federal grand jury returned a five-count indictment charging Jemel E. Thompson, 25, of Ashtabula, with firearms and drug violations and Maranda M. Rabenold, 31, of Madison, with firearms violations, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Count 1 of the indictment alleges that on or about August 8, 2014, Thompson was in possession of ammunition, after he had been previously convicted of arson in the Oakland County, Michigan, Circuit Court.
Count 2 of the indictment alleges that on or about June 16, 2014, Rabenold, aided and abetted by Thompson, made false statements to The Great Outdoors Store, North Kingsville, Ohio in connection with the purchase of a HiPoint, 9mm pistol.
Count 3 of the indictment alleges that on or about July 19, 2014, Rabenold, aided and abetted by Thompson, made false statements to LWS LJC, Inc., Jefferson, Ohio in connection with the purchase of a HiPoint JCP pistol.
Count 4 of the indictment alleges that on or about September 8, 2014, Thompson attempted to distribute less than 100 grams of heroin.
Count 5 of the indictment alleges that on or about September 8, 2014, Thompson used the United States mail in facilitating an attempt to distribute heroin.
If convicted, the defendants’ sentences will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictment was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Ashtabula Police Department. The matter is being prosecuted by Assistant United States Attorney Jason M. Katz.An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Cleveland Man Indicted for Violating the Clean Air Act, Illegally Dumping Garbage and Defrauding Company out of $1.2 MillionRead the Press Release
A federal indictment was filed charging Christopher L. Gattarello and another Cleveland man with violating the Clean Air Act by failing to remove asbestos prior to demolishing a former factory in Cleveland, law enforcement officials said.
Gattarello and another conspirator were also charged with defrauding a Louisiana company out of nearly $1.2 million.
At the same time, state charges were filed in Cuyahoga County Common Pleas Court against Gattarello and two men, charging them with illegally dumping garbage in Cleveland.
Indicted in federal court are Gattarello, 50, of Cleveland; Willam S. Jackson, Jr., 44, of Cleveland, and Robert A. Shaw, Sr., 74, of Ypslanti, Michigan.
The indictments were announced by Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, Ohio Attorney General Mike DeWine, Cuyahoga County Prosecutor Timothy McGinty, Ohio EPA Director Craig W. Butler and Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.
“We will not allow our neighborhoods to be used as garbage dumps,” Dettelbach said. “Mr. Gattarello’s actions show his total disdain for the law and for the people who live near the factory. He will be held accountable for his actions.”
“Thousands of tons of garbage were dumped illegally near a residential neighborhood,” Attorney General DeWine said. “This behavior is inexcusable. Residents have to deal with this significant environmental and health threat, and they deserved to see those accountable brought to justice.”
“Dumping waste in our county is criminal, reprehensible and makes it harder for the people of Cuyahoga County to beautify our region,” said Adrienne Linnick, assistant Cuyahoga County prosecutor. “But dumping roughly 29 million pounds of assorted waste — as was found on the old National Acme site—attracts so many pests and produces so many odors that it can contribute to the demise of a neighborhood. Nobody wants to do business next to trash heaps, let alone live next to one where they might want to jog, bike, walk a dog or take their children for a stroll.”
Butler said: “I commend the hard work put into this case by Ohio EPA’s special investigations staff and our partnering agencies to bring about this indictment. Ohio EPA will not tolerate reckless disregard for the health and welfare of Ohio citizens.”
“IRS-Criminal Investigation is committed to unravelling complex financial schemes and following the money to ensure those who profit from crime are held accountable,” Enstrom said.
Gattarello owned and controlled several municipal garbage-hauling businesses in greater Cleveland, including Reach Out Disposal, All Points Rubbish Disposal and Axelrod Rubbish Recycling. Shaw worked for Gattarello at those companies, while Jackson operated a Cleveland building demolition company.
Gattarello and Jackson were each charged with two counts of violating the Clean Air Act.According to the four-count federal indictment:
In June 2011, Gattarello, on behalf of All Points, leased the former National Acme facility at 170 East 131st Street in Cleveland. The 570,000 square-foot facility was built in 1917 and was used for manufacturing for nearly a century. It is located near many homes and a school. Gattarello represented to the lessor that paper and cardboard waste would be recycled at the facility.
In July 2011, a company estimated removing asbestos from the facility would cost $1.5 million.
Around August 2011, Gattarello directed paper and cardboard waste, as well as municipal garbage, be delivered to the facility for recycling. Over the next several months, more garbage, paper and cardboard were delivered than could be handled, and Gattarello had the waste moved inside. By April 2012, most of the facility was filled with garbage.In May 2012, Gattarello, on behalf of Reach Out, entered into a contract to purchase the facility. Gattarello intended to demolish the facility and sell any metal removed as scrap.
In July 2012, Jackson submitted a notice of demolition with the Cleveland Division of Air Quality stating there was no asbestos in the National Acme facility. About 10 days later, the CDAQ rejected Jackson’s notice because it was incomplete and stated demolition “may not begin” until a proper notice was submitted and approved. About 10 days after that, on July 21, 2012, Jackson began demolition at Gattarello’s direction.
Asbestos fibers were released into the environment during demolition. Debris accumulated outside the facility from demolition and asbestos in the piles were exposed to the wind and elements.
In the state’s case, Christopher Gattarello, Axelrod Recycling, and Reachout Disposal each were indicted on the same five counts — two counts of illegal open dumping, two counts of operating a solid waste landfill without a license, and one count of operating a solid waste transfer facility without a license. The charges stem from alleged solid waste violations at the former National Acme facility and at 965 Wayside Avenue in Cleveland.
Also in the state’s case, Christopher Gattarello’s brother, Anthony Gattarello, 48, of Highland Heights, was indicted on one count of illegal open dumping and one count of operating a solid waste disposal facility without a license. Jackson was indicted on one count of illegal open dumping. The charges relate to alleged violations at the former National Acme facility.
Additionally, Christopher Gattarello was charged with in federal court with one count each of conspiracy to commit wire fraud and money laundering. Shaw faces one count of conspiracy to commit wire fraud.
AIM Business Capital LLC is a financial company based in Louisiana that specializes in “factoring” – a practice in which AIM purchases accounts receivable, such as invoices billed to customers for goods and services. Businesses that factored their receivables with AIM received immediate cash. AIM, like other factoring companies, purchase the receivables at a percentage discount of the invoice. AIM made a profit by collecting the full amount of the invoice from the business’s customers, according to the federal indictment.In 2011 and 2012, Shaw, on behalf of Reach Out and Axelrod, entered into contracts with AIM for the purchase of receivables from Reach Out and Axelrod. Gattarello directed the creation of false and fraudulent invoices for the companies and directed that they be submitted to AIM. In some cases, Gattarello and Shaw directed other employees to create false letters attesting to the validity of the invoices, which Shaw forwarded to AIM. The loss to AIM was nearly $1.2 million, according to the federal indictment.
The federal case is being prosecuted by Assistant United States Attorneys Brad Beeson and James V. Moroney following an investigation by the Federal Bureau of Investigation, the U.S. and Ohio Environmental Protection Agencies, the Ohio Bureau of Criminal Investigation and the Internal Revenue Service.
The state case is being prosecuted by the Ohio Attorney General’s Office in cooperation with the Cuyahoga County Prosecutor’s Office.
An indictment is only a charge and is not evidence of guilt. The defendant is entitled to a fair trial in which it will be the government’s burden to prove guilty beyond a reasonable doubt.
The Justice Department Awards $5.1 Million to Hire Police Officers in Northern OhioRead the Press Release
The U.S. Department of Justice announced funding awards to seven cities and agencies in the district, aimed at creating, and in some cases protecting, 41 law enforcement positions, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio
Nearly $124 million will be awarded nationally from the Justice Department’s Office of Community Oriented Policing Services (COPS), including $5.1 million in the Northern District of Ohio.
The list of this year’s grantees includes:
- Austintown, $250,000 for two officers.
- Canton, $1,125,000 for nine officers.
- Cleveland, $1,875,000 for 15 officers.
- The Cleveland Metropolitan Housing Authority, $500,000 for four officers.
- Lima, $375,000 for three officers.
- Lorain, $625,000 for five officers.
- Warren, $375,000 for three officers.
“The Justice Department is proud to support the brave men and women serving and protecting our communities in the Northern District of Ohio,” Dettelbach said. “As we work together to develop innovative strategies to reduce firearms violence, dismantle gang activity and break cycle of violence, we need to help the people on the front lines to fight crime.”
“The COPS Office is pleased to assist local law enforcement agencies throughout the country in addressing their most critical public safety issues,” said Ronald L. Davis, Director of the COPS Office. “Funding from this year’s program will allow many cities and counties to apply new sworn personnel to issues related to violent crime, property crime, and school safety.”
The COPS Hiring Program offers grants to state, local and tribal law enforcement agencies to hire or rehire community policing officers. The program provides salaries and benefits for officer and deputy hires for three years.
Grantees for the 2014 hiring program were selected based on their fiscal needs, local crime rates, and community policing plans.
The COPS Office is a federal agency responsible for advancing community policing nationwide. Since 1995, COPS has awarded over $14 billion to advance community policing, including grants awarded to more than 13,000 state, local, and tribal law enforcement agencies to fund the hiring and redeployment of approximately 125,000 officers and provide a variety of knowledge resource products including publications, training, and technical assistance.
For the entire list of grantees and additional information about the 2014 COPS Hiring Program, visit the COPS website at www.cops.usdoj.gov.
North Ridgeville Landlord Agrees to End Discriminatory Housing PracticesRead the Press Release
The Justice Department today announced that a North Ridgeville, Ohio, landlord, Emil Bagi, and his management company, Ridgeway Management Ltd., have entered into a consent decree and have agreed pay $30,000 to resolve claims that they discriminated on the basis of race at the Ridge Plaza Apartments, a 36 unit apartment complex they own and operate in North Ridgeville, Ohio. The settlement must still be approved by the federal district court in the Northern District of Ohio.
According to documents filed along with the settlement agreement the department alleges that the defendants discriminated against African Americans by quoting higher rental and application fee rates to them than to white apartment seekers, and by refusing to show African Americans vacant units when they visited while showing such units to white apartment seekers who visited the complex. The complaint is based on evidence obtained by the department’s fair housing testing program. The department sent African-American and white testers posing as prospective renters to the complex and the African-American testers were quoted higher rents and application fees than the white testers. African-American testers were also told that they could not view a unit at that time, while similarly situated white testers were shown units. The department also alleges that since acquiring ownership of the property in 1995, the defendants have never leased a unit to an African-American tenant.
Under the terms of the settlement, the defendant wills establish a settlement fund of $20,000 to compensate persons harmed by the alleged discrimination and a $10,000 civil penalty to the United States. In addition, the defendants will establish non-discriminatory rental policies, obtain fair housing training, and submit to reporting and monitoring requirements for the three year term of the settlement.
“It is simply unacceptable for a landlord to make renting an apartment more difficult and more expensive because of a person’s race,” said Acting Assistant Attorney General Molly Moran for the Civil Rights Division.
“The Department of Justice is committed to enforcing the Fair Housing Act using every tool at our disposal,” said U.S. Attorney Steven M. Dettelbach for the Northern District of Ohio. “This landlord got caught by fair housing testers trying to charge higher rent to minority applicants. He failed the test miserably – and now he has to pay the price. Other landlords should keep that in mind when they are showing properties.”
Fighting illegal housing discrimination is a top priority of the Department of Justice. The federal Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Individuals who believe that they may have been victims of housing discrimination at Ridge Plaza should contact the Justice Department at 1-800-896-7743 or by email at [email protected]. Persons who believe they have experienced housing discrimination elsewhere may contact the Justice Department or contact HUD at 1-800-669-9777 or through its website at http://portal.hud.gov/hudportal/HUD?src=/program_offices/fair_housing_equal_opp.
Man Sentenced to Prison for Selling Counterfeit Baseball Cards, Including Babe Ruth and Mickey Mantle FakesRead the Press Release
A Pennsylvania man was sentenced to nearly three years in prison for selling counterfeit baseball cards of Mickey Mantle, Babe Ruth and others on eBay, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Steven Norris, 39, of Milton, Penn., was sentenced to 32 months in prison after pleading guilty earlier this year to three counts of mail fraud. Norris was also ordered to pay restitution totaling $49,660.
Norris’ brother and co-defendant, Scott Norris, 40, of Brecksville, was previously sentenced to four years of probation for his role in the offense and was ordered to pay restitution of $28,160.
“These defendants used the legends of America’s pastime to fraudulently get tens of thousands of dollars,” Dettelbach said. “This prison sentence should send a message to would-be fraudsters, whether they use baseball cards or elaborate investment schemes to rip off the public.”
From 2006 through 2012, Steven and Scott Norris advertised various baseball cards for sale on eBay. They utilized numerous email addresses to list the cards for sale. The cards, if genuine, would have been rare and valuable, including 1952 Mickey Mantle cards and 1933 Babe Ruth cards, according to court documents.
The Norris’ accepted payments from bidders but failed to deliver the cards as required. In some instances, Steven and Scott Norris sent counterfeit or “reprinted” cards to successful bidders rather than the genuine cards advertised for sale, according to court documents.
In other instances, Steven and Scott Norris contacted individuals who bid on the cards, represented the high bidder was unable to complete the transaction, and asked if the “runner up” bidder was interested in buying the item. They would then negotiate a sales price and direct the buyer to mail a cashier’s check to an address in Brecksville owned by the defendants’ parents. After receiving payment, Steven and Scott Norris would fail to deliver the items in question or sent counterfeit or “reprinted” baseball cards to the buyers, according to court documents.
As a result of the scheme, individual bidders and PayPal suffered losses of approximately $60,310, according to court documents.
The case was prosecuted by Assistant United States Attorney Robert W. Kern following an investigation by the United States Secret Service and the Brecksville Police Department.
Indiana Man Charged with Perjury, Obstruction and Making False StatementsRead the Press Release
Alexander Krivozus, 42, of Carmel, Indiana, was charged earlier this week by a grand jury in Cleveland, Ohio for two counts of making false statements, one count of perjury and one count of obstruction of justice during an investigation into a Cleveland resident who maintained a secret bank account at UBS, the Justice Department and Internal Revenue Service announced.
According to the documents filed with the court, during 2009 through 2011, the Department of Justice and the IRS were investigating Edward Gurary, of Cleveland, Ohio as a result of receiving records from UBS bank in Switzerland from Gurary’s undeclared bank account at UBS. The records revealed that Gurary had UBS wire funds from his undeclared bank account to various bank accounts in Latvia, and asked UBS to fax the confirmations of some of the wire transfers to a fax number in the (317) area code, a number the government later associated with Krivozus. Krivozus was subpoenaed to testify, interviewed by the government over two days, and testified before the grand jury. In each interview, as well as before the grand jury, Krivozus denied knowing about the Gurary transactions or the faxed confirmations.
According to other court records, Gurary was arrested in February 2011, and pleaded guilty on March 08, 2011 in United States District Court in Cleveland, Ohio to one count of filing false income tax returns with the IRS for the years 2004 through 2008. The charges against Krivozus allege that his statements and denials in the interviews and before the grand jury were false.
Krivozus faces a maximum sentence of five years in prison on each charge, a $250,000 fine, and 3 years of supervised release.
The case was investigated by the IRS Criminal Investigation Division, and is being prosecuted by Justice Department Tax Division trial attorney Richard M. Rolwing and Assistant United States Attorney Robert Patton.
Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at http://www.usdoj.gov/tax/. Additional information about tax fraud schemes to watch out for may be found on the IRS Criminal Investigation Web site at http://www.ustreas.gov/irs/ci/.
Fremont Man Faces Firearms ChargeRead the Press Release
An information was filed against Timothy J. Miller, age 30, of Fremont, Ohio, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The information charges Miller with possession of two silencers and an AR-15 firearm that were not registered to him in the National Firearms Registration and Transfer Record.
If convicted, the defendant’s sentence will be determined by the court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, and the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case is being handled by Assistant United States Attorneys Noah P. Hood and Gene Crawford.
Akron Man Sentenced to Six Years in Prison for Possessing RicinRead the Press Release
Jeff Boyd Levenderis, age 58, of Akron, was sentenced to six years in prison for possessing the biological toxin ricin for use as a weapon, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation's Cleveland office.
Levenderis was convicted on four counts -- one count of possessing a biological toxin for use as a weapon, one count of possessing ricin and two counts of making false statements to FBI agents -- earlier this year following a trial.
The evidence and testimony introduced at trial showed that Levenderis produced ricin, a deadly biological toxin, at his home in Akron, sometime after 2000 and kept it in his freezer until it was recovered by FBI agents in January 2011.
The evidence showed that Levenderis intended to make a “weaponized” form of ricin. The evidence also showed that Levenderis planned to use the ricin against his stepfather and against first responders who might respond to a fire Levenderis planned to set at his house as part of an elaborate suicide plan.
Testimony at trial confirmed that the substance Levenderis manufactured contained active ricin and that it contained hundreds of lethal doses if inhaled or injected.
The case was prosecuted by Assistant United States Attorneys Matthew W. Shepherd and Om Kakani and Erin Creegan, Trial Attorney with the National Security Division of the United States Department of Justice. The conviction resulted from an investigation conducted by the FBI.
Canton Man Sentenced to More Than Two Years in Prison and Ordered to Pay Nearly $200,000 for Tax ViolationsRead the Press Release
A Canton man was sentenced to more than two years in prison and ordered to pay nearly $200,000 in restitution for tax violations, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Kathy Enstrom, Special Agent in Charge of the IRS' Cincinnati Field Office.
Frederick C. Berndt, 39, previously pleaded guilty to five counts. U.S. District Judge Donald C. Nugent sentenced Berndt to 25 months in prison and ordered him to pay $197,206 in restitution.
"This sentence serves as a message to those who would shirk their responsibilities to pay taxes," Dettelbach said.
“The privilege of living well in the United States carries certain responsibilities, one of which is the voluntary payment of taxes,” Enstrom said. “IRS Criminal Investigation will vigorously investigate those individuals who knowingly and willfully evade their tax obligation.”
Berndt, then chief executive officer of 11 Good Energy, Inc, evaded paying taxes in calendar years 2003, 2004 and 2006 and failed to file income taxes in years 2007 through 2010, according to court documents.
The case is being prosecuted by Assistant U.S. Attorney Ann C. Rowland and former Assistand U.S. Attorney Justin J. Roberts following an investigation by the Internal Revenue Service.
Medina Man Faces Heroin ChargesRead the Press Release
A Medina mas was indicted for possession with intent to distribute heroin, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Curtis DeBose, 34, possessed the heroin on August 7, 2014, according to the indictment.
Debose was arrested by members of the Medina County Drug Task Force and Drug Enforcement Administration on a criminal complaint after an nvestigation.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictment was conducted by the Medina County Drug Task Force, Medina Police Department and the Drug Enforcement Administration. The matter is being prosecuted by Assistant United States Attorney Teresa Riley.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Louisville Man Charge for Child Pornography ViolationsRead the Press Release
Ian A. Leach, 26, of Louisville, Ohio, was charged with receiving, distributing and possessing visual depictions of minors engaged in sexually explicit conduct, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment charges that from on or about May 27, 2014, through on or about July 13, 2014, Leach knowingly received and distributed in interstate and foreign commerce, by computer, numerous computer files, which files contained visual depictions of real minors engaged in sexually explicit conduct.
The indictment also charges that on September 4, 2014, Leach possessed a computer that contained child pornography.
If convicted, the sentence in this case will be determined by the court after consideration of the federal sentencing guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan. The case was investigated by the Canton Office of the Federal Bureau of Investigation and the Canton Police Department.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Former Ohio Man Indicted for $1.2 Million Bank FraudRead the Press Release
A grand jury returned a four-count indictment charging a Mississippi man for a conspiracy in which he defrauded a Tennesse bank out of $1.2 million, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Paul D. Allen, age 52, of Oxford, Mississippi, age 52, was indicted on one count of conspiriacy to commit bank fraud and three counts of bank fraud.
Allen, a self-proclaimed entrepreneur and businessman, moved to the Northern District of Ohio in 1999. Prior to that, he lived in Tennessee, where he developed a relationship with Stephen Henry, an unindicted co-conspirator.
Allen and Henry executed a scheme to defraud Oakland Deposit Bank and obtain money and property from the bank by means of materially false and fraudulent representations. The bank was chartered and had offices in Tennessee. Henry served as president of the bank and also served as a loan officer, according to the indictment.
Allen contacted several people in Ohio and recruited them to invest in various business projects he promoted, including B-Telecom Incorporated, a purported data-storage company. Allen promised investors they would receive a percentage ownership in the business in return for the investors obtaining loans from the Oakland Deposit Bank in their own names. Allen told the investors the loan proceeds would be used for operating the business, according to the indictment.
Between 2003 and 2008, Allen had the investors complete loan documentation in support of the loans, and then submit the loan applications to Henry, or accompany the investors when they submitted the loan applications to Henry, according to the indictment.
Allen forged borrower signatures on loans for amounts ranging between $42,770 and $168,000. He sometimes took out additional loans in borrowers' names without their knowledge. He used the proceeds to pay personal expenses or to make interest payments on existing loans, according to the indictment.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant U.S. Attorney M. Kendra Klump following an investigation by the Federal Bureau of Investigation (Cleveland Division, Painesville Resident Agency) and with the assistance of the Geauga County Prosecutor’s Office.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Lucas Man Sentenced to 20 Years in Prison for Production of Child PornographyRead the Press Release
A Lucas man was sentenced to 20 years in prison for crimes related to child pornography, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Robert A. Anderson, 69, pleaded guilty earlier this year to four counts, including production of child pornography, receipt of visual Depictions of minors engaged in sexually explicit conduct and removal of property to prevent seizure.
From 2003 through 2011, Anderson did use, persuade, induce, entice and coerce two minors to engage in sexually explicit conduct, for the purpose of producing a visual depiction of such conduct, and such visual depiction was produced or transmitted using materials that had been mailed, shipped, and transported in or affecting interstate or foreign commerce by any means, including by computer, according to court documents.
This case is being prosecuted by Assistant United States Attorney Carol M. Skutnik. The case was investigated by the Department of Homeland Security Investigations, Cleveland Office.
Former Postal Manager Sentenced to Nearly Four Years in Prison for Taking BribesRead the Press Release
The former manager of the U.S. Postal Service’s Vehicle Maintenance Facility in Cleveland was sentenced to nearly four years in prison for taking cash bribes in exchange for awarding business and contracts from the Postal Service, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Monica Weyler, Special Agent in Charge of the U.S. Postal Service Office of Inspector General.
Kevin Hood, 46, of Richmond Heights, was sentenced to 46 months in federal prison by U.S. District Judge Dan Polster. Hood pleaded guilty earlier this year to one count each of Hobbs Act extortion and theft of government property.
“Some defendants appear to still have not gotten the message that accepting bribes has no place in Northeast Ohio,” Dettelbach said. “I commend the work of U.S. Postal Service Office of Inspector General’s special agents. The corruption was persistent and pervasive, and would be continuing but for their hard work.”
“This crime is particularly egregious considering the defendant was promoted to this position because the former manager was convicted on similar charges,” Weyler said.
Hood worked for the Postal Service since 1998 and most recently served as the manager of the Vehicle Maintenance Facility at 1801 Broadway Avenue in Cleveland. In that job, Hood had the ability to award and monitor contracts on behalf of the Postal Service.
The owner of a Cleveland company that has contracts with the Postal Service said Hood approached him for money in order to get work and contracts from the Postal Service. In late 2011, the business owner paid Hood in cash and believed he had to continue to pay Hood to receive work, according to court documents.
Hood received $15,000 in bribes, more than $4,000 in free vehicle repairs, at least $900 worth of stolen parts, according to court documents and statements.
On March 6, the owner paid Hood $4,500 in $100 bills. Hood placed the envelope containing the bills in his left boot. The transaction was monitored and recorded by USPS Office of Inspector General Special Agents, according to court documents.
Judge Polster addressed Hood during the sentencing hearing: “It is hard to fathom on top of that for you to continue that conduct when you pick up the paper every day and hear about the prosecution and investigation of other individuals. I’m not sure if you thought it was okay or nobody’s going to find you. I don’t know what you were thinking.”
Hood is the third vehicle maintenance facility (VMF) manager is recent years to be sentenced to prison as the result of investigations by Cleveland USPS OIG special agents. In 2009, a former Cleveland VMF manager was sentenced to 22 months in prison after pleading guilty for his role in a postal theft and kickback conspiracy. In 2012, a former Akron VMF manager was sentenced to three months in custody and three years of probation after pleading guilty for his role in a conspiracy to accept gifts and payments in exchange for providing postal vehicle repair work to a contractor.
This case was prosecuted by Assistant U.S. Attorneys Miranda Dugi and Antoinette T. Bacon following an investigation by the U.S. Postal Service Office of Inspector General.
Cuyahoga County to Get Justice Department Grant to Combat Domestic Violence HomicidesRead the Press Release
Attorney General Eric Holder announced Monday that the Justice Department has selected four sites to receive a total of $2.6 million in grants to implement promising models aimed at reducing domestic violence homicides. Over the next two years, these sites—Pitt County, North Carolina; Cuyahoga County, Ohio; Contra Costa County, California; and the Borough of Brooklyn, New York—will institute screening models and evidence-based strategies that will allow them to anticipate potentially lethal behavior, take steps to stop the escalation of violence, and – ultimately – save lives. The National Institute of Justice will conduct an evaluation of the models in each of the selected sites to identify the key components needed to successfully adapt the domestic violence homicide prevention models nationwide.
“Domestic violence is more than a crime against just the victim,” said Attorney General Holder in a video message posted on the Justice Department’s website. “It is a crime against all of us as a society. And our collective response must treat it as such.”
The complete text of the Attorney General’s video message is below:
“Domestic violence is a devastating crime that claims far too many lives. Studies have shown that, on average, three women die every day in America at the hands of their partner or ex-partner. And from 2009 to 2012, 40 percent of mass shootings started with the killer targeting a girlfriend, wife, or ex-wife. These are tragic and shocking statistics, and the Justice Department is working hard to bring an end to this horrific status quo.
“Under the Violence Against Women Act, which was reauthorized last year, the Department of Justice is taking vital action to protect and empower women and partners who are being exploited and abused. Through our Office on Violence Against Women, we are working to support victims and hold perpetrators accountable by promoting a coordinated community response. And in the reauthorized Act, this Administration helped to secure important new protections for women in Indian Country, LGBT individuals, and others.
“These are important achievements – but we must do more. That’s why, in 2013, I was proud to stand with Vice President Biden to unveil a new grant-funded initiative to help reduce domestic violence homicides. This funding provided twelve communities– in states across the country – with the opportunity to reduce domestic violence homicides by effectively identifying potential victims and monitoring high-risk offenders.
“And today, I am pleased to announce that four sites have been selected to receive a total of $2.6 million to implement promising models aimed at reducing domestic violence homicides. In Pitt County, North Carolina; in Cuyahoga County, Ohio; in Contra Costa County, California; and in the Borough of Brooklyn, New York – these two-year awards will make a tremendous difference, helping local officials to put their anti-violence initiatives into practice.
“In that time, they will institute screening models and evidence-based strategies that will allow them to anticipate potentially lethal behavior, take steps to stop the escalation of violence, and – ultimately – save lives. These innovative programs can then be studied and replicated in order to protect those who are at risk – and stop would-be abusers – across the United States.
“We have come a long way since the time when these incidents of abuse were considered private, household matters. But we have a ways to go still. Domestic violence is more than a crime against just the victim. It is a crime against all of us as a society. And our collective response must treat it as such.
“Going forward, the Justice Department will continue to build our important efforts to end violence against women and girls – no matter who they are or where they live – because all Americans deserve to feel safe and secure in their homes, on their college campuses, and on the streets of our communities.
“As we strive to end the epidemic of domestic and intimate partner violence, all of us have a great deal of work to do. But this Administration, this Department of Justice – and I personally – will not waver in that effort: to shine a light on violence and abuse; to protect and empower women; and to make domestic violence homicide a thing of the past.”The full video of the Attorney General’s message is available at http://www.justice.gov/agwa.php.
Two Arrested and Charged for Penny-Stock FraudRead the Press Release
Stephen D. Anthony, Special Agent in Charge of the Cleveland Division of the Federal Bureau of Investigation for the Northern District of Ohio, and Steven M. Dettelbach, United States Attorney for the Northern District of Ohio announce the federal arrest of Izak Sirk De Maison (aka Izak Zirk Engelbrecht, aka Zirk Engelbrecht), 58 years of age, and Stephen J. Wilshinsky, 59 years of age, in Los Angeles, California.
De Maison, a self described “merchant banker”, devised a scheme and artifice to defraud investors by creating public “shell” companies, executing a merger of an emerging business with the shell to create a publicly traded company, and then paying undisclosed kickbacks to brokers, including Wilshinsky, in exchange for using their clients’ funds to purchase shares of the resulting penny stock. The public companies that De Maison created typically conducted minimal actual business activity and had little revenue with no profit. To generate income from the shell companies, De Maison utilized various schemes to sell his company shares to generate personal income. De Maison utilized the same individuals over and over in his schemes.
The complaint alleges that De Maison conspired with brokers, including Wilshinsky, to ensure that any time he wanted to sell free trading shares on the open market, there would be an available buyer. Despite typical low volume trading in the stocks controlled by De Maison, when he wanted to sell on the open market, orders were filled almost instantaneously. This immediate fulfillment was because De Maison conspired with brokers who had some discretion to make trades in their investor/clients’ accounts. De Maison paid brokers an undisclosed “kickback”, typically fifty percent of the total sale price, in exchange for the brokers using the investor/clients’ accounts the brokers controlled to purchase De Maison’s stocks on the open market. It is unlawful to not disclose the kickbacks to the investor/clients and to not disclose to the investor/clients that their accounts were, in fact, trading in such risky penny stocks.
Another necessary aspect to this scheme for it to succeed was for De Maison, at least for some period of time, to cause the stock price in the companies he controlled to rise before plummeting to a price point that reflected the actual business performance. De Maison conspired with others to inflate the price point through false reporting and manipulative business activities, all of which affected the stock price and helped De Maison achieve the maximum value out of the shares he owned, according to the complaint.
De Maison and Wilshinsky are both charged with conspiracy to commit wire fraud and securities fraud. De Maison is also charged with wire fraud, securities fraud, money laundering and use of interstate commerce for purpose of securities fraud. This matter is considered an on-going investigation. Additional charges are expected against these two individuals and additional individuals are expected to be charged for their roles in this multi-million dollar conspiracy. A number of victims are from the Northern Ohio area.
“These two are nothing more than sophisticated thieves,” said Anthony. “Putting a suit on and calling it investing does not make stealing acceptable. The FBI will continue to work with the SEC to make sure these two and their additional conspirators answer for this multi-million dollar fraud.”
”The FBI and SEC continue to work tirelessly to investigate financial fraud,” Dettelbach said. “We will prosecute cases as they are brought to us to ensure faith in the markets and to seek justice for those who have been victimized.”
De Maison and Wilshinsky were taken into custody by FBI agents from the Los Angeles office without incident.
A complaint is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt. If convicted, the defendants’ sentences will be determined by the court after review of factors unique to this case, including the defendants’ prior criminal records, if any; their role in the offenses; and the characteristics of the violations. In all cases, the sentences will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
Holland Man Charged with Identity Theft and Making False StatementsRead the Press Release
Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced an indictment was filed against Wael Ahmed Hageali, age 44, of Holland, Ohio.
The indictment charges Hageali with making a false statement on a passport application on March 17, 2014 and aggravated identity theft.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, and the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the Department of State, Bureau of Diplomatic Security. The case is being handled by Assistant United States Attorney Noah P. Hood.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Former Gates Mills Man Charged with Defrauding Investors Out of Millions of DollarsRead the Press Release
A 19-count federal indictment was filed charging a former Gates Mills resident with operating a $9.6 million investment scheme in which he defrauded investors and enriched himself, law enforcement officials said.
Oscar Villarreal, age 27, of Mexico, used the ill-gotten money to purchase a Lamborghini, a Steinway piano and otherwise live a lavish lifestyle, according to the indictment.
He has been charged with 10 counts of wire fraud, seven counts of money laundering, one count of securities fraud and one count of investment adviser fraud.
“This defendant used lies and deception to rip off investors and lead an extravagant lifestyle,” said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
“Mr. Villarreal utilized his charisma and bogus information to defraud hard working individuals,” said Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office. “It is believed that Mr. Villarreal has fled the Cleveland area and the FBI is asking the public to provide any information they have regarding his current whereabouts so that he may answer for his numerous years as a fraudster.”
“When you knowingly mix deceit and trickery into the financial well-being of individuals, you create a recipe for devastation that could last a lifetime,” said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.
The investment scheme took place between 2008 and 2013. At different times, Villarreal operated numerous partnership or limited liability corporations, including WW Capital III, L.P., WW Capital III LLC (also known as WWCIII), WW Capital Partners LLC, (also known as Fund II) and Black Mountain Enterprises, LLC, and maintained several bank accounts and E-Trade trading accounts, according to the indictment.
WWCIII was a fund that purported to pursue investments with companies in Mexico related to the petroleum, steel, metals and real estate industries. Villarreal promoted and sold investment contracts in the form of limited partnership interests in the funds to approximately 46 investors in Ohio, Florida, New Jersey and New York in the amount of more than $9.6 million, according to the indictment.
From January 2008 through January 2009, Villarreal solicited approximately $550,000 from seven investors for Fund II, falsely representing the money would be used in the Mexican metal industry, according to the indictment.In February 2009, Villarreal distributed approximately $715,000 to Fund II investors, which he misrepresented as profits from their investment. He failed to disclose to investors that he had received a consulting fee of $1.5 million from a Cleveland-area company for unrelated services, and that he used money from that, as well as from his personal line of credit, to pay Fund II investors. Villarreal later falsely represented to potential investors in WWCIII that Fund II had generated a 45 percent rate of return, when he knew Fund II had generated no returns, according to the indictment.
Rather than investing WWCIII funds for their stated purpose, Villarreal used investor money to make speculative trades from his E-Trade accounts, pay business expenses necessary to promote the investment scheme, purchase luxury items such as a Steinway piano and a Lamborghini, and otherwise fund a lavish lifestyle, according to the indictment.
Villarreal falsely reported to WWCIII investors, both orally and in writing, that their funds would be pooled and used to invest in the Mexican steel and petroleum industries, Mexican real estate and/or Mexican infrastructure projects. Villarreal further represented that he would use personal and family business connections in Mexico to make the investments, according to the indictment.
Instead, he diverted investor funds into an E-Trade account where he made speculative stock trades which lost millions of dollars in investor funds. Villarreal falsely represented to WWCIII investors that they were achieving positive returns on their investments, causing most investors to be lulled into the belief they were making money. Based upon his false statements, some of the WWCIII investors placed even more money into other investment opportunities offered by Villarreal, according to the indictment.
This indictment is the result of an investigation by Federal Bureau of Investigation, the Internal Revenue Service – Criminal Investigations and the Securities and Exchange Commission. The case is being prosecuted by Assistant U.S. Attorney Adam Hollingsworth and Special Assistant U.S. Attorney Derek Kleinmann.
If convicted, the defendant’s sentence will be determined by the court after a review of the federal sentencing guidelines and factors unique to the case, including the defendant’s prior criminal record (if any), the defendant’s role in the offense and the characteristics of the violation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Elyria Man Faces Likely 20-Year Prison Sentence for Dealing Heroin and Fentanyl That Caused Fatal OverdoseRead the Press Release
An Elyria man faces a likely sentence of 20 years in prison after pleading guilty to distributing heroin and fentanyl, including fentanyl that caused the death of an Elyria resident last year, law enforcement officials said.
The guilty plea was announced by Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, Ohio Attorney General Mike DeWine, Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office, and Elyria Police Chief Duane Whitely.
Siarres R. Noble, age 29, pleaded guilty to four counts of distribution of fentanyl, two counts of distribution of heroin and one count of possession with intent to distribute fentanyl.
Noble’s plea agreement calls for a recommended sentence of 20 years in federal prison. He is scheduled to be sentenced Dec. 17.
Noble admitted selling heroin and fentanyl at various times in March and November 2013, including fentanyl that he sold on November 8, 2013, which resulted in the death of an Elyria resident one day later.
“The drugs sold by this defendant killed a woman,” Dettelbach said. “Heroin and fentanyl use leads to death, destroys lives and damages families. This should send a clear message to drug dealers who are doing nothing more than selling poison, that we in law enforcement will work death and overdose cases back from the victims, identify who supplied them the drugs and hold them accountable for their actions.”
“State, local and federal authorities are taking the opiate epidemic very seriously, and drug dealers need to know that they will be held accountable for overdose deaths,” said Attorney General DeWine. “Not only are these dealers putting the lives of those they sell to at risk, but they are also putting themselves at risk of being locked up for decades in prison.”
“Information about heroin and other dangerous illegal drugs has become too common place in our daily news reports,” said Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland Office. “The partnership between law enforcement, social services and the community must continue in order to further attempts to rid our territory of these highly addictive substances.”
Elyria Police Chief Duane Whitely said: “There is a serious drug problem in this country and it is important that law enforcement at every level take the steps necessary to combat the sales of illegal drugs. Sadly, in this case, the sale of drugs led to someone’s death. The weapon used may not have been a gun, but it is just as deadly.
“I want to thank everyone involved in this case for the effort they put into it. Starting with the response from Elyria Police Investigative Unit for responding so quickly to the spike in overdoses that led to the arrest of Siarres Noble for selling the drugs that led to the death. I appreciate the great working relationship with have with the FBI and the U.S. Attorney’s office. It is the strong working relationship between all of these agencies that led to the federal conviction of Siarres Noble,” Whitely said.
This case was investigated by the Elyria Police Department and the Federal Bureau of Investigation and prosecuted by Assistant United States Attorneys Robert F. Corts and Vasile C. Katsaros and Special Assistant United States Attorney Margaret Tomaro of the Ohio Attorney General’s Office.
Mexican National Charged Will Illegally Entering the U.S.Read the Press Release
An indictment was filed charging Raul Zarazua-Rubio, 46, of Mexico, with unlawful reentry into the United States on September 1, 2014, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, and the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the Department of Homeland Security, Immigration and Customs Enforcement, Homeland Security Investigations, Strongsville, Ohio. The case is being handled by Assistant United States Attorney Noah P. Hood.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Three New York Men Indicted for Credit Card Fraud ConspiracyRead the Press Release
Three New York men were indicted on one count of conspiracy to commit and committing credit card fraud, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Indicted are: Mohammad Parvez, age 23, of Brooklyn, New York; Fazly Azzam, age 22, of Brooklyn, New York; and Shaha Jalal, age 35, of New York, New York.
The indictment alleges that in August 2014, Parvez, Azzam and Jalal conspired with each other to commit fraud in connection with access devices. The defendants illegally obtained credit card account numbers assigned to more than 100 credit cards. An unidentified member of the conspiracy electronically encoded the illegally obtained credit card numbers onto credit cards embossed with the names of Parvez, Azzam and Jalal. Using these credit cards, the defendants obtained and attempted to obtain property and services from retail stores, according to the indictment.
If convicted, the defendants’ sentences will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictment was conducted by the Department of Homeland Security, Immigration and Customs Enforcement, Homeland Security Investigations and the United States Secret Service. The matter is being prosecuted by Assistant United States Attorney David M. Toepfer.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Cleveland Man Charged with Robbing Bank on Brookpark RoadRead the Press Release
A grand jury returned a one-count indictments charging Jeremy D. Carpenter, 33, of Cleveland, with one count of bank robbery, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment alleges that Carpenter robbed the U.S. Bank, 2132 Brookpark Road, Cleveland, Ohio, on August 5, 2014
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to his case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant U.S. Attorney Matthew B. Kall, and was investigated by the Cleveland Police Department and the Cleveland Office of the Federal Bureau of Investigation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Bay Village Man Indicted for Bank RobberyRead the Press Release
A grand jury returned a one-count indictment charging Robert T. Gauna, 31, of Bay Village, with one count of bank robbery, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment alleges that Gauna robbed the Lorain National Bank, 42935 North Ridge Road, Elyria Township, Ohio, a federally insured financial institution, on July 14, 2014.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to his case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant U.S. Attorney Matthew B. Kall, and was investigated by the Lorain County Sheriff’s Office and the Elyria Resident Agency of the Federal Bureau of Investigation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Cuyahoga Falls Man Sentenced to 30 Years in Prison for Trying to Buy A ChildRead the Press Release
A Cuyahoga Falls man was sentenced to 30 years in prison for attempting to purchase a 10-year-old girl, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Cleveland Division of the Federal Bureau of Investigation.
Robert W. Thomas, age 37, was found guilty earlier this year on three counts: offering to buy a child, enticement and receipt and distribution of visual depictions of minors engaged in sexually explicit conduct.
"This sentence is well-deserved given the disturbing nature of the charges," Dettelbach said. “Our office remains committed to working with the FBI and all our law enforcement partners to defend our children and fight human trafficking.”
“This case is the result of outstanding investigative work completed by the FBI and the Alliance Police Department and our partners,” Anthony said. “Law enforcement will continue to proactively and aggressively pursue predators that intend to harm our children.”
"The city of Alliance is very satisfied with the result in this matter," said Law Director Jennifer L. Arnold. "The level of professionalism and cooperation of all the agencies involved was impressive. I was proud to work with everyone involved, especially Detective Shatzer, who spearheaded the investigation."
On January 11, 2014, detectives from the Alliance Police Department arrested a man who was attempting to purchase a 10-year-old female child to keep and use for sexual purposes. The man had posted on an online site asking for anyone willing to arrange a “marriage” of their daughter to him. An Alliance Police Department officer, also assigned to the Ohio Internet Crimes Against Children Task Force, responded to the man’s posting and began a conversation, according to court documents.
Thomas agreed to a meeting with the online undercover officer to purchase for $400 what he believed to be a 10-year-old child. Thomas and the officer, acting in an undercover capacity, met in a business establishment in Alliance and then went outside to complete the “transaction.” As the two approached the undercover officer’s vehicle, Thomas was arrested. At the time of arrest, Thomas had $400 cash in his hand, according to court documents.
This case was investigated by the Federal Bureau of Investigation and Alliance Police Department, with assistance from the Cuyahoga Falls Police Department. The case was prosecuted by Assistant U.S. Attorney Michael A. Sullivan.
Highland Heights Man Pleads Guilty to Sending White Powder to IRSRead the Press Release
A Highland Heights man pleaded guilty today after sending a letter containing white powder to the Internal Revenue Service, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office.
John T. Buchak, 27, pleaded guilty to one count of threatening use of a weapon of mass destruction. He is scheduled to be sentenced on Dec. 4.
Buchak sent a letter via the U.S. Mail to the Internal Revenue Service on March 31, 2014, that contained white powder, according to the indictment.
This case is being prosecuted by Assistant U.S. Attorney Chelsea Rice following an investigation by the Federal Bureau of Investigation.
Former Head of Cleveland Anti-Poverty Agency Pleads Guilty to Bribery and Related CrimesRead the Press Release
The former head of a Cleveland-area anti-poverty agency pleaded guilty to accepting more than $23,000 in cash, home renovations and other things of value in exchange for steering work to specific contractors, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland office..
Jacqueline K. Middleton, 69, of Shaker Heights, pleaded guilty to two counts of honest services fraud, one count of bribery in federally funded programs and one count of Hobbs Act Conspiracy. She is scheduled to be sentenced Dec. 3.
“Middleton violated the trust of taxpayers and the people she had pledged to serve,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
"Middleton padded her pocket with monies for federally funded contracts she awarded," Anthony said. "Law enforcement will continue to root out individuals illegally capitalizing on their trusted position. ”
Middleton served as president and chief executive officer of the Council of Economic Opportunities of Greater Cleveland. The CEOGC was organized with the purpose of serving low-income people of Cuyahoga County and Greater Cleveland. The CEOGC administered several federal, state and local programs designed to address the needs of low-income individuals, including Head Start, the Community Services Block Grant program and the Home Energy Assistance program.
From 2008 through around August 7, 2012, Middleton used her official position to enrich herself by soliciting and accepting gifts, payments and other things of value from contractors who did business with CEOGC. These gifts and payments were made in exchange for favorable action from Middleton for the payors and their companies, according to the information.
Middleton solicited and accepted gifts, payments and other things of value totaling more than $12,017 from a person identified as Contractor No. 1 and totaling approximately $11,200 from a person identified as Contractor No. 2. The things of value included kickbacks from CEOGC payments, home renovation work and payments to vendors for related supplies on her behalf, according to the information.
Middleton provided official favorable action Company No. 1 and Contractor No. 2 as requested and as opportunities arose. That included authorizing CEOGC contracts which retained Contractor No. 2 for consulting services and which retained Company No. 1 for work including parking lot renovations, classroom remodeling and flooring remodeling at various sites and offices administered by CEOGC, according to the information.
The case is being prosecuted by Assistant U.S. Attorney Michael L. Collyer following an investigation by the Federal Bureau of Investigation and the Department of Health and Human Services – Office of Inspector General.
Executives at Youngstown Construction Company Sent to Prison for Tax ConvictionRead the Press Release
Two officials at a Youngstown construction and excavation company were each sentenced to nearly two years in prison for willfull failure to pay taxes, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Scott Bonamase, age 49, of Streetsboro, Ohio, and David Bonamase, age 53, of Canfield, Ohio, were sentenced to 21 months in prison after they avoided paying more than $279,000 in taxes, according to the indictment.
The charges were in connection with their operation of A. Bonamase Contracting, Inc., which employed between 10 to 25 employees for the years 2006 through 2009. During that time period, Scott Bonamase willfully under-reported employee gross wages to the Internal Revenue Service and Scott and David Bonamase omitted payments to employees in the books and records of the company, according to court documents.
A. Bonamase Contracting, Inc. had contracts with government agencies that required certified payroll reports to verify that they were paying the prevailing wage. Scott and David Bonamase willfully falsified, signed, and submitted certified payroll reports to the government. Scott and David Bonamase certified that their employees were being paid the prevailing when, in fact, they were paid less, according to court documents.
The case results from an investigation conducted by the United States Department of Labor and Department of Housing and Urban Development, Office of the Inspector General and the Internal Revenue Service, Criminal Investigation agents. This case is being prosecuted by Assistant United States Attorney Henry F. DeBaggis.
Cleveland Company Pleads Guilty to Making Illegal Discharges into Sewer SystemRead the Press Release
Cleveland-based Kelly Plating Company pleaded guilty to making illegal discharges with high concentrations of metals such as chrome and zinc into the sewer system, which in turn, after treatment, discharges to Lake Erie, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The company pleaded guilty today to one count of conspiracy to violate the Clean Water Act and one count of violating an approved pretreatment program.
An employee at Kelly Plating bypassed the pollution control equipment and discharged partially treated wastewater and sludge directly into the sewer system. These discharges contained high concentrations of chrome and zinc. This happened at least 14 times between March and May, 2012, according to court documents.
Under the terms of the plea agreement, both parties agree to recommend to the court that Kelly Plating pay a $50,000 fine as well as a $25,000 community service payment. The community service payment will be made to a charitable organization to be presented to the court prior to sentencing. The charitable organization will use the payment to improve water quality in Northeast Ohio, according to the plea agreement.
Sentencing is scheduled for Dec. 11.
Criminal charges remain pending against a Kelly Plating employee who was indicted earlier this year.
This case is being prosecuted by Special Assistant U.S. Attorney Brad Beeson following an investigation by the Ohio EPA, U.S. EPA, the Ohio Bureau of Criminal Investigation, and Northeast Ohio Regional Sewer District.
Solon Doctor Indicted for Health Care Fraud and Illegally Distributing Prescription PainkillersRead the Press Release
A 46-count indictment was filed charging a Solon doctor with illegally distributing thousands of doses of prescription painkillers such as Percocet, Oxycontin and Opana to people with no legitimate medical need for the drugs, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Syed Jawad Akhtar-Zaidi, age 59, was indicted on one count of conspiracy to distribute controlled substances, one count of health care fraud, 36 counts of distribution of controlled substances, and eight counts of money laundering.
Zaidi operated Pain Management of Northern Ohio (PMNO) at 34055 Solon Road in Solon, where he issued drug orders purporting to be “prescriptions” for controlled substances, primarily oxycodone, oxymorphone, hydrocodone, hydromorphone and morphine, to customers they characterized as “patients,” according to the indictment.
Zaidi knowingly and intentionally distributed and dispensed controlled substances for no legitimate medical purpose and outside the court of professional practice through several actions, such as: without adequately verifying the patient’s identity and medical complaint; without adequate and reliable patient medical history; without establishing a true diagnosis; without performing a complete examination; without establishing a treatment plan and without maintaining adequate medical records, according to the indictment.
Zaidi used pre-signed blank prescription forms upon which PMNO staff would fill in the controlled substance and dosage to be prescribed. He also instructed staff not to report customers who staff suspected of being “drug seeking” and/or “doctor shopping to law enforcement, according to the indictment.
The indictment details dozens of transactions in 2012 and 2013 in which customers received thousands of doses of Oxycontin, Percocet, Vicodin, morphine and other prescription painkillers.
Zaidi enriched himself by submitting claims to Medicaid, Medicare and various private insurers, and receiving payments, for office visits which served no legitimate medical purpose. Zaidi selected the billing code, which his staff then submitted on the doctor’s behalf, according to the indictment.
The charges also seek to forfeit more than $4.8 million in accounts controlled by Zaidi as well as 139 pieces of jewelry valued at more than $90,000. Prosecutors contend the property is derived from gross proceeds traceable to the violations laid out in the indictment.
The case was prosecuted by Assistant U.S. Attorneys Henry DeBaggis and Matthew Kall following an investigation by the Drug Enforcement Administration, the Federal Bureau of Investigation and the Office of Health and Human Services – Office of Inspector General.
Massillon Man Faces Child Pornography ChargeRead the Press Release
Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, announced today that Gregory Allen Mays, 53, of Massillon, Ohio, was charged with producing visual depictions of minors engaged in sexually explicit conduct.
The indictment charges that from in or about June 14, 2013, through on or about July 23, 2013, Mays did use, persuade, induce, entice and coerce a minor to engage in sexually explicit conduct, for the purpose of producing a visual depiction of such conduct and such visual depiction was produced or transmitted using materials that had been mailed, shipped, and transported in or affecting interstate or foreign commerce by any means, including by computer.
If convicted, the sentence in this case will be determined by the Court after consideration of the federal sentencing guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Carol M. Skutnik. The case was investigated by the Federal Bureau of Investigation, Canton Office.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Four Cleveland Men Indicted for Trafficking in Counterfeit TrademarksRead the Press Release
A federal indictment was filed today charging four individuals with trafficking in counterfeit trademarks, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Osama Iwais, age 36, Samer Iwais, age 31, Tarek Iwais, age 35, and Kalid Iwais, age 36, all of Cleveland, Ohio, are named in the one-count indictment.
The indictment alleges that between December 13, 2011, and March 7, 2012, the defendants did intentionally traffic, attempt to traffic and aid and abet the trafficking and attempted trafficking in goods, specifically, Ralph Lauren Polo shirts, boots and shorts, Ugg boots, Nike footwear, Timberland boots, Gucci footwear, New Era hats, True Religion jeans, North Face jackets and Lacoste boots, while knowingly using on or in connection with said merchandise counterfeit trademarks which were identical to and substantially indistinguishable from marks that were in use for such goods, and which were registered with the U.S. Patent and Trademark Office.
The indictment alleges that the merchandise in question, if genuine, had an aggregate value of approximately $95,000.
The case is being prosecuted by Assistant United States Attorney Robert W. Kern following an investigation by the Federal Bureau of Investigation and the Cleveland Police Department.
If convicted, the defendants’ sentences will be determined by the court after review of factors unique to this case, including the defendants’ prior criminal records, if any, the defendants’ role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Cleveland Man Sentenced to 17 Years in Prison for Heroin TraffickingRead the Press Release
A Cleveland man was sentenced to 17 1/2 years in prison for his role in a major heroin trafficking conspiracy, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland office.
Maceo Moore, 37, pleaded guilty in February to one count of conspiracy to possess with intent to distribute heroin.
U.S. District Judge Christopher Boyko sentenced Moore to 210 months in federal prison. Boyko also ordered Moore to forfeit $9,550 in cash and a 2007 Mercedes Benz.
“This defendant was featured in movies and music videos but now his talents will be confined to federal prison,” Dettelbach said. “He played a starring role in a criminal conspiracy involving heroin and firearms, and for that, richly deserves this sentence.”
“Maceo Moore will no longer profit from harming others by selling drugs as his glamorization of a drug dealer’s lifestyle appropriately ends in a lengthy prison sentence,” Anthony said. “Thankfully, Moore was brought to justice by law enforcement professionals who work every day to protect the public from violent people like him.”
Moore obtained heroin that was originally shipped from Atlanta to Northeast Ohio, which he in turn sold to others, according to court documents.
Moore and others also planned and committed burglaries and robberies from other drug dealers, customers, and each other. This was done to fund their drug trafficking, to obtain heroin and other drugs, and to collect drug debts, according to court documents.
The men then sold the stolen heroin at discounted prices or used the stolen money to obtain heroin. They identified potential victims through a variety of ways, including targeting those who appeared to have expensive jewelry or cars or by using women to gather information about potential victims and report back to them. They sometimes used firearms or zipties to restrain victims, according to court documents.
According to a sentencing memo filed in the case, Moore told undercover officers in 2012: “I sold drugs, but I started getting more money when I started taking from the drug dealers. That’s how, honestly, that’s how I got my money. I sold drugs, but I always been the hustler, so I sold drugs, I find out such and such over here got it, they doing good, well, we going to get that. Flat out, we going to get it.”
This case is being prosecuted by Assistant U.S. Attorneys Matthew W. Shepherd, Daniel J. Riedl, and Matthew B. Kall, following a multi-year investigation by the Northern Ohio Law Enforcement Task Force (NOLETF).
The NOLETF is a long standing multi-agency task force comprised of investigators from the Federal Bureau of Investigation, Cuyahoga Metropolitan Housing Authority, Drug Enforcement Administration, Internal Revenue Service, U.S. Coast Guard Investigative Service, Cleveland Division of Police, Cleveland Heights Police Department, Cuyahoga County Sheriff’s Office, Euclid Police Department, Regional Transit Authority Police Department, Westlake Police Department, and Shaker Heights Police Department. The NOLETF is also one of the initial Ohio High Intensity Drug Trafficking Area (HIDTA) initiatives. HIDTA supports and helps coordinate numerous Ohio drug task forces in their efforts to eliminate or reduce drug trafficking in Ohio.
The investigation was assisted by the Hotel Interdiction Team, another HIDTA initiative composed of members of the FBI, Cuyahoga County Sheriff’s Office, Homeland Security Investigations, and police departments from Broadview Heights, Brooklyn, Brook Park, and Independence.
Two Men Charged with Defrauding Cleveland Credit Union Out of $1.9 MillionRead the Press Release
Two men from Northeast Ohio were charged with conspiring to defraud a Cleveland credit union out of nearly $1.9 million, law enforcement officials said.
Gary Chaney, 49, of Streetsboro, and Patrick Bruckman, 58, of Chester Township, were each charged with one count of conspiracy to commit theft or embezzlement from a credit union.
The charges were announced by Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, Stephen D. Anthony and Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office.
Bruckman and Chaney both maintained personal accounts at Taupa Lithuanian Credit Union, as well as a corporate account for Network Systems Engineering (NSE), a computer consulting firm they owned together, according to the information.
Bruckman, Chaney, credit union CEO Alex Spirikaitis and others conspired to defraud the credit union from at least 2007 through 2013. During that time, Bruckman and Chaney knowingly wrote checks drawn on their personal and corporate accounts for which there were insufficient funds, according to the criminal information.
Chaney withdrew approximately $241,000 from his personal account, Bruckman withdrew approximately $63,000 from his personal account and they collectively withdrew $1,582,000 from their corporate accounts for which there were insufficient funds, for a total loss to the credit union of $1,886,000, according to the information.
Chaney and Bruckman did not have sufficient funds in their accounts to cover the checks, and Spirikaitis allowed the overdrafts to clear the account. Chaney and Bruckman made minimal deposits to their accounts, which did not offset the large amount of funds which Spirikaitis transferred to their accounts at Taupa. At no time during the conspiracy did Chaney or Bruckman submit any credit applications or loan documentation for the money they received from Spirikaitis to cover their overdrafts, according to the information.
The National Credit Union Administration and the Ohio Department of Commerce took possession of Taupa last year and placed it into receivership due to its insolvency. Taupa, based in Cleveland, had about 1,150 members and assets of approximately $24 million, according to court records.
Spirikaitis, former teller Michael Ruksenas and Vytas Apanavicius have previously been found guilty for their roles in conspiracies related to defrauding the credit union.
This case is being prosecuted by Assistant United States Attorney Robert J. Patton and Special Assistant United States Attorney Derek Kleinmann. The case was investigated by the Federal Bureau of Investigation.
If convicted, the defendants’ sentences will be determined by the court after consideration of the federal sentencing guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Toledo Man Sentenced to More Than 18 Years in Prison for Human TraffickingRead the Press Release
A Toledo man was sentenced to more than 18 years in prison sex trafficking involving a minor, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI's Cleveland Office.
Taurus Devault, 27, was sentenced to 224 months in prison by U.S. District Judge James Carr. Devault pleaded guilty last year to one count of sex trafficking of a minor and one count of conspiring to use a facility of interstate commerce (i.e. the internet and the telephone network) to promote a business enterprise involving prostitution.
Co-conspirator Duane Hill, 26 and also from Toledo, was sentenced to more than 16 years in prison earlier this year.
"These defendants made their profits using underage girls," Dettelbach. "We will continue to work with our partners to prosecute human trafficking cases in all their many forms."
"Protecting our nation's children is one of the highest priorities in the FBI," Anthony said. "No one should be able to pick up a phone or go online to purchase a child. People who traffic children for their own financial gain deserve - and are getting - the highest possible sentences the court can hand down. "
Devault and Hill conspired together in 2012 to offer underage girls for sale on the web site backpage.com to engage in commercial sex acts, according to court documents.
The investigating agency in this case is the Northwest Ohio Violent Crimes Against Children Task Force which consists of the Federal Bureau of Investigation, Toledo, Ohio, Toledo Police Department, Perrysburg Township Police Department, Lima Police Department, Oregon Police Department, Fulton County Sheriff’s Office, Ottawa County Sheriff’s Office, Ohio State Highway Patrol, and the Bureau of Criminal Investigation. The case is being handled by Assistant United States Attorney Daniel Hurley.
Massillon Landlords Pay $850,000 to Resolve Housing Discrimination LawsuitsRead the Press Release
The Justice Department announced today that Massillon, Ohio landlords John and Mary Ruth have agreed to pay $850,000 to settle lawsuits filed by the Justice Department and other parties alleging that the Ruths discriminated on the basis of race and familial status at properties they formerly owned in Massillon.
The settlement must still be approved by United States District Judge John R. Adams in the Northern District of Ohio.
The proposed settlement would resolve a lawsuit filed by the department on October 31, 2011, alleging that the Ruths and the companies through which they manage their properties had discriminated against African Americans and families with children at Yorkshire Apartments, Thackeray Ledges and Wales Ridge— three apartment complexes located in Massillon, Ohio. The settlement would also resolve related lawsuits raising similar allegations filed by Stark County, the Ohio Civil Rights Commission and several former property managers and tenants at the complexes. In an order issued on March 31, 2014, the court noted that 10 of Mr. Ruth’s former employees had testified that they were instructed to discriminate against African Americans and that other former employees had testified that they been instructed to discriminate against families with children. The court ruled that the department had presented sufficient evidence of a pattern or practice of unlawful discrimination by the defendants for the case to go to trial before a jury.
Under the terms of the settlement, the defendants will pay:
- $650,000 in damages and attorney’s fees to the plaintiffs in the lawsuits filed by the Ohio Civil Rights Commission, Stark County and several former residents and property managers;
- $175,000 in damages to 11 additional former residents and employees identified by the United States who had been harmed by the defendants’ discrimination; and
- $25,000 in a civil penalty to the United States.
“It is a sad fact that decades after the passage of the Fair Housing Act, many people still face unlawful discrimination when looking for housing,” said Molly Moran, Acting Assistant Attorney General for the Civil Rights Division. “The magnitude of this settlement makes clear that the Department of Justice will vigorously pursue violations of the Fair Housing Act.”
“The freedom of every family to live where they wish, without regard to their race or if they have kids, is basic to who we are in this country,” said U.S. Attorney Steven M. Dettelbach for the Northern District of Ohio. “When landlords deny that basic right, there will be consequences. We will continue to work hard to ensure that this fundamental right is protected in Ohio and across the nation.”
The settlement also requires that the defendants hire an independent management company to manage all of their rental properties, receive training on the requirements of the Fair Housing Act and report to the department for a period of three years on their compliance with the settlement. The settlement also requires the defendants to hire a third party to periodically test their properties to ensure compliance with the Fair Housing Act.
Fighting illegal housing discrimination is a top priority of the Department of Justice. The federal Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Individuals who believe that they may have been victims of housing discrimination can call the Justice Department at 1-800-896-7743, e-mail the Justice Department at [email protected], or contact HUD at 1-800-669-9777 or through its website at http://portal.hud.gov/hudportal/HUD?src=/program_offices/fair_housing_equal_opp.
Three Cleveland Men Sentenced to Prison for Bank RobberyRead the Press Release
Three Cleveland men were sentenced to prison for their roles in an armed robbery of a Euclid bank, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI's Cleveland office.
Shawn Caldwell, 22, was sentenced to more than 24 years in prison. Julian Anderson, 23, was sentenced to more than 11 years in prison. Dejuan Brown, 24, was sentenced to more than 10 years in prison.
The men aided and abetted one another in robbing a PNC Bank in Euclid, Ohio, on January 24, 2014. They stole approximately $39,900 from the bank and that they carried and brandished firearms during the robbery.
A fourth defendant, Germain D. Davis, Jr., 20, will be sentenced next week.
The case is being prosecuted by Assistant U.S. Attorney M. Kendra Klump and Michelle M. Baeppler following an investigation by the Federal Bureau of Investigation and the Euclid Police Department.
Westlake Cardiologist Indicted for Performing Unnecessay Medical Procedures and Tests to Overbill Insurers by $7.2 MillionRead the Press Release
A 16-count indictment was unsealed in federal court charging a Westlake cardiologist with performing unnecessary catheterizations, tests, stent insertions and causing unnecessary coronary artery bypass surgeries as part of a scheme to overbill Medicare and other insurers by $7.2 million, law enforcement officials said.
Dr. Harold Persaud, 55, was indicted on one count of health care fraud, 14 counts of making false statements and one count of engaging in monetary transactions in property derived from criminal activity.
The indictment was announced by Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio, Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland Office, and Lamont Pugh III, Special Agent in Charge, U.S. Department of Health & Human Services, Office of Inspector General – Chicago Region.
“The charges in this case are deeply troubling,” U.S. Attorney Dettelbach said. “Inflating Medicare billings alone would be bad enough. Falsifying cardiac care records, making an unnecessary referral for open heart surgery and performing needless and sometimes invasive heart tests and procedures is inconsistent with not only federal law but a doctor’s basic duty to his patients.”
“This doctor violated the sacred trust between doctor and patient by ordering unnecessary tests, procedures and surgeries to line his pockets,” Special Agent Anthony said. “He ripped off taxpayers and put patients’ lives at risk.”
“Medical providers have a duty and obligation to provide only those services that are medically necessary and are in the best interests of the patients under their care,” Special Agent in Charge Pugh said. “The conduct alleged in this indictment outlines a disregard for patient needs in exchange for financial gain at taxpayer expense. The OIG will continue to work with our law enforcement and prosecutorial partners to identify fraudulent health care schemes and hold individuals accountable for their actions.”
Persaud had a private medical practice at 29099 Health Campus Drive in Westlake and had hospital privileges at Fairview Hospital, St. John’s Medical Center and Southwest General Hospital, according to the indictment.
Persaud devised a scheme to defraud and obtain money from Medicare and other insurers. The scheme took place between Feb. 16, 2006, through June 28, 2012, according to the indictment.
According to the indictment, his activities in furtherance of the scheme included but were not limited to:
- Persaud selected the billing code for each customer submitted to Medicare and private insurers, and used codes that reflected a service that was more costly than that which was actually performed;
- Persaud performed nuclear stress tests on patients that were not medically necessary;
- He knowingly recorded false results of patients’ nuclear stress tests to justify cardiac catheterization procedures that were not medically necessary;
- Persaud performed cardiac catheterizations on patients at the hospitals and falsely recorded the existence and extent of lesions (blockage) observed during the procedures;
- He recorded false symptoms in patient records to justify testing and procedures on patients;
- Persaud inserted cardiac stents in patients who did not have 70 percent or more blockage in the vessel that he stented and who did not have symptoms of blockage;
- He placed a stent in a stenosed artery that already had a functioning bypass, thus providing no medical benefit and increasing the risk of harm to the patient;
- He improperly referred patients for coronary artery bypass surgery when there was no medical necessity for such surgery, which benefitted Persaud by increasing the amount of follow-up testing he could perform and bill to Medicare and private insurers;
- Persaud performed medically unnecessary stent procedures, aortograms, renal angiograms and other procedures and tests.
As a result of this scheme, Persaud overbilled and caused the overbilling of Medicare and private insurers in the amount of approximately $7.2 million, of which Medicare and the private insurers paid approximately $1.5 million, according to the indictment.
The indictment seeks to forfeit $93,446 in an account in the name of Harold Persaud and $250,188 in an account in the name of Roberta Persaud.
This case is being prosecuted by Assistant U.S. Attorneys Michael L. Collyer and Chelsea Rice following an investigation by the Federal Bureau of Investigation and the U.S. Department of Health and Human Services – Office of Inspector General.
If convicted, the defendant’s sentence will be determined by the court after a review of the federal sentencing guidelines and factors unique to the case, including the defendant’s prior criminal record (if any), the defendant’s role in the offense and the characteristics of the violation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Twenty-Six People Indicted for Heroin and Drug Trafficking in ToledoRead the Press Release
Twenty-six people were indicted for their roles in a conspiracy to bring large amounts of heroin, cocaine and marijuana to Toledo from Arizona, California, Illinois and Mexico, law enforcement officials said.
The 55-count federal indictment was announced by Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio, Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office, Toledo Police Chief William Moton and Lucas County Sheriff John Tharp.
“Heroin abuse is an epidemic in our community that takes lives and destroys families,” Dettelbach said. “We will continue to target drug traffickers while also working to reduce demand and get treatment for those who need it.”
“This is another example of the international drug trafficking connections that are plaguing our communities with danger and heroin,” Anthony said. “The FBI will continue collaborative law enforcement efforts to combat these violent organizations.”
“Through the working relationship that has been developed between the Toledo Police Metro Drug Task Force and the Federal Bureau of Investigation we have become more efficient in targeting the mid- and upper-level heroin dealers in Toledo and surrounding communities,” said Toledo Police Chief William Moton. “These arrests are a byproduct of this successful collaboration. The City of Toledo and surrounding areas are the benefactors of these efforts as the spread of heroin has the potential to deteriorate the standard of living in our community.”
Those indicted are from Toledo unless otherwise noted. They are:
Alejandro Garcia, 44; Regina Navarro, 36; Osvaldo Perez, 60; Sean Machaterre, 31; Dicki Isom, 33; Federico Perez, 25; Daryl Mickles, Jr., 31; Keith Hubbell, 30; David Berrera, Jr., 40; Santos Flores, 34, of Oregon, Ohio; Juan Montano, 35; Daniel Montano, 26; Yousvani Gacita, 34; Davi Mata, 32; Willie Edward Smith, 38; Juan Rivera, 34; Paulo Gonzalez, 27; Abdul Shabazz, 39; Davalon Brown, 28; James Munoz, 37; Victoria Santellana, 31; Daniel Barboza, 38; Anthony Rudess, 42, of Curtice, Ohio; Eric Mays-Clausen, 41; Randolph Kemp, 53, and Jacqueline Jaquez, 40.The defendants conspired between 2010 and this month to bring large shipments of heroin, cocaine and marijuana to Toledo for distribution. Garcia obtained the drugs from suppliers in Arizona, California, Illinois and Mexico and then distributed the drugs to mid-level dealers in the Toledo area. Those dealers, in turn, distributed the drugs to other dealers, according to the indictment.
The indictment details scores of transactions and drug sales that took place in Toledo, including locations at Ravine Park Village, Graham Street, Berry Street, North Ontario Street, Bronson Street, Sylvania Avenue, Westfield Park Mall, Main Street, Starr Avenue, Heatherdowns Road and other locations.
Three people – Garcia, Kemp and Isom – face additional charges of being felons in possession of firearms.
Prosecutors are also seeking to forfeit more than $6,800 in cash, six firearms, nine automobiles and homes at 1509 Navarre Avenue and 625 Parker Avenue in Toledo.This indictment is the result of an investigation by the FBI and the Metro Drug Task Force, made up of members of the Toledo Police Department and the Lucas County Sheriff’s Office. The case is being prosecuted by Assistant U.S. Attorneys Thomas P. Weldon and Michael Freeman.
If convicted, the defendants’ sentences will be determined by the court after a review of the federal sentencing guidelines and factors unique to the case, including the defendant’s prior criminal record (if any), the defendant’s role in the offense and the characteristics of the violation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Two Men Indicted for Defrauding 60 People Out of $6.5 Million Through Real Estate InvestmentRead the Press Release
Two men were indicted on charges they defrauded approximately 60 people out of more than $6.5 million through a fraudulent Arizona real-estate development investment, law enforcement officials said.
Stanley M. Paulic, 41, of Aurora, Ohio, and Steven R. Long, 45 of Mather, California, each face one count of conspiracy to commit mail fraud and wire fraud and one count of wire fraud.
“These individuals ripped off dozens of people, stealing life savings and creating real financial hardships,” said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
“These two individuals stole the hard earned money of others for their own greedy benefit,” said Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland Office. “The FBI and our partners will continue efforts to root out such deceitful perpetrators.”
Paulic and Long co-founded Integrity Financial AZ, LLC, or IFAZ, which had regional offices near Cleveland, Chicago and Sacramento, California. Beginning around 2008, Paulic served as chief executive officer of the company while Long served as president.
Together, the two conspired to unlawfully enrich themselves through false pretenses, representations and other means to individuals seeking to invest money in a legitimate enterprise and instead converting that money to Paulic and Long’s personal use, according to the indictment.
IFAZ solicited investor funds for the purported development of residential real estate in Tonapah, Arizona. At no time during the periods mentioned in the indictment did Long, Paulic or IFAZ register with the U.S. Securities and Exchange Commission.
Paulic and Long represented to prospective investors and IFAZ owned land and built homes in Arizona. They represented to investors that they rented these homes to individuals who were unable to qualify for standard residential mortgages and then, once those renters improved their credit scores, IFAZ sold the homes to them at substantial profit, according to the indictment.
They made these representations in a variety of ways: through the IFAZ web site, holding seminars, including one in Beachwood, Ohio, in April 2009, mailing pamphlets to individuals, including a Richmond Heights resident in 2008, and buying advertisements, such as one purchased in a newspaper in Cleveland in 2009, according to the indictment.
Paulic, Long and IFAZ promised investors they would earn rates of return between 10 and 20 percent, with returns being distributed monthly. Investors were also told their investment would be secured by a deed of trust for a property in Arizona, and that not more than one deed would be associated with each parcel, according to the indictment.
In reality, Long recorded multiple deeds on single parcels and monthly payments made to investors came, at least in part, from other investor funds, according to the indictment.
Paulic and Long used IFAZ investment funds to pay for personal expenditures and expenditures of non-IFAZ corporate entities. For example, from March 2008 to August 2009, Paulic received approximately $586,225 in wire transfers from IFAZ, according to the indictment.
Overall, approximately 60 people invested approximately $8.1 million in IFAZ. Approximately $1.6 million was returned to investors, resulting in a loss to investors of approximately $6.5 million, according to the indictment.
The case is being prosecuted by Assistant U.S. Attorney M. Kendra Klump following an investigation by the Federal Bureau of Investigation and U.S. Postal Inspection Service.
If convicted, the defendants’ sentences will be determined by the court after a review of the federal sentencing guidelines and factors unique to the case, including the defendant’s prior criminal record (if any), the defendant’s role in the offense and the characteristics of the violation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
North Ridgeville Woman Charged with Distributing MethamphetamineRead the Press Release
A federal grand jury returned a two-count indictment charging a North Ridgeville woman and an Arizona man with using the U.S. mail to distribute methamphetamine, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Indicted are Robert Havers, 49, and Patricia Ann Quinn, 43.
On July 24, 2014, Havers mailed approximately one pound of methamphetamine in the U.S. Mail from Phoenix, Arizona, to Quinn in North Ridgeville, Ohio. On July 25, 2014, U.S. Postal Inspectors delivered the package, which Quinn accepted and opened, according to the indictment.
This case is being prosecuted by Assistant United States Attorney Margaret A. Sweeney following an investigation by the United States Postal Inspection Service.
If convicted, the defendants’ sentences will be determined by the Court after review of factors unique to this case, including the defendants’ prior criminal records, if any, the defendants’ roles in the offenses and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Mentor Man Charged with Enticement and Failure to Register as Sex OffenderRead the Press Release
Larun E. Miller, 45, of Mentor, was charged with enticement and failure to register as a sex offender, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment charges that from on or about May 28, 2014, through on or about June 2, 2014, in the Northern District of Ohio, Eastern Division, and elsewhere, Miller did knowingly use facilities and means of interstate and foreign commerce, that is, a cellular phone with Internet connectivity, to attempt to persuade, induce, entice and coerce an individual who had not attained the age of 18 years, that is, a 14-year-old girl to engage in illegal sexual activity with him.
The indictment also charges that from on or about October 1, 2013, through on or about June 3, 2014, in the Northern District of Ohio, Eastern Division, the defendant, Miller, a sex offender as defined for the purposes of the Sex Offender Registration and Notification Act, as a result of being convicted under Federal law, on October 28, 2005, of travel with intent to engage in illicit sexual conduct, in Case No. 5:05CR300, in the Northern District of Ohio, did knowingly fail to register and update registration as required by the Sex Offender Registration and Notification Act.
Lastly, the indictment charges that from on or about May 28, 2014, through on or about June 2, 2014, in the Northern District of Ohio, Eastern Division, and elsewhere, Miller, being required by federal law to register as a sex offender, committed a felony offense involving a minor under Title 18, United States Code, Section 2422(b), to wit: the felony offense charged in count one of the indictment.
If convicted, the sentence in this case will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan. The case was investigated by the United States Marshals Service and the Jefferson County (Colorado) District Attorney’s Office.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Dalton Man Faces Child Pornography ChargesRead the Press Release
Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, announced today that Ryan P. Collins, a 31 year-old male from Dalton, Ohio, was charged with receiving, distributing and possessing visual depictions of minors engaged in sexually explicit conduct.
The indictment charges that from on or about November 17, 2012, through on or about February 19, 2013, Collins knowingly received and distributed in interstate and foreign commerce, by computer, numerous computer files, which files contained visual depictions of real minors engaged in sexually explicit conduct.
The indictment also charges that on February 28, 2013, Collins possessed a computer that contained child pornography.
If convicted, the sentence in this case will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan. The case was investigated by the Canton Office of the Federal Bureau of Investigation and the Canton Police Department.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Concord Township Man Indicted for Defrauding Cleveland Credit Union Out of $2.3 MillionRead the Press Release
A seven-count federal indictment was returned charging a Concord Township man defrauding Taupa Lithuanian Credit Union out of $2.3 million, law enforcement officials said.
John Struna, 51, was indicted on one count of conspiracy to commit bank fraud, one count of bank fraud, one count of making false statements and four counts of money laundering.
The indictment was announced by Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office, and Kathy Enstrom, Special Agent in Charge of the Internal Revenue Service – Criminal Investigations.
“Most people learn early in life that there is no such thing as free money,” Dettelbach said. “This defendant is charged as part of a group that used others' hard earned savings as a personal piggy bank. Mr. Struna’s greed has caught up with him with this indictment.”
“John Struna willfully overdrew his credit union accounts to the tune of $2.3 million through his relationship with a corrupt executive at the credit union,” Anthony said.
“Fraud schemes harm everyone, especially those where someone, for their own personal benefit, has taken what belonged to others,” Enstrom said. “IRS Criminal Investigation is committed to unraveling financial transactions and money laundering schemes where individuals attempt to conceal the true source of their money.”
The National Credit Union Administration and the Ohio Department of Commerce took possession of Taupa last year and placed it into receivership due to its insolvency. Taupa, based in Cleveland, had about 1,150 members and assets of approximately $24 million, according to court records.
Credit union CEO Alex Spirikaitis, former teller Michael Ruksenas and Vytas Apanavicius have previously been found guilty for their roles in conspiracies related to defrauding the credit union.
Struna maintained both personal and corporate accounts at Taupa dating back to 1995. He began a conspiracy with Spirikaitis in 2002 and continued through 2013, during which time Spirikaitis caused Taupa to make approximately 46 fraudulent transfers into Struna’s accounts, according to the indictment.
In 2011, Struna requested and received $112,105 from Spirikaitis for the purchase of a condominium located in Ft. Myers, Florida. At no time did Struna submit any credit applications or loan documents, according to the indictment.
The fraudulent transfers totaled approximately $2.3 million. From 2002 through 2013, Struna repaid only approximately $15,000 of the $2.3 million Spirikaitis transferred into his accounts, according to the indictment.
The indictment also seeks to forfeit a 2014 Jeep Wrangler Unlimited, a 2014 Mazda 6 and the lost money.
This case is being prosecuted by Assistant United States Attorney Robert J. Patton and Special Assistant United States Attorney Derek Kleinmann. The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service.
If convicted, the defendant’s sentence will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Canton Man Faces Child Pornography ChargesRead the Press Release
Shane C. Albert, 23, of Canton, Ohio, was charged with receiving, distributing and possessing visual depictions of minors engaged in sexually explicit conduct, Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment charges that from on or about May 1, 2012, through on or about March 7, 2013, Albert knowingly received and distributed in interstate and foreign commerce, by computer, numerous computer files, which files contained visual depictions of real minors engaged in sexually explicit conduct.
The indictment also charges that on May 1, 2013, Albert possessed a computer that contained child pornography.
If convicted, the sentence sentence in this case will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan. The case was investigated by the Canton Office of the Federal Bureau of Investigation and the Canton Police Department.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Former Office Manager Charged with Embezzling $200,000Read the Press Release
An information was filed in U.S. District Court today charging the former office manager of a Cleveland law firm with embezzling approximately $200,000 from the firm, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Kelly R. Logan, age 42, of Seven Hills, Ohio, is charged in the one-count information. The information alleges that from February 2002 to November 2013, Logan forged approximately 111 checks drawn on accounts maintained by the law firm, and made them payable to her. In addition, Logan made false entries in the books of the law firm to conceal her embezzlement.
If convicted, the defendant’s sentence will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant United States Attorney Ann C. Rowland following an investigation by the Federal Bureau of Investigation.