Northern District of Ohio
Press releases recorded for this federal judicial district.
Avon Man Charged with StructuringRead the Press Release
Larry T. Chuppa was charged today with one count of structuring cash deposits into a financial institution in order to evade bank reporting requirements, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
According to court records, Chuppa, 57, currently resides in Avon, Ohio.
Between December 2011 through March 2012, Chuppa made a series of cash deposits at Fifth Third Bank for the purpose of evading reporting requirements, according to the information.
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.
This case is being prosecuted by Special Assistant United States Attorney Perry D. Mastrocola, following an investigation by the Internal Revenue Service, Criminal Investigation.
Toledo Man Sentenced to 15 Years in Prison for Sex Trafficking of MinorsRead the Press Release
A Toledo man was sentenced to 15 years in prison for sex trafficking of children, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Roy Calhoun, 30, guilty to multiple charges last year, including sex trafficking of children, conspiracy to obstruct a sex trafficking investigation and conspiracy to possess with intent to distribute Oxycodone.
“This defendant profited from children in the commercial sex trade,” Dettelbach said. “Our office will continue to pursue human trafficking cases with vigor.”
Calhoun was arrested in 2010 and accused of recruiting females, including minor children, to work as prostitutes between 2007 and 2010. He advertised a minor on craigslist.com on different occasions and drove the minor to Toledo-area hotels, according to court documents.
Calhoun beat and assaulted the females who worked for him and threatened those who left or attempted to quit working as prostitutes, according to court documents.
This case was prosecuted by Assistant United States Attorney James V. Moroney following an investigation by the Northwest Ohio Violent Crimes Against Children Task Force.
The NWOVCACTF includes members of the Federal Bureau of Investigation, Ohio Bureau of Criminal Identification and Investigation, Toledo Police Department, Lima Police Department, Perrysburg Township Police Department, Fulton County Sheriff's Office and the Ottawa County Sheriff's Office.
Five Indicted for $4.1 Million Mortgage Fraud Involving Homes in Medina and Gates MillsRead the Press Release
A federal indictment was filed charging five people with taking part in a $4.1 million mortgage fraud scheme involving six luxury properties in Medina, Ohio, and one property in Gates Mills, Ohio, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The seven-count indictment charges one count of conspiracy to commit bank fraud and wire fraud, one count of conspiracy to commit bank fraud and five counts of bank fraud.
Those charged are: Thomas G. France, age 43, of Strongsville; Katen S. Pabley, a.k.a. Keith Pabley, age 40, of Shaker Heights; Su Chi Straka, age 37, of Parma; Lisa R. Nagle, age 42, of Houston, Texas; and, Ranjeet Pabley, age 67, of Lombard, Illinois.
Previously charged via information were Joseph Beccia, age 60, of Parma; and, Alex Blackmore, age 49, of Bronx, New York.
As part of the first mortgage fraud scheme, the indictment charges that from in or around May 2006 through on or about June 20, 2007, Beccia and his company, Horizon Construction, built six new, luxury properties in Medina. Although some of the properties were not fully completed, Beccia listed five of the six properties for sale at purchase prices that were equal to the true market value of each property, starting on or about May 13, 2005.
Specifically, Beccia listed the five properties for sale as follows: 2940 Sutton Lane, Medina for $599,000, on or about August 30, 2006; 4281 Fox Glen Drive, Medina for $395,000, on or about May 13, 2005; 4320 Perian Court, Medina for $399,000, on or about November 9, 2005; 3006 Sutton Lane, Medina for $529,500, on or about August 30, 2006; and, 4740 Lake Forest Trial, Medina for $925,000, on or about August 30, 2006.
Beccia incurred the cost of the construction of these homes without having known purchasers for these properties. Beccia was not able to sell these properties for an extended period of time and began to experience financial difficulties. Joseph Jones, an individual previously convicted in another mortgage fraud scheme, met Beccia through France, a real estate agent working in the area. France advised Beccia that Jones had a system by which Jones could sell these properties so that Beccia could pay off his debts on the properties, according to the indictment.
The indictment charges further that Jones and France explained to Beccia that Jones had individuals willing to have properties purchased in their names. Jones and France also advised Beccia that in order to make Jones’ system work the properties would need to be removed from the market and re-listed at significantly higher purchase prices. Finally, Jones and France advised Beccia that they would handle the interactions with the loan officers and securing the mortgage loans. All Beccia had to do was participate in the sale of the properties at the significantly inflated purchase prices and sign off on the loan documents as the seller, which Beccia agreed to do, according to the indictment.
The indictment also charges that Beccia advised Jones and France the amount of money he required from the sale of each the properties in order for him to repay the amounts he had borrowed to construct the homes. Then, Jones determined the additional amount of money he wanted to receive over and above the amount of money required to be distributed to Beccia after the sale of each property. Beccia and France prepared new purchase agreements for each of the six properties with the inflated purchase price necessary to satisfy the amounts of money required. After the newly inflated purchase agreements were created, the purchase agreements were provided to Straka and Nagel, knowing that they would provide appraisal reports to support the inflated purchase prices, according to the indictment.
Jones enlisted K. Pabley and Blackmore to be straw buyers/investors of Beccia’s properties. Jones advised K. Pabley and Blackmore that if they would agree to allow these luxury homes to be purchased in their names, they would not have to provide any down payment funds because Jones would provide the down payment, and Jones would provide K. Pabley and Blackmore with a significant amount of cash back after the closing of each property for allowing their names to be used as the purchasers. K.Pabley’s credit could not support the purchase of the luxury properties, so K.Pabley recruited R.Pabley, his mother, to serve as the straw buyer/investor. Both R.Pabley, at the direction of K.Pabley, and Blackmore signed the loan documents containing false information in order for them to qualify to purchase the properties, according to the indictment.
The indictment charges that France re-listed five of the six properties for sale at the inflated purchase prices determined by Beccia and Jones as follows: 2940 Sutton Lane, Medina from $599,000 to $950,000; 4281 Fox Glen Drive, Medina from $395,000 to $647,000; 4320 Perian Court, Medina from $399,000 to $650,000; 3006 Sutton Lane, Medina from $529,500 to $920,000; and, 4740 Lake Forest Trial, Medina from $925,000 to $1,400,000.
Finally, the indictment charges that Jones enlisted the services of Marilyn Mannarino, an individual previously convicted in another mortgage fraud scheme, and Tower City Title on all six of Beccia’s properties. Tower City prepared the HUD-1s to make it appear to the financial institutions and mortgage lenders that R.Pabley and Blackmore provided the down payments from their own personal funds, when in fact Jones provided the down payments. Beccia, R.Pabley, and Blackmore signed the HUD-1s knowing that R.Pabley and Blackmore had not provided the down payments from their own personal funds.
Each of the properties for which defendants secured a mortgage loan went into foreclosure, resulting in a total loss of approximately $3,327,333, with Flagstar Bank incurring a loss of approximately $1,053,000, Lehman Brothers Bank incurring a loss of approximately $752,500, J.P. Morgan Chase incurring a loss of approximately $422,000, Suntrust Mortgage, Inc. incurring a loss of approximately $420,833, and American Brokers Conduit, a division of American Home Mortgage, Inc. incurring a loss of approximately $679,000, according to the indictment.
In the second mortgage fraud scheme, the indictment charges Jones and K.Pabley of conspiring with D.C., owner of Perl Building Corporation, to fraudulent purchase the property located at 1924 Epping Road, Gates Miles, Ohio, in R.Pabley’s name. Similar to Beccia, Jones identified D.C. as a builder in financial trouble and contacted D.C. with an offer to purchase the Epping Road property that D.C. had not been able to sell. Jones explained that he had an individual willing to purchase the property, but that in order to make the transaction work they would need to inflate the purchase price of the property significantly over the fair market value of the property so that Jones could obtain the excess funds from the inflated purchase price. Just as Jones had done with Beccia, Jones advised D.C. that he would handle all the aspects of the transaction. All D.C. had to be willing to do was sign the HUD-1 containing the inflated purchase price, which D.C. agreed to do, according to the indictment.
Again, K.Pabley’s credit score would not support the purchase of the property, so he recruited R.Pabley to have the property purchased in her name. And, again, Jones enlisted the services of Mannarino and Tower City Title to prepare the HUD-1 and handle the closing. The loan application and HUD-1 were falsified in a similar manner as those in the Medina scheme and those involved in the Epping property signed the loan documents knowing they contained false information in order to induce the lender, Washington Mutual, to approve and fund the loan. The Epping Road property, also, went into foreclosure creating a loss to Washington Mutual of approximately $807,000, according to the indictment.
If convicted, defendants’ sentences will be determined by the Court after review of factors unique to this case, including defendants’ prior criminal records, if any, each defendant’s role in the offense, and the characteristics of the violation. In all cases the sentences will not exceed the statutory maximum and in most cases they will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Mark S. Bennett, following an investigation by the Cleveland Offices of the Federal Bureau of Investigations and the United States Secret Service. An indictment 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.
Pair Indicted for Conspiracy to Distribute Bath SaltsRead the Press Release
A federal grand jury returned a six-count indictment charging two people from Northeast Ohio with conspiracy with intent to distribute bath salts, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Indicted are Ryan Kralik, 32, of Newton Falls, and Ruth Eimers, 36, of Ravenna.
“People continue to come up with new ways to poison our children, as long as they think there is money to be made,” Dettelbach said. “These are very dangerous synthetic drugs that have nothing to do with baths or salt and everything to do with risky behavior.”
“These indictments deal a blow to the individuals and criminal groups involved in the distribution of a dangerous synthetic drug in Northeast Ohio. The criminal organizations behind the importation, distribution and selling of these synthetic drugs have scant regard for human life in their reckless pursuit of illicit profits," said William Hayes, acting special agent in charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Detroit, which covers Michigan and Ohio. "HSI is committed to working with our law enforcement partners to help keep this poison off the streets.”
Portage County Sheriff David Doak said: “The sale of bath salts is not going to be tolerated. We were glad to be part of this investigation.”
The defendants own and operate a website named freshsalts.com, which offers for sale 10 to 15 different types of bath salts ranging in price from $29 to $59. Customers can also purchase bulk amounts of bath salts from the web site for between $299 and $459, according to the indictment.
The bath salts are offered for sale with names similar to slang terms for cocaine and heroin, such as “Eightballz Extreme,” “Faux-Caine” and “Zombie Girls Extra Strength,” among others, according to the indictment.
Customers who purchased bath salts from the web site were required to pay with money orders or cashier’s checks to R.M. Kralik, Western Union wire transfer to “Ryan Kralik” in Warren, Ohio, of by cash sent to “FGS” to a P.O. Box in Diamond, Ohio, according to the indictment.
Eimers’ assisted Kralik with distribution shipments and bookkeeping, according to the indictment.
The defendants are charged with conspiracy to possess with the intent to distribute and distribution of bath salts, Schedule I controlled substance analogues and a Schedule I controlled substance; importation of bath salts, a controlled substance analogue, from the People’s Republic of China; attempted possession with the intent to distribute bath salts, a controlled substance analogue; use of the Internet for a controlled substance offense; distribution of bath salts, Schedule I controlled substance analogues; and possession with the intent to distribute bath salts, Schedule I controlled substance analogues.
The case is being prosecuted by Assistant U.S. Attorney Teresa Dirksen following an investigation by the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the Portage County Drug Task Force and Portage County Sheriff’s Office
If convicted, their sentence will be determined by the court after review of factors unique to this case, including prior criminal records, if any, their role in the offenses and the unique 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.Man Charged with Theft of Government BenefitsRead the Press Release
Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, announced today that a federal grand jury returned an indictment charging Ronald Newnham, age 68, of Canton, with theft of government benefits.
The indictment charges that between on or about November 27, 2004, and on or about July 26, 2011, Newnham wilfully and knowingly stole and converted to his own use, death pension benefits issued by the Department of Veterans Affairs. Newnham caused the funds to be transferred from the beneficiary’s account to his bank account for his own personal benefit.
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.
This case is being prosecuted by Assistant United States Attorney M. Kendra Klump, following an investigation by the Cleveland Resident Agency of the Department of Veterans Affairs Office of Inspector General.
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 Heights Man Sentenced to 30 Years in Prison for Bank RobberiesRead the Press Release
A Cleveland Heights man was sentenced to 30 years in priso for seven counts bank robberies and attempting an eighth last year 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.
Kevin Walcott, age 40, previously plead guilty to the seven counts of bank robbery and one count of attempted bank robbery. He got nearly $13,000 from the robberies on the East Side of Cleveland, according to court documents.
“This defendant robbed more than a half-dozen banks during a month-long spree,” Dettelbach said. “Each of these incidents put people at risk.”
Anthony said: “The valuable partnership between the public, local law enforcement and the FBI helped put a stop to this string of bank robberies. The FBI commends the attentive citizens that assisted in bringing Kevin Walcott to justice.”
The robberies (all in 2012) are as follows:
Oct. 26: Dollar Bank, 2200 Warrensville Center Road, University Heights, $2,470.
Nov. 1: Ohio Savings Bank, 2066 Lee Road, Cleveland Heights, $690.
Nov. 2: PNC Bank, 10900 Lorain Road, Cleveland, $2,194.
Nov. 5: Citizens Bank, 5710 Mayfield Road, Lyndhurst, $1,021.
Nov. 8: Key Bank, 911 East 185th Street, Cleveland, $3,660.
Nov. 13: Huntington Bank, 920 East 185th Street, Cleveland, $800.
Nov. 15: Huntington Bank, 20601 Fairmount Blvd., Shaker Heights, $2,069.
Attempted: Nov 21: PNC Bank, 20711 Chagrin Blvd. Shaker Heights.
Walcott was arrested shortly after the attempted robbery of PNC Bank. According to court documents, Shaker Heights police found a handwritten note on him that read, in part: “I have a Gun and a Police Radio If I SEE Police or hear the ALARM you Die First If I don’t make it out you Die First Give me all your 100.00 Both Drawer’s 50.00 20.00 I sEE Bait MonEY 10.00 you Die.”
This case was prosecuted by Assistant United States Attorneys Margaret A. Sweeney and Phillip J. Tripi, following investigation by the Federal Bureau of Investigation and Shaker Heights Police Department.
Willard Woman Charged with Social Security FraudRead the Press Release
Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that an information was filed against Diana Ousley, age 57, of Willard, Ohio.
The charge relates to Social Security Fraud beginning on or about May 2004 and continuing to November 2012. She is accused of fraudulently receiving $64,414.
If convicted, defendant’s sentence will be determined by the Court after review of factors unique to each 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 investigating agency in this case is the Office of Inspector General Social Security Administration.
The case is being handled by Assistant United States Attorney Angelita Cruz Bridges.
An information is only a charge and is not evidence of guilt. The burden of proof is always on the government to prove a defendant guilty beyond a reasonable doubt.
Seventeen People Indicted for Conspiracy That Brought Cocaine, Heroin and Marijuana to Youngstown, Akron and ColumbusRead the Press Release
A grand jury returned a 57-count indictment charging 17 people for their roles in a conspiracy that distributed cocaine, heroin and marijuana on the streets of Youngstown, Akron and Columbus, law enforcement officials announced.
Terrance A. Tarver obtained cocaine and marijuana from individuals in Columbus for distribution in Youngstown, Akron and Columbus. Tarver also obtained heroin from sources in Youngtown and Akron for distribution in Youngstown and Akron, according to the indictment.
Tarver was one of 10 people named in a federal indictment filed in April 2012. He has pleaded guilty and is awaiting sentencing.
This indictment details a distribution network of people who obtained drugs from Tarver and then sold them throughout Northeast Ohio.
Count 1 charges all 17 people listed below with conspiracy to possess with intent to distribute cocaine, heroin and marijuana:
Defendant
Residence
Age
Benjamin J. Phillips
Cheraw, South Carolina
36
Youngstown, Ohio
41
Ronald O. Clark
Youngstown, Ohio
47
Phillip D. Whitman
Youngstown, Ohio
37
Gerard B. Balbirsingh
Farrell, Pennsylvania
45
Edward Odem, III
Sharon, Pennsylvania
34
Darryl C. Pippin
Youngstown, Ohio
43
Abdul W. Muhammad, aka Wally
Youngstown, Ohio
41
Clifton T. Hudson
Youngstown, Ohio
40
Dwayne A. Oliver
Youngstown, Ohio
42
Antjuan A. Adkins
Akron, Ohio
37
Edthaniel L. Tarver, aka Lamont
Youngstown, Ohio
37
Anthony J. Walker, aka Prem
Tempe, Arizona
36
Dontae R. Lackey
Columbus, Ohio
35
Quay L. Watkins
Akron, Ohio
35
Brandon M. Williams
Youngstown, Ohio
20
Patrick D. McWhorter
Youngstown, Ohio
21
“This group represents another layer of people who sold drugs throughout the region,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “They profited from other people’s addictions.”
“The individuals arrested this morning represent the second tier of this cocaine, heroin, and marijuana trafficking organization” said Stephen D Anthony, Special Agent in Charge of the FBI’s Cleveland office. “As evidenced by this continuing investigation, the FBI will work with our law enforcement partners to target and eliminate the most significant threats to our communities.”
Lt. Jeff Solic, who leads the Mahoning Valley Law Enforcement Task Force, said: “These types of cases and arrests are only possible because of the tremendous cooperation between local, state and federal law enforcement.”
Counts 2-4 of the indictment charge defendants Benjamin J. Phillips, Abdul W. Muhammad, aka Wally, Brandon M. Williams and Patrick D. McWhorter with maintaining a premises for the purposes of distributing and using controlled substances. Counts 5-57 of the indictment charge the defendants with using a telephone to facilitate drug trafficking.The investigation was conducted under the U.S. Attorney’s Organized Crime Drug Enforcement Task Force (OCDETF) which is part of a national program that seeks to identify, investigate and prosecute significant drug trafficking enterprises by utilizing multiple investigative and prosecution resources.
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.
The investigation preceding the indictment was conducted by the Federal Bureau of Investigation, the Drug Enforcement Administration and the Mahoning Valley Law Enforcement Task Force. The case is being prosecuted by Assistant United States Attorneys Nancy L. Kelley and Linda H. Barr.
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.
Toledo Man Found Guilty on Human Trafficking ChargesRead the Press Release
A Toledo man was found guilty by a jury on two counts of sex trafficking of children, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Brady Jackson, 27, will be sentenced later this year. An exact date has not been scheduled.
“This verdict is another stark reminder that human trafficking hides in plain sight,” Dettelbach said. “This defendant's sole purpose was to profit off these girls in the commercial sex industry.”
Jackson advertised on backpage.com in in Septmber 2011 that the two girls, ages 16 and 15, were available for prostitution. Jackson told the girls that he would take all the money they would make from prostitution but that he would take them shopping and get their hair and nails done, according to court records.
This case is being prosecuted by Assistant United States Attorneys Carol M. Skutnik and Ava Dustin following an investigation by the Northwest Ohio Violent Crimes Against Children Task Force (NWOVCACTF).
The NWOVCACTF, directed by the FBI Resident Agency in Toledo, Ohio, includes special agents of the FBI, and agents and officers from the Ohio Bureau of Criminal Identification and Investigation, Ohio Highway Patrol, Toledo Police Department, Lima Police Department, Perrysburg Township Police Department, Fulton County Sheriff's Office and the Ottawa County Sheriff's Office. Toledo Office of the Federal Bureau of Investigation.
#####Anthony O. Calabrese III Sentenced to Nine Years in Prison for BribesRead the Press Release
Anthony O. Calabrese III was sentenced to nine years in prison and ordered to pay more than $200,000 for his role in a series of bribery schemes involving Jimmy Dimora, Frank Russo, J. Kevin Kelley and others uncovered as part of the Cuyahoga County corruption investigation, federal law enforcement officials said.
“Anthony Calabrese misused his status as an attorney to facilitate bribes and foster corruption,” said Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland Office. “Today's sentence reflects the fact that Calabrese was deeply involved in a variety of bribery schemes involving a school district, a halfway house and the infamous trip to Las Vegas, just to name a few.”
“His criminal conduct spanned his entire legal career,” Assistant U.S. Attorney Antoinette Bacon said in court.
Calabrese, 40, of Chagrin Falls, Ohio, previously pleaded guilty to 18 counts which detail improper payments of nearly $550,000. The counts include racketeering; conspiracy to commit mail fraud and honest services fraud; Hobbs Act conspiracy; bribery concerning programs receiving federal funds; conspiracy to commit mail fraud and mail fraud.
U.S. District Judge Sara Lioi sentenced Calabrese to 108 months in prison and ordered him to pay $132,041 in restitution -- $120,970 to Cuyahoga County and $11,071 to Parma schools. Calabrese has already forfeited $74,450
The racketeering charge involves conduct that took place between 2001 and 2009 in which Calabrese gave things of value to public officials and their designees in return for public officials taking and promising to take official action that benefitted Calabrese, Law Firm 1 (where Calabrese was an associate and partner), their clients and designees, according court documents.
Specifically, Calabrese participated in a scheme in which he and Cuyahoga County employee J. Kevin Kelley helped obtain tax exempt status for the property leased by Alternatives Agency around January 2004, according to court documents.
In September 2004, after a tax refund check was issued to Alternatives Agency for $144,216.26, Calabrese instructed Alternative Agency to issue a check to Business 45 for $72,000 and classify the expense as consulting, despite Calabrese knowing that Business 45 performed no consulting services for Alternatives Agency to justify the expense, according to the indictment.
Business 45, in turn, issued checks payable to Calabrese for $31,500 and J. Kevin Kelley Consulting, LLC, for $35,500. Business 45 kept the remaining $5,000, according to the indictment.
In another scheme, Calabrese lobbied Kelley (a member of the Parma School Board) and other members of the Parma School Board in January 2005 to contract with Business 9 to serve as project manager for a renovation project. Business 9 was a construction company that specialized in stone and brick masonry and was a client of Law Firm 1, according to court documents.
In September 2005, the Parma School Board, with Kelley voting in favor, awarded a contract worth $1.8 million to Business 9, according to court documents.
Calabrese and Kelley arranged for Business 9 to hire The Eagle Group, a consulting company formed by Daniel P. Gallagher. In August 2009, Business 9 sent a check for $15,000 to Eagle. Gallagher then paid a portion of that money to Kelley and Kevin Payne, according to court documents.
Other conduct detailed in court documents includes Calabrese, Kelley, Brian Schuman, former Cuyahoga County Auditor Frank P. Russo and former Cuyahoga County Commissioner James C. Dimora conspiring to increase the funding for Alternatives Agency.
In or around January 2008, Calabrese, who served as legal counsel for Alternatives Agency, instructed Schuman, an employee of Alternatives Agency, to increase Kelley’s monthly consulting fee by $2,000 for four months for the purpose of funding expenses associated with a Las Vegas trip for Dimora, Russo and Public Employee 55, according to court documents.
In or around 2003, Prudoff began receiving payments from Alternatives Agency on a monthly basis, purportedly for consulting work. When BE39 informed Calabrese that Alternatives Agency received no work product from Prudoff, Calabrese told BE39 that Prudoff was consulting on a Lorain expansion project, according to court documents.
BE39 questioned why Alternatives Agency was paying Prudoff, since he was the Community Development Director for Lorain and it would be within his job requirements to assist companies such as Alternatives Agency, who were interested in developing facilities in Lorain. Calabrese insisted that BE39 continue to cause Alternatives to pay Prudoff, according to court documents.
Calabrese did not inform the Alternatives board about the payments for consultants on a Lorain expansion project and the board did not approve payments to any such consultant, according to court documents.
In or around June 2005, Calabrese told BE39 that Prudoff had some issues arise and Prudoff’s monthly payment should be issued to Relative 2, who was related to Prudoff’s girlfriend, according to court documents.
In or around July 2005, Calabrese and Prudoff assisted Relative 2 in forming Business 46. On or about July 25, 2005, Alternatives Agency began issuing checks to Business 46 for approximately $4,000 on a monthly basis, according to court documents.
Prudoff provided favorable consideration to Calabrese and his designees on business matter unrelated to Alternatives Agency, in return and in exchange for the consulting fees that Calabrese caused Prudoff and Business 46 to receive from Alternatives, according to court documents.
In another case, Business 43 was incorporated in the State of Ohio in March 2005 and Calabrese’s relative (Relative 1) was the registered agent for the company. Calabrese caused Alternatives to engage Business 43's services but concealed from Alternatives his relative’s relationship to Business 43 and did not disclose to them that Relative 1 performed little or no work for Alternatives to justify the fees paid, according to court documents.
In or around 2002, Calabrese influence Alternatives to hire A.C. Sinagra and Associates. In January 2006, A.C. Sinagra and Associated entered into a contract setting a monthly consulting fee at approximately $1,500, according to court documents.
In March 2006, Calabrese and Sinagra agreed that Calabrese would cause Alternatives to increase its payments to A.C. Sinagra and Associates, and Sinagra would use the additional funds to pay persons or entities identified by Calabrese in the amounts Calabrese designated, according to court documents.
Calabrese first suggested Sinagra make consulting payments to Relative 1 through Business 43. He later asked Sinagra to pay Calabrese through Burlwood Holdings, an LLC formed in 2004 and controlled by Calabrese, according to court documents.
Calabrese also asked Sinagra to pay Relative 2 and Sinagra agreed to both requests. Sinagra performed no legitimate work for Alternatives to justify the increase in his fee, according to court documents.
In May 2006, Alternatives increased Sinagra’s monthly fee from $1,500 to approximately $6,000. In May 2006, A.C. Sinagra Company issued a check to Relative 2 for $2,000 and Berlwood Holdings (sic) for $2,000. This continued through November 2007, according to court documents.
In sum, from Calabrese caused Alternatives to make payments to Prudoff and Relative 2 between July 2003 and March 2006 totaling approximately $144,000, according to court documents.
Calabrese caused Alternatives to make payments to Business 43 between March 2005 and March 2006 totaling approximately $12,950, according to court documents.
Calabrese caused Alternatives to make payments to A.C. Sinagra and Associates between January 2002 and November 2007 totaling approximately $190,500, according to court documents.
Calabrese caused Alternatives to make payments to J. Kevin Kelley Consulting between October 2004 and August 2008 totaling approximately $201,473, according to court documents.
Regarding Count 9, Relative 1's brother was Attorney 6. Attorney 7 was Calabrese’s relative and formerly related to Relative 1. On or about Feb. 2, 2009, Calabrese told BE39 that Calabrese and Attorney 7 had met with Attorney 6. Calabrese asked BE39 to meet with Attorney 6, according to the indictment.
BE39 met with Attorney 6 on Feb. 2, 2009. Attorney 6 told BE39 that Calabrese and Attorney 7 wanted Attorney 6 to meet with BE39 to go over the script, according to court documents.
Attorney 6 instructed BE39 that if anyone questioned BE39 about Relative 1, BE39 should say that BE40 and BE39 hired Relative 1 to work out of her home to help with the Lorain expansion, which Calabrese and BE39 knew was not true, according to court documents.
This case was prosecuted by Assistant U.S. Attorneys Antoinette T. Bacon and Nancy L. Kelley. The investigation was conducted by the Cleveland office of the Federal Bureau of Investigation and the Internal Revenue Service.Youngstown Man Indicted for Production of Child PornographyRead the Press Release
A federal grand jury returned a four-count indictment charging Christopher Cavna, age 26, of Youngstown, Ohio, with producing, distributing and receiving child pornography, Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment charges that on or about May 19, 2013, Cavna knowingly permitted 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 using materials that had been mailed, shipped, and transported in interstate or foreign commerce by any means, including by computer.
The indictment also charges that on or about May 20, 2013, Cavna knowingly permitted a different minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of such conduct, and such visual depiction was produced using materials that had been mailed, shipped, and transported in interstate or foreign commerce by any means, including by computer.
The indictment also charges that on or about May 20, 2013, Cavna knowingly distributed two computer image files, each containing a visual depiction of a real minor engaged in sexually explicit conduct. The indictment also charges that from on or about October 12, 2011 though October 28, 2012, Cavna knowingly received and distributed numerous computer files, which files contained visual depictions of real minors, other than those previously mentioned, engaged in sexually explicit conduct.
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.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan.
The case was investigated by the Youngstown office of the Federal Bureau of Investigation, the Mahoning County Violent Crimes Task Force and the Ohio Adult Parole Authority.
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.
Man Indicted for Cleveland Bank RobberyRead the Press Release
A grand jury returned a one-count indictment charging Roland Jerome Lamarr, 59, with bank robbery, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment alleges that Lamarr robbed Charter One Bank located at 1215 Superior Avenue, Cleveland, Ohio, on May 2, 2013.
The case is being prosecuted by Assistant U.S. Attorney Justin Seabury Gould, following investigation by agents of the Federal Bureau of Investigation, and members of the Cleveland Division of Police.
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.
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.
Fraud and Perjury Charges Filed Against Parma ManRead the Press Release
A grand jury returned a three-count indictment charging Yong Xiang Chen aka Qin Dong, age 37, of Parma, Ohio, with one count of naturalization fraud and two-counts of perjury, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment alleges that Chen, a citizen of China, lied in his naturalization application and interviews when applying for naturalization by failing to disclose his use of another name when seeking immigration benefits.
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 Phillip J. Tripi, following investigation by agents of the Immigration and Customs Enforcement, Homeland Security Investigations.
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 Director of Cleveland VA Medical Center Indicted for Conspiracy, Fraud, Money Laundering and Other ChargesRead the Press Release
The former director of the Cleveland VA Medical Center was indicted on 36 counts, accused of accepting bribes in return for influencing development projects and decisions involving the U.S. Department of Veterans Affairs, law enforcement officials said.
William D. Montague, 61, of Brecksville, was charged with conspiracy to commit honest services mail fraud, bribery, money laundering, multiple counts of wire fraud, mail fraud, disclosing public contract information and other charges.
The indictment is part of the Cuyahoga County corruption investigation.
“As a Veterans Affairs Medical Center Director, William Montague misled staff and misused his position to enrich himself and businesses pursuing contracts with the Veterans Administration,” said Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland Office. “The arrest of Montague reflects law enforcement’s continued dedication to root out corruption at any level.”
“Violating the public trust for personal gain cannot be tolerated, particularly at the expense of our nation’s heroes,” said Gavin McClaren, United States Department of Veterans Affairs – Office of Inspector General, Resident Agent in Charge, Cleveland.
The Louis Stokes Cleveland VA Medical Center was approximately the fifth-largest in the country, annually serving about 95,000 veterans who lived in 24 counties in Northeast Ohio. Montague began working for the VA in 1975 and served as director of the Cleveland VA Medical Center from 1995 until his retirement in 2010, according to the indictment.
The VA had been operating medical facilities in both Brecksville and the Wade Park neighborhood in Cleveland. In the early 2000s, the VA began exploring the feasibility of consolidating the facilities into one location, known as the VA Development Project. The combined facility would include a domiciliary, office space and parking, according to the indictment.
The VA selected Business 42 to develop and managed the VA Development Project. Michael Forlani was the sole member of Business 42, and he had multiple other business interests, including as president and part-owner of Doan Pyramid LLC, according to the indictment.
Forlani is currently serving eight years in prison after pleading guilty to racketeering, bribery and other charges.
On or about Jan. 1, 2010, Business 66 began operations, having purchased Doan’s assets. Business 66 operated out of Doan’s former office space and retained many Doan employees, according to the indictment.
Montague solicited and accepted gifts, payments and other things of value from Forlani and Business 66, including a consulting contract between Business 66 and House of Montague, a financial services company Montague started in 2008, according to the indictment.
The indictment details numerous instances between 2007 and 2010 in which Montague took actions on behalf of Forlani or others. Those activities include helping expedite getting a bond rating from Standard & Poors and desired ratings, help getting desired legal opinions from the VA, help getting desired parking rates, and other activities.
Montague retired from the VA on Feb. 3, 2010, about a month after Business 66 began operations. On Feb. 15, 2010, Business 66 issued a check to House of Montague for $2,750, the first of many approximately monthly checks. On Dec. 29, 2010, Montague became a member of the Business 66 Board of Advisors, according to the indictment.
From about Feb. 15, 2010 through May 2012, Business 66 paid House of Montague $156,750, according to the indictment.
In a different scheme, Montague entered into a consulting agreement with a company identified as Business 73, headquartered in Virginia. The company agreed to pay Montague $2,500 a day for a minimum of 24 days, between July 1, 2008 and July 1, 2009, while Montague was still employed by the VA, according to the indictment.
Montague emphasized his ability to access key decision makers in the VA quickly and effectively as one of the reasons he could help Business 73 develop joint ventures and/or expand services provided by the VA. Montague told an official at Business 73 that he had consulted with a VA ethics panel and that he had authorization to do the consulting work as long as he took vacation time to perform the work. In fact, Montague had no such authorization, according to the indictment.
The case was prosecuted by Assistant United States Attorneys Antoinette T. Bacon and Nancy L. Kelley following an investigation by the FBI and United States Department of Veterans Affairs – Office of Inspector General.
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 offenses and the characteristics of the violations. In all cases, the sentences will not exceed the statutory maximum and in most cases they 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.
Five Stark County Residents Accused of Laundering $530,000 from Illegal Bookmaking OperationRead the Press Release
A federal grand jury returned a two-count indictment charging five Stark County residents with being engaged in a conspiracy to launder more than $530,000 obtained through the operation of an illegal sports bookmaking operation, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Joseph D. Nemeth, age 49, Rhonda S. Albaugh, age 45, both of Uniontown, Ohio, Joseph M. Nemeth, age 75, Helen C. Nemeth, age 75, and Robert T. Johns, age 66, all of Canton, Ohio, are indicted in count one with conspiracy to launder monetary instruments.
Joseph D. Nemeth faces an addition count of transmitting wagering information in interstate commerce. He is accused of being engaged in the business of betting and wagering and with using one or more wire communication facilities for the transmission and interstate commerce of bets and wagers and information assisting in the placing of bets and wagers on one or more sporting events and contests.
The indictment alleges that all of the defendants from conspired to launder at least $530,000 generated from an illegal sports bookmaking operation between 2004 and 2013. All but $15,000 of these transactions occurred after November 1, 2008, according to the indictment.
Joseph D. Nemeth conducted a sports bookmaking operation by accepting wagers on professional and college basketball and football games. He collected a percentage off the bets and used offshore Internet gambling services to record and process bets placed by his gamblers. He travelled to various businesses and residential locations to meet with bettors, reconcile accounts and collect or pay money, according to the indictment.
Joseph D. Nemeth instructed Robert Johns and other gamblers to pay some of their loss debts to him by paying Rhonda Albaugh by check, which she then deposited into various bank accounts.
Joseph D. Nemeth and Albaugh opened numerous credit card and bank accounts and utilized them to receive payments from various gamblers. They also took illegal gambling proceeds and invested them into real estate and construction projects, which were titled in the names of others, including Helen Nemeth and Joseph M. Nemeth, according to the indictment.
If convicted, a defendant’s sentence will be determined by the Court after review of factors unique to this case, including a defendant’s prior criminal record, if any, a 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 investigation preceding the indictment was conducted by the United States Secret Service and its Money Laundering Task Force. The matter was presented to the grand jury by Assistant United States Attorneys Robert E. Bulford and Robert J. Patton.
An indictment is only a charge and is not evidence of guilty. 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 Ashland Residents Arrested for Human TraffickingRead the Press Release
Three Ashland residents held a cognitively disabled woman and her child against her will for more than two years and forced her perform manual labor for them, law enforcement officials said.
The conspiracy included beating the disabled woman and her child, threatening the woman with a firearm, threatening to kill the woman and her child, threatening the woman and her child with large snakes, forcing them to sleep in a padlocked room with a large iguana and other actions, according to charges filed in U.S. District Court.
Jordie L. Callahan, 26; Jessica L. Hunt, 31, and Daniel J. Brown, AKA D.J. Brown, 33, were all arrested today and charged with forced labor. Callahan is charged with an additional count of tampering with a witness.
“We are yet again reminded that modern-day slavery exists all around us,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “One of our nation’s core values is freedom, yet this woman and her child were denied freedom for two years. The victims in this case endured violence, threats, sub-human living conditions and other horrific acts.”
“These defendants violated the victim’s most basic civil right, freedom, by exploiting her most basic instinct, the protection of her child,” said Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland Office. “The FBI continues to aggressively pursue and bring to justice those individuals who abuse and harm innocent members of our community.”
“The streets are a lot safer with these folks locked up,” Ashland Police Chief David Marcelli said. “Cooperation with the FBI and U.S. Attorney’s Office was key to the successful arrest of these individuals.”
Ashland County Prosecutor Ramona Rogers said: “We are pleased to cooperate with federal authorities, particularly when it provides for a more severe punishment for these defendants.”
All three are accused of participating in a conspiracy between May 2011 and October 2012 in which they held a woman and her juvenile child in a condition of forced labor and involuntary servitude.
An affidavit from FBI Special Agent Michael Sirohman was filed along with the charges.
The victims in this case are identified only as S.E. and her juvenile child. S.E. suffered from a cognitive disability and received monthly public assistance payments, according to the affidavit.
Callahan and Hunt recruited S.E. and her child to live with them in their two-bedroom apartment in Ashland. Hunt’s four juvenile sons also lived at the house, along with numerous pit bull dogs, large snakes and other reptiles, according to the affidavit.
Callahan and Hunt monitored S.E. and her child’s activities with a baby monitor, according to the affidavit.
Hunt was in possession of all of S.E.’s government benefits cards and the PINs. Hunt normally used nearly all of the money on the cards and rarely gave any money to S.E., according to the affidavit.
Callahan and Hunt forced S.E. to clean the house, do laundry, walk to the store to do their shopping and care for their numerous pit bulls and reptiles. S.E. was timed when she went to the store and was not allowed to bring her child with her, according to the affidavit.
Callahan and Hunt beat S.E. and her child, threatened their lives, denied them food and threatened them with the pit bulls and reptiles, according to the affidavit.
At various points, Callahan threated S.E. with a gun. S.E. and her child initially were forced to sleep on a cement floor in the basement with no mattress. Later they were moved to a room upstairs, again with no bed or mattress. The child was kept in the room all day and at night the room was padlocked to keep S.E. and her child from escaping, according to the affidavit.
S.E. and her child were only allowed to eat canned food or what was left over after Callahan, Hunt and Hunt’s children ate. S.E. was not allowed to feed fruit or vegetables to her child, but Callahan and Hunt ordered S.E. to feed fruit and vegetables to the iguana that freely roamed in their bedroom. On another occasion, S.E. said her child had not eaten all day, but Callahan got a plate of food and gave it to a dog rather than letting them eat, according to the affidavit.
Callahan and Hunt also repeatedly taunted and threatened S.E. and B.E. with injury from the couple’s snakes, including a poisonous coral snake, a ball phython and a Burmese python that weighed 130 pounds, according to the affidavit.
In August 2011, the conspirators slammed S.E.’s hand with a rock in order to obtain pain medication. She was taken to the emergency room and returned with a prescription for pain medication, according to the affidavit.
In December 2011, Callahan and Hunt injured S.E.’s back and then forced her to turn over the prescription for Vicodin she received for her back injury, according to the affidavit.
On another occasion, Callahan kicked S.E. in the hip, and then he and Hunt forced S.E.to turn over the prescription for Vicodin she received for her hip injury, according to the affidavit.
When S.E. attempted to flee the apartment, Brown deceived S.E. into accompanying them in their vehicle and returned her to Callahan and Hunt’s apartment, according to the affidavit.
In October 2011, Callahan and Hunt forced S.E. to hit her child, threatening to inflict much greater physical harm on both if S.E. did not do so. Callahan and Hunt used Callahan’s mobile phone to record S.E. purportedly abusing her child via the baby monitor.
About a year later, S.E. was arrested for shoplifting a candy bar. She asked to be taken to jail, said she was living with Callahan and Hunt and that they “were mean to her,” according to the affidavit.
A police officer went to Callahan and Hunt’s apartment. When the officer advised Callahan that S.E. would not return, Callahan told police he believed S.E. was abusing her child and showed them the mobile phone video from October 2011.
S.E. later told police that Callahan had showed her video recordings of her beating her child after being instructed to do so by Callahan and Hunt. Callahan told S.E. that if she “messed up” or told police about her living conditions, Callahan would show the videos to police and have her daughter taken away, according to the affidavit.
The case was prosecuted by Assistant United States Attorneys Chelsea Rice and Thomas E. Getz following an investigation by the FBI and Ashland Police Department and assistance from the Ashland County Prosecutor’s Office.
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 offenses and the characteristics of the violations. In all cases, the sentences will not exceed the statutory maximum and in most cases they will be less than the maximum.
A charge 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.
The investigation is ongoing.Director of Cleveland Non-Profit Pleads Guilty to Tax ChargesRead the Press Release
The director of a Cleveland non-profit organization pleaded guilty today to withholding taxes from employees but not paying them over to the government, said Steven M. Dettelbach, the United States Attorney for the Northern District of Ohio.
Edward G. Kramer, 62, also evaded his personal income tax obligations when he falsified his income tax returns for two years and did not file a file return in two other years.
He pleaded guilty to a 10-count criminal information in U.S. District Court Thursday. He is scheduled to be sentenced Sept. 13.
“We all have an obligation to truthfully report our income and pay taxes,” Dettelbach said. “It is especially incumbent on those who work in our legal system to follow the law themselves.”
Kramer was director and chief counsel of Housing Advocates, Inc., a non-profit organization in Cleveland that received federal funding from the U.S. Department of Housing and Urban Development. Kramer also maintained a private law practice and owned a property leasing business called Remark, according to the information.
Kramer underreported his income for calendar years 2007 (underreported by $79,262) and 2008 (underreported by $101,571), the understatement consisting of unreported payments from Housing Advocates accounts for his benefit as well as unreported income from his private law practice, according to the information.
Kramer also failed to file income tax returns for 2009 and 2010, despite the fact that he had taxable income of approximately $149,884 in 2009 and $270,687 in 2010, according to the information.
Collectively, Kramer sought to avoid paying taxes on approximately $500,000 in income between 2007 and 2010, according to the information.
Kramer was responsible for collecting, accounting for and paying over quarterly to the Internal Revenue Service income and FICA taxes on behalf of Housing Advocates, Inc. The organization deducted and collected the required taxes from the wages of its employees but Kramer willfully failed to pay over the taxes, according to the information.
The taxes collected but not paid over from January 2009 until September 2010 total nearly $80,000, according to the information.
This case is being prosecuted by Assistant U.S. Attorney Justin J. Roberts following an investigation by the Internal Revenue Service – Criminal Investigations and the Department of Housing and Urban Development – Office of Inspector General.
Cleveland Man Guilty of Trying to Destroy A Bridge with ExplosivesRead the Press Release
A Cleveland man was found guilty of trying to use explosives to destroy a bridge in Northeast Ohio, 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.
Joshua Stafford, 24, was found guilty of conspiracy to use weapons of mass destruction, attempted use of weapons of mass destruction and malicious use of an explosive device to destroy property used in interstate commerce following a three-day trial before U.S. District Judge David Dowd. Stafford is scheduled to be sentenced on Sept. 11 at noon.
“We all need to thank the FBI and its law enforcement partners,” Dettelbach said. “The evidence in this trial made clear that their actions saved innocent lives. By being diligent, smart and responsible, law enforcement agents were able to not only literally defuse a dangerous situation, but they also were able to catch a dangerous group of violent men before they were able to harm anyone else.”
“This defendant took it upon himself to operate the cell phone he believed to be the device that would detonate two IED devices and cause potentially significant damage to the Route 82 Brecksville-Northfield High Level Bridge,” Anthony said. “This defendant’s callous disregard for our community, all in the name of making his own ideological views known, reinforces the need for law enforcement to work diligently to confront and stop terrorists from committing violent acts against our fellow citizens.”
Stafford is the last of five men to be found guilty for their roles in a conspiracy to destroy the Route 82 Brecksville-Northfield High Level Bridge. Cars travel over the bridge, which crosses from Brecksville, Ohio to Sagamore Hills, Ohio over the Cuyahoga Valley National Park.
Douglas L. Wright, of Indianapolis, was sentenced to 11 ½ years in prison followed by a lifetime of supervised release.Brandon L. Baxter, of Lakewood, Ohio, was sentenced to nine years and nine months in prison followed by a lifetime of supervised release.
Connor C. Stevens, of Berea, Ohio, was sentenced to eight years and one month in prison followed by a lifetime of supervised release.
Anthony M. Hayne, 35, of Cleveland, was sentenced to six years in prison followed by a lifetime of supervised release.
Those four men pleaded guilty last year to conspiracy to use weapons of mass destruction, attempted use of weapons of mass destruction and malicious use of an explosive device to destroy property used in interstate commerce.
Hayne, Wright, Baxter, Stevens and Stafford were arrested on April 30.
According to court documents, Wright, Baxter, Hayne, Stevens and Stafford were self-proclaimed anarchists who formed into a small group and considered a series of evolving plots over several months.
The initial plot involved the use of smoke grenades to distract law enforcement in order for the co-conspirators to topple financial institution signs atop high rise buildings in downtown Cleveland, according to the complaint.
The plot later developed to the utilization of explosive materials. The defendants conspired to obtain C-4 explosives contained in two improvised explosive devices to be placed and remotely detonated, according to the complaint.
The defendants discussed various bridges and physical targets in and around the Cleveland, Ohio metropolitan area over the course of several months. The final plan resulted in the Route 82 Brecksville-Northfield High Level Bridge being the designated target.
The public was never in danger from the explosive devices, which were controlled by an undercover FBI employee. The defendants were closely monitored by law enforcement. The explosives that the defendants allegedly purchased and attempted to use were inoperable and posed no threat to the public.
This case is being prosecuted by Assistant U.S. Attorneys Duncan T. Brown, Justin E. Herdman and Thomas E. Getz following an investigation by the FBI and the FBI’s Joint Terrorism Task Force.
Agencies represented on the FBI’s Joint Terrorism Task Force include: Cuyahoga County Sheriff’s Office, Federal Air Marshal Service, Cleveland Police Department, Cleveland Heights Police Department, U.S. Secret Service, U.S. Coast Guard Investigative Service, Ohio Bureau of Criminal Investigation and Intelligence, Westlake Police Department, U.S. Diplomatic Security Service, Immigration and Customs Enforcement, Customs and Border Protection, RTA Police, Ohio State Highway Patrol, Transportation Security Administration, Alcohol, Tobacco and Firearms, Shaker Heights Police Department, North Olmstead Police Department, US Postal Inspectors, and the Defense Criminal Investigative Service. Assistance in this case was also provided by the U.S. National Park Service Park Rangers, Sagamore Hills Police Department and Brecksville Police Department, and the Summit County Sheriff’s Office.
Cleveland Man Sentenced to 12 Years in Prison for Leading Ring That Obtained Blank Prescriptions, Forged Them and Sold the PainkillersRead the Press Release
A Cleveland man was sentenced to 12 years in prison for leading a ring that obtained blank prescription pads that were used to fraudulently obtain thousands of prescription painkiller pills, law enforcement officials announced today.
Louis Eppinger, 53, led a conspiracy that forged prescriptions for Oxycontin and Percocet pills, hired people to have them filled at pharmacies throughout the region, then sold the pills on the street, according to court documents. He previously pleaded guilty to conspiracy to possess with intent to distribute Oxycodone, health care fraud and aggravated identity theft.
“We have seen a huge increase in prescription drug abuse in Ohio, and this case demonstrates the lengths people will go to defraud and profit from pills,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “Instead of dealers shipping in drugs from South America, we now have people forging prescriptions.”
“The abuse of illicitly obtained prescription drugs is reaching epidemic proportions, surpassing that of marijuana, cocaine and heroin combined,” said Stephen Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office. “Dismantling illicit drug diversion networks such as the organization charged in this investigation will remain a top FBI priority.”
Besides Eppinger, six other people have pleaded guilty to related crimes. They are: Patricia Arnold, age 61, of Cleveland; Anthony H. Perry, age 42, of East Cleveland; Elizabeth A. Davis, age 40, of East Cleveland; James Byrge, age 62, of Cleveland; Judy Burrows, age 25, of Cleveland, and Brittany N. Glass, age 22, of Cleveland.
Between 2011 and 2012, Eppinger, Arnold, Glass, Perry, Davis, Burrows and Byrge engaged in a conspiracy to possess with intent to distribute oxycodone, according to court documents.
Eppinger obtained blank prescription paper from an unknown source and DEA numbers of various physicians located in Northern Ohio for the purposes of passing fraudulent prescriptions for Oxycontin and/or Percocet, both of which contain oxycodone, according to court documents.
Eppinger provided the blank prescription paper to Arnold, who forged the prescriptions. Eppinger then provided the fraudulent prescriptions to Glass, Perry and Davis, who served as “walkers” and attempted to pass the prescriptions at pharmacies in Northeast Ohio, including several in Cleveland as well as locations in Shaker Heights, Willoughby and Garfield Heights, according to court documents.
Glass, Perry and Davis then gave the pills to Eppinger, who paid them for passing the fraudulent prescriptions. Eppinger then sold the pills or provided them on consignment to Burrows, Burge and others, according to court documents.
Eppinger pleaded guilty to health care fraud for defrauding the Ohio Medicaid program by billing more $21,098 for prescription painkillers to which he was not entitled, according to the indictment. He was ordered to repay that amount in restitution.
Eppinger also used the identities of two people in relation to a felony, resulting the in the aggravated identity theft convictions.
The case is being handled by Assistant United States Attorneys Michael L. Collyer and Michelle M. Baeppler following investigation by the FBI’s Cleveland office, with assistance from the Cleveland Police Department, West Shore Enforcement Bureau, Ohio High Intensity Drug Trafficking Area and Ohio Attorney General’s Office.
Two Are Charged for $3.3 Mortgage-Fraud Involving Six Medina PropertiesRead the Press Release
A one-count federal information was filed against two people accused of taking part in a mortgage fraud scheme involving six luxury properties located in Medina, Ohio, Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, announced today.
The lenders lost a total of approximately $3,327,333 as a result of the scheme, according to the information. The information charges one count of conspiracy to commit bank fraud and wire fraud in a mortgage fraud scheme.
Those charged are: Joseph J. Beccia, age 60, of Parma; and, Alex F. Blackmore, age 49 of Bronx, New York.
The information charges that from in or around May 2006 through on or about June 20, 2007, Beccia and his company, Horizon Construction, built six luxury properties in Medina.
Although some of the properties were not fully completed, Beccia listed five of the six properties for sale at purchase prices that were equal to the true-market value of each property, starting on or about May 13, 2005. Specifically, Beccia listed the five properties for sale as follows: 2940 Sutton Lane, Medina for $599,000, on or about August 30, 2006; 4281 Fox Glen Drive, Medina for $395,000, on or about May 13, 2005; 4320 Perian Court, Medina for $399,000, on or about November 9, 2005; 3006 Sutton Lane, Medina for $529,500, on or about August 30, 2006; and, 4740 Lake Forest Trial, Medina for $925,000, on or about August 30, 2006.
Beccia incurred the cost of the construction of these homes without having known purchasers for these properties. Beccia was not able to sell these properties for an extended period of time and began to experience financial difficulties, according to the information.
Joseph Jones, an individual previously convicted in another mortgage fraud scheme, met Beccia through T.F., a real estate agent working in the area. T.F. advised Beccia that Jones had a system by which Jones could sell these properties so that Beccia could pay off his debts on the properties.
The information charges further that Jones and T.F. explained to Beccia that Jones had individuals willing to have properties purchase in their names. Jones and T.F., also, advised Beccia that in order to make Jones’ system work the properties would need to be removed from the market and re-listed at significantly higher purchase prices. Finally, Jones and T.F. advised Beccia that they would handle the interactions with the loan officers and securing the mortgage loans. All Beccia had to do was participate in the sale of the properties at the significantly inflated purchase prices and sign off on the loan documents as the seller, which Beccia agreed to do.
The information also charges that Beccia advised Jones and T.F. the amount of money he required from the sale of each the properties in order for him to repay the amounts he had borrowed to construct the luxury homes. Then, Jones determined the additional amount of money he wanted to receive over and above the amount of money required to be distributed to Beccia after the sale of each of the properties. Beccia and T.F. prepared new purchase agreements for each of the six properties with the inflated purchase price necessary to satisfy the amounts of money required.
Jones enlisted Blackmore to be a straw buyer/investor of some of Beccia’s properties. Jones advised Blackmore that if he would agree to allow these luxury homes to be purchased in his name, he would not have to provide any down payment funds because Jones would provide the down payment funds, and Jones would provide Blackmore with a significant amount of cash back after the closing of each property for allowing his name to be used as the purchaser. In addition, Blackmore signed the loan documents containing false information in order for him to qualify to purchase the properties, according to the information.
The information charges that T.F. re-listed five of the six properties for sale at the inflated purchase prices determined by Beccia and Jones as follows: 2940 Sutton Lane, Medina from $599,000 to $950,000; 4281 Fox Glen Drive, Medina from $395,000 to $647,000; 4320 Perian Court, Medina from $399,000 to $650,000; 3006 Sutton Lane, Medina from $529,500 to $920,000; and, 4740 Lake Forest Trial, Medina from $925,000 to $1,400,000.
Finally, the information charges that Jones enlisted the services of Marilyn Mannarino, an individual previously convicted in another mortgage fraud scheme, and Tower City on all six of Beccia’s properties. Tower City prepared the HUD-1s to make it appear to the financial institutions and mortgage lenders that Blackmore provided the down payments from his own personal funds, when in fact Jones provided the down payments. Beccia and Blackmore signed the HUD-1s knowing that Blackmore had not provided the down payments from his own personal funds.
Each of the properties for which defendants secured a mortgage loan went into foreclosure, resulting in a total loss of approximately $3,327,333, with Flagstar Bank incurring a loss of approximately $1,053,000, Lehman Brothers Bank incurring a loss of approximately $752,500, J.P. Morgan Chase incurring a loss of approximately $422,000, Suntrust Mortgage, Inc. incurring a loss of approximately $420,833, and American Brokers Conduit, a division of American Home Mortgage, Inc. incurring a loss of approximately $679,000.
If convicted, defendants’ sentences will be determined by the Court after review of factors unique to this case, including defendants’ prior criminal records, if any, each defendant’s role in the offense, and the characteristics of the violation. In all cases the sentences will not exceed the statutory maximum and in most cases they will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Mark S. Bennett, following an investigation by the Cleveland Offices of the Federal Bureau of Investigations and the United States Secret Service. 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.
Dart Trucking Officials Guilty in $3.6 Million Check-Kiting Bank FraudRead the Press Release
Two officials with Dart Trucking were found guilty of bank fraud charges related to a $3.6 million check-kiting scheme against Huntington Bank, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Timothy Kephart, 54, of Morrisdale, Penn, the chief executive officer of Dart Trucking, and Mark Michael, age 55, of Clearfield, Penn., the chief financial officer of Dart Trucking, were both found guilty of one count of conspiracy to commit bank fraud and one count of bank fraud.
The men are scheduled to be sentenced by U.S. District Judge Dan Aaron Polster on September 4, 2013.
Kephart and Michael were charged with kiting checks, in conspiracy with Lee Stoneburner, the president of Dart Trucking, from October 2007 until February 2010, from various accounts of Dart Trucking at Huntington Bank, in Columbiana, Ohio.
Stoneburner, 44, from the Columbiana, Ohio area, previously pleaded guilty to conspiring to commit bank fraud and is awaiting sentencing.
A check kiting scheme involves writing a series of worthless, non-sufficient funds (NSF) checks where a NSF check from one bank account was deposited into another account; another NSF check would then be written to cover the previous NSF check, concealing the overdraft from the bank, such that a false balance, or “float,” was created in the accounts. The defendants would then use that falsely created “float” to pay their bills, expenses, and to pay their salaries.
The evidence at trial established that it was a complicated, daily task to compute the amount of NSF checks which had to be written and to track what accounts had to be “covered” and from which accounts a NSF check could be written to cover a particular account. These officers involved their clerical staff in tracking and covering these checks. The use of “controlled disbursement accounts” or “CDA’s,” which allowed the company an extra day to post its expenses before they paid them, gave the company a float it could draw upon over the course of this scheme.
This case was prosecuted by Assistant United States Attorney Christian H. Stickan and Assistant United States Attorney Perry D. Mastrocola, following an investigation by the Federal Bureau of Investigation, Youngstown, Ohio.
Seven People Indicted for Roles in Conspiracy to Steal Copper from SubstationsRead the Press Release
Seven people were indicted in federal court for their roles in a conspiracy to steal copper from two dozen substations in Northeast Ohio owned by First Energy or Cleveland Public Power, 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.
“These defendants risked the safety of utility workers and the well-being of people served by these substations,” Dettelbach said. “The theft of copper and other scrap metal is a serious problem in our region, and the targeting of energy facilities additionally poses a significant threat to our national security infrastructure.”
“The potential of harm posed by these individuals to enrich themselves while risking lives and posing serious threats to our community will not be tolerated. The FBI and our law enforcement partners will aggressively pursue and bring to justice those individuals who place our community in harm’s way.”
Indicted are: Christopher M. Butts, 26, of Cleveland; Michael T. Butts, 33, of Brooklyn; Jon T. Lefort, 25, of Cleveland; William Bertini, 25, of Olmsted Township; Jason B. Kauffman, 34, address unknown; Keven Wenson, 22, of Lakewood, and Julio Torres, 45, address unknown.
The thefts took place between January and May 2013 and included substations in Brooklyn, Parma, Brecksville, Fairlawn, Medina, Cleveland, Wadsworth, Lakewood, Cuyahoga Heights, Independence, Vermillion, Lorain, Avon Lake, Westlake and Valley View, according to the indictment.
The 24 substations listed in the indictment have copper material around its base that facilitated the transmission of electricity. Removal of the copper material from a substation causes a substantial risk of electrical blackouts as well as possible injury or death to utility company employees responsible for maintaining, servicing and repairing the substations, according to the indictment.
According to the indictment, Christopher and Michael Butts instructed Lefort, Bertini, Kauffman, Wenson and Torres how to remove the copper material from the substation in a way that would minimize the risk of physical harm to the person cutting the wire or cable. The defendants used bolt cutters to cut fencing and/or locks protecting the substations.
The defendants then unlawfully extracted the copper wire and materials from the substations, manually carrying it in garbage cans, duffel bags, contractor bags and other containers to “staging areas.” From there, the copper material was transported to scrap yards, where it was sold for cash, according to the indictment.
The indictment details 25 copper thefts and five attempted thefts. It also lists 53 instances where at least some of the defendants sold stolen copper to area scrap yards between January and April 2013.
The defendants collectively sold the stolen copper for more than $15,000, although repairs to the substations will likely cost more than $100,000, according to the indictment.
Count 1 charges all seven defendants with conspiracy to damage energy facilities. Counts 2 through 6 charge specific individuals with destruction of an energy facility, in violation of a federal statute specifically directed at protecting facilities that produce, distribute and store energy, such as electrical substations.
This case is being prosecuted by Assistant U.S. Attorneys Thomas E. Getz and M. Kendra Klump following an investigation by the Federal Bureau of Investigation, Avon Lake Police Department, Brecksville Police Department, Medina County Sheriff’s Office, Middleburgh Heights Police Department, Valley View Police Department and Northeast Ohio Regional Fusion Center, and assistance from the Medina County Prosecutor’s Office.
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 records, the defendant’s role in the offenses 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.
Cleveland Trio Charged for Armed RobberyRead the Press Release
Three people from Cleveland were named in a seven-count indictment for their roles in an armed robbery, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Eric Gooch, age 22, Larnell A. Tripp, Jr., age 24, and Ashley N. White, were charged conspiracy to commit interference with commerce by robbery and possession of a firearm during a crime of violence. Gooch was also charged with two separate counts of armed bank robbery and possessing a firearm during the bank robberies.
Specifically, the indictment alleges that from December 2012 to January 21, 2013, Eric Gooch, Larnell Tripp, Jr., and Ashley White conspired to rob Roses Discount Store in Cleveland, Ohio. The indictment further alleges that on January 21, 2013, they entered and robbed the Roses Discount Store, and during the robbery, a firearm was brandished. The indictment further alleges that on February 22, 2013, Eric Gooch robbed the PNC Bank located at 16614 Harvard Avenue, Cleveland, Ohio, and on March 13, 2013 Gooch robbed the PNC Bank located at 2771 South Moreland Boulevard, Cleveland, Ohio. The indictment further alleges that a firearm was brandished during each bank robbery.
The indictment resulted from an investigation conducted by the City of Cleveland, Division of Police, and the Federal Bureau of Investigation.
The case is being prosecuted by Assistant United States Attorneys Michelle M. Baeppler and M. Kendra Klump.
If convicted, each defendant’s sentence will be determined by the court after review of factors unique to each case, including the defendants’ prior criminal records, if any, the defendants’ roles 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.
North Ridgeville Man Sentenced to 17 1/2 Years in Prison for Child Pornography ConvictionRead the Press Release
A North Ridgeville man was sentenced to more than 17 years in prison after previously pleading guilty to one count of distribution of visual depictions of minors engaging in sexually explicit conduct, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
William Wilson, 73, was sentenced to 210 months in prison by U.S. District Judge Donald Nugent.
This case was being prosecuted by Assistant U.S. Attorney Michael A. Sullivan following an investigation by the Federal Bureau of Investigation.
Lorain County Pair Indicted for Human Trafficking, Drug OffensesRead the Press Release
A man and woman from Lorain County were indicted for human trafficking and drug offenses after forcing a 16-year-old girl and 19-year-old woman to have sex for money, law enforcement officials said.
Jeremy Mack, 37, of Elyria, and Ashley Onysko, 23, of Avon Lake, were each indicted on one count of conspiracy to engage in sex trafficking and drug trafficking and two counts of sex trafficking.
“This pair forced people, including a minor, to have sex for money,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “These activities happen all around us and it’s the responsibility of the community and law enforcement to work together to end these crimes.”
“Jeremy Mack and Ashley Onysko used narcotics to gain control over their victims and forced them to engage in sex acts while lining their own pockets with money,” said Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office. “The FBI and our law enforcement partners will utilize all necessary resources to bring to justice those that victimize our youth.”
“This is an example of local police and federal law enforcement working together to make our community safer,” said Elyria Police Chief Duane Whitely.
Count 1 charges that between December 2012 and April 9, 2013, Mack and Onysko conspired together to provide heroin to Victim 1 and cocaine to Victim 2 and then, after the victims incurred drug debts, used force, threats of force, fraud and coercion to compel them to engage in commercial sex acts.
They did this, in part, by posting photographs of Victim 1 and Victim 2 on backpage.com on a user account that Mack and Onysko created on Dec. 25, 2012, according to the indictment.
In March 2013, Victim 2, a 16-year-old minor, went to Mack’s residence in Elyria after school, at which time Mack gave her cocaine. Mack later told and caused others to tell Victim 2 that she needed to engage in commercial sex acts. She did, after which she turned over all proceeds to Mack, according to the indictment.
From March through April 9, 2013, Mack brandished a firearm in front of Victim 1 and Victim 2, according to the indictment.
Count 2 charges that from February through April 9, 2013, Mack and Onysko caused Victim 1 to engage in commercial sex acts by using force, threats of force, fraud and coercion.
Count 3 charges that from March through April 9, 2013, Mack and Onysko caused Victim 2 to engage in commercial sex acts by using force, threats of force, fraud and coercion.
This case is being prosecuted by Assistant United States Attorneys Bridget M. Brennan and Carole Skutnik following an investigation by the FBI and Elyria Police Department.
An indictment is merely a charge. All defendants are presumed innocent of the charges until proven guilty beyond a reasonable doubt in court.
Immigration Charges Filed in Unrelated CasesRead the Press Release
Immigration charges were filed against two people in unrelated cases, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Ziyaya Mtola, 39, was indicted on one cout of failure to depart the United States. The indictment alleges that Mtola is an alien and a citizen of the Republic of South Africa who physically resisted efforts to remove him from the United States pursuant to an order of removal on April 22, 2013.
In an unrelated case, Eleazar Ivan Carrillo-Vasquez aka Eduardo Ramirez-Lopez, 28, was charged with illegally reentering the United States following his deportation. The indictment alleges that Carillo-Vasquez is an alien who was previously removed or deported from the United States to Mexico on October 28, 2008, and April 22, 2009.
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 cases are being prosecuted by Assistant U.S. Attorney Phillip J. Tripi, following investigations by agents of the Enforcement and Removal Operations of the Immigration and Customs Enforcement Agency.
Counterfeiting Charges Filed on Lakewood ManRead the Press Release
Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that a grand jury returned a two-count indictment charging Christopher Kelley, age 30, of Lakewood, Ohio, with one count of passing counterfeit obligations and one count of possessing counterfeit obligations.
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 case is being prosecuted by Assistant United States Attorney Margaret A. Sweeney following an investigation by the United States Secret Service and the Ohio Bureau of Criminal Investigation, Ohio Casino Control Commission.
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 with Murder Conviction Faces Federal Charges for Having Six FirearmsRead the Press Release
A Canton man with a prior murder conviction was faces federal firearms charges after authorities found him with six firearms, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Torrey T. Gross, age 39,was indicted on one count of being a felon in possession of a firearm.
"It is profoundly troubling that a man with this criminal backgroud was able to get his hands on these fireams," Dettelbach said. "We will continue to use all the tools at our disposal to keep firearms from those who are forbidden from possessing them."
Gross was arrested on April 17, 2013, by Metro Narcotics, FBI Safe Streets Task Force and the Canton Police Department SWAT team during an execution of a Stark County Common Pleas Court Search Warrant. The search warrant yielded an S.K.S. semiautomtic rifle, a Ruger SR40C pistol, a Smith & Wesson Bodyguard 380 pistol, a Glock 17 pistol, a Glock 21, .45-caliber pistol, a Smith & Wesson, model 22A-1 .22-caliber pistol and various ammunition, according to the indictment.
Gross is forbidden from possessing firearms or ammunition because of a 1997 conviction for muder in Oakland County, Michigan, according to the indictment.
If convicted, Gross’ sentence will be determined by the Court after review of factors unique to this case, including his prior criminal record, if any, his role in the offenses and the unique 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 case is being prosecuted by Assistant U.S. Attorney Teresa Dirksen.
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.
Youngstown Man Charged with Threatening the President and First LadyRead the Press Release
A federal grand jury returned a two-count indictment charging a Youngstown man with making threats against the President and First Lady of the United States, Steven M. Dettelbach, United States Attorney for the Northern District of Ohio,.
Frederick Watt, age 33 is accused of making the threats by telephone to Trumbull County 911 operators in Warren, Ohio on March 24, 2013.
If convicted, Watts’ sentence will be determined by the Court after review of factors unique to this case, including his prior criminal record, if any, his role in the offenses and the unique 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 case is being prosecuted by Assistant U.S. Attorney Nancy Kelley following an investigation by the United States Secret Service.
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.
Guilty Pleas in Rocky River Fish-Kill Case; Restitution Will Be Used to Restock the River with Steelhead TroutRead the Press Release
A Strongsville company and the company owner’s wife pleaded guilty for their roles in the dumping of a drum of liquid cyanide into a storm drain that flowed into the Rocky River, resulting in the death of more than 30,000 fish, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Kennedy Mint, Inc. pleaded guilty to violating of the Clean Water Act.
Teresina Montorsi, 74, pleaded guilty to obstruction of justice.
“Clean, fresh water is Ohio’s greatest natural resource,” Dettelbach said. “We are satisfied that we were able to determine who put the cyanide into the river and killed tens of thousands of fish. The restitution from this case will be used to restock the river with fish, so that people can again enjoy the natural beauty of the Rocky River.”
“Our natural resources must be protected from illegal discharges,” said Randall K. Ashe, Special Agent in Charge of U.S. EPA’s criminal enforcement program in Ohio. “This prosecution sends a clear message that crimes against the environment will not be tolerated and will be vigorously prosecuted.”
Ohio Attorney General Mike DeWine said: “Illegal dumping into Ohio sewers brings severe consequences, both for our environment and for perpetrators. We will continue to work with other agencies to bring justice to those who violate environmental laws and to protect Ohio’s valuable natural resources.”
Company owner Renato Montorsi was indicted last year, but those charges were dismissed after he wasfound to be incompetent to stand trial.
Renato and Teresina Montorsi are married and live in Grafton, Ohio, according to public records.
Kennedy Mint will pay restitution of $30,893 -- $1 for every fish killed by the illegal discharge. The money will be paid to the Ohio Department of Natural Resources and used to restock the river with steelhead trout under the terms of the plea agreement.Kennedy Mint will also make a payment to the Cleveland Metroparks. The amount will be determined at sentencing, which is scheduled for Aug. 29.
Renato Montorsi owned and operated Kennedy Mint, which is located in Strongsville. Kennedy Mint specializes in collectible coins, but previously conducted metal plating and printing operations. The East Branch of the Rocky River is near the Kennedy Mint facility and storm water from that location’s parking lot flows into the East Branch of the Rocky River, according to court documents.
On April 16, 2012, Montorsi, with assistance from an employee, put two drums into a dumpster outside Kennedy Mint. On April 17, the waste hauling company declined to dispose of the contents of the dumpster because of the two drums inside, according to court documents.
On April 18, Montorsi moved the drums from the dumpster and placed them next to the storm drain in the Kennedy Mint parking lot, according to court documents.
Later that day, Montorsi used a hammer and sharp metal tool to punch a hole near the bottom of a drum that included a poison label featuring a skull and cross bones. After punching the hole, liquid cyanide in the drum was discharged into the storm drain and eventually the East Branch of the Rocky River, according to court documents.
Around April 22, the Ohio Department of Natural Resources received reports of dead fish in the East Branch of the Rocky River. Nearly every fish was dead downstream for the next three miles, according to the court documents.
The Ohio DNR counted approximately 30,893 dead fish in that three-mile stretch of the river, due to the discharge of cyanide, according to court documents.
On April 25, personnel from the Ohio Environmental Protection Agency asked to enter the Kennedy Mint facility to look for the drums, which they did not locate. After they left, Renato Montorsi, with help from Teresina Montorsi, moved two drums from Kennedy Mint to their residence so they would not be discovered if investigators returned, according to court documents.
On June 22, Teresina Montorsi gave permission to U.S. EPA agents to search their home without a warrant, at which point the agents found the punctured drum and another drum that contained cyanide, according to court documents.
This case is being prosecuted by Special Assistant U.S Attorney Brad J. Beeson following an investigation by the following agencies: United States Environmental Protection Agency, Criminal Investigation Division; Ohio Bureau of Criminal Identification and Investigation; the Northeast Ohio Regional Sewer District; the Ohio Environmental Protection Agency, Office of Special Investigations; the Ohio Department of Natural Resources, Division of Wildlife, and the Cleveland Metroparks Rangers, all members of the Northeast Ohio Environmental Crimes Task Force.
People can report possible environmental violations to Ohio EPA at 800-282-9378 or U.S. EPA at www.epa.gov/tips
Detroit Man Charged with Use of Counterfeit Debit CardsRead the Press Release
A crimininal information was filed charging Tyrone Nix, 22, of Detroit, with illegal possessing and using counterfeit debit cards, 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 review of factors unique to each 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 investigating agency in this case is the United States Secret Service. The case is being handled by Assistant United States Attorney Thomas A. Karol.
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.
Cleveland Man Indicted for Bank RobberyRead the Press Release
A Cleveland man was indicted for robbing a bank in Middleburg Heights, Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment alleges Marc S. Easton, 44, robbed a Key Bank located in Middleburg Heights, Ohio, and stole approximately $10,997.15 from the bank.
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 Lauren Bell, following investigation by agents 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.
Canton Man Sentence to More Than Six Years in Prison for Filing False Tax Returns While in PrisonRead the Press Release
Brandon Mace was sentenced to more than six years in prison for claiming false income tax refunds totaling nearly $5.5 million, said Steven M. Dettelbach, United States Attorney.
Mace filed the false claims while incarcerated on state charges.
Mace pleaded guilty to the charges on February 27, 2013, before United States District Judge Patricia A. Gaughan, who imposed today’s sentence. The two-count indictment against Mace charged that he prepared and filed false income tax returns for the years 2008 and 2009 claiming false tax refunds in the amounts of $207,000 and $5,292,000, respectively.
Mace, a 35-year old resident of Canton, Ohio, has been in pretrial detention since his arrest on these charges on November 20, 2012, according to court records.
Mace requested a non-prison sentence on a number of grounds, including his claim that he knew he would never receive any of the requested refunds. According to court documents and proceedings, however, the government mailed the requested 2008 refund check to Mace at a Post Office box, where he planned to retrieve it upon his scheduled release from state custody in late 2009. He did not succeed in getting the check because the Post Office returned it to the government before he could get there. The government did not issue the 2009 refund check, although Mace made efforts to obtain it beyond filing his false return. After the IRS sent Mace correspondence requesting an explanation for his lack of a supporting W-2 form, Mace replied by sending a hand-written letter containing a false excuse.
In announcing the prison sentence, Judge Gaughan cited to Mace’s extensive criminal record as a significant factor.
The case was prosecuted by Special Assistant United States Attorney Perry D. Mastrocola and Assistant United States Attorney John M. Siegel, following an investigation by the Internal Revenue Service -- Criminal Investigation.
Akron Man Sentenced to More Than Three Years in Prison, Ordered to Pay $15 Million in Restitution for Mortgage SchemesRead the Press Release
An Akron man was sentenced to more than three years in prison and ordered to pay more than $15 million in restitution for his role in a mortgage fraud scheme in Florida and a separate scheme to defraud two elderly investors, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Andrew D. Norman, 36, previously pleaded guilty to conspiracy to commit bank fraud, conspiracy to commit wire fraud and filing a false tax return.
Norman and his business partner Jason Herceg conspired with Jack Coppenger in procuring “straw buyers” and submitting false loan documents to banks to purchase Coppenger’s lots in Florida (which had already been inflated in value as part of a land flip) in a mortgage fraud scheme. Coppenger, with assistance from Norman and Herceg, perpetrated a large mortgage fraud scheme involving numerous straw buyers, who essentially sold their good credit score to Coppenger, in order for him to secure loans, through straw buyers’ names, for property in Florida, according to court documents.
Coppenger promised money to the straw buyers if they signed the loan application and paperwork, that he would make any down payment and all the mortgage payments for the straw buyers, and that, once the property was developed, they would receive half the profits from any sale, according to court documents.
Norman and Herceg were mentored by Coppenger in how to recruit and use straw buyers. Norman and Herceg assisted Coppenger by using their brokerage company, Akron-based V.P. Equity, to prepare and submit falsified loan documents to the banks, which fraudulently inflated the income and assets of the straw buyers to qualify them for these loans. Ultimately, Coppenger failed to make the mortgage payments on these loans, resulting in a loss to banks of approximately $13.1 million, according to court documents.In the second conspiracy scheme, Norman, Herceg, Coppenger and others, conspired to defraud two elderly individuals by selling them a Florida property for $7 million. Moments before the sale, Norman and Herceg, with Coppenger’s help, bought the property, through their partnership, 104 Investments, from the original seller and inflated its value by approximately $2.5 million. They then sold this property to these elderly individuals, who were told they were buying the property from the original seller. These elderly victims were never told of the last minute “flip” and that they were actually buying the land from Norman, Herceg and 104 Investments. Norman, Herceg, and their 104 Investments business partner, Robert Jason Workman, received approximately $2.5 million from this gain, and funneled portions out to themselves and paid $690,000 to Coppenger as a kickback for setting up the fraudulent scheme, which they fraudulently deducted as a business expenses, according to court documents.
Norman also failed to report the income from this fraudulent scheme on his 2006 tax return.
Coppenger and Herceg have pleaded guilty to related crimes and are awaiting sentencing.
The case is being prosecuted by Assistant U.S. Attorneys Christian H. Stickan, Henry F. DeBaggis and Robert J. Patton following investigation by agents of the Internal Revenue Service – Criminal Investigations and the Federal Bureau of Investigation’s Akron office.
Willowick Woman Accused of Claiming $5.2 Million in False RefundsRead the Press Release
On May 16th, IRS agents arrested Margaret Monone Greenaway on a two-count indictment charging her with claiming false income tax refunds totaling $5,271,794 for the years 2010 and 2011, said Steven M. Dettelbach, United States Attorney.
Greenaway filed income tax returns using her name during a prior marriage, Margaret M. Demaria-Susevich, on which she claimed refunds to which she was not entitled of $1,326,671 for 2010 and $3,945,123 for 2011, according to the indictment.
Greenaway, age 52, resides in Willowick, Ohio, according to court records. Following her arrest, Greenaway entered not guilty pleas before U.S. Magistrate Judge Kenneth S. McHargh, who ordered her to be temporarily detained while efforts were made to arrange for her release subject to home detention with electronic monitoring and the removal of computers from her home.
The case is assigned to United States District Judge David D. Dowd, in Akron.
The case was presented for indictment by Assistant United States Attorney John M. Siegel following an investigation by the Internal Revenue Service – Criminal Investigation, Cleveland, Ohio.
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.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.Dennison Man Sentenced to Nearly 22 Years in Prison for Child Pornography CrimesRead the Press Release
A Dennison man was sentenced to nearly 22 years in prison for crimes related to the production and distribution of child pornography, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Vernon L. Kriner, Jr., 43, pleaded guilty earlier this year to child exploitation, possession of child pornography and two counts of receipt and distribution of visual depictions of children engaged in sexually explicit conduct.
U.S. District Judge Patricia A. Gaughan sentenced Kriner to 262 months in prison.
This case was prosecuted by Assistant United States Attorney Michael A. Sullivan following an investigation by the Federal Bureau of Investigation.
Medina Chiropractor Sentenced to 2 1/2 Years in Prison for Health Care FraudRead the Press Release
A Medina chiropractor was sentenced to 30 months in prison for overbilling Medicare and insurance companies more than $1.8 million for medical equipment and treatment that were not medically necessary, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Dr. John N. Heary, 39, previously pleaded guilty to seven counts of health care fraud.
“This doctor took advantage of programs designed to provide care and support for the old and the sick,” Dettelbach said. “Our office and the Justice Department are committed to rooting out health care fraud in all its forms.”
“Most medical professionals endeavor to provide quality health care services and submit proper claims for payment to the Medicare program” said Lamont Pugh III, Special Agent in Charge of the U.S. Department of Health & Human Services, Office of Inspector General – Chicago Region. “This doctor chose to exploit Medicare and other insurers for illegal personal gain and paid the price for his criminal acts. The OIG will continue to work with our law enforcement partners to combat fraud in the health care system and protect vital taxpayer dollars.”
Heary did business under his name and two corporate entities. HealthSource of Medina was the operating name of Heary’s chiropractic practice until October 2009. Medina Health & Wellness Center, Inc. was the corporate name under which Heary sold durable medical equipment, according to court documents.
Both entities were located at 433 West Liberty Street, Medina, Ohio, 44256, according to court documents.Heary provided custom-molded ankle-foot orthotics, or “boots”, to patients who did not need them and wrote false diagnoses to justify the billing. He billed Medicare and insurance anywhere from $2,770 to $4,300 for each pair of boots, according to court documents.
He also routinely provided the most expensive back braces without any demonstration of medical necessity or any pursuit of a less costly alternative. He billed Medicare and insurance anywhere from $995 to $1,250 for each back brace, according to court documents.
When patients questioned the necessity of this medical equipment, Heary told them tha they were part of a “free package deal” and would be covered by their insurance, according to court documents.
Hearly also billed for supervised physical therapy often when the patients were not supervised. He also billed for an hour’s worth of physical therapy when, at most, patients did a half hour, according to court documents.
Heary submitted more than $1.8 million in fraudulent claims to Medicare, Anthem Blue Cross and Blue Shield, Medical Mutual of Ohio and the Ohio Bureau of Worker’s Compensation, according to court documents.
The insurance programs reimbursed Heary for more than $812,000. He will repay that amount in restitution, according to court documents.
This case is being prosecuted by Assistant United States Attorneys Michael L. Collyer and Adam Hollingsworth following an investigation by the U.S. Department of Health and Human Services, Office of Inspector General, Office of Investigations, the Federal Bureau of Investigation, the Ohio Bureau of Worker's Compensation and the Ohio Chiropractic Board.
If you suspect health care fraud, waste or abuse, please report it by calling HHS Office of Inspector General at 800-447-8477, the Centers for Medicare & Medicaid Services at 800-633-4227, or the FBI Cleveland Field Office at (216) 522-1400. To learn more about health care fraud prevention and enforcement go to www.medicare.gov.
Lorain County Pair Charged with Human Trafficking OffensesRead the Press Release
A man and woman from Lorain County were charged with human trafficking crimes after forcing a 16-year-old girl and 19-year-old woman to have sex for money, said Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland office, and Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Jeremy Mack, 37, of Elyria, and Ashley Onysko, 23, of Avon Lake, were charged with two counts of sex trafficking (one involving a minor) in a criminal complaint unsealed today in U.S. District Court.
“Human trafficking often happens in plain sight,” Anthony said. “The FBI, our law enforcement partners, along with the assistance of vigilant citizens will continue efforts to tackle this problem.”
“These defendants are accused of preying on teens in our community,” Dettelbach said. “We will work to get help for the victims and bring the accused to justice.”
Mack and Onysko were arrested April 9, 2013 at 8 Tattersal Court in Elyria. Onysko told investigators that she worked for Mack facilitating meetings for sex between girls and men. She posted advertisements on backpage.com and craigslist.com, according to an affidavit filed in the case.
One victim, identified as “Jane Doe #1” was 19 and was forced to have sex for money in order to pay off a drug debt to Mack. Jane Doe #1 said several girls lived at 8 Tattersal Court and were forced by Mack to prostitute themselves in order to pay off their drug debts to him, according to the affidavit.
Jane Doe #1 began seeing several men a day charged to engage in sexual acts with them. Mack or Onysko drove Jane Doe #1 to the appointments but she had to turn all the money over directly to Mack, according to the affidavit.
Jane Doe #1 stated that if she kept any money, she believed Mack would “beat the living crap out of me.” She witnessed him push, hit and choke other girls and said Mack often carried a handgun and stun gun, according to the affidavit.
Another victim, identified as Jane Doe #2, met Mack through Mack’s son in March 2013. Jane Doe #2 noticed that the other girls were afraid of Mack and didn’t seem allowed to leave the house except to meet clients, according to the affidavit.
On March 29, 2013, Mack instructed Jane Doe #2 to get fixed up and instructed other girls to take photos of her for backpage.com. Jane Doe #2 said she didn’t want to be a prostitute but did so because Mack was “a guy with a gun who knew where I lived,” according to the affidavit.
Onysko soon received a call for an appointment with Jane Doe #2. Onysko arranged the meeting and provided Jane Doe #2 with condoms. She gave all the money to Mack. Jane Doe #2 left the house on Tattersal after her parents discovered her photographs on backpage.com, according to the affidavit.
This case is being prosecuted by Assistant United States Attorneys Bridget M. Brennan and Carole Skutnik following an investigation by the FBI and Elyria Police Department.
A criminal complaint is merely an accusation. All defendants are presumed innocent of the charges until proven guilty beyond a reasonable doubt in court.
New York Man Charged with Trafficking in Counterfeit MerchandiseRead the Press Release
A New York man was charged wtih trafficking in counterfeit merchandise after investigators found him with more than 1,300 counterfeit items, including handbags, sunglasses and shirts, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Man Zhang, age 30, of Woodside, New York, was named in the one-count indictment.
On or about March 27, 2013, Zhang intentionally trafficked and attempted to traffic more than 1,300 items, including 225 designer handbags, 53 designer wallets, 71 pairs of designer sunglasses, 339 hats, 349 Monster and Ed Hardy tee-shirts, and 209 bottles of designer perfume, each of which contained counterfeit marks, logos, labels and tags, according to the indictment.
The marks on the merchandise were identical to and substantially indistinguishable from marks used on genuine merchandise, and were in use and registered for such goods on the principle register of the United States Patent and Trademark Office. The use of such counterfeit marks was likely to cause confusion, mistake or to deceive, according to the indictment.
According to a criminal complaint previously filed in this matter, Zhang’s vehicle was stopped in Austintown, Ohio, on March 27, 2013, for a traffic violation. Upon stopping the vehicle, police officers observed numerous items in plain view inside the vehicle which appeared to be counterfeit merchandise. Zhang was arrested on outstanding state warrants and the vehicle was impounded and inventoried.
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.
This case is being prosecuted by Assistant U.S. Attorney Robert W. Kern of the Cleveland U.S. Attorney’s Office, following an investigation by the Cleveland Office of the Department of Homeland Security, Office Immigration and Customs Enforcement.
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 Toledo Men Charged with Violating the Clean Air ActRead the Press Release
Two Toledo men were charged with violations of the Clean Air Act and regulations involving the removal and disposal of asbestos-containing material, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Charged are John Mayer, age 52, and Timothy Bayes, age 32.
“These defendants are accused of ignoring laws and regulations that are in place to protect the public,” Dettelbach said. “Protecting the environment, including the air we breathe, is a priority of my office and the Justice Department.”
The indictment alleges that between September 2010 and December 2010, Mayer directed individuals to remove asbestos-containing insulation from boilers, duct work and pipes in a former manufacturing facility in Toledo, Ohio, in order that Mayer could sell the scrap metal from those items. This work was performed in violation of the federal Clean Air Act regulations regarding asbestos abatement, according to the indictment.
It is alleged that the asbestos-containing insulation was not wetted at any time during the removal process; the City of Toledo, Division of Environmental Services, was not notified prior to the work commencing; and, that there was not on site a person trained in the provisions of the federal asbestos regulations.
Bayes, at Mayer’s direction, dumped approximately 82 garbage bags of the asbestos-containing insulation at various locations throughout Toledo in violation of the requirement that such material be disposed at a site operated in accordance with federal law, according to the indictment.
If convicted, each defendant’s sentence will be determined by the court after review of factors unique to each 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 investigating agencies in this case are the U.S. EPA Criminal Investigation Division, the Ohio Bureau of Criminal Identification and Investigation, and the Ohio Environmental Protection Agency, all members of the Northwest Ohio Environmental Crimes Task Force. The case is being handled by Assistant United States Attorney Thomas A. Karol and Special Assistant United States Attorney James J. Cha.
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.
Toledo Orthodontist Accused of Failing to Pay $187,000 in TaxesRead the Press Release
An indictment was filed charging Stuart Duchon, age 65, of Toledo, Ohio, with failing to collect and pay over employees’ portion of FICA taxes, as well as the employees’ withholding federal income taxes, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Duchon owned and operated an orthodontist practice in Toledo and from 2007 to 2011, he failed to collect and pay to the Internal Revenue Service approximately $187,000 for the federal taxes withheld from his employees wages, according to the indictment.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to each 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 investigating agency in this case is the Internal Revenue Service. The case is being handled by Assistant United States Attorney Thomas A. Karol.
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 Canton Men Accused of Participating in Burglary RingRead the Press Release
Two Canton men were named in an eight-count indictment, accused of allegedly participating in numerous burglaries and thefts of coins, jewelry, silver bars from businesses and then selling the stolen goods in Ohio, Pennsylvania, and Illinois, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Nicholas Moore, age 23, and Arsenio Smith, age 25, are charged with conspiracy, transportation of stolen goods and sale or receipt of stolen goods across state lines.
If convicted, their sentence will be determined by the Court after review of factors unique to this case, including prior criminal record, if any, role in the offenses and the unique 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 case is being prosecuted by Assistant U.S. Attorney Teresa Dirksen following an investigation by the Uniontown Police Department/Lake Township and Federal Bureau of Investigations in conjunction with the Salem Police Department, Stark County Sheriff’s Office, Lexington, Kentrucky Police Department, Richland County Sheriff’s Office, Mansfield Police Department, Stow Police Department, Springfield Police Department, Wooster Police Department, Jackson Township Police Department, Uniontown Police Department, and Robinson Township 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.
Pair Sentenced for Removing Copper from Radio TowersRead the Press Release
Two people were sentenced for the malicious destruction of federally-licensed communications lines, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Thomas M. Carbone, 28, of North Royalton, was sentenced to 27 months in prison while Katie M. Stanton, 23, of Cleveland, was sentenced to eight months under house arrest. They were ordered to pay $10,971 in restitution.
On or about August 17 to 18, 2012, Carbone and Stanton unlawfully entered the property of Radio One on Ridge Road in North Royalton, Ohio, and willfully and maliciously destroyed and removed copper material from four radio-station towers situated on the property, according to court documents.
This unlawful removal of copper depleted the signal strength of the supported radio station, thereby impeding the station’s ability to broadcast emergency messages, according to court docuements.
This case is being prosecuted by Assistant United States Attorneys Thomas E. Getz and M. Kendra Klump. The case was investigated by the Cleveland Division of the Federal Bureau of Investigation and the North Royalton Police Department.
Theft and Fraud Charges Filed Against Canton Woman Accused of Illegally Getting Social SecurityRead the Press Release
Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that a grand jury returned a two-count indictment charging Lisa J. Music, 54, of Canton, with one count of theft of government property and one count of Social Security fraud.
The indictment alleges that Music stole and converted to her own use, approximately $37,390 in Social Security payments made to her that she was not entitled to receive.
The indictment further alleges that Music concealed and failed to disclose her marriage to her second husband in order to continue to receive Social Security payments.
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 Lauren Bell, following investigation by agents of the Social Security Administration Office of Inspector General.
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.
Mansfield Man Indicted for Theft of $1 MillionRead the Press Release
A Mansfield man was indicted on charges that he embezzled more than $1 million from an customer annuity accounts at an insurance company where he worked, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Willard C. Lee, age 51, was indicted on one count each of insurance embezzlement and wire fraud.
Lee was employed by Allstate. The indictment alleges that Lee embezzled approximately $1,056,000 from Allstate customer annuity accounts between July 2007 and December 2011. Lee forged customer signatures on withdrawal requests to Allstate and Lincoln Benefit Life, a company wholly owned by Allstate, which sells annuities, according to the indictment.
Once fraudulent paperwork was submitted, Lee had the proceeds wire-transferred into bank accounts he controlled in Mansfield, according to the indictment.
The case was presented for indictment by Assistant United States Attorney James V. Moroney following an investigation by the Federal Bureau of Investigation;’s Mansfield office, who in turn were following up an investigation by the Investigative Services unit of the Allstate Insurance Company.
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.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 Cleveland Resident Charged with Illegal Re-entryRead the Press Release
Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that a federal grand jury has returned an indictment charging Marcos A. Cardenas-Landino, age 24, formerly of Cleveland, with illegal re-entry following deportation or removal.
The indictment alleges that on February 27, 2013, Cardenas-Landino was illegally present in the United States after previously being deported subsequent to a conviction for the commission of possession of a controlled substance with intent to sell.
The indictment was presented to the grand jury by Assistant United States Attorney Lauren Bell after investigation by United States Immigration and Customs Enforcement.
If convicted, the defendant’s sentence will be determined by the Court after review of 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. 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 Woman Charged with Theft and Social Security FraudRead the Press Release
Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that a grand jury returned a two-count indictment charging Bonita A. Armstead, 37, of Cleveland, with one count of theft of government property and one count of Social Security Fraud.
The indictment alleges that Armstead stole and converted to her own use, approximately $122,149.10 in Social Security payments made to her that she was not entitled to receive.
The indictment further alleges that Armstead obtained and used a second Social Security account number to receive Social Security Benefits.
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 Lauren Bell, following investigation by agents of the Social Security Administration, Office of Inspector General.
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.
Child Pornography Charges Filed Against Cuyahoga Falls ManRead the Press Release
Steven J. Woods, 49, of Cuyahoga Falls, 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 OhioThe indictment charges that from on or about February 28, 2013, through on or about April 4, 2013, Woods knowingly received and distributed, by computer, numerous computer files, which contained visual depictions of real minors engaged in sexually explicit conduct. On April 5, 2013, images of child pornography were also found on his external hard drive.
The actual 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 Cleveland Office of the United States Secret Service and the Cuyahoga Falls 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.
Vermilion Man Charged for Financial Schemes That Resulted in Nearly 100 Clients Losing $4.4 MillionRead the Press Release
A Vermilion man was charged with financial crimes that resulted in nearly 100 clients losing more than $4.4 million over a decade, law enforcement officials said today.
Richard A. Zakarian, age 47, is charged with two counts each of wire fraud and mail fraud and one count of making and subscribing false income tax returns. Zakarian was a certified financial planner and a self-employed tax preparer who owned and operated several business ventures.
The five-count information details two schemes by Zakarian – one to defraud investment clients (many of whom were also clients of his tax-preparation business), another to defraud clients whose payroll taxes he handled through a company known as Ben Franklin Payroll Service.
Many of the payroll tax victims were churches, charities and other non-profit organizations that Zakarian lured as clients through purported grants from charity he claimed to operate. The information further details Zakarian’s falsification of his tax returns to conceal his fraudulently generated income from the investment scheme.
“This defendant is accused of taking advantage of trust of dozens of clients, which ranged from homeless shelters and nursery schools to retirees and those with disabilities,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “The conduct laid out here is as outrageous as it is predatory.”
Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigations’ Cleveland Office, said: “Zakarian orchestrated multiple financial schemes that all had one common thread, monetary benefit to him. Authorities will continue to bring those to justice that choose to unlawfully violate the trust of their clients.”
“Investment fraud schemes are often described as a house of cards. The underlying structure can fall apart at any time and expose the individuals responsible," said Kathy A. Enstrom, Acting Special Agent in Charge, IRS, Criminal Investigation, Cincinnati Field Office. “Investment schemes that seem too good to be true should be a signal to investors to stay clear.”
The information filed in U.S. District Court details the following schemes:
THE INVESTMENT SCHEME
From September 2002 through August 2012, Zakarian devised a scheme to defraud investment clients by inducing them to invest their retirement funds, and occasionally other savings, through him as their account representative through false and fraudulent misrepresentations. He primarily targeted clients from his tax-preparation business when they received their tax refunds or sought his financial advice.
Zakarian misled clients to believe their funds would be placed in safe, guaranteed-return investments when, in fact, he diverted the funds to pay personal and business expenses and invested in risky investments for which he had a consistent history of incurring large losses.
Zakarian recruited 25 investment clients, often targeting tax preparation clients who he knew to have available funds and to be susceptible to his pitch through their prior relationship of trust in him.
hile some received a return on part or all of their investment, 23 clients incurred combined out-of-pocket losses of more than $1 million. In addition, the clients did not receive hundreds of thousands of dollars of gains on their investments that Zakarian falsely reported to them during the scheme.
A number of clients were retired, out of work, or nearing retirement. Most invested through Zakarian by moving their money from in traditional, relatively safe and dependable stocks, bonds and mutual funds.
In one case, Zakarian convinced a recently retired client to pay an early-withdrawal penalty to move money from a certificate of deposit purchased upon retirement. He induced another client to redeem a life insurance annuity to generate investment funds and talked her out of using the money to pay off her home mortgage or car loans.Until mid-2009, Zakarian obtained use of clients funds primarily by having them place their investments with companies offering self-directed IRA services, and then having those companies transfer the funds to Zakarian as investments in promissory notes he issued. Zakarian initially issued the notes personally, as Zakarian Tax Consultants, but later issued them through a shell real estate company, Viewcrest Properties. Zakarian touted the IRA companies to his clients and misled many clients into believing that they were investing in those companies or that the use of the companies would assure the safety of their investments. Due to Zakarian’s misrepresentations, many clients did not realize their investments involved promissory notes.
THE PAYROLL TAX SCHEME
Zakarian began his separate payroll tax scheme in 2010 that continued through August 2012.
He induced clients to retain Ben Franklin Payroll Service, which he owned and operated, leading them to believe the company would and did file the client’s required employment tax returns and reports and pay the clients’ federal, state and local tax obligations.The funds should have been forwarded to various taxing authorities to pay the income taxes of his clients’ employees. In reality, he failed to file many of the returns and diverted substantial portions of the clients’ funds to pay his own personal and business expenses and invest in highly-leveraged, risky investments with a consistent history of sustaining large losses.
Zakarian attempted to solicit for-profit clients by offering services well below market rates and below his own operating costs, such as a rate of $1 per employee per pay period. Later in 2010, after this failed to generate as many clients as he envisioned, Zakarian developed a new plan to solicit churches, charities and other non-profits through a purported “grant” program. These organizations were targeted as they typically had tight budgets sensitive to payroll costs. Zakarian’s primary objective was to gain access to their operating accounts.
Zakarian began marketing Ben Franklin Payroll Service as being affiliated with Zakarian Charities and the Benjamin Franklin Foundation, organizations established “as an effort to give back to the community.” He offered payroll grants from the Benjamin Franklin Foundation to non-profit organizations to cover two years of free payroll service through Ben Franklin Payroll Service.
To make the grant process appear legitimate, the application required the applicant to submit a one- or two-page narrative history and mission statement, a copy of the IRS tax-exempt determination letter, a list of the Board of Directors, an IRS Form 990 and an annual report, if available. About two weeks after receiving the client’s application, Zakarian sent a congratulatory letter, announcing that the Benjamin Franklin Foundation had awarded a two-year renewable grant.
Rather than forwarding the monies withdrawn to from his clients’ accounts directly to taxing authorities, Zakarian instructed his employees to transfer the tax funds to a Ben Franklin Payroll Service operating account. Clients were sent false quarterly employment tax returns and payroll summaries, giving the false impression that their payroll taxes were being properly handled.
In total, Ben Franklin had at least 72 clients who incurred combined losses of more than $3.4 milllion from Zakarian’s fraudulent diversion of their employment tax funds entrusted to his company. Just over half of the losses were incurred by at least 29 non-profit organizations, with the rest being incurred by at least 43 businesses.
Zakarian also filed false federal income returns for the years 2006 through 2009, failing to report the income he received from the investment scheme. He filed the 2006 through 2008 returns deliquently in December 2009 after the Ohio Division of Securities requested copies. On the 2006 and 2007 returns, Zakarian also falsely claimed substantial losses on the investments he made with the fraudulently obtained client funds, and used those losses to offset other income he earned those years.
If convicted, the defendant’s sentences will be determined by the court after review of the federal sentencing guidelines and factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offenses and the characteristics of the violations.
This case is being prosecuted by Assistant U.S. Attorneys Robert J. Patton and John M. Siegel, following an investigation by the Federal Bureau of Investigation, the Internal Revenue Service – Criminal Investigation, the Lorain Police Department, and the Lorain County Prosecutor’s Office. The investigators also received assistance from the Ohio Department of Commerce, Division of Securities.
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.
Former Kirtland Man Sentenced to Prison for Tax ViolationsRead the Press Release
A former Kirtland man was sentenced to more than two years in prison for filing false income taxes, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
John C. Hartman, age 61, previously pleaded guilty to two counts of filing false tax returns for the years 2005 and 2006. His tax returns omitted more than $360,000 in income obtained from relatives that he defrauded, according to court documents.
Hartman solicited the money from family members under the guise that he was going to invest their money in various investments such as stock, raw materials and real property. He never invested these funds. Instead, Hartman used these funds to pay for personal expenses, according to court documents.
Hartman also obtained money by telling his friends and family members that he needed funds to pay for outstanding tax obligations, a bad stock investment, and medical expenses for his sick wife. He obtained these funds under the guise of loans. Hartman had no such delinquent tax obligations or bad stock investments and his wife did not have the serious medical condition that Hartman described. Hartman had no intention to repay any of the funds he purported to be loans. Instead, Hartman spent the funds on personal expenses, according to court documents.
The unreported income from fraud for 2005 and 2006 was $230,000 and $136,500, respectively. The tax loss for 2005 and 2006 was $65,797 and $17,963, respectively.
This case is being prosecuted by Assistant United States Attorney Robert Patton and Special Assistant United States Attorney Perry D. Mastrocola, following an investigation by the Internal Revenue Service Criminal Investigation Division.