Western District of Oklahoma
Press releases recorded for this federal judicial district.
Four El Reno Residents Convicted of Conspiracy in Fraudulent Vehicle Cash-Back Rebate SchemeRead the Press Release
Oklahoma City, Oklahoma – On Thursday, May 28, 2015, a jury returned guilty verdicts against ROBERT W. ARNOLD, 25, of El Reno, Oklahoma, on charges of conspiracy and wire fraud, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Three co-defendants—RICHARD M. ARNOLD SR. (a/k/a/ “Rick Arnold”), 61, RICHARD M. ARNOLD II, (a/k/a/ “Ricky Arnold”), 29, and ROBYN R. ARNOLD, 56, all of El Reno—pled guilty to conspiracy before trial. All were charged with conspiring to defraud new car purchasers out of cash rebates based on false representations that a charitable trust would make all of the victims’ monthly car payments.
The evidence at trial showed that from May of 2013 through April of 2014, the defendants informed their acquaintances, family members, and friends that they could become beneficiaries of a program operated by a charitable trust designed to help working people acquire new cars. The defendants claimed that “CECU Trust” financed the program, which was also called the “United Auto Buyers Co-op Association.”
Rick Arnold, Ricky Arnold, and Robert Arnold met car purchasers interested in the program at various car dealerships and arranged for purchases on credit that would include cash rebates to the buyers from $4,000 to $12,000 per car. In some instances, defendants caused victims’ loan applications to include fraudulently inflated income. Defendants told the car buyers that the rebate money would have to be given to the defendants for deposit into CECU Trust, which would then pay the buyers’ car loans in their entirety.
After the car purchases were complete, one or more of the defendants met the car buyers in a public place, such as a coffee shop or a bank, to receive the proceeds of the cash-back finance transactions. That money was deposited into bank accounts controlled by Robyn Arnold. Much of the money was used for personal expenses. Defendants also asked buyers to sign powers of attorney as well as proposed agreements advising the buyers that the association’s success depended on the buyers referring new participants to the program.
When various lenders notified buyers of potential defaults, defendants either assured the buyers that the payments would be made or stated that the trust would be unable to make further payments unless the buyers recruited additional participants.
A federal grand jury indicted all four defendants on December 3, 2014. On March 24, 2015, Ricky Arnold pled guilty to conspiracy. Rick Arnold and Robyn Arnold pled guilty to conspiracy on May 11, 2015; Rick Arnold also entered a guilty plea to one count of wire fraud. A jury convicted Robert Arnold of conspiracy and wire fraud after hearing more than two days of testimony.
The maximum penalty for the convictions against Rick Arnold, Ricky Arnold, and Robyn Arnold is thirty years in prison, five years of supervised release, and a fine of $1,000,000. The maximum penalty for the convictions against Robert Arnold is twenty years in prison, three years of supervised release, and a fine of $250,000. All four defendants will be required to pay restitution to victims and to forfeit property up to the value of the proceeds of the offenses. Sentencings will take place in approximately 90 days.
Reference is made to court filings for further information.
This case is the result of an investigation by the Federal Bureau of Investigation and the Public Protection Unit of the Oklahoma Attorney General’s Office. The case is being prosecuted by Assistant U.S. Attorneys Scott E. Williams and Kate Holey.
Ponca City Man Sentenced to 151 Months in Federal Prison for Forcible Sexual AssaultRead the Press Release
Oklahoma City, Oklahoma – Today, Ivan Bennett Willis (22) was sentenced to 151 months in federal prison by Senior United States District Court Judge Robin J. Cauthron announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Upon his release from incarceration, Willis was ordered to serve five years of supervised release and register as a sex offender, said Coats.
In January, Willis was convicted by a jury of forcing his victim to engage in a sexual act on September 22, 2013, at a home located on Ponca Tribal land. This case was investigated by the Federal Bureau of Investigation and Bureau of Indian Affairs; the prosecutor was Assistant U.S. Attorney Rozia McKinney-Foster.
Indictment Unsealed Charging Shawnee Man for Embezzling from the Citizen Pottawatomie NationRead the Press Release
Oklahoma City, Oklahoma – A federal grand jury indictment was unsealed today charging THOMAS BIERD, 35, from Shawnee, Oklahoma, with embezzlement from the Citizen Pottawatomie Nation, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
The Citizen Pottawatomie Nation's included the Community Development Corporation (CDC), which promoted economic development in the Native American community by providing business loans and grants to companies owned by or which primarily employed members of Federally-recognized Indian tribes. Kristi Bias (a/k/a Kristi Coker), 41, from Shawnee, was employed as the Executive Director of the CDC. The indictment alleges that between December, 2010, and September, 2011, Bias and Bierd aided and abetted each other by devising a scheme to embezzle funds from the CDC. Specifically, it is alleged that in her capacity as Executive Director, Bias would cause a check to be issued by the CDC to an entity controlled by Bierd or to an individual specified by Bierd. Bias, it is alleged, would cause false documentation to be placed in the CDC’s file, making it appear that the checks were for the legitimate purposes of the CDC when in fact they were not, and Bierd would kick back a portion of the check proceeds to Bias.
If convicted, Bierd faces up to five years in prison, a $250,000 fine, and payment of restitution to the Tribe. The public is reminded that an indictment is only a charge and is not evidence of guilt. Each defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Bierd was arrested earlier today and appeared this afternoon in federal court. He was released on bond and the Court set the trial date for June of 2015.
In a separate case, Kristi Bias was charged on November 7, 2014, and pled guilty to embezzlement from the Tribe on November 25, 2014. She is awaiting sentencing where she also faces up to five years in prison, a $250,000 fine, and payment of restitution to the Tribe.
This case is the result of an investigation conducted by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorney Tim Ogilvie.
Final Defendant Sentenced to Serve 42 Months in Prison for Money Laundering in Connection with Federal Wireless Telephone Program SubsidiesRead the Press Release
Oklahoma City, Oklahoma –OSCAR ENRIQUE PEREZ-ZUMAETA, of Cancun, Mexico, was sentenced yesterday by United States District Judge Tim DeGiusti to serve 42 months in prison for money laundering in connection with the Federal Communication Commission’s Lifeline Program, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
The current Lifeline Program, which was created in 1985, furthers the FCC’s mission to provide all Americans with access to a basic level of telephone service. Since 2005, Lifeline has provided subsidies to participating telephone companies not only for landline service, but also for wireless service for qualifying low-income customers. The Universal Service Administrative Company (“USAC”) administers the Lifeline Program on behalf of the FCC and under detailed federal regulations. To pay for the program, USAC collects fees from telephone companies, which often pass the fees on to customers as “universal service charges” on monthly telephone bills.
Most participating wireless telephone companies receive a subsidy of $9.25 per month for each qualifying low-income customer. If a qualifying customer lives on “Tribal Lands,” however, the company receives $34.25 per customer. Much of Oklahoma includes Tribal Lands that qualify for the higher monthly subsidy. Before receiving reimbursement, participating telephone companies file forms with the FCC that report the number of Lifeline eligible customers they have served. Companies must also file annual reports to certify that customers who received Lifeline service at an earlier date remain eligible for the program.
Icon Telecom, an Edmond company, was owned exclusively by Wes Yui Chew, also of Edmond. Icon participated in the wireless Lifeline Program from July 2011 until September 2013. An information filed on June 3, 2014, alleged that in September 2011, Icon reported fewer than 2,200 wireless customers who qualified for the Lifeline program. By November 2012, that number had grown to 135,364. The information explains that although it had fewer than ten full-time employees, Icon received a total of $58,283,329 through the Lifeline Program during 2011, 2012, and 2013.
Perez-Zumaeta owned and managed PSPS Sales LLC, a California entity that recruited low-income individuals to apply for Lifeline service through Icon. According to court records, Icon paid over one million dollars to PSPS Sales from December 2011 through April 2013. Perez-Zumaeta was charged with directing PSPS Sales workers to enroll fictitious customers for Icon by using phone book listings and forging Lifeline application forms. He also allegedly directed workers in Mexico to falsify approximately 40,000 Lifeline recertification forms for use in Icon’s fraudulent scheme.
On November 7, 2014, Perez-Zumaeta pled guilty to money laundering by depositing a $52,390.00 check from Icon into a bank account of PSPS Sales on December 7, 2012. He admitted that when he made that deposit, he knew that more than $10,000.00 of those funds was the result of criminal fraud against the FCC.
Perez-Zumaeta has been in federal custody since April 25, 2014, when he was arrested at the San Francisco airport. At his sentencing hearing yesterday, Judge DeGiusti ordered Perez-Zumaeta to serve 42 months in prison, followed by two years of supervised release.
Related Case
On June 12, 2014, Chew pled guilty to money laundering for his transfer of $20,455,829.10 on April 9, 2013, from an Icon account to a personal account. He admitted that when he made that transfer, he knew that Icon had tens of thousands fewer customers than it had reported to the FCC for the first three months of 2013. Also on June 12, 2014, as the sole owner of Icon, Chew also entered a guilty to plea on behalf of the company to knowingly making a false statement to the FCC on May 13, 2013. Chew admitted that in response to a USAC audit request, Icon intentionally fabricated customer recertification forms, which included fictitious signatures. As part of their plea, Chew and Icon agreed to the forfeiture of $20,542,740.73, which the United States seized on October 4, 2013, from a personal account at Ally Bank that belonged to Chew. They also agreed not to contest the forfeiture of $6,485,933.82 seized on October 7, 2013, from two Icon accounts at BancFirst.
On April 2, 2015, Judge DeGiusti ordered that Chew serve 48 months in federal prison, followed by three years of supervised release, and pay a fine of $117,166.48 (which is the anticipated cost of his federal imprisonment). Chew’s company, Icon Telecom, was sentenced to three years of probation. Chew and Icon agreed not to contest the forfeiture of more than $27 million seized during the investigation.
These cases are the result of an investigation by the Office of Inspector General for the Federal Communications Commission; the Federal Bureau of Investigation; and the Internal Revenue Service Criminal Investigation. These cases are being prosecuted by Assistant U.S. Attorneys Chris M. Stephens and Scott E. Williams.
Reference is made to the information and other public filings for further information
Former Executive Vice President Sentenced to Serve 15 Months in Federal Prison in Connection with the Failure of Freedom State BankRead the Press Release
Oklahoma City, Oklahoma – MARK A. NIXON, 62, from Freedom, Oklahoma, former Executive Vice President of The Freedom State Bank in Freedom, Oklahoma, was sentenced yesterday by United States District Judge Stephen P. Friot for his involvement in the Bank’s failure on June 27, 2014, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
On December 15, 2014, Nixon pled guilty and admitted to preparing and submitting a Consolidated Report of Condition and Income to the FDIC which falsely stated that The Freedom State Bank possessed $21,950,000.00 in assets, when he in fact knew that the true amount was substantially less.
In the sentencing hearing yesterday, Nixon was ordered to serve 15 months in prison, followed by one year of supervised release, and was ordered to pay $1,557,808.89 in restitution to the FDIC. He was ordered to report to the Bureau of Prisons on May 14, 2015, to begin serving his sentence.
This case is the result of an investigation by the FDIC Office of Inspector General. It was prosecuted by Assistant U.S. Attorney Julia E. Barry.
Icon Telecom and Its Owner Sentenced for Money Laundering and Making False Statements in Connection with Federal Wireless Telephone Program SubsidiesRead the Press Release
Oklahoma City, Oklahoma – WES YUI CHEW, of Edmond, Oklahoma, and his company, ICON TELECOM, INC., also of Edmond, were sentenced today by United States District Judge Tim DeGiusti for money laundering and making a false statement to the Federal Communications Commission in connection with the federal Lifeline Program, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Judge DeGiusti ordered that Chew serve 48 months in federal prison, followed by three years of supervised release, and pay a fine of $117,166.48 (which is the anticipated cost of his federal imprisonment). Chew’s company, Icon Telecom, was sentenced to three years of probation. Chew and Icon agreed not to contest the forfeiture of more than $27 million seized during the investigation.
The current Lifeline Program, which was created in 1985, furthers the FCC’s mission to provide all Americans with access to a basic level of telephone service. Since 2005, Lifeline has provided subsidies to participating telephone companies not only for landline service, but also for wireless service for qualifying low-income customers. The Universal Service Administrative Company (“USAC”) administers the Lifeline Program on behalf of the FCC and under detailed federal regulations. To pay for the program, USAC collects fees from telephone companies, which often pass the fees on to customers as “universal service charges” on monthly telephone bills.
Most participating wireless telephone companies receive a subsidy of $9.25 per month for each qualifying low-income customer. If a qualifying customer lives on “Tribal Lands,” however, the company receives $34.25 per customer. Much of Oklahoma includes Tribal Lands that qualify for the higher monthly subsidy.
Before receiving reimbursement, participating telephone companies file forms with the FCC that report the number of Lifeline eligible customers they have served. Companies must also file annual reports to certify that customers who received Lifeline service at an earlier date remain eligible for the program.
Icon Telecom, owned exclusively by Chew, participated in the wireless Lifeline Program from July 2011 until September 2013. An information filed on June 3, 2014, alleged that in September 2011, Icon reported fewer than 2,200 wireless customers who qualified for the Lifeline program. By November 2012, that number had grown to 135,364. The information explains that although it had fewer than ten full-time employees, Icon received a total of $58,283,329 through the Lifeline Program during 2011, 2012, and 2013.
On June 12, 2014, Chew pled guilty to money laundering for his transfer of $20,455,829.10 on April 9, 2013, from an Icon account to a personal account. He admitted that when he made that transfer, he knew that Icon had tens of thousands fewer customers than it had reported to the FCC for the first three months of 2013.
Also on June 12, 2014, as the sole owner of Icon, Chew also entered a guilty to plea on behalf of the company to knowingly making a false statement to the FCC on May 13, 2013. Chew admitted that in response to a USAC audit request, Icon intentionally fabricated customer recertification forms, which included fictitious signatures.
As part of their plea, Chew and Icon agreed to the forfeiture of $20,542,740.73, which the United States seized on October 4, 2013, from a personal account at Ally Bank that belonged to Chew. They also agreed not to contest the forfeiture of $6,485,933.82 seized on October 7, 2013, from two Icon accounts at BancFirst.
Related Case
The case against Chew and Icon is related to a June 3, 2014, indictment against OSCAR ENRIQUE PEREZ-ZUMAETA, of Cancun, Mexico, alleging that Perez-Zumaeta owned and managed PSPS Sales LLC, a California entity that recruited low-income individuals to apply for Lifeline service through Icon. According to the indictment, Icon paid over one million dollars to PSPS Sales from December 2011 through April 2013. Perez-Zumaeta is charged with directing PSPS Sales workers to enroll fictitious customers for Icon by using phone book listings and forging Lifeline application forms. He also allegedly directed workers in Mexico to falsify approximately 40,000 Lifeline recertification forms for use in Icon’s fraudulent scheme.
On November 7, 2014, Perez-Zumaeta pled guilty to money laundering by depositing a $52,390.00 check from Icon into a bank account of PSPS Sales on December 7, 2012. He admitted that when he made that deposit, he knew that more than $10,000.00 of those funds was the result of criminal fraud against the FCC.
Perez-Zumaeta has been in federal custody since April 25, 2014, when he was arrested at the San Francisco airport. A federal magistrate judge ordered him detained based on a risk of flight. Perez-Zumaeta is awaiting sentencing where he faces up to ten years in prison, a fine of up to $250,000, and up to three years of supervised release.
These cases are the result of an investigation by the Office of Inspector General for the Federal Communications Commission; the Federal Bureau of Investigation; and the Internal Revenue Service Criminal Investigation. These cases are being prosecuted by Assistant U.S. Attorneys Chris M. Stephens and Scott E. Williams.
Reference is made to the information and other public filings for further information.
Former Office Manager from Jones Sentenced to 94 Months in Prison in Connection with over $1 Million Embezzlement and Tax FraudRead the Press Release
Oklahoma City, Oklahoma –JULIE ANN SMITH (a/k/a “Julie A. Judkins” and “Julie A. Judkins Smith”), of Jones, Oklahoma, was sentenced today to serve 94 months in federal prison and ordered to pay $1,237,939.22 in restitution for embezzling from her former employer and for tax fraud, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
On October 30, 2014, a federal jury found Smith guilty of 36 counts of bank fraud, mail fraud, aggravated identity theft, forged securities, and tax fraud. According to evidence presented at trial, Smith worked from 2000 until late June 2012 at Power Equipment & Engineering, Inc. (“PE&E”), in Oklahoma City. At PE&E, Smith was the accounts-payable clerk and office manager, where she prepared checks and paid invoices for the company. While employed at PE&E from June of 2002 through June of 2012, Smith forged approximately 195 PE&E checks by using the company owner’s signature stamp without PE&E’s permission or knowledge. The forged checks totaled more than $1 million. The evidence showed that Smith disguised the forged checks through false entries on PE&E’s accounting system, wrote many of the forged checks to a fake company under her control, and directed other forged checks to credit card companies, financial institutions, and vendors for her personal benefit. Finally, the evidence showed that Smith filed materially false federal income tax returns for years 2008 through 2012.
Today, United States District Judge Stephen P. Friot sentenced Smith to 94 months in federal prison, and ordered her to pay $1,237,939.22 in restitution. Judge Friot ordered Smith to pay $1,036,816.22 in restitution to PE&E for the embezzlement, and $201,123.00 in restitution to the Internal Revenue Service. The 94-month sentence includes 70 months’ imprisonment for the bank fraud, mail fraud, and forged security counts, followed by 24 additional months in prison for one count of aggravated identify theft. Judge Friot sentenced Smith to 36 months’ imprisonment for the tax fraud, to be served at the same time as the 70-month term of imprisonment. After her incarceration, Smith will be on supervised release for five years. At the end of today’s sentencing, Smith was taken into custody to begin service of her federal sentence.
This sentence is the result of an investigation conducted by the Internal Revenue Service - Criminal Investigations, United States Secret Service, Federal Bureau of Investigation, and Oklahoma City Police Department. The case was prosecuted by Assistant U.S. Attorneys Chris M. Stephens and Jessica L. Perry.
Reference is made to court filings for further information.
Yukon Tax Preparer to Serve 24 Months in Prison for Prepaing Tax Return for Client Falsly Claiming Entitlement to First-Time Homebuyer CreditRead the Press Release
Oklahoma City, Oklahoma – WILLIAM DAVID GREEN, a tax preparer from Yukon, Oklahoma, was sentenced to serve 24 months in federal prison for preparing a false tax return for a client, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Green was also ordered to pay $171,362.00 in restitution and serve one year of supervised release upon his release from prison.
Green was charged by information on August 14, 2014, with two separate counts. Count One alleged that Green prepared a false tax return for a taxpayer that falsely represented on Line 69 that the taxpayer was entitled to first-time homeowner credit in the amount of $7,266 when he knew the taxpayer was not because he did not purchase a home in 2008. Count Two charged Green with obstruction of the administration of Internal Revenue laws by preparing the 2010 tax return reflecting a balance of $5,046 due to the IRS from the taxpayer, collecting a check from the taxpayer payable to the IRS in that amount, depositing the check into his business account by altering the payee portion of the check and endorsing the check, failing to file the taxpayer’s tax return, and spending the money intended for the IRS for his own purposes.
Green pled guilty to both counts on September 3, 2014. Green was sentenced to serve 24 months in federal prison, serve one year of supervised release upon his release from prison, and pay $171,362.00 in restitution. He was ordered to report to the Bureau of Prisons on May 4, 2015, to begin serving his sentence.
This case is the result of an investigation by IRS Criminal Investigation and is being prosecuted by Assistant U.S. Attorney Susan Dickerson Cox.
Settlement with Continental Carbon Company to Reduce Air Pollution at Manufacturing Facilities in Alabama, Oklahoma and TexasRead the Press Release
WASHINGTON – In a settlement with the United States and the states of Alabama and Oklahoma, Continental Carbon Company has agreed to install pollution control technology that will significantly cut emissions of harmful air pollutants at manufacturing facilities in Alabama, Oklahoma and Texas, the Department of Justice and the U.S. Environmental Protection Agency (EPA) announced today. The settlement will resolve claims that Houston-based Continental violated the Clean Air Act by modifying their facilities in a way that caused the release of excess sulfur dioxide (SO2) and nitrogen oxide (NOx).
The settlement requires Continental to pay a civil penalty of $650,000, which will be shared with Alabama and Oklahoma, co-plaintiffs in the case. Continental must also spend $550,000 on environmental projects to help mitigate the harmful effects of air pollution on the environment and to benefit local communities, including at least $25,000 on energy efficiency projects in the communities near each of the three facilities.
“Today’s agreement is good news for residents living near Continental facilities, many of whom were overburdened by air pollution for far too long and whose children, like all Americans, should be able to breath clean air.” said Assistant Attorney General John C. Cruden of the Justice Department’s Environment and Natural Resources Division. “The agreement also reflects our continuing efforts to vigorously enforce the Clean Air Act to protect public health and the environment. The settlement requires Continental to control large sources of air pollution with advanced technology and requires projects that will have a direct and positive impact on Continental’s neighbors.”
“This settlement brings another major carbon black company into compliance with a law that protects clean air for American communities,” said Assistant Administrator Cynthia Giles of EPA’s Office of Enforcement and Compliance Assurance. “By investigating all 15 carbon black manufacturing plants in the U.S., EPA is committed to improving public health and leveling the playing field for companies that follow the law. By installing the latest pollution control technology and funding environmental projects, Continental is taking steps to reduce emissions of air pollutants that can lead to serious health problems.”
Continental manufactures carbon black, a fine carbonaceous powder used in tires, plastics, rubber, inkjet toner and cosmetics, at facilities in Phenix City, Alabama, Ponca City, Oklahoma, and Sunray, Texas. Because the oil used to make carbon black is high in sulfur, its production creates large amounts of nitrogen oxide, sulfur dioxide and particulate matter. This settlement supports EPA’s and the Justice Department's national efforts to advance environmental justice by working to protect communities such as Phenix City and Ponca City that have been disproportionately impacted by pollution.
EPA expects that the actions required by the settlement will reduce harmful emissions by approximately 6,278 tons per year of sulfur dioxide and 1,590 tons per year of nitrogen oxide. Continental estimates that it will spend about $98 million to implement the required measures. The pollution reductions will be achieved through the installation, upgrade and operation of state-of-the-art pollution control devices designed to reduce emissions and protect public health.
SO2 and NOx have numerous adverse effects on human health and are significant contributors to acid rain, smog and haze. These pollutants are converted in the air to particulate matter that can cause severe respiratory and cardiovascular impacts, and premature death.
EPA concluded that the modifications made at Continental’s plants violated the Clean Air Act based on information the company submitted in response to an information request from EPA in 2007. EPA issued notices of violation to Continental for these claims in 2012.
The settlement was filed with the U.S. District Court of the Western District of Oklahoma and is subject to a 30 day public comment period. The company is required to pay the penalty within 30 days after the court approves the settlement.
The consent decree is available for review at http://www.justice.gov/enrd/Consent_Decrees.html
This settlement is part of EPA’s National Enforcement Initiative to control harmful emissions from large sources of pollution. Through the initiative, EPA investigated all 15 of the carbon black plants in the U.S. for violations of the Clean Air Act’s Prevention of Significant Deterioration requirements. With this settlement, six of the 15 facilities will be covered by consent decrees with EPA. In 2013, EPA announced the first national carbon black settlement with Boston-based Cabot Corporation, the second largest carbon black manufacturer in the United States.
More on the settlement: https://www.epa.gov/enforcement/continental-carbon-company-clean-air-act-settlement
Oklahoma City Man Pleads Guilty to Child Sex TraffickingRead the Press Release
Oklahoma City, Oklahoma – Today, WILLIAM VONTRAIL JOHNSON, 28, from Oklahoma City, pleaded guilty to prostituting a 14-year-old girl in an Oklahoma City motel, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to court records, on June 13, 2014, a sting operation led by the Oklahoma Bureau of Narcotics Human Trafficking Division and the Oklahoma City Police Department Vice Unit recovered a 14-year-old girl from an Oklahoma City hotel where she was being prostituted by Mr. Johnson. An online advertisement for escort services led law enforcement to the girl. Shortly after the girl was recovered from the hotel room, Mr. Johnson was arrested in the parking lot with a key to the hotel room where the girl was recovered. Mr. Johnson also had $800 in cash and a smart phone, which was examined by law enforcement. Mr. Johnson’s internet history on his smart phone showed it had been used to post the online advertisement that law enforcement had responded to. The smart phone also stored numerous images of the girl and a video of Mr. Johnson engaging in sex acts with her.
Mr. Johnson was indicted by a federal grand jury on December 3, 2014. During the plea hearing today, Mr. Johnson admitted to child sex trafficking of the 14-year-old girl in Oklahoma City and Texas, including posting advertisements online and accepting money in exchange for her performing sex acts.
At sentencing, Mr. Johnson faces a mandatory minimum of ten years and up to life in prison. A sentencing hearing will be set by the court in approximately 90 days.
This case is the result of an investigation by the Oklahoma Bureau of Narcotics Human Trafficking Division, the Oklahoma City Police Department Vice Unit, and the Department of Homeland Security. The case is being prosecuted by Assistant U.S. Attorneys Brandon Hale and K. McKenzie Anderson.
Two Indicted for Making Terrorist HoaxRead the Press Release
Oklahoma City, Oklahoma – Today, a federal grand jury returned an indictment charging ISRAA JAFAR ALI, 19, from Oklahoma City, and SAJJAD HUSSEIN AL FEHAIDAH, 23, from Saudi Arabia, with conspiracy to make a terrorist hoax and for making a terrorist hoax, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to the indictment, it is alleged that on September 19, 2014, Ms. Ali made a 911 call to the Edmond Police Department using the cell phone of her boyfriend, Mr. Al Fenaidah. Ms. Ali allegedly reported that a Saudi Arabian international male student would commit a suicide bombing at an unspecified Christian church near the University of Central Oklahoma (UCO) campus within two to three weeks by strapping ion himself an explosive device (a bomb laden vest containing nails) to kill a number of people. It is alleged that Mr. Al Fenaidah provided Ms. Ali his cell phone to make the false report and accessed his Facebook account to research biographical information on the Saudi Arabian male to provide to Ali. The indictment alleges that the purpose of the conspiracy by Ali and Fehaidah was to retaliate against the Saudi Arabian male international student.
If convicted, each defendant faces up to five years in prison and a $250,000 fine on the conspiracy count and up to five years in prison and a $250,000 fine on the terrorist hoax count. Reference is made to the court record for further information. The public is reminded this is simply a charge and both defendants are presumed innocent unless and until they are convicted beyond a reasonable doubt.
The Federal Bureau of Investigation and United States Attorney’s Office would like to thank the Edmond Police Department and the following members of the FBI Joint Terrorism Task Force who assisted in the investigation: the Oklahoma City Police Department, the Oklahoma Highway Patrol, the United States Secret Service, and the Department of Homeland Security. The case is being prosecuted by Assistant U.S. Attorney Ed Kumiega.
Three Florida Men and a Corporation Convicted for Running Illegal International Gambling EnterpriseRead the Press Release
WASHINGTON – A federal jury in Oklahoma City convicted three Florida men and a Florida corporation today for their participation in an illegal international gambling and money laundering enterprise, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Sanford C. Coats of the Western District of Oklahoma.
“In the age of the internet, what used to be a crime conducted by bookies on street corners is now an international criminal enterprise,” said Assistant Attorney General Caldwell. “Operating on-line but off-shore, the individuals convicted in this case raked in more than a billion dollars in illegal gambling proceeds. But as these convictions demonstrate, no matter where or how organized criminals operate, the Criminal Division will bring them to justice.”
“This is a great result in this important case,” said U.S Attorney Coats. “I applaud the tremendous, collaborative efforts of our law enforcement partners and the prosecution team.”
Paul Francis Tucker, 50, of Mount Dora, Florida, Luis Robles, 50, of St. Beach, Florida, and Zapt Electrical Sales Inc., a corporation registered in Florida and owned by Tucker, were found guilty of engaging in a racketeering conspiracy, conducting an illegal gambling business and conspiracy to commit money laundering. Christopher Lee Tanner, 58, of Sarasota, Florida, was found guilty of conducting an illegal gambling ring. A sentencing date will be set by the court in approximately 90 days, and the hearing will take place before U.S. District Judge Stephen P. Friot of the Western District of Oklahoma.
According to evidence presented at trial, from 2003 to 2013, Tanner, Tucker, Robles and Zapt Electrical Sales conspired with others to operate internet and telephone gambling services from Panama City, Panama through an enterprise known as Legendz Sports. The international gambling enterprise took more than $1 billon in illegal wagers, almost exclusively from gamblers in the United States on American sporting events.
The evidence demonstrated that Tanner and Tucker worked as bookies in Florida, and illegally solicited and accepted sports wagers and settled gambling debts. Tucker also used Zapt Electrical Sales and its bank account to launder gambling proceeds collected from losing bettors.
The evidence showed that Robles worked as a runner for the enterprise, delivering cash to Legendz Sports bookies to make payouts and picking up cash profits from the bookies. According to the evidence at trial, bookies and runners for Legendz Sports transported millions of dollars of gambling proceeds in cash and checks from the United States to Panama. The checks were made out to various shell companies created by Legendz Sports all over Central America to launder gambling proceeds.
The case was investigated by the FBI and Internal Revenue Service-Criminal Investigation, with the assistance of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and the U.S. Marshals Service. The case is being prosecuted by Trial Attorney John S. Han of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Susan Dickerson Cox and Travis D. Smith of the Western District of Oklahoma.
Oklahoma Army National Guard Soldier Pays $12,000 to Settle Allegations of False ClaimsRead the Press Release
Oklahoma City, Oklahoma -- Sanford C. Coats, United States Attorney for the Western District of Oklahoma announces that Staff Sergeant Kasey Ray Bickerstaff has agreed to pay $12,000 to settle civil penalty claims stemming from allegations that he violated the False Claims Act by submitting, or causing to be submitted, false claims under the Army National Guard’s Recruiting Assistance Program (G-RAP).
Staff Sgt. Kasey Ray Bickerstaff is a member of the Oklahoma Army National Guard. He registered as a recruiter assistant under the G-RAP to help the Guard supplement its enlistment efforts. As a recruiter assistant, Bickerstaff could earn bonuses for individuals he recruited to join the National Guard.
The United States contends that from January 2009 through April 2010, Bickerstaff submitted or caused to be submitted four false claims under the G-RAP program to obtain bonus payments for potential soldiers whom he did not assist in recruiting and to which he was not entitled.
In order to resolve the allegations brought by the United States, Bickerstaff agreed to pay $12,000. In reaching this settlement, Bickerstaff did not admit liability and the government did not make any concessions regarding the legitimacy of the claims. The agreement allows the parties to avoid the delay, expense, inconvenience, and uncertainty involved in litigating the case.
This case was investigated by the U.S. Army Criminal Investigation Command. The case was prosecuted by Assistant United States Attorney Ronald R. Gallegos.
Complaint Unsealed Charging Two with Making Terrorist HoaxRead the Press Release
Oklahoma City, Oklahoma – Today, Sanford C. Coats, United States Attorney for the Western District of Oklahoma, and Jim Finch, FBI Special Agent in Charge, announced that a criminal complaint was unsealed this afternoon charging ISRAA JAFAR ALI, 19, from Oklahoma City, and SAJJAD HUSSEIN AL FEHAIDAH, 23, from Saudi Arabia, with making a false report of a purported suicide bomber targeting an unspecified Christian church near the University of Central Oklahoma (UCO) campus in Edmond, Oklahoma.
According to the complaint, on September 19, 2014, Ms. Ali made a 911 call to the Edmond Police Department using the cell phone of her boyfriend, Mr. Al Fenaidah. During that call, Ms. Ali reported that a terrorist act may occur in Edmond. Specifically, according to the complaint, Ms. Ali identified an international student who she claimed to have overheard talking about committing a suicide bombing by strapping on a vest with nails that would explode and kill people at an unspecified Christian church near the UCO campus. According to the complaint, Mr. Al Fenaidah assisted Ms. Ali by allowing her to use his cell phone to make the false report and by looking up biographical information about the student who was wrongfully accused of making the threat.
Based on the 911 call and report, the FBI’s Joint Terrorism Task Force vigorously investigated the threat until it was determined that it was, in fact, a hoax.
Mr. Al Fenaidah was arrested yesterday and appeared in U.S. District Court this afternoon in Oklahoma City. He was ordered detained until a detention/preliminary hearing on Monday, February 9, 2015, at 1:30: p.m.
Ms. Ali was arrested today in Nashville, Tennessee, and appeared in U.S. District Court in Nashville. She was ordered to appear in U.S. District Court in Oklahoma City on February 20, 2015.
If convicted, each defendant faces up to five years in prison and a $250,000 fine. Reference is made to the criminal complaint and affidavit for further information. The public is reminded this is simply a charge and both defendants are presumed innocent unless and until they are convicted in court.
The FBI and United States Attorney’s Office would like to thank the Edmond Police Department and the following members of the FBI Joint Terrorism Task Force who assisted in the investigation: the Oklahoma City Police Department, the Oklahoma Highway Patrol, the United States Secret Service, and the Department of Homeland Security. The case is being prosecuted by Assistant U.S. Attorney Ed Kumiega.
Warr Acres Man Pleads Guilty to Tax EvasionRead the Press Release
Oklahoma City, Oklahoma – RICKY A. ERWIN, from Warr Acres, Oklahoma, pled guilty yesterday to committing tax evasion, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Erwin was charged by information on January 14, 2015. As part of his guilty plea, Erwin admitted that he made several affirmative acts to conceal his income, to include enlisting a third party to incorporate a business in 2007 named Pro Tech Supply Inc. (PTSI), and instructing the third party to serve as PTSI’s registered agent to separate himself from the entity. Erwin further admitted to using PTSI as a shell corporation for his construction business and instructing contractors to make payments to PTSI to avoid them having to report his income to the IRS on Form 1099s.
As part of his guilty plea, Erwin agreed to pay restitution to the IRS for the income tax owed for the 2007, 2008, 2009 and 2010 calendar years, which is approximately $133,015. At sentencing, Erwin faces up to five years in prison and a $250,000 fine.
This case is the result of an investigation by IRS Criminal Investigation and is being prosecuted by Assistant U.S. Attorney Charles W. Brown.
Mississippi Man Found Guilty of Aggravated Sexual Abuse of a Minor in Indian CountryRead the Press Release
Oklahoma City, Oklahoma – A federal court jury deliberated only about three hours today before finding IVAN BENNETT WILLIS, 22, from Choctaw, Mississippi, guilty of aggravated sexual abuse in Indian Country, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to evidence presented at trial, on September 22, 2013, Willis forcibly raped a minor female victim in a home in the White Eagle Indian community in Ponca City, Oklahoma. The trial lasted three days and the jury deliberated approximately three hours before finding Willis guilty. At sentencing, Willis faces a prison sentence of up to life in prison. A sentencing date will be set by the court in approximately 90 days.
These charges are the result of an investigation and efforts by the Federal Bureau of Investigation, the Bureau of Indian Affairs, the Choctaw Police Department, and the Ponca Tribal Police. The case was prosecuted by Assistant U.S. Attorney Rozia McKinney Foster.
Reference is made to court filings for further information.
Air Force Contractor Pays $380,000 to Settle Allegations of False ClaimsRead the Press Release
Oklahoma City, Oklahoma -- Sanford C. Coats, United States Attorney for the Western District of Oklahoma, announces that Computer Sciences Corporation (“CSC”), a government contractor, has agreed to pay $380,000 to settle civil claims stemming from allegations that it violated the False Claims Act by submitting false claims to the United States Air Force.
CSC contracted with the Air Force to provide aircraft maintenance services at Vance Air Force Base, Oklahoma. As part of the contract, CSC agreed to perform maintenance on hydraulic actuators in Air Force aircraft. Hydraulic actuators power various systems and functions in the aircraft such as the landing gear, vertical/horizontal stabilizers and flaps.
The United States contends that CSC submitted false claims for payment to the Air Force during the period from February 1, 2008 through January 31, 2013. More specifically, the false claims for payment were for painting, non-destructive inspections and pressure tests of hydraulic actuators in T-38 aircraft that were not performed. In order to resolve the allegations brought by the United States, CSC agreed to pay $380,000.
In reaching this settlement, CSC did not admit liability and the government did not make any concessions regarding the legitimacy of the claims. The agreement allows the parties to avoid the delay, expense, inconvenience, and uncertainty involved in litigating the case.
This case was investigated by the Air Force Office of Special Investigations. The case was prosecuted by Assistant United States Attorney Ronald R. Gallegos.
Former Owner of D&D Equipment & Supply Sentenced to 24 Months in Prison and Pay over $756,000 in Restitution for FraudRead the Press Release
Oklahoma City, Oklahoma – DEAN ELVIN STIGER, 67, of Oklahoma City, has been sentenced to twenty-four months in federal prison and ordered to pay $756,922.05 in restitution for his role in defrauding UE Manufacturing through fictitious freight invoices, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
A grand jury indicted Stiger on July 17, 2013, on sixteen counts of wire fraud and three counts of money laundering. According to the indictment, Stiger owned and operated D&D Equipment & Supply, which provided freight services to businesses in the oil and gas industry, including UE Manufacturing. Stiger and Kevin Sheldon, a purchasing agent at UE Manufacturing, caused that company to pay more than $500,000 in fictitious D&D freight invoices from 2009 to the end of 2012. They met periodically at a bank to divide the proceeds of the crime. The indictment also alleged that Stiger used some of the proceeds in large banking transactions, including the payment of a monthly mortgage in the amount of $20,004.05 and the purchase of a $58,000.00 Cadillac Escalade.
Stiger pled guilty to one count of fraud and one count of money laundering on October 30, 2013. His health and other issues delayed his sentencing.
Yesterday, Chief U.S. District Judge Vicki Miles-LaGrange ordered Stiger to serve 24 months in the custody of the Federal Bureau of Prisons, to be followed by two years of supervised release. He was also ordered to pay $756,922.05 to UE Manufacturing. The court had previously entered an additional order of forfeiture against him in the amount of $436,461.03.
Kevin Sheldon pled guilty to wire fraud on August 16, 2013. His sentencing is pending.
This sentence is the result of an investigation conducted by Internal Revenue Service Criminal Investigation, the United States Secret Service, and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Scott E. Williams.
Enid Tax Preparer Pleads Guilty to Filing a False Tax ReturnRead the Press Release
Oklahoma City, Oklahoma – CESAR E. LEON, owner and operator of Cesar’s Tax Service in Enid, Oklahoma, pleaded guilty this week to making and subscribing a false 2009 tax return, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Leon was charged by information on January 12, 2015, with filing a false tax return for the 2009 calendar year. As part of his guilty plea, Leon admitted that he caused a tax loss amount of between $80,000.00 and $200,000.00 to the Internal Revenue Service (“IRS”). He further agreed to pay restitution to the IRS for all taxes due and owing for the 2008, 2009, 2010, 2011, and 2012 calendar years. At sentencing, Leon faces up to three years in prison and a $250,000 fine.
This case is the result of an investigation by IRS Criminal Investigation and is being prosecuted by Assistant U.S. Attorney Julia E. Barry.
Six Fort Worth, Texas, Residents Indicted for Walgreens Burglaries in Texas and OklahomaRead the Press Release
Oklahoma City, Oklahoma – Hylon Joshua Alford-Solomon (23), James Richard Wooden (24), Chris Allen Williams, Jr. (24), Kenneth Wayne Tolbert (23), Kendrick Dwight Marshall (28), and Christopher Benjamin Blanton (21), all from Fort Worth, Texas, were indicted by a federal grand jury for the burglary of Walgreens Pharmacies in Texas and Oklahoma announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
The indictment alleges in count one that from November 2013 through on or about July 19, 2014, the six defendants conspired to burglarize closed Walgreens Pharmacies in Woodway and Southlake, Texas, and Mustang, Oklahoma, in order to steal Hydrocodone, Alprazolam (Xanax), and Promethazine with Codeine cough syrup, all highly abused controlled substances. A second count charges Alford-Solomon, Wooden, Williams, and Tolbert with traveling from Texas to Mustang, Oklahoma on July 19, 2014, and breaking into the Walgreens Pharmacy at 112 East Highway 152. Each defendant faces up to 10 years in prison for the conspiracy charge. If convicted, the defendants will be required to pay restitution to Walgreens in an amount to be determined by the court. Further, if any member of the public knows of the whereabouts of Kendrick Dwight Marshall, they are asked to contact law enforcement.
This case is the result of an investigation by the Drug Enforcement Administration; the Mustang, Oklahoma City, El Reno, Fort Worth, Woodway, Southlake, and Denton Police Departments; and Walgreens Loss Prevention. It is being prosecuted by Assistant U.S. Attorneys Matt Dillon and Mark A.Yancey. The public is reminded that each defendant is presumed innocent until otherwise proven guilty beyond a reasonable doubt.
Former Bank Executive Vice President Pleads Guilty to Making False Financial Report to FDIC in Connection with Failure of Freedom State BankRead the Press Release
Oklahoma City, Oklahoma – MARK A. NIXON, 62, from Freedom, Oklahoma, pleaded guilty yesterday to submitting a falsified report of the financial condition of Freedom State Bank to the Federal Deposit Insurance Corporation (“FDIC”), announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Nixon’s guilty plea comes approximately six months after the Bank’s failure on June 27, 2014.
Nixon was the former Executive Vice President of The Freedom State Bank, located in Freedom, Oklahoma. During his plea hearing, Nixon admitted to preparing and submitting a Consolidated Report of Condition and Income to the FDIC which falsely stated that The Freedom State Bank possessed $21,950,000.00 in assets, when he in fact knew that the true amount was substantially less.
Nixon was charged on December 4, 2014, with one count of submitting a false statement to the FDIC. In a written plea agreement, Nixon admitted that he was responsible for causing between $1,000,000.00 and $2,500,000.00 in losses to The Freedom State Bank, and agreed that he is subject to a sentencing enhancement for substantially jeopardizing the soundness of a financial institution.
At sentencing, Nixon faces up to five years in prison, followed by three years of supervised release, and a $250,000.00 fine. He will also be ordered to pay restitution to the FDIC in an amount later determined by the court. A sentencing hearing will be set by the court in approximately 90 days.
This case is the result of an investigation by the FDIC Office of Inspector General. It is being prosecuted by Assistant U.S. Attorney Julia E. Barry.
Former Insurance Company Employee to Serve Two Years in Prison and Pay over $168,000 in Restitution for Forging Checks and Filing False Tax ReturnRead the Press Release
Oklahoma City, Oklahoma – CARLA JO MIRES, of Oklahoma City, was sentenced today by United States District Judge Joe Heaton to serve 24 months in federal prison for embezzling money from her employer by forging checks and for filing a false tax return, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Mires was also ordered to pay $168,386.89 in restitution to the IRS and the victims of her embezzlement scheme.
Mires worked for Union Mutual Insurance Company in the accounting office. She was charged with forging a check from Union Mutual that went to Mires’ personal account. Mires also filed a false tax return for 2008 by failing to report as income the money she had embezzled from her employer. Mires was charged by information on August 14, 2014. She pled guilty on September 3, 2014, and agreed to pay restitution to the IRS and for all the losses sustained by the victims relates to her embezzlement scheme. At the sentencing hearing, Judge Heaton ordered Mires to serve three years of supervised release after she completes her 24-month prison term. She was ordered to report to the Bureau of Prisons on January 13, 2015, to begin serving her prison sentence.
This case is the result of a joint investigation conducted by Internal Revenue Service Criminal Investigation and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Travis D. Smith.
Former Office Manager to Serve Year in Prison and Pay over $141,000 in Restitution for Tribal EmbezzlementRead the Press Release
Robin Jean Bitseedy, 41, of Anadarko, Oklahoma, was sentenced by Chief United States District Judge Vicki Miles-LaGrange to serve twelve months and one day in federal prison for embezzlement from the Wichita and Affiliated, Caddo, and Delaware Tribes, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Bitseedy was also ordered to pay $141,820.47 in restitution to the tribes.
According to Court records, Bitseedy worked as the Office Manager for Wichita, Caddo, Delaware Enterprises, Inc. (“WCD Enterprises”), a corporation organized by the Wichita and Affiliated, Caddo, and Delaware Tribes. Bitseedy’s position gave her access to tribal funds which she used to embezzle money from December 2007 through June 3, 2013. In pleading guilty to the embezzlement, Bitseedy admitted that she used the WCD Enterprises Walmart credit card for personal use without permission and wrote checks to herself with forged signatures. She admitted she used the money to purchase gift cards and items for family and pay the rent and bills for her family.
Bitseedy was charged by information on August 11, 2014, and pled guilty on August 28, 2014. At sentencing hearing, the Judge ordered Bitseedy to report to the Bureau of Prisons on January 9, 2015, to begin serving her prison sentence.
This case is the result of investigations conducted by the Bureau of Indian Affairs and was prosecuted by Assistant U.S. Attorney Rozia McKinney-Foster.
Former Office Manager to Serve Year in Prison and Pay over $141,000 in Restitution for Tribal EmbezzlementRead the Press Release
Oklahoma City, Oklahoma – ROBIN JEAN BITSEEDY, 41, of Anadarko, Oklahoma, was sentenced by Chief United States District Judge Vicki Miles-LaGrange to serve twelve months and one day in federal prison for embezzlement from the Wichita and Affiliated, Caddo, and Delaware Tribes, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Bitseedy was also ordered to pay $141,820.47 in restitution to the tribes.
According to Court records, Bitseedy worked as the Office Manager for Wichita, Caddo, Delaware Enterprises, Inc. ("WCD Enterprises"), a corporation organized by the Wichita and Affiliated, Caddo, and Delaware Tribes. Bitseedy’s position gave her access to tribal funds which she used to embezzle money from December 2007 through June 3, 2013. In pleading guilty to the embezzlement, Bitseedy admitted that she used the WCD Enterprises Walmart credit card for personal use without permission and wrote checks to herself with forged signatures. She admitted she used the money to purchase gift cards and items for family and pay the rent and bills for her family.
Bitseedy was charged by information on August 11, 2014, and pled guilty on August 28, 2014. At sentencing hearing, the Judge ordered Bitseedy to report to the Bureau of Prisons on January 9, 2015, to begin serving her prison sentence.
This case is the result of investigations conducted by the Bureau of Indian Affairs and was prosecuted by Assistant U.S. Attorney Rozia McKinney-Foster.
Indictment Unsealed Charging Four from El Reno with Conspiracy and Wire Fraud Related to Vehicle Cash Rebate SchemeRead the Press Release
Oklahoma City, Oklahoma – Today, a federal grand jury indictment was unsealed charging RICHARD M. ARNOLD, SR. (a/k/a/ "Rick Arnold"), 60, RICHARD M. ARNOLD, II, (a/k/a/ "Ricky Arnold"), 28, ROBERT W. ARNOLD, 25, and ROBYN R. ARNOLD, 55, all from El Reno, Oklahoma, with conspiracy to defraud new car purchasers out of cash rebates based on false representations that a charitable trust would make the victims’ monthly car payments, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to the indictment, from May of 2013 through April of 2014, the defendants informed their acquaintances, family members, and friends that they could become beneficiaries of a program operated by a charitable trust designed to help working people acquire new cars. The defendants claimed that "CECU Trust" financed the program, which was also called the "United Auto Buyers Co-op Association."
It is alleged that Rick, Ricky and Robert Arnold met car purchasers interested in the program at various car dealerships and arranged for purchases on credit that would include cash rebates to the buyers from $4,000 to $12,000 per car. The indictment alleges that in some instances, the defendants caused victims’ loan applications to include fraudulently inflated income. It is also alleged that these defendants told the car buyers that the rebate money would have to be given to the defendants for deposit into the trust, which would then pay the buyers’ car loans in their entirety.
After the car purchases were complete, it is alleged that one or more of the defendants met the car buyers in a public place, such as a coffee shop or a bank, to receive the proceeds of the cash-back finance transactions and deposited the money into bank accounts controlled by Robyn Arnold. It is further alleged that the defendants asked buyers to sign powers of attorney as well as proposed agreements advising the buyers that the association’s chances of success would increase relative to the buyers’ success in referring new participants to the program.
When the defendants failed to make the car loan payments as promised, various lenders notified buyers of potential defaults. When the buyers asked for explanations, it is alleged that Rick and Ricky Arnold assured the buyers that the payments would be made or that the trust would be unable to make further payments unless the buyers recruited additional participants.
The indictment charges all four defendants with conspiracy. Rick Arnold is charged with 9 counts of wire fraud, Ricky Arnold is charged with 8 counts of wire fraud, and Robert Arnold is charged with one count of wire fraud. The indictment also seeks forfeiture in the amount of the proceeds of the offenses. Each count of conspiracy and wire fraud carries up to 30 years in prison and a $1,000,000 fine, in addition to up to five years of supervised release. If convicted, the defendants will also be required to pay restitution to individual victims and financial institutions. Reference is made to the indictment and court record for further information. The public is reminded that each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
All four defendants were arrested before 7:00 a.m. today at their El Reno residences and were released on bonds after appearing before United States Magistrate Judge Gary Purcell this afternoon in Oklahoma City.
This case is the result of an investigation by the Federal Bureau of Investigation and the Public Protection Unit of the Oklahoma Attorney General’s Office. The case is being prosecuted by Assistant U.S. Attorneys Scott E. Williams and Kate Holey.
Edmond Pharmacy to Pay $43,000 to Settle Claims Involving Violations of the Controlled Substances ActRead the Press Release
Oklahoma City, Oklahoma – SHERRY’S DRUG, which operates a retail pharmacy in Edmond, Oklahoma, has paid $43,000 in civil penalties to the United States to settle claims stemming from alleged violations of the Controlled Substances Act, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
The Controlled Substances Act, 21 U.S.C. Sections 801 et seq. ("CSA"), was passed by Congress to combat the illegal distribution and abuse of controlled substances, including prescription medications. The CSA is enforced by the Drug Enforcement Administration's (DEA) Office of Diversion Control, whose mission is to prevent, detect, and investigate the diversion of controlled pharmaceuticals and listed chemicals from legitimate sources while ensuring an adequate and uninterrupted supply for legitimate medical, commercial, and scientific needs. Under the CSA, entities registered with the DEA who purchase, distribute, dispense, transfer, or sell controlled substances must comply with inventory and documentation requirements. Regulations promulgated under the CSA require that each DEA registrant, including pharmacies, maintain complete and accurate records of each substance manufactured, received, sold, delivered, dispensed or otherwise disposed of by the registrant for two years. These requirements play a vital role in ensuring the appropriate handling, accounting, and distribution of controlled substances.
Sherry’s Drug ("Sherry’s") is an Oklahoma corporation with its primary business located in Edmond, Oklahoma. The United States alleged that between February 3, 2010, and January 6, 2014, Sherry’s improperly filled prescriptions for controlled substances that did not contain the prescriber’s DEA number, substituted Sherry’s DEA registration number for the prescriber’s DEA number, and filled prescriptions for controlled substances under a non-valid DEA registration number.
In order to resolve the claims by the United States, Sherry’s paid $43,000 in civil penalties to the government. In reaching this settlement, Sherry’s did not admit liability and the government did not make any concession regarding the legitimacy of its claims. The agreement allows the parties to avoid the delay, expense, inconvenience, and uncertainty involved in litigating the case.
This case was investigated by the Drug Enforcement Administration's Office of Diversion Control, Oklahoma City District Office Diversion Group, and was prosecuted by Assistant United States Attorney Ronald R. Gallegos.
President of Local Defense Contractor Charged with Bribery and Making False Statements in Connection with Sales to the MilitaryRead the Press Release
Oklahoma City, Oklahoma – CHRISTOPHER HOUSTON HENSLEY, 56, of Yukon, Oklahoma, has been indicted by a federal grand jury and charged with bribing a public official, conspiracy to commit bribery, and making false statements to the federal government, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Hensley is the founder and president of Aerochem, Inc., based in Oklahoma City. Aerochem manufactures paint remover ("depaint") products, and it sold these products to Tinker Air Force Base ("Tinker") and other military bases for several years. The indictment alleges that Hensley developed a relationship with the depaint section chief for an aircraft maintenance squadron at Tinker. According to the indictment, from around 2005 to 2008, Hensley provided several items of value to the section chief, including cash to purchase a wedding ring and a bass boat. The indictment further alleges that Hensley conspired, from 2008 to 2012, with a former Aerochem employee to bribe the section chief by providing meals, alcohol, trips to gentlemen’s clubs, and cruise tickets. According to the indictment, Hensley and the other Aerochem employee also purchased a boat for $7,500 in 2010 for the section’s chief’s use. It is further alleged that in 2011 and 2012, the other Aerochem employee, with Hensley’s knowledge, made routine cash payments, of approximately $300 to $500, to the section chief based on how much depaint product Tinker was buying from Aerochem.
The indictment also alleges Aerochem had a similar relationship with a supervisor of a division at Corpus Christi Army Depot that stripped paint off helicopter parts used by the U.S. military. According to the indictment, Hensley and the former Aerochem employee provided entertainment, wire transfers, and more than $3,000 in cash to the Corpus Christi supervisor in exchange for the supervisor’s favorable treatment of Aerochem’s business interests.
Finally, the indictment alleges that Hensley falsely recertified to the federal government that a certain Aerochem product, Aerostrip 5182, met qualification requirements for sales to military bases. According to the indictment, Hensley twice provided false certifications: in 2011 to the Department of the Air Force, and in 2013 to the Corpus Christi Army Depot. The indictment alleges that in both cases, Hensley did not have laboratory testing reports showing the Aerochem product had actually passed all military conformance standards for the depaint product.
The indictment charges Hensley with three counts of making a bribe to the Tinker depaint section chief. Those counts separately allege that Hensley provided the section chief (1) in 2007 with $1,200 to buy a wedding ring, (2) in 2009 with approximately $1,100 in cruise tickets, and (3) in 2010 with a $7,500 boat in Aerochem’s name for his use, in exchange for the section chief’s favorable treatment of Aerochem business interests. The indictment also charges Hensley with conspiring, from 2008 to 2012, with a former Aerochem employee to make bribe payments to the Tinker employee and the CCAD employee. In addition, Hensley is charged with two counts of making false statements to the federal government about Aerostrip 5182’s certification with military performance specifications.
If convicted, Hensley faces a prison sentence of up to 15 years for each bribery count, and up to 5 years for the conspiracy count and each false statement count. Hensley could also receive an additional $250,000 fine on each count if convicted. The public is reminded that the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
These charges are the result of an investigation conducted by the U.S. Air Force Office of Special Investigations, Federal Bureau of Investigation, and U.S. Army Criminal Investigation Command. The case is being prosecuted by Assistant U.S. Attorney Chris M. Stephens.
Reference is made to court filings for further information.
United States Attorney for Western District of Oklahoma Involved in Collecting over $36 Million in Fiscal Year 2014Read the Press Release
Oklahoma City, Oklahoma -- The United States Attorney’s Office for the Western District of Oklahoma was involved in collecting a total of $36,340,329.15 in civil and criminal cases and through asset forfeiture in Fiscal Year 2014, announced Sanford C. Coats, United States Attorney.
The Western District of Oklahoma collected $30,519,863.47 in criminal and civil actions handled by the district. Of this amount, $4,579,614.84 was collected in criminal actions and $25,940,248.63 was collected in civil actions.
The Western District also worked jointly with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $362,502.68 in civil cases pursued jointly with these offices.
Finally, the U.S. Attorney’s Office also worked with partner agencies and divisions to collect an additional $5,457,963.00 in asset forfeiture actions in FY 2014. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
Attorney General Eric Holder announced today that the Justice Department collected $24.7 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2014. The more than $24 billion in collections in FY 2014 represents nearly eight and a half times the appropriated $2.91 billion budget for the 94 U.S. Attorney’s offices and the main litigating divisions in that same period.
"Every day, the Justice Department’s federal prosecutors and trial attorneys work hard to protect our citizens, to safeguard precious taxpayer resources, and to provide a valuable return on investment to the American people," said Attorney General Holder. "Their diligent efforts are enabling us to achieve justice and recoup losses in virtually every sector of the U.S. economy. And this result shows the fruits of the Justice Department’s tireless work in enforcing federal laws; in protecting the American people from violent crime, national security threats, discrimination, exploitation, and abuse; and in holding financial institutions accountable for their roles in causing the 2008 financial crisis."
"These results are due to the outstanding work done by the talented women and men in the U.S. Attorney’s Office, particularly in our Asset Recovery Unit," said Coats. "Our Office is clearly dedicated to recovering funds for the federal treasury and for victims of federal crime. We will continue to hold accountable those who seek to profit from fraud and other illegal activities."
Significant Cases in the Western District of Oklahoma
In May of 2014, the U.S. Attorney’s Office recovered $23,981,669.78 in the bankruptcy of Stelera Wireless, LLC, a rural internet broadband service provider in Texas, Colorado, Kansas and New Mexico. Stelera had received loans from the Rural Utilities Service of the U.S. Department of Agriculture to promote distance learning, telemedicine initiatives and rural broadband access. Stelera defaulted on its note and sought bankruptcy protection. During the bankruptcy case, the United States recovered the loan amounts owed after defeating arguments that the loan was not properly secured and that the debt should be reclassified and written down.
In January of 2014, Wildcat Concrete Services, Inc., a Kansas corporation, paid $372,750 to the North American Wetlands Conservation Fund as part of a non-prosecution agreement with the United States arising from the destruction of cliff swallow nests during a bridge repair project that were protected by the Migratory Bird Treaty Act.
In October of 2013, SSM Health Care of Oklahoma, Inc., which owns and operates St. Anthony Hospital in Oklahoma City, agreed to pay $475,000 to the United States to settle civil claims relating to SSM’s billing Medicare for inpatient services that should have been billed as outpatient services.
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
Hospice Company Owner Found Guilty of Committing Medicare Fraud, Conspiracy, Obstruction of Federal Audit, and Making False StatementsRead the Press Release
Oklahoma City, Oklahoma – A federal jury in Oklahoma City found PAULA KLUDING, 39, from Chandler, Oklahoma, the owner of Prairie View Hospice, Inc., an Oklahoma corporation located in Chandler, guilty on 39 separate counts relating to Medicare fraud, conspiracy, obstruction of a federal audit, and making false statements in health care matter, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
PATRICIA CARTER, 43, from Tecumseh, Oklahoma, was the general manager of Prairie View Hospice and was indicted along with Kluding in this case. Carter pled guilty on November 3, 2014, to one count of obstruction of a federal audit and testified at the trial.
According to evidence presented at trial, Prairie View Hospice was in business to provide hospice care to Medicare beneficiaries. Hospice care consists of providing health care, medication, medical equipment, and other goods and services to terminally ill patients. From July of 2010 through July of 2013, Kluding conspired with others to conceal the true medical condition of Prairie View Hospice’s patients and the true quality and quantity of health care services they were receiving in order to “pass” a Medicare audit and to fraudulently obtain money from Medicare. Specifically, certain medical documents were falsified to make it appear that nurses had visited patients or conducted necessary assessments when such visits and assessments had not, in fact, been made. Nursing notes were also falsified to make it appear that patients were in worse health than they actually were in order to justify to Medicare the patient’s continued hospice care. In addition, Prairie View Hospice, acting through Kluding, sent the falsified documents to a Medicare subcontractor in response to requests to audit patient files and in support of claims for Medicare reimbursement.
The trial lasted for four and half days and the jury deliberated about six hours before returning a guilty verdict on all counts.
At sentencing, Kluding faces up to 5 years imprisonment and a fine of $250,000 on each count, as well as paying restitution to the government. Carter faces 5 years imprisonment and a fine of $250,000. The government also seeks forfeiture of all proceeds obtained by Kluding from the criminal acts. Sentencing will take place in approximately 90 days.
This case is the result of an investigation by the U.S. Department of Health and Human Services Office of Inspector General and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorneys Amanda Maxfield Green and Jessica Perry.
Texas Man Indicted for Fraud Involving Trade of Airplane and Aircraft PartsRead the Press Release
Oklahoma City, Oklahoma – On Wednesday, November 12, a federal grand jury returned an eight-count indictment charging LARRY DALE MORGAN of Hutto, Texas, with wire fraud in connection with the trade of an airplane and fraud and false statements involving aircraft parts, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Morgan was a pilot who owned and operated several aircraft in Cushing, Oklahoma. According to the indictment, Morgan fraudulently induced a fellow pilot from Ovid, New York, into trading the man’s Cessna 421A aircraft for Morgan’s Beechcraft Bonanza aircraft, knowing that the Beechcraft Bonanza was worth substantially less than the $123,500.00 that Mr. Morgan represented in email communications. The indictment further alleges that Morgan made multiple false and fraudulent entries in the aircraft’s logbooks, and failed to disclose an existing lien on the aircraft when he executed the Bill of Sale. Reference is made to the indictment and court record for further information.
If convicted, Morgan faces up to 20 years’ imprisonment, a $250,000 fine, and three years of supervised release on the wire fraud counts. He faces up to 15 years’ imprisonment, a $500,000 fine, and up to three years’ supervised release on the aircraft parts fraud counts, as well as up to five years’ imprisonment, a $250,000 fine, and up to three years of supervised release on the false writing count. The public is reminded that the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This case is the result of an investigation by the Department of Transportation, Office of the Inspector General. The case is being prosecuted by Assistant U.S. Attorney Julia E. Barry.
Mexican National Pleads Guilty to Money Laundering in Connection with Federal Wireless Telephone Subsidy ProgramRead the Press Release
Oklahoma City, Oklahoma – OSCAR ENRIQUE PEREZ-ZUMAETA, of Cancun, Mexico, pled guilty today to laundering the proceeds of a scheme to defraud the Federal Communications Commission, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Perez-Zumaeta’s guilty plea comes five months after ICON Telecom, Inc., and its owner, Wes Yui Chew, entered guilty pleas in the same investigation and agreed to forfeit more than $27 million taken illegally from the FCC’s Lifeline Program.
"Unfortunately, people decide to defraud well-intentioned government programs for personal benefit," said Coats. "The FCC Lifeline program is intended to help low-income Americans have access to telephone services, and this individual exploited the program for his own, significant financial gain. I applaud the FCC-Inspector General, FBI and IRS Criminal Investigation for their exemplary work in this case, and urge the public to report fraud relating to all government programs."
FCC Chairman Tom Wheeler said, "I applaud the efforts of the United States Attorney’s Office to bring to justice the criminals guilty of defrauding the Lifeline program designed to assist low-income Americans to afford basic phone services. Today’s action could not be accomplished without the work of the FCC’s Office of Inspector General. Waste, fraud, and abuse of the program is simply unacceptable. The Commission will remain vigilant in our work to root out abuses and continue to work with our partners in the U.S. Attorney’s Office, IRS and the FBI."
The current Lifeline Program, which was created in 1985, furthers the FCC’s mission to provide all Americans with access to a basic level of telephone service. Since 2005, Lifeline has provided subsidies to participating telephone companies not only for landline service, but also for wireless service for qualifying low-income customers. The Universal Service Administrative Company ("USAC") administers the Lifeline Program on behalf of the FCC and under detailed federal regulations. To pay for the program, USAC collects fees from telephone companies, which often pass the fees on to customers as "universal service charges" on monthly telephone bills.
Most participating wireless telephone companies receive a subsidy of $9.25 per month for each qualifying low-income customer. If a qualifying customer lives on "tribal lands," however, the company receives $34.25 per customer. Much of Oklahoma includes tribal lands that qualify for the higher monthly subsidy.
Before receiving reimbursement, participating telephone companies file forms with the FCC that report the number of Lifeline eligible customers they have served. Companies must also file annual reports by January 31 to certify that customers who received Lifeline service at an earlier date remain eligible for the program.
ICON Telecom, owned exclusively by Chew, participated in the wireless Lifeline Program from July 2011 until September 2013. In November 2011, ICON reported fewer than 12,000 wireless customers who qualified for the Lifeline program. By November 2012, that number had grown to 135,364. Although it had fewer than ten full-time employees, ICON received a total of $58,283,329 through the Lifeline Program during 2011, 2012, and 2013.
An indictment filed against Perez-Zumaeta on June 3, 2014, alleges that he owned and managed PSPS Sales LLC, a California entity that recruited low-income individuals to apply for Lifeline service through ICON. According to the indictment, ICON paid over one million dollars to PSPS Sales from December 2011 through April 2013. Perez-Zumaeta is charged with directing PSPS Sales workers to enroll fictitious customers for ICON by using phone book listings and forging Lifeline application forms. He also allegedly directed workers in Mexico to falsify approximately 40,000 Lifeline recertification forms for use in ICON’s fraudulent scheme.
Perez-Zumaeta has been in federal custody since April 25, 2014, when he was arrested at the San Francisco airport. On May 16, a federal magistrate judge ordered him detained based on a risk of flight.
Today he pled guilty to laundering $52,390.00 from ICON’s scheme by depositing a check in that amount from ICON into a bank account of PSPS Sales on December 7, 2012. He admitted that when he made that deposit, he knew that more than $10,000.00 of those funds was the result of criminal fraud against the FCC. As a result of this guilty plea, he faces up to ten years in prison, a fine of up to $250,000, and up to three years of supervised release.
This case is the result of an investigation by the Office of Inspector General for the Federal Communications Commission; the Federal Bureau of Investigation; and the Internal Revenue Service, Criminal Investigations Division. It is being prosecuted by Assistant U.S. Attorneys Chris M. Stephens and Scott E. Williams.
Reference is made to the indictment and other public filings for further information.
Oklahoma City Man Pleads Guilty to Traveling to Colorado to Bring 13-Year-Old to Oklahoma City to Engage in Illicit Sexual ConductRead the Press Release
Oklahoma City, Oklahoma – Today, MARK AVERY SUMPTER, 43, from Oklahoma City, pleaded guilty to traveling to Colorado to pick up a 13-year-old girl to bring her to Oklahoma City to engage in illicit sexual conduct, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to court records, on June 27, 2014, the Oklahoma City Police Department (OCPD) notified the FBI that they had recovered an endangered 13-year-old runaway girl who was reported missing to the Douglas County Sheriff’s Department in Douglas County, Colorado. An investigation of social media accounts were traced to an IP address located in Oklahoma City. When OCPD officers responded to the address they found Sumpter and the missing girl. Sumpter and the girl communicated through the website chathour.com, Skype (a Voice Over Internet Protocol service that allows users to communicate through a computer or other wifi-compatible device), and Kik (a social media application designed for mobile technology that utilizes usernames, rather than phone numbers, to connect people via instant messaging). After exchanging messages and sexually-explicit photos, Sumpter traveled to Colorado to pick up the girl and return to Oklahoma City where they stayed for several days, from approximately June 21, 2014 through June 27, 2014. During the trip from Colorado to Oklahoma and at the Oklahoma City apartment, Sumpter engaged in illicit sexual conduct with the 13-year-old girl. Reference is made to the court record for further information.
Mr. Sumpter was indicted by a federal grand jury on August 20, 2014. During the plea hearing today, Sumpter admitted that he traveled from Oklahoma City to Colorado and picked up the 13-year-old girl, with the purpose of returning to Oklahoma City to engage in illicit sexual contact.
At sentencing, Sumpter faces a mandatory minimum of ten years and up to life in prison. A sentencing hearing will be set by the court in approximately 90 days.
This case is the result of an investigation by the Douglas County Sheriff’s Department (Colorado), the Oklahoma City Police Department, the Edmond Police Department, and the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys Brandon Hale and Julia E. Barry.
Oklahoma Dental Clinics Pay over $5 Million to Settle Allegations of False Medicaid Claims for Dental Restoration ProcedureRead the Press Release
Oklahoma City, Oklahoma -- Sanford C. Coats, United States Attorney for the Western District of Oklahoma and E. Scott Pruitt, Attorney General for the State of Oklahoma, jointly announce that OCEAN DENTAL, P.C, has agreed to pay $5,050,000 to settle civil claims stemming from allegations that it violated the False Claims Act by submitting false Medicaid claims for work that was either never performed or billed at a higher rate than allowed.
"We continually strive to protect government programs, such as Medicaid, from fraud and abuse by ensuring they are used properly and only by those who are in need and are eligible," said U.S. Attorney Sanford C. Coats. "This case is a good example of the value of coordination between state and federal law enforcement, as well as the coordinated use of parallel proceedings, to achieve a successful civil and criminal resolution."
"Preventing fraud is a priority at the Attorney General's Office because fraud limits the ability of those truly deserving of assistance from receiving the help for which they are eligible," said Attorney General Scott Pruitt. "We appreciate partnering with the U.S. Attorney's Office in order to hold accountable those who would perpetrate fraud against the taxpayers."
Ocean Dental operates dental clinics throughout Oklahoma. As part of its practice, Ocean Dental provides dental services to patients, including children, covered by the Oklahoma Medicaid program.
The United States and Oklahoma contend that Ocean Dental submitted false claims for payment to the Oklahoma Medicaid program for dental restorations during the period from January 1, 2005 through September 30, 2010. Specifically, it is alleged that claims for dental restorations furnished to Medicaid beneficiaries by Ocean Dental’s then-employee Robin Lockwood, D.D.S., were false because they were either (1) upcoded by billing for more restored surfaces than were actually performed or (2) not performed at all.
To resolve the civil allegations brought by the United States and Oklahoma, Ocean Dental agreed to pay $5,050,000. Under the Settlement Agreement, Ocean Dental and Chad Hoecker, D.D.S., owner and president of Ocean Dental, are being released from civil liability related to the allegations. Ocean Dental has also entered into a Corporate Integrity Agreement with the U.S. Department of Health and Human Services, Office of Inspector General which requires, among other things, additional record-keeping, reporting and compliance requirements.
"With this settlement, Ocean Dental has agreed to strict new reporting and compliance requirements that will help guard against billing abuses moving forward," said Winston Whittington, Assistant Special Agent in Charge of the OIG’s Dallas office. "Those who perpetrate fraud threaten the health of both the program and the people who depend on it for their care. We will continue to actively pursue these investigations."
In reaching this settlement, Ocean Dental did not admit liability and the government did not make any concessions regarding the legitimacy of the claims. The agreement allows the parties to avoid the delay, expense, inconvenience, and uncertainty involved in litigating the case.
In a separate related criminal case, Dr. Lockwood pled guilty in July of 2012 to committing health care fraud for her role while employed at Ocean Dental. In November of 2012, Dr. Lockwood was sentenced to serve 18 months in federal prison and ordered to pay $375,672.27 in restitution to Medicaid.
This case was investigated by the Federal Bureau of Investigation, the U.S. Department of Health and Human Services, Office of Inspector General, the Oklahoma Attorney General’s Office Medicaid Fraud Control Unit, and the Oklahoma Healthcare Authority. The case was prosecuted by Assistant United States Attorneys Ronald R. Gallegos and Scott Maule, and Oklahoma Assistant Attorney General Niki S. Batt.
Former Office Manager from Jones Found Guilty on 36 Counts in Connection with over $1 Million Embezzlement and Tax FraudRead the Press Release
Oklahoma City, Oklahoma – A federal court jury deliberated only about two hours today before finding JULIE ANN SMITH (a/k/a "Julie A. Judkins" and "Julia A. Judkins Smith"), of Jones, Oklahoma, guilty on 36 counts of bank fraud, mail fraud, aggravated identity theft, forged securities, and tax fraud, in connection with embezzling over one million dollars from her former employer, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to evidence presented at trial, Smith worked from 2000 until around late June 2012 at Power Equipment & Engineering, Inc. ("PE&E"), in Oklahoma City. At PE&E, Smith was the accounts-payable clerk and officer manager, where she prepared checks and paid invoices for the company. While employed at PE&E from June of 2002 through June of 2012, Smith forged approximately 195 PE&E checks by using the company owner’s signature stamp without PE&E’s permission or knowledge. The forged checks totaled approximately $1,026,399.08. In addition, evidence showed that Smith disguised the forged checks through false entries on PE&E’s accounting system, wrote many of the forged checks to a fake company under her control, and directed other forged checks to credit card companies, financial institutions, and vendors for her personal benefit. Finally, the evidence showed that Smith filed materially false federal income tax returns for years 2008 through 2012.
The trial lasted two days and the jury deliberated approximately two hours before finding Smith guilty on all 36 counts. At sentencing, Smith faces a prison sentence of up to 30 years for each bank fraud count, up to 20 years for each mail fraud count, up to 10 years for each forged securities count, up to three years for each false tax return count, and a mandatory two-year prison term under the aggravated identify theft count. Smith could also receive an additional $250,000 fine on each count. A sentencing date will be set by the court in approximately 90 days.
These charges are the result of an investigation conducted by the Internal Revenue Service - Criminal Investigations, United States Secret Service, Federal Bureau of Investigation, and Oklahoma City Police Department. The case is being prosecuted by Assistant U.S. Attorneys Chris M. Stephens and Jessica L. Perry.
Reference is made to court filings for further information.
Indictment Unsealed Charging Oklahoma City Attorney with Conspiracy Involving Travel from Oklahoma City to Peru to Engage in Sex with Children Under 18Read the Press Release
Oklahoma City, Oklahoma – Today, a federal grand jury indictment was unsealed charging MICHAEL DEAN BILLINGS, 59, an attorney from Oklahoma City, with conspiracy involving travel from Oklahoma City to Iquitos, Peru to engage in illicit sex with children, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to the three-count indictment, for over a decade beginning on February 2, 2003, and continuing through September 2013, Billings and others conspired to commit sex trafficking of children by recruiting and obtaining children in Peru to engage in commercial sex acts and further conspired to travel from Oklahoma City to Iquitos, Peru, to engage in illicit sexual conduct with children under 18 years of age. Specifically, the indictment includes three counts: Count 1 alleges conspiracy to commit sex trafficking of children, Count 2 alleges conspiracy to travel with intent to engage in illicit sexual conduct, and Count 3 alleges conspiracy to engage in illicit sexual conduct in foreign places. Reference is made to the indictment and court record for further information.
Billings was arrested earlier today at his law office and appeared before United States Magistrate Judge Suzanne Mitchell in Oklahoma City. He was ordered to be held without bond pending a final detention hearing will be held on Monday, October 27th at 4:00 p.m. before Judge Mitchell.
If convicted, Billings faces up to life in prison, a $250,000 fine, and registration as a sex offender for life. The public is reminded that the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This case is the result of an investigation by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys Robert Don Gifford, II, and David Petermann.
Identity Theft Scheme Results in over 18 Years in Collective Prison Sentences for Three Metro-Area ResidentsRead the Press Release
Oklahoma City, Oklahoma – Sanford C. Coats, United States Attorney for the Western District of Oklahoma, announced that three individuals were sentenced yesterday to serve over eighteen years in prison collectively for their involvement in an identity theft scheme. United States District Judge Robin J. Cauthron sentenced DERRICK JAY ALBERS, 39, to 120 months in prison, RACHEL LYNN HALL, 40, to 63 months in prison, and CRYSTAL DAWN TRUITT, 29, to 40 months in prison, for their involvement the scheme. Albers, Hall, and Truitt primarily resided in and around the Oklahoma City metropolitan area during the commission of the scheme.
On March 18, 2014, a federal grand jury indicted Albers, Hall, and Truitt for conspiracy to commit wire fraud. According to court records, from June 2013 until January 2014, the defendants obtained billing and financial information, including credit card numbers, for corporate and individual third parties and used these numbers, along with merchant ID numbers belonging to corporate entities, to create what appeared to be genuine credit cards. The defendants used these cards and the fraudulent IDs they had made to purchase services and merchandise both in stores and on-line. The defendants then brokered the merchandise and services on the streets for cash and drugs.
On May 7, 2014, Albers, Hall, and Truitt each pled guilty to conspiracy to commit wire fraud.
In addition to the prison terms imposed yesterday, Judge Cauthron also ordered the defendants to pay $110,814.15 in restitution and serve three years of supervised release when they are released from prison. In pronouncing the sentences, Judge Cauthron cited to the defendants’ lengthy criminal histories, the long-lasting effects borne by the victims of the scheme, and the need to adequately deter criminal conduct.
This case is the result of investigations conducted by the Oklahoma City Economic and Identity Crimes Task Force, the United States Secret Service, the Oklahoma City Police Department, and the Midwest City Police Department. The case was prosecuted by Assistant U.S. Attorney Travis D. Smith.
Sex Offender Sentenced to 45 Years for Producing Child PornRead the Press Release
Oklahoma City, Oklahoma – Today, JEREMY DAVID EADES, 28, most recently of Minot, North Dakota, pled guilty to producing child pornography and was sentenced to serve 45 years in federal prison, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
At a hearing today in Oklahoma City, Eades pled guilty to producing child pornography in Pottawatomie County on November 29, 2012, using a 4-year-old child. During the same hearing, United States District Court Judge Robin Cauthron sentenced Eades to serve 45 years in prison, followed by 20 years of supervised release. He will also be required to register as a sex offender the rest of his life. Eades faced a heightened federal penalty due to a 2004 Oklahoma state court conviction for committing lewd acts with a child. Eades also had 2009 state conviction for failure to register as a sex offender. He was apprehended in Minot, North Dakota, on January 13, 2013, where he had traveled shortly after producing the child pornography in Pottawatomie County.
This case is the result of an investigation by ICE Homeland Security Investigations, the Minot North Dakota Police Department, the United States Marshals Service, and the Pottawatomie County Sheriff’s Office. The case was prosecuted by Assistant U.S. Attorneys Brandon Hale and Mark Yancey.
Assistant U.S. Attorney Ashley L. Altshuler Receives Award from Attorney General for Reentry ProgramRead the Press Release
Oklahoma City — Attorney General Eric Holder recognized 278 Justice Department employees, including Assistant U.S. Attorney Ashley L. Altshuler from the Western District of Oklahoma, with Attorney General Awards at a ceremony this morning in Washington DC. These annual awards recognize department employees and other individuals for their dedication in carrying out the mission of the Department of Justice.
"With this important event, we come together to honor some of our nation's most distinguished, dedicated, and deserving public servants," said Attorney General Holder. "The hard work and impressive achievements of these 278 award recipients have inspired their colleagues at every level of the U.S. Department of Justice – including me. Their leadership has been indispensable in defining the past year as one of historic accomplishment in the face of nearly unprecedented challenge."
"We are delighted that the Attorney General has recognized the dedicated work of AUSA Altshuler in the implementation of our Probationer and Parolee Reentry Program," said Sanford C. Coats, United States Attorney for the Western District of Oklahoma. "We are extremely proud of our reentry efforts which are specifically designed to help offenders avoid recidivism and become productive members of society."
AUSA Altshuler received an Attorney General's Award for Contribution by a New Employee for his exceptional performance in support of the DOJ Project Safe Neighborhoods, Project Sentry and Offender Reentry Initiatives. Since he was hired, AUSA Altshuler has exceptionally performed his duties in support of the Department of Justice’s Project Safe Neighborhoods, Project Sentry and offender reentry initiatives. He has taken the initiative to make reentry a priority and led these efforts in the U.S. Attorney’s Office through the creation and development of the Probationer and Parolee Reentry Program (PPREP).
The PPREP program is designed to serve three purposes: (1) To inform recently released state parolees and probationers about the coordinated effort between federal, state, and local authorities to prosecute gun offenders to the fullest extent of the law; (2) to educate them about the legal consequences of gun and drug crimes; and (3) to inspire them to seek reentry social services to better their lives and lessen the chances of recidivism. The PPREP program is a partnership between federal, state and local law enforcement agencies, including the Oklahoma County District Attorney’s Office, Oklahoma County Sheriff’s Office, ATF, DEA, FBI, Federal Bureau of Prisons, Oklahoma Department of Corrections Probation and Parole, Oklahoma City Police Department, Edmond Police Department, Midwest City Police Department, and other non-governmental entities. In addition, AUSA Altshuler has established a research partnership with a local university to study the effectiveness of the reentry program.
The inaugural PREP session was held on March 24, 2011, which targeted 100 offenders. Since that date, over two dozen P-PREP programs have been held hosting approximately 3000 state probationers and parolees.
Sex Offender to Serve 40 Years in Prison Producing Child Porn of ToddlerRead the Press Release
Oklahoma City, Oklahoma – Today, ANTHONY RAY SACKETT, 35, of Norman, Oklahoma, was sentenced by United States District Judge Joe Heaton to serve 40 years in federal prison for producing child pornography, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
On January 31, 2014, Sackett engaged in sexually explicit conduct with an approximately two-year-old child and took pictures and made videos of it with his cell phone. Sackett then swapped the images with others during child pornography trading sessions using the cell phone application, Kik. At the time of his offense, Sackett was a registered sex offender due to a 2002 Cleveland County conviction for possession of child pornography. He also had a 2011 Cleveland County conviction for failure to register as a sex offender.
Today, Judge Heaton sentenced Sackett to serve 40 years in federal prison. After serving his prison term, Sackett must serve 10 years of supervised release and will be required to register as a sex offender for the remainder of his life.
This case is the result of an investigation by ICE Homeland Security Investigations and the Los Angeles County Sheriff’s Department in California. The case was prosecuted by Assistant U.S. Attorney Brandon Hale.
Madill Home Builder Sentenced to 33 Months in Prison for Defrauding InvestorRead the Press Release
Oklahoma City, Oklahoma – STEVEN RUSSELL HART, 55, of Madill, Oklahoma, was sentenced last week to serve 33 months in prison for defrauding an Oklahoma City investor of more than $700,000, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
During 2009, 2010, and 2011, Hart operated SRC Construction, Inc., which built homes in an Ardmore subdivision called "The Meadows." He funded the construction through Texoma Land Development LLC, an Oklahoma City entity.
On October 15, 2013, a federal grand jury indicted Hart for sending false draw requests to Texoma Land Development. The requests specified specific construction work that SRC had supposedly performed or was in the process of performing. According to the indictment, Hart caused SRC to receive hundreds of thousands of dollars to pay for construction that never took place, including five houses that did not exist. The indictment alleged that he used a portion of these fraudulent proceeds for personal expenses.
Hart pled guilty on April 1, 2014. Judge Timothy D. DeGiusti sentenced Hart to serve 33 months in prison, ordered him to pay $728,906.75 in restitution, and entered a forfeiture money judgment in the same amount. After release from prison, Hart will be on supervised release for two years.
This sentence is the result of an investigation by the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Scott E. Williams.
Investment Firm's Founder and Two Former Associates Plead Guilty in Fraudulent Investment Scheme to Market Pharmaceutical OintmentRead the Press Release
Oklahoma City, Oklahoma – Last Friday, LAWRENCE GENE BOTHWELL, 34, of Oklahoma City, Oklahoma, TOMMY LYNN RICHARDSON, 50, of Ninnekah, Oklahoma, and KENNETH BOYCE, 54, of Pleasant View, Utah, entered guilty pleas related to fraudulent investment scheme to market a pharmaceutical ointment, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Bothwell was the founder of Bothwell Consulting, LLC, is an Oklahoma limited liability company and investment firm whose principal place of business was in Oklahoma City. Bothwell, Richardson, and Boyce were executives at Bothwell Consulting. Prior to founding Bothwell Consulting, Bothwell worked for the Massachusetts-based developer and owner of a topical ointment called Menastil to develop a website to market Menastil to a wider consumer base. However, Bothwell never acquired any ownership interest or distribution rights in Menastil.
On June 17, 2014, a federal grand jury returned a 13-count indictment alleging that the three defendants were engaged in a conspiracy to commit wire fraud and money laundering for their sale of fraudulent debentures. Specifically, it was alleged that the defendants induced investors to invest in Bothwell Consulting based on false representations that their investments would be used to market Menastil and that the debentures were secured by a multi-million dollar trust, which did not actually exist. Instead, it was alleged that Bothwell, Richardson, and Boyce used the more than one million dollars of fraudulent proceeds for their own personal benefit
Last Friday, the three defendants each entered separate guilty pleas. Bothwell pled guilty to committing money laundering and faces up to ten years in prison, and a fine of up to $250,000 at sentencing. Richardson and Boyce each pled guilty to conspiracy to commit wire fraud and face up to 20 years’ imprisonment and a $250,000 fine at sentencing. Sentencing hearings will be set by the court in approximately 90 days. Reference is made to the court record for more information.
This case is the result of an investigation by the Federal Bureau of Investigation and is being prosecuted by U.S. Attorney Sanford C. Coats and Assistant U.S. Attorney Julia E. Barry.
Yukon Physician to Serve 36 Months Probation and Pay over $340,000 in Restitution for Failure to File Tax ReturnsRead the Press Release
Oklahoma City, Oklahoma – DWAYNE L. ROUSH, a physician from Yukon, Oklahoma, who is practicing in Purcell, Oklahoma, was sentenced yesterday to serve 36 months of probation and ordered to pay $340,652.53 in restitution to the IRS for to failing to file a federal tax return for 2011, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. In addition, Roush was ordered to pay a $1,000 fine and perform 200 hours of community service.
Roush was charged by information on May 22, 2014, with failing to file a federal tax return for 2011. He pled guilty on June 10, 2014. As part of his guilty plea, Roush agreed to pay restitution to the Internal Revenue Service for six tax years, including 2007, 2008, 2009, 2010, 2011, and 2012.
This case is the result of an investigation by IRS Criminal Investigation and was prosecuted by Assistant U.S. Attorney Julia E. Barry
Former Office Manager Sentenced to 27 Months in Prison for Forgery and Signing A False Tax ReturnRead the Press Release
Oklahoma City, Oklahoma – ERIN MARIE WELLS, of Yukon, Oklahoma, was sentenced to serve 27 months in prison for check forgery and signing a false federal income tax return, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
From 2009 until mid-2013, Wells was employed as the office manager of Advanced Electric, located in Oklahoma City. She was responsible for paying the company’s bills, depositing checks into the company bank account, and maintaining the company’s books and records. On May 12, 2014, she pled guilty to forging the signature of the company’s owner on a $1,500 check and using the proceeds for her personal benefit. In a plea agreement, she agreed to pay restitution to the company in the amount of $256,857.76. At the same hearing, Wells pled guilty to signing a false tax return. She admitted that on January 11, 2013, she signed a personal federal tax return for the 2012 calendar year that she knew was false because it reported only $28,386 in total income, substantially less than the income she actually received.
At sentencing, U.S. District Judge Stephen P. Friot ordered that Wells be incarcerated for 27 months. The sentence was based in part on the fact that Wells embezzled more than a quarter of a million dollars over several years while holding a position of trust in the company. It was also based on a total loss to the IRS of $51,145.00 during three tax years. Following her 27-month sentence, Wells was ordered to serve three years of supervised release and perform 104 hours of community service. The sentence also requires her to pay a total of $308,002.76 to Advanced Electric and the IRS.
This case was the result of an investigation by the Internal Revenue Service - Criminal Investigations and the Federal Bureau of Investigation. It was prosecuted by Assistant U.S. Attorney Scott E. Williams.
Former Office Manager from Jones Charged with Embezzling Nearly $1 Million from Employer and Tax FraudRead the Press Release
Oklahoma City, Oklahoma – JULIE ANN SMITH (a/k/a "Julie A. Judkins" and "Julia A. Judkins Smith"), of Jones, Oklahoma, has been indicted by a federal grand jury and charged with bank fraud, mail fraud, forged securities, and tax fraud, in connection with embezzling nearly one million dollars from a metro company, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
On September 2, 2014, the federal grand jury returned a 36-count superseding indictment against Smith. The superseding indictment alleges that Smith worked from 2000 until around late June 2012 at Power Equipment & Engineering, Inc. ("PE&E"), in Oklahoma City. At PE&E, Smith was the accounts-payable clerk and officer manager, where she prepared checks and paid invoices for the company. It is alleged that Smith forged approximately 192 PE&E checks, from June of 2002 through June of 2012, by using the company owner’s signature stamp without PE&E’s permission or knowledge. The 192 checks totaled approximately $985,540.14. It is further alleged that Smith disguised the forged checks through false entries on PE&E’s ledger, wrote many of the forged checks to a fake company under her control, and directed other forged checks to credit card companies, financial institutions, and vendors for her personal benefit.
In the superseding indictment, counts 1-16 charge Smith with bank fraud and allege that she fraudulently obtained PE&E’s money, under the control of a local bank, by causing the forged checks to be presented for payment against PE&E’s account at the bank. Counts 17-24 charge Smith with mail fraud. According to these counts, Smith used interstate mail to send forged checks to institutions to pay personal credit card expenses from around January 2007 through June 2012. Count 25 of the superseding indictment charges Smith with aggravated identity theft for fraudulently using the company owner’s signature on a forged check during and in relation to a specific mail fraud count. In the superseding indictment, counts 26-31 allege that Smith made and possessed forged securities of an interstate business—specifically, the forged PE&E checks—with the intent to deceive various payees. The final five counts (32-36) allege that Smith filed materially false federal income tax returns for years 2008 through 2012.
If convicted, Smith faces a prison sentence of up to 30 years for each bank fraud count, up to 20 years for each mail fraud count, up to 10 years for each forged securities count, up to three years for each false tax return count, and a mandatory two-year prison term under the aggravated identify theft count. Smith could also receive an additional $250,000 fine on each count if convicted. The public is reminded that the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
Trial is scheduled to start on October 6, 2014, in Oklahoma City.
These charges are the result of an investigation conducted by the Internal Revenue Service - Criminal Investigations, United States Secret Service, Federal Bureau of Investigation, and Oklahoma City Police Department. The case is being prosecuted by Assistant U.S. Attorneys Chris M. Stephens and Jessica L. Perry.
Reference is made to court filings for further information.
Mail Fraud Involving Mineral Rights Results in 32 Months in Prison and $1 Million Restitution for Louisiana ManRead the Press Release
Oklahoma City, Oklahoma – JORDAN SIMON, 34, of Baton Rouge, Louisiana, was sentenced by United States District Judge Joe Heaton to serve 32 months in prison for mail fraud involving mineral rights, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. According to court records, from November of 2011 through March of 2013, Simon induced an Oklahoma woman to sell her mineral rights to Simon’s company, Iconic Resources, promising to pay her for those rights. However, Simon sold the mineral rights to third parties and sent the woman checks which were rejected for insufficient funds and mailed her a bogus mineral deed which purported to convey the interests back to the woman.
Simon was charged by Information on February 25, 2014, and pled guilty on March 13, 2014. As part of his plea agreement, Simon agreed to pay restitution to the Oklahoma woman and to other victims whom he also defrauded of their mineral rights. Judge Heaton sentenced Simon to serve 32 months in prison, followed by three years supervised release, and ordered him to pay $1,054,143.86 in restitution to his victims.
This case is the result of an investigation by the Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorney Amanda Maxfield Green.
Former Bookkeeper for Chickasha Electrical Contractor to Serve 30 Months in Prison and Pay $336,950 in Restitution for EmbezzlementRead the Press Release
Oklahoma City, Oklahoma – TAMARA HOUSLEY (a/k/a "Tami Housley"), of Louden, Tennessee, was sentenced today by United States District Judge Joe Heaton to serve 30 months in prison for embezzling from her employer by committing wire fraud and for filing a false income tax return, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. In addition, Housley was ordered to pay $336,950 in restitution.
Housley worked as a bookkeeper for an electrical contracting firm in Chickasha, Oklahoma. As bookkeeper, Housley’s duties included preparing checks, documenting accounts payable and receivable, inputting new employees into the payroll system, authorizing automatic draft payroll deductions, paying company taxes, and collecting mail. Although she was not authorized to sign company checks, she prepared checks for all payments, including business credit card statements. Housley also had exclusive access to the company payroll account.
According to court records, Housley starting using business credit cards in 2006 to make unauthorized personal purchases and directed payments to her personal PayPal account, pay her personal utility bills, cable television and cell phone bills, and purchase concert tickets. Housley had exclusive access to the company mail and withheld the monthly credit card statements from her boss and, when she resigned, even changed the billing address on one card to her home address. Starting in 2007, according to court records, Housley used her access to the company payroll account to fraudulently add her boyfriend to the weekly payroll as a "ghost employee." Housley was also charged with filing a false tax returns.
Housley was indicted on February 6, 2014. On April 22, 2014, she pled guilty to committing wire fraud and filing a false income tax return for 2010. She was sentenced today to serve 30 months in prison, followed by three years supervised release, and ordered to pay $336,950 in restitution to her employer and the IRS.
This case is the result of an investigation by the Federal Bureau of Investigation and IRS Criminal Investigation. It was prosecuted by Assistant U.S. Attorneys Julia E. Barry and Mark A. Yancey.
Federal Grand Jury Indicts Edmond Man Charging with Traveling to Kenya to Engage in Illicit Sexual Conduct with Underage ChildrenRead the Press Release
Oklahoma City, Oklahoma – Late today, a federal grand jury has returned an indictment charging MATTHEW LANE DURHAM, 19, from Edmond, Oklahoma, with traveling from Oklahoma City to Kenya to engage in illicit sexual conduct with children, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to the indictment and other court records, Durham was a volunteer at the Upendo Children’s Home, located in Nairobi, Kenya. Upendo specializes in assisting neglected Kenyan children by providing them with food, housing, clothes, school and religion. Specifically, the indictment alleges three counts: Count 1 alleges that Durham traveled from Will Rogers World Airport to Nairobi, Kenya, for the purpose of engaging in illicit sexual conduct with persons under 18 years of age; Count 2 alleges that Durham engaged in illicit sexual conduct with several minors under 18 years of age; and Count 3 alleges aggravated sexual abuse when he crossed a state line with intent to engage in a sexual act with a child under 12 years of age. The conduct in all three counts is alleged to have occurred between April 30, 2014, and June 17, 2014.
If convicted, Durham faces up to life in prison. Durham is currently detained. The public is reminded that Durham is presumed innocent unless and until proven guilty. Reference is made to the indictment and court record for further information.
This case is the result of an investigation by the Federal Bureau of Investigation, the United States Embassy in Kenya, and the United States Department of State Diplomatic Security Criminal Investigative Office. The case is being prosecuted by Assistant U.S. Attorneys Robert Don Gifford II, and David P. Petermann.
Del City Man Charged with Assault of Federal Officer with A Dangerous WeaponRead the Press Release
Oklahoma City, Oklahoma – Earlier today, a criminal complaint was unsealed charging JAMES WILLIAMS, 60, from Del City, Oklahoma, with assaulting a federal officer with a dangerous weapon, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to court records, on June 26, 2014, law enforcement on Tinker Air Force Base received a report of a man acting in a suspicious manner in a sport utility vehicle (SUV) on base. It is alleged that while law enforcement attempted to conduct a traffic stop the SUV fled and a high speed chase ensued. It is alleged that when a Senior Airman attempted to close the gate to prevent the SUV from exiting the base the driver of the SUV accelerated towards the Airman nearly striking her with the vehicle as it exited the installation. It is alleged that law enforcement for Tinker Air Force Base and the Oklahoma Highway Patrol pursued the vehicle at speeds over 100 miles per hour. The SUV was later identified as belonging to Williams.
Williams was arrested on July 29, 2014, and appeared before a United States Magistrate Judge in Oklahoma City earlier today. A preliminary hearing is set August 15, 2014.
If convicted, Williams faces up to 20 years in prison and a $250,000 fine. The public is reminded that the defendant is presumed innocent unless and until proven guilty.
This case is the result of an investigation by the Air Force Office of Special Investigations, Oklahoma Highway Patrol, and Oklahoma County Sheriff’s Office. The case is being prosecuted by Assistant U.S. Attorney Robert Don Gifford II.
Oklahoma City Man Charged with Traveling to Colorado to Bring 13-Year-Old to Oklahoma City to Engage in Illicit Sexual ConductRead the Press Release
Oklahoma City, Oklahoma – Late last Friday, a criminal complaint was unsealed charging MARK SUMPTER, 43, from Oklahoma City, with traveling to Colorado to pick up a 13-year-old girl to bring her to Oklahoma City to engage in illicit sexual conduct, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to court records, on June 27, 2014, the Oklahoma City Police Department (OCPD) notified the FBI that they had recovered an endangered 13-year-old runaway girl who was reported missing to the Douglas County Sheriff’s Department in Douglas County, Colorado. It is alleged that an investigation of social media accounts were traced to an IP address located at 1916 Heritage Park Drive, Apartment 249, in Oklahoma City. When OCPD officers responded to the address they found Sumpter and the missing girl. The complaint alleges that Sumpter and the girl communicated through the website chathour.com, Skype (a Voice Over Internet Protocol service that allows users to communicate through a computer or other wifi-compatible device), and Kik (a social media application designed for mobile technology that utilizes usernames, rather than phone numbers, to connect people via instant messaging). It is alleged that after exchanging messages and sexually-explicit photos, Sumpter traveled to Colorado to pick up the girl and return to Oklahoma City where they stayed for several days, from approximately June 21, 2014 through June 27, 2014. It is alleged that during the trip from Colorado to Oklahoma and at the Oklahoma City apartment, Sumpter engaged in illicit sexual conduct with the 13-year-old girl. Reference is made to the criminal complaint for further information.
Sumpter was arrested on July 17, 2014, and appeared before a United States Magistrate in Oklahoma City late last Friday afternoon. He is held without bond.
If convicted, Sumpter faces up to life in prison. The public is reminded that the defendant is presumed innocent unless and until proven guilty.
This case is the result of an investigation by the Douglas County Sheriff’s Department (Colorado), the Oklahoma City Police Department, the Edmond Police Department, and the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys Brandon Hale and Julia E. Barry.
Edmond Man Charged with Traveling to Kenya to Engage in Illicit Sexual Conduct with Underage ChildrenRead the Press Release
Oklahoma City, Oklahoma – Late last Friday, a criminal complaint was unsealed charging MATTHEW LANE DURHAM, 19, from Edmond, Oklahoma, with traveling to Kenya to engage in illicit sexual conduct with underage children, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to court records, Durham was a volunteer at the Upendo Children’s Home, located in Nairobi, Kenya, that was founded by an American citizen who is a resident of Edmond, Oklahoma. Upendo specializes in assisting neglected Kenyan children by providing them with food, housing, clothes, school and religion. The school is funded through sponsorships and donations. It is alleged that Durham volunteered with Upendo in June of 2012, June of 2013, December of 2013, and from April 30 to June 17, 2014. It is alleged that on the latest trip to Kenya, Durham stayed at the children’s home in an “overflow bunk” rather than at an offsite facility with a sponsor family where he stayed on prior visits. The complaint alleges that during the period from April to June of 2014, Durham engaged in sexual acts with multiple children, male and female, ranging in ages from four to ten. Reference is made to the criminal complaint for further information.
Durham was arrested on July 17, 2014, and appeared before a United States Magistrate Judge in Oklahoma City late last Friday afternoon. He is held without bond and a preliminary hearing is scheduled for August 1, 2014.
If convicted, Durham faces up to life in prison. The public is reminded that Durham is presumed innocent unless and until proven guilty.
This case is the result of an investigation by the Federal Bureau of Investigation, the United States Embassy in Kenya, and the United States Department of State Diplomatic Security Criminal Investigative Office. The case is being prosecuted by Assistant U.S. Attorney Robert Don Gifford, II.