Western District of Oklahoma
Press releases recorded for this federal judicial district.
Oklahoma City Nurse Practioner Pays $50,000 to Settle Civil Penalty Claims Involving Violations of Controlled Substances ActRead the Press Release
Oklahoma City, Oklahoma -- Brandi A. Kammerer, N.P., who practices in Oklahoma City, Oklahoma, has agreed to pay $50,000 to the United States to settle civil penalty claims stemming from allegations that she violated 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, with a mission 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.
The United States alleged that from September 10, 2010, through August 29, 2012, Ms. Kammerer issued prescriptions to individuals for controlled substances that were not for a legitimate medical purpose and not in the usual course of professional practice. More specifically, NP Kammerer improperly issued prescriptions for controlled substances to two family members, and without having established a provider/patient relationship.
In order to resolve the civil penalty claims by the United States, Ms. Kammerer agreed to pay $50,000 to the government. In reaching this settlement, Ms. Kammerer did not admit liability, and the government did not make any concession 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 Drug Enforcement Administration’s Office of Diversion Control and was prosecuted by Assistant United States Attorney Ronald R. Gallegos.
Indictment Unsealed Charging Three Midwest City Women with Conspiracy to Defraud OKC Schools Tutoring ProgramRead the Press Release
Oklahoma City, Oklahoma – A federal indictment was unsealed today charging three Midwest City women with conspiracy to defraud the U.S. Department of Education by making false claims for payment for tutoring sessions of students attending Oklahoma City Public Schools, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. The three women charged are REBECCA E. COTTON, 42, PATRICIA R. BURNS, 71, and BOBBIE J. DAILEY, 62, all from Midwest City, Oklahoma.
As part of the No Child Left Behind Act of 2001, the U.S. Department of Education provided funding for extracurricular tutoring to eligible students at eligible schools. Eligible schools were those designated by the state to be in need of improvement, and student eligibility was determined by family income. The Oklahoma City Public Schools District ("OKCPS") offered this tutoring program to eligible students at U.S. Grant High School and Roosevelt Middle School. OKCPS required tutoring providers to record student attendance at tutoring sessions on paper rosters and on a computer database which, in turn, was used to generate invoices that the tutoring providers submitted to OKCPS for payment.
It is alleged that during the 2009-2010 school year, Burns, with the assistance of her daughter, Cotton, owned and operated A Plus Academics, LLC ("A Plus"), a business providing academic tutoring to school children. It is alleged that during this same year, Cotton owned and operated Foundations Tutoring, LLC ("Foundations"), a business that also provided academic tutoring to school children. A Plus and Foundations shared office space at 608 Askew Drive, in Midwest City. For 2009-2010, both A Plus and Foundations were state-approved tutoring providers having contracts with OKCPS to provide tutoring services. A Plus primarily tutored students at U.S. Grant High School. Foundations primarily tutored students at Roosevelt Middle School. Both companies hired teachers at the respective schools as tutors. It is alleged that during the 2009-2010 school year Dailey was employed at U.S. Grant High School as a counselor and also as an A Plus tutor and "liaison" between A Plus and U.S. Grant High School.
The indictment alleges that during the 2009-2010 school year, Burns, Cotton, and Dailey instructed tutors at U.S. Grant High School to complete and sign student attendance rosters for tutoring sessions that did not, in fact, take place. It is alleged that Dailey herself completed and signed student attendance rosters for tutoring sessions that did not take place. It is alleged that Cotton and one of the employees of Foundations instructed tutors at Roosevelt Middle School to complete and sign attendance rosters for tutoring sessions that did not, in fact, take place.
It is further alleged that Cotton entered the false attendance information into the computer database used by OKCPS. Burns and Cotton allegedly used this false information to generate invoices, which were submitted to OKCPS for payment. For the 2009-2010 school year, OKCPS paid A Plus $884,548.13 and paid Foundations $351,621.00 for tutoring services.
The indictment alleges eight counts. Count 1 charges Cotton, Burns, and Dailey with conspiracy, for which each face up to five years in prison. Counts 2-4 charge Cotton, Burns, and Dailey with making false statements, for which each face up to five years in prison. Count 5 charges Cotton with making false statements, for which she faces up to five years in prison. Count 6 charges Cotton with wire fraud for which she faces up to 20 years in prison. Count 7 charges Cotton with money laundering for which she faces up to ten years in prison. Count 8 charges Cotton with aggravated identity theft for which she faces up to an additional mandatory two years in prison. All counts also include a potential fine of $250,000. The public is reminded that the indictment is merely an accusation and that the defendants are each presumed innocent unless and until proven guilty. Reference is made to the indictment for further information.
This case is the result of an investigation by the Internal Revenue Service Criminal Investigation, the U.S. Department of Education, and the Economic Crimes Task Force, and is being prosecuted by Assistant U.S. Attorneys Amanda Maxfield Green and Chris M. Stephens.
Oklahoma City Doctor Pays $60,000 to Settle Civil Penalty Claims Involving Violations of Controlled Substances ActRead the Press Release
Oklahoma City, Oklahoma -- William D. Jones, M.D., who practices in Oklahoma City, Oklahoma, has agreed to pay $60,000 to the United States to settle civil penalty claims stemming from allegations that he violated 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, with a mission 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, medical providers 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, maintain complete and accurate records of each substance manufactured, received, sold, delivered, dispensed or otherwise disposed of by the registrant. These requirements play a vital role in ensuring the appropriate handling, accounting, and distribution of controlled substances. Violations of the record-keeping requirements subject DEA registrants to civil monetary penalties.
The United States alleged that from January 1, 2009, through July 1, 2013, Dr. Jones ordered and received 5,550 dosage units of Schedule III and IV controlled substances under his DEA registration number, but failed to keep the records required by the CSA. It was also alleged that Dr. Jones dispensed controlled substances to individuals not for a legitimate medical purpose and not in the usual course of his medical practice.
In order to resolve the civil penalty claims by the United States, Dr. Jones agreed to pay $60,000 to the government. In reaching this settlement, Dr. Jones did not admit liability, and the government did not make any concession 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 Drug Enforcement Administration’s Office of Diversion Control and was prosecuted by Assistant United States Attorney Ronald R. Gallegos.
Midwest City Man to Serve 27 Years in Federal Prison for Producing Child PornRead the Press Release
Oklahoma City, Oklahoma – JACK RUSSELL OWENS, 62, of Midwest City, Oklahoma, was sentenced by United States Chief District Judge Vicki Miles-LaGrange to serve 324 months in federal prison for producing child pornography, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to court records, Owens, a former professional photographer, made pornographic images of prepubescent girls in his Midwest City home. He used both regular cameras and hidden video cameras. He took the pictures and videos in the bathroom, in and around the backyard pool, and in the attic. Some of the pornographic pictures taken by Owens were surreptitious; others were not. Evidence showed that Owens, who frequented girls gymnastics events and went to nudist resorts, had been taking pictures of young girls—both clothed and unclothed—since the 1980s. In addition, evidence also showed that Owens had touched the genitals of a 9-year-old girl on more than one occasion. Owens had told the child, now a young adult, that she would get in trouble if she reported him.
In addition to homemade child pornography, Owens also possessed approximately 20,000 images of child pornography that he had downloaded from the Internet on two different home computers and an external hard drive. The bulk of Owens’s collection depicted girls between the ages of 5 and 11.
Owens’s misconduct came to light when a local citizen, through a chance encounter, observed child pornography on one of Owens’s computers and reported it to the Midwest City Police Department. Owens pled guilty to producing child pornography on May 8, 2013.
This case was part of Project Safe Childhood, the flagship program in the Department of Justice’s National Strategy for Child Exploitation Prevention and Interdiction, and was the result of an investigation conducted by the Midwest City Police Department and the Edmond Police Department, in conjunction with the AT&T Digital Crime lab at the University of Central Oklahoma. The case was prosecuted by Assistant U.S. Attorneys Brandon Hale and Chris Stephens.
Maryland Epidemiologist Sentenced to Prison After Pleading Guilty to Illegally Shipping Guns to Ghana and Defrauding Social Security AdministrationRead the Press Release
Oklahoma City, Oklahoma – Yesterday, SAMUEL ALPHONSO NIMO, 62, from Owings Mills, Maryland, pled guilty to illegally shipping firearms to the Republic of Ghana and to defrauding the Social Security Administration, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Following the guilty plea, Chief United States District Judge Vicki Miles-LaGrange sentenced Nimo to serve 12 months and one day in prison and pay $27,816.93 in restitution to the Social Security Administration.
According to court filings and information from the plea hearing, from May of 2009 through May of 2011, Nimo participated in illegally shipping at least eight firearms to the Republic of Ghana for resale. In addition, Nimo was receiving SSI benefits for the care of his child for a disability. However, Nimo unlawfully continued to collect SSI benefits from 2008 through 2011, after his child relocated to Germany in 2008 and was no longer entitled to receive benefits.
During the time the offenses were committed, Nimo worked as an epidemiologist for the Oklahoma State Department of Health. He is currently employed by the Baltimore City Health Department in Maryland.
At the combined plea and sentencing hearing yesterday, Nimo pled guilty to illegally shipping firearms to Ghana and to defrauding the Social Security Administration. Chief Judge Miles-LaGrange then sentenced Nimo to serve 10 months in prison on the firearms count and serve 12 months and one day in prison and pay $27,816.93 in restitution to the Social Security Administration on the fraud count.
This case was investigated by the Bureau of Alcohol Tobacco Firearms and Explosives and the Social Security Administration Office of Inspector General. The case was prosecuted by Assistant United States Attorney Ashley L. Altshuler.
Wyeth Pharmaceuticals Agrees to Pay $490.9 Million for Marketing the Prescription Drug Rapamune for Unapproved UsesRead the Press Release
Oklahoma City – Wyeth Pharmaceuticals, Inc., a pharmaceutical company acquired by Pfizer, Inc. in 2009, has agreed to pay $490.9 million to resolve its criminal and civil liability arising from the unlawful marketing of the prescription drug Rapamune for uses not approved as safe and effective by the U.S. Food and Drug Administration (FDA), the Justice Department announced today. Rapamune is an "immunosuppressive" drug that prevents the body’s immune system from rejecting a transplanted organ.
"The FDA approves drugs for certain uses after lengthy clinical trials," said Sanford Coats, U.S. Attorney for the Western District of Oklahoma. "Compliance with these approved uses is important to protect patient safety, and drug companies must only market and promote their drugs for FDA-approved uses. The FDA approved Rapamune for limited use in renal transplants and required the label to include a warning against certain uses. Yet, Wyeth trained its sales force to promote Rapamune for off-label uses not approved by the FDA, including ex-renal uses, and even paid bonuses to incentivize those sales. This was a systemic, corporate effort to seek profit over safety. Companies that ignore compliance with FDA regulations will face criminal prosecution and stiff penalties."
"FDA’s drug approval process ensures companies market their products for uses proven safe and effective," said Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division. "We will hold accountable those who put patients’ health at risk in pursuit of financial gain."
The Federal Food, Drug and Cosmetic Act (FDCA) requires a company such as Wyeth to specify the intended uses of a product in its new drug application to the FDA. Once approved, a drug may not be introduced into interstate commerce for unapproved or "off-label" uses until the company receives FDA approval for the new intended uses. In 1999, Wyeth received approval from the FDA for Rapamune use in renal (kidney) transplant patients. However, the information alleges, Wyeth trained its national Rapamune sales force to promote the use of the drug in non-renal transplant patients. Wyeth provided the sales force with training materials regarding non-renal transplant use and trained them on how to use these materials in presentations to transplant physicians. Then, Wyeth encouraged sales force members, through financial incentives, to target all transplant patient populations to increase Rapamune sales.
Wyeth has pled guilty to a criminal information charging it with a misbranding violation under the FDCA. The resolution includes a criminal fine and forfeiture totaling $233.5 million. Under a plea agreement, which has been accepted by the U.S. District Court in Oklahoma City, Wyeth has agreed to pay a criminal fine of $157.58 million and forfeit assets of $76 million.
The resolution also includes civil settlements with the federal government and the states totaling $257.4 million. Wyeth has agreed to settle its potential civil liability in connection with its off-label marketing of Rapamune. The government alleged that Wyeth violated the False Claims Act, from 1998 through 2009, by promoting Rapamune for unapproved uses, some of which were not medically accepted indications and, therefore, were not covered by Medicare, Medicaid and other federal health care programs. These unapproved uses included non-renal transplants, conversion use (switching a patient from another immunosuppressant to Rapamune) and using Rapamune in combination with other immunosuppressive agents not listed on the label. The government alleged that this conduct resulted in the submission of false claims to government health care programs. Of the amounts to resolve the civil claims, Wyeth will pay $230,112,596 to the federal government and $27,287,404 to the states.
"Wyeth’s conduct put profits ahead of the health and safety of a highly vulnerable patient population dependent on life-sustaining therapy," said Antoinette V. Henry, Special Agent in Charge, Metro-Washington Field Office, FDA Office of Criminal Investigations. "FDA OCI is committed to working with the Department of Justice and our law enforcement counterparts to protect public health."
Pfizer is currently subject to a Corporate Integrity Agreement (CIA) with the Department of Health and Human Services’ Office of Inspector General that it entered in connection with another matter in 2009, shortly before acquiring Wyeth. The CIA covers former Wyeth employees who now perform sales and marketing functions at Pfizer. Under the CIA, Pfizer is subject to exclusion from federal health care programs, including Medicare and Medicaid, for a material breach of the CIA, and the company is subject to monetary penalties for less significant breaches.
"We are committed to enforcing the laws protecting public health, taxpayers and government health programs, and to promoting effective compliance programs," said Daniel R. Levinson, Inspector General, Department of Health and Human Services. "Our integrity agreement with Pfizer, which acquired Wyeth, includes required risk assessments, a confidential disclosure program, and auditing and monitoring to help prospectively identify improper marketing."
The civil settlement resolves two lawsuits pending in federal court in the Western District of Oklahoma under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens to bring civil actions on behalf of the government and share in any recovery. The first action was filed by a former Rapamune sales representative, Marlene Sandler, and a pharmacist, Scott Paris. The second action was filed by a former Rapamune sales representative, Mark Campbell. The whistleblowers’ share of the civil settlement has not been resolved.
"The success obtained in this case is an excellent example of how we address the threats to our nation’s Health Care System; the importance of the public reporting of fraud, waste, or abuse; and the significant results that can be obtained through multiple agencies cooperating in investigations," said James E. Finch, Special Agent in Charge of the Oklahoma City Division of the Federal Bureau of Investigation.
The criminal case was handled by the U.S. Attorney’s Office for the Western District of Oklahoma (USAO) and the Justice Department’s Civil Division, Consumer Protection Branch. The civil settlement was handled by USAO and the Justice Department’s Civil Division, Commercial Litigation Branch. The Department of Health and Human Services’ (HHS) Office of Counsel to the Inspector General; the HHS Office of General Counsel, Center for Medicare and Medicaid Services; the FDA’s Office of Chief Counsel; and the National Association of Medicaid Fraud Control Units. These matters were investigated by the Federal Bureau of Investigation; the FDA’s Office of Criminal Investigation; HHS’ Office of Inspector General, Office of Investigations and Office of Audit Services’ the Defense Criminal Investigative Service; the Office of Personnel Management’s Office of Inspector General and Office of Audit Services; the Department of Veterans’ Affairs’ Office of Inspector General; and TRICARE Program Integrity.
Except for conduct admitted in connection with the criminal plea, the claims settled by the civil agreement are allegations only, and there has been no determination of civil liability. The civil lawsuits are captioned United States ex rel. Sandler et al v. Wyeth Pharmaceuticals, Inc., Case No. 05-6609 (E.D. Pa.) and United States ex rel. Campbell v. Wyeth, Inc., Case No. 07-00051 (W.D. Okla.). Pfizer cooperated with the government’s investigation.
This case was prosecuted by United States Attorney Sanford C. Coats and Assistant U.S. Attorneys Vicki Zemp Behenna and H. Lee Schmidt.
Cordell Veterinarian to Serve Year in Prison and Pay over $892,000 in Restitution for Making False Statements to Defraud BankRead the Press Release
Oklahoma City, Oklahoma – Today, DAVID L. STURGEON, 63, from Cordell, Oklahoma, was sentenced by United States District Judge Joe Heaton to serve 12 months and one day in federal prison for making false statements to defraud the Bank of Cordell, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. In addition, Judge Heaton ordered that Sturgeon serve five years of supervised release upon his release from prison and pay $892,854.15 in restitution to two bank victims.
Sturgeon is a large animal veterinarian who operates the Washita Veterinarian Clinic and lives in Cordell, Oklahoma. Sturgeon also bought and sold cattle as a manager partner of 20/20 Cattle and Consulting L.L.C and S&D Cattle L.L.C. According to an Information filed on February 21, 2013, from December 2007 through December 2008, Sturgeon secured several loans based on a revolving line of credit extended by Bank of Cordell. Under the loan agreements, loan advances were to be used by Sturgeon for the purchase of cattle which served as collateral for the loan funds advanced. Proceeds from the sale of the cattle were to be used by Sturgeon to pay off the loans owed to Bank of Cordell. During this same time, Sturgeon had two commodities trading accounts with R.J. O’Brien, a commodities firm located in Chicago, Illinois ("RJO"), that he used to make trades in agricultural commodities.
In 2008, RJO required Sturgeon to make certain deposits in his trading accounts to meet margin calls. During the plea hearing today, Surgeon admitted that on August 6, 2008, he represented to the Bank of Cordell that he needed a loan advance of $36,000 to purchase 70 head of cattle for the purpose of influencing the Bank of Cordell to advance him the loan. However, Sturgeon admitted that the loan was not used to purchase cattle and his statements were falsely made so he could fraudulently divert loan funds to make margin calls on the two RJO commodities accounts.
Sturgeon was charged on February 21, 2013. He pled guilty on March 7, 2013. At the sentencing hearing today, Judge Heaton took into account relevant conduct to the offense of conviction and ordered that restitution of $599,364.29 be paid to Bank of Cordell and $293,489.86 to Farm Credit Bank. Sturgeon is to report to the Bureau of Prisons on August 19, 2013, to begin serving his prison sentence.
This case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorneys Ross N. Lillard, III, and Robert J. Troester.
Norman Dentist Pays $40,000 to Resolve Claims of Improperly Issuing Prescriptions for Controlled SubstancesRead the Press Release
Oklahoma City, Oklahoma -- Ronald L. Williams, D.D.S., who practices in Norman, Oklahoma, has agreed to pay $40,000 to the United States to settle allegations that he issued prescriptions to individuals for controlled substances that were not for a legitimate medical purpose and not in the ordinary course of professional practice, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
The United States alleged that from May 19, 2010, and May 18, 2012, Dr. Williams issued prescriptions for controlled substances to individuals without performing physical examinations and without having an established dentist/patient relationship. In reaching this settlement, Dr. Williams did not admit liability, and the government did not make any concession 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 Drug Enforcement Administration’s Office of Diversion Control and was prosecuted by Assistant United States Attorney Ronald R. Gallegos.
Former Tinker Official Convicted of Accepting BribesRead the Press Release
Oklahoma City, Oklahoma – JAMES LEE LOMAN, 70, of McLoud, Oklahoma, a former Item Manager at Tinker Air Force Base, was convicted today on charges of conspiring to commit wire fraud, accepting bribes, and participating in government contracting under an illegal conflict of interest, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
The jury heard that from approximately 2002 to 2006, Loman accepted large cash payments from an individual associated with Daytona Aerospace, Inc., of Deerfield Beach, Florida, in exchange for favorable treatment in the Air Force’s purchasing of aircraft replacement parts. The evidence included numerous faxes that Loman sent from his home in McLoud to the individual in Florida. Some of these faxes calculated his bribe payments based on a percentage of aircraft sales to the Air Force, beginning at 5% and ending at 10%. Other faxes kept track of the amount of bribes due and the amount already paid to him. Still other faxes were "collection letters" that used coded language. Loman drove to Florida on multiple occasions to pick up the cash in increments of approximately $50,000. The faxes showed total cash bribes in the amount of $838,200.
Loman could be sentenced to twenty years in prison for conspiracy, fifteen years for accepting bribes, and five years for being involved in federal contracting while under a personal conflict of interest. He could also be fined up to $250,000 on each count. He could also be ordered to serve three years of supervised release after incarceration. Sentencing will take place in approximately 90 days.
This conviction is the result of an investigation by the Defense Criminal Investigative Service and the United States Air Force Office of Special Investigations, with assistance from the Federal Bureau of Investigation and the Office of Inspector General for the U.S. Department of Transportation. The case was prosecuted by Assistant U.S. Attorneys Scott E. Williams and Chris M. Stephens.
Woodward Man Pleads Guilty to Unlawful Possession of Firearms and Ammunition After Being Involuntarily Committed to A Mental InstitutionRead the Press Release
Oklahoma City, Oklahoma – TIMOTHY DEAN EIKE, 19, from Woodward, Oklahoma, pled guilty to being in unlawful possession of firearms and ammunition after being involuntarily committed to a mental institution, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to court filings and information from the plea hearings, on July 24, 2012, Eike was discovered to be in possession of a 20 gauge shotgun and a 30.06 caliber rifle, together with 97 rounds of 20 gauge ammunition and 168 rounds of 30.06 ammunition. The Woodward Police Department was aware that Eike had been ordered to involuntary inpatient mental health treatment on February 10, 2012. As a person who had been involuntarily committed to a mental institution, Eike was a prohibited from possessing firearms and ammunition under federal firearms laws. Further investigation revealed that on July 5 and 9, 2012, Eike purchased the weapons and ammunition from a licensed firearms dealer in Woodward, Oklahoma, and falsely represented that he had never been involuntarily committed to a mental institution.
Eike was indicted by a federal grand jury on May 7, 2013. He pled guilty on June 26, 2013, to being in unlawful possession of firearms and ammunition after being involuntarily committed to a mental institution. A sentencing date will be set by the Court in approximately 90 days where Eike faces up to ten years in prison.
This case was investigated by the Woodward Police Department, Woodward County Sheriff’s Office, Federal Bureau of Investigation, United States Marshals Service, and the Bureau of Alcohol Tobacco Firearms and Explosives. The case is being prosecuted by Assistant United States Attorney Edward J. Kumiega.
Oklahoma City Man to Serve Six Months in Prison for Making Threat to Commit Violence in WyomingRead the Press Release
Oklahoma City, Oklahoma – Today, GLENN ALLEN KIRKHAM, 34, of Oklahoma City, Oklahoma, was sentenced by United States District Judge Robin Cauthron to serve six months in prison for making a threat to commit violence in Casper, Wyoming, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
On January 14, 2013, public officials in and around Casper, Wyoming, received numerous reports from various sources of a threatened attack in Casper using multiple types of weapons. The threat had been posted from Oklahoma City on 4chan.org, an internet-based bulletin board service. The posting was quickly distributed throughout social media and caused significant concern in the community. The threat came not long after Casper had experienced a homicide/suicide at a local college. As a result of the threat, officials immediately took precautions that included placing 40 schools on lockdown, notifying hospitals and nursing homes, and placing police officers at potential locations of an attack.
Kirkham pled guilty on March 20, 2013. At today’s sentencing hearing, Judge Cauthron noted that even though the defendant had no criminal history and may have viewed the threat as some sort of joke, incarceration was important as a deterrent to those tempted to use the internet to cause wide-spread fear and disrupt public services.
This case is the result of an investigation by the Federal Bureau of Investigation and the Casper Police Department in Wyoming. The case was prosecuted by Assistant U.S. Attorneys Mark A. Yancey and Scott E. Williams.
Insider Theft of over $150,000 from Indian Casino Results in Criminal Embezzlement and Tax Charges Against Chickasha CoupleRead the Press Release
Oklahoma City, Oklahoma – KIMBERLY DAWN LOGSDON and WILLIAM MICHAEL LOGSDON, both of Chickasha, Oklahoma, have been indicted by a federal grand jury in connection with the embezzlement of over $150,000 from the Silver Buffalo Casino and failure to file federal tax returns, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
The Silver Buffalo Casino is a gaming establishment in Anadarko, Oklahoma, that is owned and operated by the Apache Tribe of Oklahoma. Kimberly Logsdon was employed as a cashier clerk at the Silver Buffalo Casino from July 25, 2007, until her termination on December 3, 2008. According to a second superseding indictment returned yesterday, from January of 2008 until December of 2008, Logsdon double-counted certain winning cashout vouchers presented by casino customers for payment and kept a total of more than $150,000. The indictment charges her husband, William Michael Logsdon, with two additional offenses. First, it alleges that he committed the crime of misprision of a felony, which is failing to notify law enforcement of a crime and taking steps to conceal that crime. Second, it charges him with committing perjury before a federal grand jury.
In two additional counts, the Logsdons are each charged with failing to file federal income tax returns for the 2008 calendar year.
If convicted of casino embezzlement, Kimberly Logsdon faces up to 20 years in prison and a $1,000,000 fine, plus mandatory restitution. William Michael Logsdon faces maximum sentences of three years and five years in prison on the misprision and perjury counts respectively, in addition to maximum fines of $250,000 on each count. If convicted of failure to file a federal income tax return, the Logsdons could be sentenced to one year in prison and fines of $100,000 each. The public is reminded that the indictment is merely an accusation and that the defendants are presumed innocent unless and until proven guilty. Reference is made to the second superseding indictment and other public filings for further information.
This case is the result of an investigation by the Bureau of Indian Affairs and the Internal Revenue Service Criminal Investigation. It is being prosecuted by Assistant U.S. Attorney Scott E. Williams.
Army Private and Mother Sentenced for First Degree Child Abuse Murder of Ten-Year-Old Boy at Fort Sill Army PostRead the Press Release
Oklahoma City, Oklahoma – Today, United States District Judge Stephen P. Friot sentenced CONNELL C. WILLIAMS, 33, from Fort Sill, Oklahoma, to life imprisonment without the possibility of parole, and CANDICE C. HOLLOWAY, 32, from Norfolk, Virginia, to 30 years imprisonment for their roles in the first degree child abuse murder of Holloway’s ten-year-old son on Fort Sill Army Post, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to court records, Williams, an enlisted member of the United States Army, was assigned to Fort Sill in Comanche County, Oklahoma, in August 2010. In September 2010, Holloway and her children moved into Fort Sill military housing with Williams. Williams and Holloway were not married and Williams is not the biological father of the two children. From early 2011 through May of 2011, Williams and Holloway intentionally committed child abuse murder by depriving Holloway’s ten-year-old son of food as a form of punishment, which ultimately resulted in his starvation death on May 5, 2011.
Holloway pled guilty to first degree murder and agreed to serve 30 years in a federal prison, followed by five years of supervised release, in exchange for her cooperation and testimony against Williams, who was facing a possible death sentence. Williams’ trial began in February 2013, and Holloway testified against Williams. During the trial, Williams agreed to enter a plea of guilty to first degree child abuse murder and accept a mandatory sentence of life imprisonment without the possibility of parole. In exchange for Williams’ guilty plea, the Department of Justice agreed to withdraw the notice to seek the death penalty.
This case was investigated by the Federal Bureau of Investigation and the United States Army Criminal Investigation Division. The case was prosecuted by United States Attorney Sanford C. Coats, Assistant U.S. Attorney Robert A. Bradford, and retired Assistant U.S. Attorney Randal A. Sengel.
Anadarko Man Pleads Guilty to Filing False ReturnRead the Press Release
Oklahoma City, Oklahoma - On June 5, 2013, RANDEL L. STONE, 43, of Anadarko, Oklahoma, pled guilty to making a false statement on a Federal income tax return, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
On May 13, 2013, Stone was charged in a one-count Information with filing a false federal income tax return because he received substantially more income than he reported on his return.
In 2007 and 2008, Stone owned and operated a business called A Plus, Inc. which did chemical spraying on trees and lawns. At today’s plea hearing, Stone admitted that his 2008 federal tax return was false because he did not report more than $100,000 that he should have claimed as income on the return. Stone further admitted that the income he did not report was money paid to A Plus from Public Service Company of Oklahoma ("PSO").
At sentencing, Stone faces up to three years in federal prison and a $250,000 fine. As part of a plea agreement, Stone has agreed to pay restitution to the IRS in the amount of his criminal conduct. The court will determine the specific amount of restitution due to the IRS at sentencing, which will take place in approximately 90 days. Also, as part of a plea agreement, Stone agreed to pay restitution to PSO in the amount of $290,000. That amount reflects the remaining balance of a civil judgment entered against Stone, based on PSO’s claims that Stone obtained money through false A Plus invoices.
This case is the result of an investigation conducted by IRS Criminal Investigation, and is being prosecuted by Assistant United States Attorney, Chris M. Stephens.
Edmond Woman Convicted of Health Care Fraud Receives Prison Term and $1.89 Million FineRead the Press Release
Oklahoma City, Oklahoma – Yesterday, FARIDEH HEIDARPOUR, 51, of Edmond, was sentenced by Chief United States District Judge Vicki Miles-LaGrange to serve twelve months and one day in federal prison for her role in committing a health care fraud scheme, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. In addition, Judge Miles-LaGrange ordered that Ms. Heidarpour serve three years of supervised release following her imprisonment, tender a check to the court in the amount of $1 million to reimburse the United States, and pay a $1.89 million fine and restitution of $120,689.84
Ms. Heidarpour pled guilty in August 2012. The evidence showed that from 2005 through 2009, she was the manager, part-owner, and medical biller for the Advanced Clinics located in Oklahoma City, Tulsa, Dallas, and Oakland, California. The majority of patients of the Advanced Clinics were injured United States Postal Workers receiving medical benefits under the U.S. Department of Labor, Office of Workers' Compensation Program (DOL-OWCP). These patients received medical evaluations and physical and occupational therapy for the purpose of obtaining schedule awards from DOL-OWCP for their injury disabilities. Ms Heidarpour fraudulently billed DOL-OWCP for services not rendered, double billing, and manipulated billing codes to obtain higher reimbursements. From October 2006 through December 2009, Ms. Heidarpour personally received over $4.4 million from the Advanced Clinics.
This sentence is the result of an investigation conducted by the United States Postal Service Office of Inspector General and the U.S. Department of Labor Office of Inspector General. The case was prosecuted by Assistant U.S. Attorneys Vicki Z. Behenna and Kerry A. Kelly.
Reference is made to public filings for further information.
Oklahoma City Doctor Pleads Guilty to Defrauding MedicaidRead the Press Release
Oklahoma City, Oklahoma – AMAR NATH BHANDRY, M.D., 53, of Oklahoma City, has pled guilty to committing health care fraud, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to the superseding information, Dr. Bhandry submitted claims to Medicaid claiming reimbursement for services that he had not actually provided. Specifically, he filed claims for comprehensive psychiatric examinations between 45-50 minutes in duration when he visited with patients for only 10-20 minutes. Dr. Bhandry pled guilty earlier today to the superseding information.
At sentencing, Dr. Bhandry faces up to 10 years in prison and $250,000 fine. Sentencing will take place in approximately ninety days.
These charges are the result of an investigation conducted by the Federal Bureau of Investigation and the Drug Enforcement Administration. The case was prosecuted by Assistant U.S. Attorneys Randal A. Sengel and David P. Petermann.
Reference is made to court filings for further information.
Former Owner of Metro Pool Company Sentenced to 18 Months for Tax FraudRead the Press Release
Oklahoma City, Oklahoma – Today, THEODORE MICHAEL ZACHRITZ, of Nichols Hills, Oklahoma, was sentenced to 18 months in federal prison for willfully failing to pay over to the Internal Revenue Service federal taxes that he withheld from his employees’ wages, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. In addition, Zachritz was ordered to pay $461,363.84 in restitution to the IRS.
For many years, Zachritz and his wife owned and operated Lifestyle Pools, LLC in Oklahoma City. As owner of the company, Zachritz deducted and withheld federal income taxes, Social Security taxes, and Medicare taxes (commonly called “payroll taxes”) from the wages of Lifestyle Pools employees. Under federal law, an employer must deduct and withhold payroll taxes from employees’ wages, and then pay over those withheld taxes to the IRS at the end of each quarter.
On January 22, 2013, the United States charged Zachritz with willfully failing to collect and pay over to the IRS the federal income taxes, Social Security taxes, and Medicare taxes withheld from wages of Lifestyle Pools employees for the third quarter of 2006 through the end of 2009. On January 31, 2013, Zachritz pled guilty to a one-count Information. At the plea hearing, Zachritz admitted that he deducted and withheld more than $290,000 in payroll taxes from his employees’ wages during that period. He also admitted that he knew he was required by law to turn over to the IRS the withheld federal payroll taxes each quarter, but he did not do so. Zachritz admitted that he still has not paid over to the IRS any of the payroll taxes that he withheld from 2006 to 2009.
Today, United States District Judge Joe Heaton sentenced Zachritz to 18 months in federal prison, followed by three years of supervised release. In addition, Zachritz was ordered to pay $461,363.84 in restitution to the IRS. He must report to federal prison on July 26, 2013.
This case was the result of an investigation conducted by IRS Criminal Investigation and was prosecuted by Assistant U.S. Attorney Chris M. Stephens.
Aggravated Identify Theft Lands City Man in Prison for 78 MonthsRead the Press Release
Oklahoma City, Oklahoma – DANIEL WAYNE AUSMUS, 44, from Oklahoma City, was sentenced by United States District Judge Timothy D. DeGiusti to serve 78 months in prison for aggravated identity theft, mail fraud, and submitting false claims to the United States, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Judge DeGiusti also ordered Ausmus to serve three years of supervised release upon release from prison and to pay $45,972.62 in restitution to the victims.
According to court filings and information from the plea and sentencing hearings, starting in November of 2009 Ausmus used various sources, including the internet, to obtain personal information of over 100 individuals including names, dates of birth, and social security numbers. Ausmus then used these to fraudulently apply online for prepaid debit cards. He had the cards mailed to vacant houses near his residence where he would retrieve them after delivery by the Postal Service. In addition, Ausmus used the personal information to file false claims for tax refunds for both state and federal tax refunds.
Ausmus was charged by information on October 30, 2012, and later pled guilty to all three count of the information.
In addition to the 78-month prison term, Judge DeGiusti also ordered Ausmus to serve three years of supervised release upon release from prison and to pay $45,972.62 in restitution to the victims, which include the IRS and States of Oklahoma, Kansas, Hawaii, Alabama, North Carolina and Missouri.
This case was investigated by the United States Postal Inspection Service and IRS Criminal Investigation. The case was prosecuted by Assistant United States Attorney Timothy Ogilvie.
Former Employee of Assisted Living Center Sentenced to 37 Months in Prison for FraudRead the Press Release
Oklahoma City, Oklahoma – Yesterday, JAMES LESTER HAUSAM, JR., 29, of Oklahoma City, Oklahoma, was sentenced to serve 37 months in prison in connection with a scheme to steal money from a resident at a metro retirement home, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
In 2010, Hausam worked at an assisted-living center in Bethany, Oklahoma. There, he became friends with Monica Michelle Brown, who also worked at the center. Hausam befriended a ninety-six-old resident at the center, fraudulently gained access to the resident’s bank account, and stole more than $250,000 belonging to him. Hausam used online banking to write checks to themselves from the resident’s account, forged the resident’s signature on blank checks, and purchased personal items through a PayPal account they set up in the resident’s name.
On September 11, 2012, Hausam was charged in a one-count Information with conspiracy to commit mail fraud and to make and possess forged securities. The Information alleged that, from January through June of 2011, Hausam and Brown conspired to steal tens of thousands of dollars for their personal benefit from a bank account belonging to the assisted-living center resident, without his permission. On September 25, 2012, Hausam pled guilty to the conspiracy count. Hausam admitted that he asked the victim in 2010 for money to help with bills; the resident gave Hausam a $1,000 check and a few blank checks. Hausam later started accessing the resident’s bank account online and writing checks from that account. Hausam admitted he also forged the resident’s name on a blank check that the resident had given him. At the plea hearing, Hausam admitted that he used the funds for his personal benefit, but never told the ninety-six-old resident that he and Brown were writing checks for thousands of dollars from the account.
At yesterday’s sentencing, United States District Judge Robin J. Cauthron sentenced Hausam to serve 37 months in federal prison, followed by three years of supervised release. Hausam was also ordered to pay restitution to the victim in the amount of $249,653.38. Hausam was remanded to the custody of the U.S. Marshal to begin service of his sentence.
The alleged conspirator, Monica Michelle Brown (a/k/a Monica Agee), 40, from Oklahoma City, was indicted by a federal grand jury on November 7, 2012, and charged with conspiracy to defraud, mail fraud, and forgery of checks. If convicted, Brown faces up to 20 years in prison and a $250,000 fine. The public is reminded that the indictment is merely an accusation and that Brown is presumed innocent unless and until proven guilty.
Brown has not been arrested and remains a fugitive. Anyone with information on her whereabouts should contact the Federal Bureau of Investigation at 405-290-7770.
These cases are the result of an investigation conducted by the Federal Bureau of Investigation and the Bethany Police Department. The cases are being prosecuted by Assistant United States Attorney Chris M. Stephens.
United States Attorney Alerts Public to Beware of Disaster Fraud in Aftermath of Recent TornadosRead the Press Release
Oklahoma City, Oklahoma – Sanford C. Coats, United States Attorney for the Western District of Oklahoma, today urged Oklahoma residents and businesses to be aware of the potential for fraud in the aftermath of the recent devastating tornados. The United States Attorney’s Office, along with the Department of Justice, the FBI, and the National Center for Disaster Fraud (NCDF), wants to remind the public that anyone can report fraud involving disaster relief operations through the National Disaster Fraud Hotline toll free at (866) 720-5721 or the Disaster Fraud e-mail at [email protected]. The telephone line is staffed by a live operator 24 hours a day, seven days a week.
"I urge everyone to exercise caution and due diligence before giving to anyone soliciting donations on behalf of tornado victims," said United States Attorney Coats. "Regrettably, there are people out there that will take advantage of this tragedy and your generosity for their own profit. Scams come in all forms - such as email, phone calls, or mail solicitations. Be vigilant and cautious to whom you are giving your personal information, and if it’s not a well-known, reputable charity, please do some research before making a contribution."
Before making a donation of any kind, consumers should adhere to certain guidelines, including the following:
- – Do not respond to any unsolicited (spam) incoming emails, including clicking links contained within those messages, because they may contain computer viruses.
- - Be skeptical of individuals representing themselves as surviving victims or officials asking for donations via email or social networking sites.
- - Beware of organizations with copycat names similar to but not exactly the same as those of reputable charities.
- – Rather than following a purported link to a website, verify the existence and legitimacy of non-profit organizations by utilizing various internet-based resources.
- – Be cautious of emails that claim to show pictures of the disaster areas in attached files, because the files may contain viruses. Only open attachments from known senders.
- – To ensure that contributions are received and used for intended purposes, make donations directly to known organizations rather than relying on others to make the donation on your behalf.
- – Do not be pressured into making contributions; reputable charities do not use coercive tactics.
- – Be aware with whom you are dealing when providing your personal and financial information. Do not give your personal or financial information to anyone who solicits contributions. Providing such information may compromise your identity and make you vulnerable to identity theft.
- – Avoid cash donations if possible. Pay by debit or credit card, or write a check directly to the charity. Do not make checks payable to individuals.
- – Legitimate charities do not normally solicit donations via money transfer services.
- – Most legitimate charities maintain websites ending in .org rather than .com
If you believe you have been a victim of fraud by a person or organization soliciting relief funds on behalf of tornado victims, if you discover fraudulent disaster relief claims submitted by a person or organization, or if you know about or suspect fraud involving disaster relief operations, you can report it through the National Disaster Fraud Hotline, toll free, at (866) 720-5721 or the Disaster Fraud e-mail at [email protected]. The telephone line is staffed by a live operator 24 hours a day, seven days a week.
You can also report suspicious e-mail solicitations or fraudulent websites to the FBI’s Internet Crime Complaint Center at www.ic3.gov.
"Investigators and prosecutors are ready to respond to credible allegations of fraud and abuse," said U.S. Attorney Coats. "If you suspect fraud, please report it."
Former Bookkeeper to Serve 24 Months in Prison and Pay over $1.8 Million in Restitution for Embezzlement and Tax EvasionRead the Press Release
Oklahoma City, Oklahoma – CAROLYN DAWSON, of Oklahoma City, was sentenced today to 24 months in prison for embezzling from her former employer, American Plant Products, and for evading federal payroll taxes, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. In addition, Dawson was ordered to pay $1,843674.42 in restitution.
Until November of 2011, Dawson worked as the bookkeeper for American Plant Products, an Oklahoma City wholesaler of greenhouse and garden supplies. Her duties included maintaining payroll, preparing payroll tax returns, and paying withheld taxes to the IRS. According to a criminal information filed on December 18, 2012, Dawson defrauded the business by using interstate wire communications to pay personal credit card expenses from a business bank account, without the knowledge of the business or its owners. These payments took place from January of 2007 until November 25, 2011, when Dawson was terminated. The information also alleged that Dawson willfully evaded federal payroll taxes by failing to file a 2010 payroll tax return for the company, failing to make payroll withholding payments to the IRS, and altering the books and records of American Plant Products to conceal her failure to make withholding payments.
On January 3, 2013, Dawson pled guilty to both counts.
Today, Chief Judge Vicki Miles-LaGrange sentenced Dawson to 24 months in prison, to be followed by 3 years of supervised release. The sentence also requires her to pay $1,194,656.15 in restitution to American Plant Products and $649,018.27 to the Internal Revenue Service. The restitution to the IRS is based not only on her evasion of payroll taxes, but also on her failure to report the embezzled funds on her personal income tax returns.
This case was the result of an investigation conducted by the Federal Bureau of Investigation and IRS Criminal Investigation. The case was prosecuted by Assistant U.S. Attorney Scott E. Williams.
Reference is made to court filings for further information.
City Woman Sentenced to 60 Months in Prison for Adoption ScamRead the Press Release
Oklahoma City, Oklahoma – SHELLY RENEE HENSON, 40, from Oklahoma City, was sentenced by United States District Judge Stephen P. Friot to serve 60 months in prison for mail fraud related to an adoption scam, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Judge Friot also ordered Henson to serve three years of supervised release upon release from prison and to pay $49,361.47 in restitution to the victims.
According to court filings and information from the plea and sentencing hearings, between July 2008 and June 2011, Henson defrauded at least five adoption agencies and adoption law firms. Henson also defrauded several prospective adoptive parents from throughout the United States, including Florida, Kansas, and Oklahoma. Henson would falsely pose as an expectant mother and then approach the adoption agencies and law firms claiming she wanted to place her purported unborn child for adoption. Throughout the course of her scams, Henson requested and received money for living expenses, including rent, utilities, food, and other personal items. When completing the “birth mother” applications, Henson often provided false information regarding her personal identification, the conception of a child, and the identity of the putative birth father. Henson also provided fraudulent medical documentation such as pregnancy verifications, sonograms, blood work, laboratory results, and other pregnancy-related medical records that she created or altered on her computer.
Henson often initiated contact with the prospective adoptive parents with whom she had been matched by the adoption agencies and law firms. On one occasion, Henson engaged in a lengthy relationship with the prospective adoptive mother, meeting on one occasion, and exchanging approximately 800 text messages over a five-month period. Henson continued to communicate with this prospective adoptive mother up to the day she had falsely claimed she was being induced in Oklahoma City, knowing that this family had traveled from Kansas to Oklahoma City to be present during the delivery. On at least two occasions, Henson requested the prospective adoptive mothers accompany her in the delivery room when she knew that there would not be a delivery. In fact, after her arrest, Henson admitted that she had previously undergone a tubal ligation procedure several years before committing the adoption fraud.
Henson was charged by indictment on August 21, 2012, with 18 counts of mail fraud, wire fraud, and misuse of a social security number. Henson pled guilty to mail fraud on January 7, 2013.
This case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant United States Attorney Charles Brown.
City Man Charged with Robbery Metro Bank with FirearmRead the Press Release
Oklahoma City, Oklahoma – JOSHUA ANTONIO MCCLENDON, 27, from Oklahoma City, has been arrested and charged with robbing the First Fidelity Bank located at 700 SW 29th, Oklahoma City, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to the criminal complaint, McClendon is alleged to have entered the bank at 4:20 p.m. yesterday, April 25, 2013, armed with a handgun, where he robbed the bank and fled. Oklahoma City Police officers responding to the bank robbery located McClendon in the 700 block of SW 28th where he was arrested without incident.
If convicted, McClendon faces up to 25 years in prison. The public is reminded that the indictment is merely an accusation and that the defendant is presumed innocent unless and until proven guilty.
This case is the result of an investigation by the Oklahoma City Police Department and the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Ashley L. Altshuler.
Bulk Mailing Service to Pay $500,000 to Resolve Claims for Underpaid PostageRead the Press Release
Oklahoma City, Oklahoma -- Bokchito Mail Center, S&T Management, Inc., The Cleaning Authority, Inc. and The Cleaning Authority, LLC (collectively "Bokchito Mail Center and its affiliates"), have agreed to pay $500,000 to the United States to settle allegations that it obtained postage discounts to which is was not entitled, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
On behalf of the United States Postal Service, the United States Attorney’s Office reached a settlement of allegations that from September 14, 2006, through February 21, 2008, the Bokchito Mail Center and its affiliates submitted and paid for mailings at a postal rate to which they were not entitled. The Postal Service offers lower postal rates to mailers who comply with certain preparation and sorting requirements because these actions save the Postal Service time and money. The United States alleges that the Bokchito Mail Center and its affiliates claimed and paid the Enhanced Carrier Route postage rate when their mailings did not comply with the preparation and sorting requirements to qualify for that rate.
"Mailers who claim improper postage discounts not only gain an unfair advantage over their competitors, they also short-change the Postal Service of necessary funds to perform their work," said U.S. Attorney Sanford C. Coats. "We will continue to work with the Postal Service to ensure that the proper postage is paid."
"Postal Inspectors appreciate the strong stance U.S. Attorney Sanford Coats has taken against those who try to take advantage of the Postal Service through shortchanging postage," said Fort Worth Division Acting Inspector in Charge Mark Applewhaite. "Among the many roles Postal Inspectors have, one of the most important is to protect the U.S. Postal Service revenue, which ensures a level playing field for all customers, be they large mailers or someone mailing a single envelope."
In reaching this settlement, Bokchito Mail Center and its affiliates did not admit liability, and the government did not make any concession 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 United States Postal Inspection Service and was prosecuted by Assistant United States Attorney Ronald R. Gallegos.
City Woman Sentenced for Social Security Disability FraudRead the Press Release
Oklahoma City – ANTIGANEE TRIPLET, 39, from Oklahoma City, has been sentenced by United States District Judge Robin J. Cauthron to serve five years’ probation and pay $13,155.51 in restitution for defrauding the Social Security Administration (SSA) to receive disability benefits to which she was not entitled, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to Court records and information from the plea and sentencing hearings, Triplet claimed she was disabled and received SSA disability benefits from January of 2009 through January 2012. Triplet reported to SSA she was not employed during this time period when, in fact, she was working and earning income at several jobs.
Triplet was charged on January 8, 2013, and pled guilty on January 23, 2013, to illegally receiving Social Security disability benefits she was not entitled to receive. Judge Cauthron ordered Triplet to serve five years’ probation and pay $13, 155.51 in restitution to SSA.
This case was the result of an investigation conducted by the Social Security Administration Office of Inspector General and was prosecuted by Assistant U.S. Attorney Amanda Maxfield Green.
Shawnee Man Charged with Abuse of Four-Year-Old Child in Indian CountryRead the Press Release
Oklahoma City, Oklahoma – JUSTIN L. ELLIS, 26, from Shawnee, Oklahoma, has been indicted by a federal grand jury and charged with malicious injury of a four-year old child in on the federal lands held in trust for the Kickapoo Tribe of Oklahoma, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to the indictment, on November 10, 2012, Ellis, a tribal member of the Kickapoo Tribe, repeatedly burned a four-year-old child on the buttocks and legs with a lit cigarette on Kickapoo Tribal land in Pottawatomie County. If convicted, Ellis faces a mandatory minimum of ten years in prison and potentially a life sentence. In addition, Ellis faces an additional $250,000 fine and up to five years of supervised release upon his release from prison. The public is reminded that the indictment is merely an accusation and that the defendant is each presumed innocent unless and until proven guilty.
This case is the result of an investigation by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorney Robert Don. Gifford, II.
Five Men Charged with Trafficking 57 Pounds of Crystal Methamphetamine ("Ice")Read the Press Release
Oklahoma City, Oklahoma -- Federal charges were filed today charging JOSE EDUARDO OSUNA VALDEZ (aka "Lalo"), 25, BRIAN JESUS GARCIA-PENA (aka "Chino"), 18, JESUS HERNANDEZ-CARILLO (aka "Jesus Jesse Hernandez"), 20, JOSE IRAI GARCIA–PENA, 20, and GAEL GUADALUPE ZANUEDO-ARREDONDO, 20, all from Mexico, with conspiracy to possess and actually possessing approximately 57 pounds of crystal methamphetamine (commonly known as "ice") with intent to distribute, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to the criminal complaint and affidavit, law enforcement received a tip on April 10, 2013, regarding a shipment of crystal methamphetamine being delivered to Oklahoma City. Law enforcement surveillance tracked the drug shipment being transferred from the transport vehicle (a white 1997 Acura) to a black Nissan Armada in the parking lot of the Flying-J truck stop located at Interstate 40 and Morgan Road, in Oklahoma City. Surveillance tracked the Armada to 4348 N.W. 12th Street, in Oklahoma City, where law enforcement converged to arrest the five defendants. According to the complaint affidavit, approximately 57 pounds of crystal methamphetamine "ice" was recovered from the vehicle. The street value is estimated to exceed $2.5 million. Reference is made to the complaint and affidavit for further information.
If convicted, the defendants each face no less than ten years and up to life in prison, plus a $10,000,000 fine. The public is reminded that the complaint is merely an accusation and that the defendants are each presumed innocent unless and until proven guilty.
This case is the result of an investigation by the Drug Enforcement Administration, the Oklahoma Highway Patrol, Oklahoma County District Attorney's Office, Oklahoma County Sheriff's Department, Canadian County Sheriff's Department, Norman Police Department, Edmond Police Department, Duncan Police Department, Moore Police Department, District-21 Drug Task Force, District-6 Drug Task Force, COMIT Task Force, U.S. Customs and Border Protection Air Training Center, and the Oklahoma National Guard-Counter Drug Unit. The case is being prosecuted by Assistant U.S. Attorney David Peterrmann.
Fifty-Seven Charged with Operating Illegal Online Sports Gaming BusinessRead the Press Release
Indictment Seeks Forfeiture Money Judgment of $1 Billion
Oklahoma City, Oklahoma -- Thirty-four individuals and 23 entities have been indicted and accused of operating an illegal sports bookmaking business that solicited more than $1 billion in illegal bets.
United States Attorney Sanford C. Coats for the Western District of Oklahoma and Acting Assistant Attorney General Mythili Raman of the Criminal Division made the announcement after the indictment was unsealed.
"The defendants cannot hide the allegedly illegal sports gambling operation behind corporate veils or state and international boundaries," said U.S. Attorney Sanford C. Coats. "I thank the IRS and FBI for their diligent work over several years to investigate this billion dollar international gambling enterprise."
"These defendants allegedly participated in an illegal sports gambling business, lining their pockets with profits from over a billion dollars in illegal gambling proceeds," said Acting Assistant Attorney General Raman. "Today's charges demonstrate that we are as determined as ever to hold accountable those involved in facilitating illegal online gambling by U.S. citizens, regardless of where the business operates, or where the defendants reside."
According to the indictment, Bartice Alan King, aka "Luke" and "Cool," 42, of Spring, Texas, conspired with others to operate internet and telephone gambling services first from San Jose, Costa Rica, and then from Panama City, Panama, which took wagers almost exclusively from gamblers in the United States seeking to place bets on sports. Known since 2003 as Legendz Sports, the enterprise allegedly used bookies located in the United States to illegally solicit and accept sports wagers as well as settle gambling debts.
The 34 defendants are alleged to have been employees, members and associates of the ongoing Legendz Sports enterprise. The 23 corporate defendants are alleged to have been used by Legendz Sports to facilitate gambling operations, operate as payment processors, own websites and domain names used in the enterprise, launder gambling funds, and make payouts to gamblers.
The indictment alleges that Legendz Sports sought to maximize the number of gamblers who opened wagering accounts by offering both "post-up" betting, which requires a bettor to first set up and fund an account before placing bets, and "credit" betting, which allowed the bettor to place a wager without depositing money in advance through face-to-face meetings with bookies or agents.
The indictment alleges that Legendz Sports solicited millions of illegal bets totaling over $1 billion.
If convicted, the defendants face up to 20 years in prison for racketeering, up to 20 years in prison for conspiring to commit money laundering, up to 10 years in prison for money laundering, and up to five years in prison for operating an illegal gambling business.
In addition, the indictment seeks a forfeiture money judgment of at least $1 billion traceable to numerous specific assets that include real estate, bank accounts, brokerage and investment accounts, certificates of deposit, IRA, domain names, a Sabreliner aircraft, a gas lease, and vehicles.
"Individuals cannot skirt the laws of the United States by setting up illegal internet gambling operations in a foreign country, while living in the United States and enjoying all the benefits of U.S. citizens," said Jim Finch, Special Agent in Charge of the FBI Oklahoma City Field Office. "The FBI, along with our law enforcement partners, will continue to be diligent in investigating such violations of federal law."
"Combining the financial investigative expertise of the IRS with the skills and resources of the FBI makes a formidable team for combating major, greed-driven crimes," said Andrea D. Whelan, Internal Revenue Service Special Agent in Charge. "This massive indictment is the result of our highly effective law enforcement partnership."
The public is reminded that the indictment is merely an accusation and that the defendants are each presumed innocent unless and until proven guilty.
This case is the result of an investigation 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 Assistant U.S. Attorneys Susan Dickerson Cox and William Lee Borden, Jr., from the Western District of Oklahoma and Trial Attorney John S. Han with the Department of Justice Criminal Division Organized Crime and Gang Section.
Edmond Man to Serve Year in Prison and Pay Nearly $920,000 in Restitution for Defrauding InvestorsRead the Press Release
Oklahoma City, Oklahoma – Today, GREGORY SCOT CONRADY, 52, of Edmond, Oklahoma, was sentenced by United States District Judge Timothy D. DeGuisti to serve 12 months and one day in prison for money laundering and wire fraud, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Conrady was also sentenced to pay $919,150.74 in restitution to two victims, serve two years of supervised release after his release from prison, and perform 104 hours of community service.
According to court documents and information from court proceedings, in April of 2007 Conrady solicited financial backing from investors to purchase portfolios of distressed debts for pennies on the dollar and then attempted to collect those debts to make money. Conrady used debt brokers to locate debt portfolios for purchase, with the debts consisting primarily of promissory notes secured by mortgages on residential properties. Conrady formed Coltate Capital, LLC, and the investors invested over $10 million to carry out this enterprise.
From November of 2007 through April of 2010, Conrady defrauded the investors by reporting broker’s fees substantially higher than what he actually negotiated with the broker and diverting the excess funds to Conrady’s personal companies, Coltate Properties, LLC, and Silverstreak, LLC. Conrady’s fraudulent scheme also involved the misappropriation of individual mortgage payments that were mailed to Coltate Capital, LLC.
Conrady was indicted by a federal grand jury on July 17, 2012. He pled guilty to committing money laundering and mail fraud on August 29, 2012.
This case was investigated by the Internal Revenue Service Criminal Investigation, Federal Bureau of Investigation, and the United States Secret Service. The case was prosecuted by Assistant U.S. Attorney Amanda Maxfield Green.
Former Car Dealer to Serve Sixteen Months in Prison and Pay More Than $276,000 in Restitution for Bank FraudRead the Press Release
Oklahoma City, Oklahoma – John B. Langley, 62, of Harrah, Oklahoma, has been sentenced to serve sixteen months in prison for making a false statement to a federally insured credit union, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. In addition, Langley was ordered to pay $276,216.57 in restitution to his victims.
In 2008 and 2009, Langley owned and operated J&K Langley Corporation, which sold used cars in Oklahoma City under the name Bargain Network Auto Sales. On June 5, 2012, Langley was indicted for fraudulently taking out duplicate loans on multiple vehicles. In particular, the indictment alleged that he borrowed money from Municipal Employees Credit Union and pledged vehicles on his lot as collateral, when he knew that those vehicles had been pledged to Floorplan Xpress, a financing company that specializes in lending money to car dealers. The indictment also alleged that Langley defrauded the credit union by selling collateralized vehicles and failing to give the proceeds to the credit union to satisfy his loans.
On November 7, 2012, Langley pled guilty to giving a fictitious lien release letter on Floorplan Xpress letterhead to Municipal Employees Credit Union on March 23, 2009, in connection with a loan for a 2009 Nissan Maxima.
Today, United States District Judge Joe Heaton sentenced Langley to serve sixteen months in federal prison, based in part on the importance of protecting the integrity of financial institutions. Based on his plea agreement, the court ordered Langley to pay $200,806.57 in restitution to Municipal Employees Credit Union and $75,410.00 to Floorplan Xpress. Langley was also ordered to serve five years of supervised release after he is released from prison.
This case was result of an investigation conducted by the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Scott E. Williams.
CVS to Pay $11 Million to Settle Civil Penalty Claims Involving Violations of Controlled Substances ActRead the Press Release
One of the Largest Settlements Ever Paid for Record-Keeping Violations
By Retail Pharmacy Chain Related to Controlled PharmaceuticalsOklahoma City, Oklahoma -- CVS Pharmacy, Inc., and Oklahoma CVS Pharmacy, L.L.C., (collectively "CVS"), have agreed to pay $11,000,000 to the United States to settle civil penalty claims for record-keeping violations under the Controlled Substances Act and related regulations, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
"The abuse of prescription drugs is a well-documented epidemic inflicting devastating, long-term, effects on individuals, families, and entire communities," said U.S. Attorney Sanford C. Coats. "To combat this problem, it is essential that those who dispense controlled substances comply with DEA's record-keeping requirements. This ensures that dispensers of prescription drugs remain accountable for the controlled substances within their control and makes the illegal diversion of those drugs more difficult. I commend the DEA Office of Diversion Control who diligently pursued this investigation."
"Abuse of prescription drugs is one of the most critical issues we face today. The scope of this problem is alarming," said Acting Special Agent in Charge Daniel R. Salter of the DEA Dallas Field Division. "This settlement reinforces the responsibilities of all pharmacies to prevent the diversion of dangerous drugs. This case highlights DEA's steadfast resolve to combat the growing prescription drug abuse problem in this country by ensuring that all DEA registrants, including nationwide pharmacy chains, are in compliance with the law. This is vital to protect public health and keep our communities safe."
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. Violations of the record-keeping requirements subject DEA registrants to civil monetary penalties.
CVS is a Rhode Island corporation with its corporate headquarters in Woonsocket, Rhode Island. CVS currently operates approximately 7,400 retail pharmacies in the United States that dispense branded and generic prescription drugs, including controlled substance medications, to retail consumers. CVS operates 46 pharmacy retail stores in Oklahoma. Each CVS pharmacy retail store is separately registered with DEA and is assigned a unique DEA registration number to dispense controlled substances as required by the CSA.
The United States has alleged that from October 6, 2005 to October 5, 2011, CVS pharmacy retail stores in Oklahoma and elsewhere violated the CSA and the record-keeping regulations by:
- 1) Creating, entering and maintaining invalid "dummy" DEA registration numbers or numbers other than the valid DEA registration number of the prescribing practitioner on dispensing records, which were at times provided to state prescription drug monitoring programs;
- 2) Filling prescriptions for certain prescribers whose DEA registration numbers were not current or valid; and
- 3) Entering and maintaining CVS dispensing records, including prescription vial labels, in which the DEA registration numbers of non-prescribing practitioners were substituted for the DEA registration numbers of the prescribing practitioners.
In order to resolve the claims by the United States, CVS has agreed to pay $11,000,000 to the government to settle civil penalty claims and acknowledged that each of its DEA-registered retail stores is required to comply with the record keeping requirements as provided under the CSA and the regulations promulgated thereunder. In reaching this settlement, CVS did not admit liability, and the government did not make any concession 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 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. Settlement was concluded with the assistance of the Department of Justice Criminal Division’s Narcotic and Dangerous Drug Section.
Former U.S. Army Captain Sentenced in Oklahoma City to 23 Months in Prison for Conspiracy to Accept Illegal GratuitiesRead the Press Release
WASHINGTON – A former U.S. Army Captain was sentenced today in Oklahoma City to serve 23 months in prison for conspiracy to accept thousands of dollars in gratuities from contractors during his deployment to Baghdad, Iraq, announced Acting Assistant Attorney General Mythili Raman of the Justice Department's Criminal Division and U.S. Attorney for the Western District of Oklahoma Sanford C. Coats.
Sean Patrick O'Brien, 38, of Lawton, Okla., was sentenced by U.S. District Judge Stephen P. Friot in the Western District of Oklahoma. In addition to his prison term, O'Brien was sentenced to serve three years of supervised release and ordered to pay $37,500 in restitution to the United States.
O'Brien pleaded guilty on Nov. 9, 2012, to a criminal information charging him with two counts of conspiracy to accept illegal gratuities.
According to court documents, O'Brien, formerly a commissioned officer in the U.S. Army, assisted in the contracting process of U.S. government funds, and was therefore considered a public official. It is a violation of federal law for officers to accept gratuities from contractors dependent upon them for contracts.
According to court documents, from mid-2008 through January 2009, O'Brien, with the assistance of two alleged co-conspirators, unlawfully sought, received and accepted illegal gratuities for helping Iraqi contractors in connection with U.S. government. O'Brien accepted approximately $37,500 in cash payments and jewelry while stationed in Iraq, which he has repatriated to the United States. One of the alleged co-conspirators also offered O'Brien a vacation to a private island.
This case was prosecuted by Assistant U.S. Attorney Scott E. Williams of the Western District of Oklahoma and by Special Trial Attorney Mark Grider of the Justice Department Criminal Division's Fraud Section, on detail from the Special Inspector General for Iraq Reconstruction (SIGIR). The case was investigated by the Defense Criminal Investigative Service, the Major Procurement Fraud Unit of the U.S. Army Criminal Investigation Command, and SIGIR.
Moore Man Who Stole Veteran Grave Markers from Tribal Cemetary to Sell for Salvage Will Serve Prison TimeRead the Press Release
Grave Markers Stolen Include those of a World War II
Comanche Code Talker and Vietnam VeteranOklahoma City, Oklahoma – Sanford C. Coats, United States Attorney for the Western District of Oklahoma, announced that JASON P. PARAS, 33, of Moore, Oklahoma, was sentenced to serve four months in prison for the theft of two grave markers from a Kiowa-Comanche-Apache Intertribal Cemetery. Paras was charged on the federal court’s Indian country misdemeanor docket on September 20, 2012, and pled guilty on October 18, 2012.
Paras admitted that in June of 2012 he stole several brass grave markers from the Deyo Mission Cemetery, a Kiowa-Comanche-Apache Intertribal Cemetery located on Indian trust land west of Lawton, Oklahoma. The brass grave markers are furnished by the U.S. Department of Veterans Affairs at no cost to the family for deceased military service members. Paras admitted he stole the brass markers to sell to a recycling company in Lawton, Oklahoma, as scrap metal. One of the grave markers was that of a Comanche Tribal member and “Comanche Code Talker” from World War II who was admitted to the Oklahoma Military Hall of Fame in September of 2011. The Comanche Code Talkers were part of a classified special unit of tribal members that used coded messages in the Comanche language to evade detection by German forces during World War II in Europe. Another marker belonged to Comanche tribal member who was a Vietnam veteran. As part of the sentence, Paras will be required to pay to replace the two markers he stole and sold as scrap metal.
The case was investigated by the Comanche Nation Police Department and the Comanche County Sheriff’s Office. The case was prosecuted by Assistant U.S. Attorney Arvo Q. Mikkanen.
Midwest City Man Who Fled to Philippines Following Indictment Related to Ponzi Scheme to Now Serve 118 Months in Federal PrisonRead the Press Release
Ordered to Pay Nearly $4.6 Million in Restitution to Victims
Oklahoma City, Oklahoma – JOE DON JOHNSON, 43, from Midwest City, Oklahoma, was sentenced by United States District Judge David L. Russell to serve 118 months in prison for conspiracy to commit money laundering in connection with a Ponzi scheme involving securities fraud, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Johnson was indicted by a federal grand jury on February 3, 2011, along with Brian William McKye, from Bethany, Oklahoma, on a nine-count indictment. Following the indictment, Johnson fled the United States to the Philippines.
The case against McKye continued and McKye was found guilty of securities fraud and conspiracy to commit money laundering on November 17, 2011, following a three-day jury trial. Evidence from trial showed that from 2006 through 2009, McKye, did business as Global West Funding Ltd., Co. Global West Financial LLC, Global West Financial LLC, Sure Lock Financial LLC, Sure Lock Loans LLC, and The Wave-Goldmade Ltd. McKye used these businesses to market investment contracts whereby investors were guaranteed a monthly rate of return from 6.5% to 20% for 6 to 60 months. Investors were told they had “100% total control” of their money and that the investments were secured by risk free real estate notes. However, McKye was not a registered investment advisor or broker-dealer in the State of Oklahoma and he used the money he received from investors to pay his own personal and business expenses and some limited returns to investors to keep the scheme on-going. Through this Ponzi scheme, McKye defrauded 115 victim-investors out of over $4.5 million. McKye’s companies were shut down by the Oklahoma Department of Securities in the spring of 2009.
In March of 2012, Johnson was apprehended in the Philippines and returned to the United States to face trial. On September 26, 2012, Johnson pled guilty to conspiracy to commit money laundering for his role in the Ponzi scheme involving McKye.
At the sentencing hearing, Judge Russell ordered Johnson to serve 118 months in federal prison, followed by three years of supervised release. In addition, Johnson was ordered to pay 4,592,610.68 in restitution to his victims. McKye was sentenced in April of 2012 to serve 262 months in prison, followed by three years of supervised release, and ordered to pay $4,516,208.97 in restitution to his victims.
This case was investigated by the Criminal Investigations of the Internal Revenue Service and prosecuted by Assistant United States Attorney Susan Dickerson Cox.
Former Owners of Bethany Nursing Home Pay $1.75 Million to Settle Claims of Equity SkimmingRead the Press Release
Oklahoma City, Oklahoma -- Sanford C. Coats, United States Attorney for the Western District of Oklahoma, announced today that JOHN V. RICH and LaWANDA J. RICH, from Tyler, Texas, and EDWIN L. GAGE and ELAINE R. GAGE, from Muskogee, Oklahoma, paid $1,750,000 to settle claims of equity skimming on a project insured by the United States Department of Housing and Urban Development ("HUD").
"HUD insured this project and expected the defendants would abide by their promises that they would use the assets and income from the project appropriately," said U.S. Attorney Coats. "Attempts to hide behind various corporate forms to evade responsibility will not shield the responsible individuals from liability for misuse of HUD program funds. Rather, as these are the public's tax dollars at issue, we will work hard to pursue cases to safeguard the integrity of federal programs."
Regulatory Background
Pursuant to the National Housing Act (the "Act"), HUD insures mortgages to facilitate the construction and rehabilitation of nursing homes, intermediate care facilities, and assisted living facilities. Regulatory agreements are an essential component of the federal financing scheme for projects under the Act. As part of the agreement, HUD agrees not to pursue personal liability for repayment of a mortgage in return for an agreement from mortgagors to operate the project in accordance with the regulatory agreements, which restrict the use of project income and assets. Equity skimming occurs when any part of the rent, assets, proceeds, income, or other funds derived from the project covered by the mortgage are used for any purpose other than to meet actual or necessary expenses of the project.
Background of Litigation
On September 13, 2010, the United States filed a civil Complaint on behalf of the HUD styled United States v. John V. Rich, LaWanda J. Rich, Edwin L. Gage, Elaine R. Gage, Virginia L. Moore, and David E. Forgy, CIV-10-990-M (W.D. Okla.). In this suit, the United States sought recovery of assets and income of the Center that was used in violation of the terms and conditions of the HUD regulatory agreements.
In February 1997, HUD had insured a mortgage on a nursing home in Bethany, Oklahoma, called Heartland Health Care Center of Bethany (the "Center"), which required a HUD regulatory agreement. At the time of the mortgage, the six individual defendants were the owners of the parent company and the officers/directors of the management company that owned the property holding company. After the project experienced financial trouble, the mortgage went into default and HUD foreclosed on the loan. Further, the ownership and management entities declared bankruptcy.
An audit by HUD's Office of Inspector General reported that project revenue was used in violation of the HUD regulatory agreement, the books and records did not support the Center’s expenditures, and the Center officials could not supply documents to support millions of dollars in project revenue.
In 2007, David E. Forgy, an executive for the Center, was indicted by a federal grand jury on charges including equity skimming in United States v. David E. Forgy, Case No. 07-CR-74-M (W.D. Okla.). In September 2007, Forgy pled guilty to one count of making a false claim and one count of misprision of a felony related to the civil defendant’s misuse of Center income and assets. In May of 2008, he was sentenced to serve 12 months and one day in prison, followed by three years of supervised release.
Resolution
In order to resolve the claims by the United States, the defendants agreed to a settlement that calls for the Riches and Gages to pay $1,750,000 to the United States. In reaching this settlement, the defendants did not admit liability, and the government did not make any concession 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 conducted by auditors and agents of the United States Department of Housing and Urban Development Office of Inspector General and was prosecuted by Assistant United States Attorneys Scott Maule and Tom Majors.
Oklahoma City Man Pleads Guilty to Making Threat to Commit Violence in WyomingRead the Press Release
Oklahoma City, Oklahoma – Today, GLENN ALLEN KIRKHAM, 34, of Oklahoma City, Oklahoma, pled guilty to making a threat to commit violence in Casper, Wyoming, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
On January 14, 2013, public officials in and around Casper, Wyoming, received numerous reports from various sources of a threatened attack in Casper using multiple types of weapons. The threat had been posted from Oklahoma City on 4chan.org, an internet-based bulletin board service. The posting was quickly distributed throughout the social media and caused significant concern in the community. The threat came not long after Casper had experienced a homicide/suicide at a local college. As a result of the threat, officials immediately took precautions that included placing 40 schools on lockdown, notifying hospitals and nursing homes, and placing police officers at potential locations of an attack.
At the plea hearing today, Kirkham admitted that he made the threat. A sentencing hearing is set for June 19, 2013, where Kirkham faces up to five years in prison and a $250,000 fine, plus mandatory restitution for the cost of emergency responders.
This case is the result of an investigation by the Federal Bureau of Investigation and the Casper Police Department in Wyoming. The case is being prosecuted by Assistant U.S. Attorneys Mark A. Yancey and Scott E. Williams.
Jury Convicts Edmond Man of Transporting and Downloading Child PornRead the Press Release
Oklahoma City, Oklahoma – Late last week, JORY MICHAEL NANCE, 28, of Edmond, Oklahoma, was convicted by a jury of 57 out of 59 counts of transportation, receipt, and attempted receipt of child pornography, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
The jury convicted Nance of transporting child pornography across state lines as he traveled with his job as well as transferring child pornography to an undercover Edmond Police Department detective through peer-to-peer file sharing. The jury also convicted Nance of downloading and attempting to download child pornography through peer-to-peer file sharing.
Nance was charged in a Superseding Indictment returned by a federal grand jury on January 22, 2013. United States District Court Judge Joe Heaton will sentence Nance in approximately three months. For each count, he faces at least five years and up to 20 years in prison, a $250,000 fine, and 5 years to life supervised release. Upon release from prison, Nance will have to register as a sex offender.
This case was part of Project Safe Childhood, the flagship program in the Department of Justice’s National Strategy for Child Exploitation Prevention and Interdiction, and was the result of an investigation conducted by the Edmond Police Department and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorneys Brandon Hale and Chris M. Stephens.
Former Tulsa Public Schools Athletic Director Pleads Guilty to Theft of School District FundsRead the Press Release
Tulsa, Oklahoma – Today, STEPHANIE SPRING, 45, from Tulsa, Oklahoma, pled guilty to theft of funds from the Tulsa Public School district before United States District Judge John E. Dowdell at the Page Belcher Federal Courthouse in Tulsa, Oklahoma, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Spring is the former Athletic Director of the Tulsa Public Schools, a recipient of federal funds from the U.S. Department of Education. It is alleged that during 2011, while serving as Athletic Director, Spring rented certain school facilities and misappropriated rental proceeds by depositing those funds into her own personal account.
Today, Spring entered a guilty plea and agreed that she owes $92,218.72 in restitution to the Tulsa Public Schools.
At sentencing, Spring faces up to ten years in federal prison, a fine of up to $250,000 and mandatory restitution. A sentencing date will be set by the Court.
This case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Vicki Zemp Behenna.
Cordell Veterinarian Pleads Guilty to Making False Statements to Defraud BankRead the Press Release
Oklahoma City, Oklahoma – Today, DAVID L. STURGEON, 63, from Cordell, Oklahoma, has pled guilty to making false statements to defraud the Bank of Cordell, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Sturgeon is a large animal veterinarian who operates the Washita Veterinarian Clinic and lives in Cordell, Oklahoma. Sturgeon also bought and sold cattle as a manager partner of 20/20 Cattle and Consulting L.L.C and S&D Cattle L.L.C. According to an Information filed on February 21, 2013, from December 2007 through December 2008, Sturgeon secured several loans based on a revolving line of credit extended by Bank of Cordell. Under the loan agreements, loan advances were to be used by Sturgeon for the purchase of cattle which served as collateral for the loan funds advanced. Proceeds from the sale of the cattle were to be used by Sturgeon to pay off the loans owed to Bank of Cordell. During this same time, Sturgeon had two commodities trading accounts with R.J. O'Brien, a commodities firm located in Chicago, Illinois ("RJO"), that he used to make trades in agricultural commodities.
In 2008, RJO required Sturgeon to make certain deposits in his trading accounts to meet margin calls. During the plea hearing today, Surgeon admitted that on August 6, 2008, he represented to the Bank of Cordell that he needed a loan advance of $36,000 to purchase 70 head of cattle for the purpose of influencing the Bank of Cordell to advance him the loan. However, Sturgeon admitted that the loan was not used to purchase cattle and his statements were falsely made so he could fraudulently divert loan funds to make margin calls on the two RJO commodities accounts.
At sentencing, Sturgeon faces up to 30 years in prison, a fine of up to $1,000,000, and mandatory restitution. A sentencing date will be set by the Court in approximately 90 days.
This case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorneys Ross N. Lillard, III, and Robert J. Troester.
Blackwell Fireman and Police Officer Charged with Illegal Possession of Fully Automatic Russian Ak-47 Machine GunRead the Press Release
Oklahoma City, Oklahoma – TROY RON AEBISCHER, 30, of Blackwell, Oklahoma, and JOHN HARVEY, 26, of Ponca City, Oklahoma, have been charged for illegal possession of an unregistered fully automatic Russian AK-47 machine gun, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Aebischer is a member of the Blackwell Fire Department who holds a current federal firearm license to both purchase and sell firearms out of his home-based business located in Blackwell, Oklahoma. Harvey is a patrolman with the Blackwell Police Department.
The federal complaints filed today alleges that on February 26, 2013, Aebischer contacted a Blackwell Police Officer seeking to sell the Russian-made fully automatic AK 47 machine gun. It is further alleged that Aebischer bought the firearm from Harvey on or about February 17, 2013, after Harvey smuggled it back from Afghanistan following a military deployment. It is alleged that the Blackwell Police Department and Bureau of Alcohol Tobacco Firearms and Explosives set up a sting operation which arranged for an officer to meet with Aebischer to examine and test fire the AK-47. The officer later arranged to purchase the weapon from Aebischer for $2,000 on February 28, 2013.
Both Aebischer and Harvey were arrested on March 1, 2012, and appeared this afternoon in federal court in Oklahoma City. They were each released on $5,000 unsecured bond.
If convicted, Aebischer and Harvey each face up to ten years in prison and a $250,000 fine. The public is reminded that the complaint is merely an accusation and that the defendants are presumed innocent unless and until proven guilty. Reference is made to the complaints for further information.
This case is the result of an investigation by the Bureau of Alcohol Tobacco Firearms and Explosives and the Blackwell Police Department. The case is being prosecuted by United States Attorney Sanford C. Coats and Assistant U.S. Attorney Edward J. Kumiega.
Army Private Pleads Guilty to First Degree Murder of Ten-Year-Old Boy at Fort Sill Army PostRead the Press Release
Lawton, Oklahoma – Today, CONNELL C. WILLIAMS, 33, from Virginia, has pled guilty to first degree murder in the starvation death of a ten-year-old boy on Fort Sill Army Post, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
"Marcus was a ten-year-old boy who was robbed of his life and subjected to a horrific and agonizing death by starvation," said U.S. Attorney Sanford C. Coats. "Although nothing can bring Marcus back, I am gratified that Connell Williams has accepted responsibility for his crime. By pleading guilty, he will be in a federal prison cell for the rest of his life and never again harm a child. I thank the investigators and the prosecution team who worked tirelessly to seek and obtain justice for Marcus in this case."
Williams, an enlisted member of the United States Army, was assigned as a PFC to the 214th Fires Brigade at Fort Sill in Comanche County, Oklahoma, in August 2010. Court proceedings showed that in September 2010, CANDICE C. HOLLOWAY, 32, from Norfolk, Virginia, and her two children moved into Fort Sill military housing with Williams. Williams and Holloway were not married and Williams is not the biological father of the two children. From early 2011 through May of 2011, Williams and Holloway intentionally withheld food from Marcus as a form of punishment, which ultimately resulted in his death on May 5, 2011. Marcus was ten-years-old at the time of his death.
Williams and Holloway were charged by indictment with first degree child abuse murder on September 7, 2011. On April 16, 2012, Holloway pled guilty to first degree murder in exchange for an agreement to serve a 30 year term in prison, followed by a five years of supervised release, and to cooperate with the prosecution and testify against Williams at his trial.
The Department of Justice originally sought the death penalty against Williams. The trial began last week and Holloway testified against Williams last Friday. In exchange for Williams’ plea of guilty to first degree murder and acceptance of a life sentence, the Department of Justice agreed to withdraw the notice to seek the death penalty. The Court accepted this guilty plea early this morning and Williams will receive a sentence of life without the possibility of release.
This case was investigated by the Federal Bureau of Investigation and the United States Army Criminal Investigation Division. The case is being prosecuted by United States Attorney Sanford C. Coats and Assistant U.S. Attorneys Randal A. Sengel and Robert A Bradford.
Oklahoma City Man Indicted for Threat to Commit Violence in WyomingRead the Press Release
Oklahoma City, Oklahoma – GLENN ALLEN KIRKHAM, 34, of Oklahoma City, Oklahoma, has been indicted by a federal grand jury for making a threat to commit violence in Casper, Wyoming, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
The indictment alleges that on January 14, 2013, public officials in and around Casper, Wyoming, received numerous reports from various sources of a potential imminent attack in the city that had been posted on 4chan.org, an internet-based bulletin board service. Among other precautions, officials placed several dozen public schools in Casper, Wyoming, and Natrona County, Wyoming, on lockdown.
If convicted, Kirkham faces up to five years in prison and a $250,000 fine, plus mandatory restitution. The public is reminded that the indictment is merely an accusation and that the defendant is presumed innocent unless and until proven guilty. Reference is made to the indictment and other public filings for further information.
This case is the result of an investigation by the Federal Bureau of Investigation and the Casper Police Department in Wyoming. The case is being prosecuted by Assistant U.S. Attorneys Mark A. Yancey and Scott E. Williams.
U.S. Attorneys Timothy Q. Purdon and Sanford C. Coats to Lead Attorney General’s Native American Issues SubcommitteeRead the Press Release
WASHINGTON – Attorney General Eric Holder announced today the appointment of U.S. Attorney for the District of North Dakota Timothy Q. Purdon as chair of the Native American Issues Subcommittee (NAIS) of the Attorney General’s Advisory Committee of U.S. Attorneys (AGAC). Attorney General Holder also appointed U.S. Attorney for the Western District of Oklahoma Sanford C. Coats to serve as vice chair.
"The Native American Issues Subcommittee, the oldest subcommittee of the Attorney General’s Advisory Committee, is vital to the department’s mission in Indian Country to build and sustain safe and secure communities for future generations," said Attorney General Holder. "I am confident that U.S. Attorneys Purdon and Coats have the expertise and dedication to lead this important group as we work to fulfill the department’s role in protecting and serving this country’s first Americans."
U.S. Attorney Purdon was appointed to the NAIS in 2010, and he served as vice chair throughout 2012. U.S. Attorney Purdon replaces U.S. Attorney for the District of South Dakota Brendan V. Johnson.
U.S. Attorney Coats was appointed to the NAIS in 2010, and he also served in the AGAC from 2010 through 2011. U.S. Attorney Coats continues his work with the AGAC’s Resource Allocation Working Group.
Attorney General Holder also thanked U.S. Attorney Johnson for serving as chair of the NAIS for the past three years, 2009-2012. "Brendan Johnson’s dedication and commitment to improving public safety in Indian Country will continue to positively impact tribal communities for years to come. His leadership has brought the U.S. Attorney community together to address a myriad of important issues in Indian Country, and his guidance has been an invaluable asset to this department. I look forward to my ongoing work with U.S. Attorney Johnson as a member of the AGAC."
The AGAC was created in 1973 to serve as the voice of the U.S. Attorneys and to advise the Attorney General on policy, management, and operational issues impacting the offices of the U.S. Attorneys. The NAIS is made up of 30 U.S. Attorneys from across the United States whose Districts contain Indian Country or one or more federally recognized tribes. The NAIS focuses exclusively on Indian Country issues, both criminal and civil, and is responsible for making policy recommendations to the Attorney General of the United States regarding public safety and legal issues that impact tribal communities.
Enid Man to Serve 36 Months in Federal Prison for Failure to Register as A Sex OffenderRead the Press Release
Oklahoma City, Oklahoma – Sanford C. Coats, United States Attorney for the Western District of Oklahoma, announced that WILLIAM K. ECHOLS, 28, of Enid, Oklahoma, was sentenced today by United States District Judge Stephen P. Friot to serve 36 months in prison for failure to register as a sex offender. Upon his release, Echols will be under the Supervision of United States Probation Office for ten years.
After traveling with the carnival around the United States, Echols was discovered in Enid, Oklahoma, by the United States Marshals after an anonymous tip through the website TipSoft.com. Echols was subsequently indicted by the federal grand jury in April of 2012 and charged with failing to register as a sex offender. Echols was required to register under the Sex Offender Registration and Notification Act (Adam Walsh Act) following his 2004 conviction in Trinity County Superior Court in California for Molesting a Child. In August of 2012, Echols entered a guilty plea to the charge in the indictment of failing to register as a sex offender. The defendant also has four prior convictions for failing to register as a sex offender in Nebraska, California, and Oregon.
This case was brought as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the U.S. Attorneys Offices, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit .
The case was investigated by the United States Marshals Service and was prosecuted by Assistant U.S. Attorney Robert Don Gifford.
Realtor Sentenced to 30 Months for Mortgage FraudRead the Press Release
Oklahoma City, Oklahoma – SAFIYYAH TAHIR BATTLES, formerly a real estate agent with T&T Realty in Oklahoma City, has been sentenced to thirty months in prison for mortgage fraud and money laundering, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma
On June 21, 2012, a jury convicted Battles of using an interstate wire facility to defraud Saxon Mortgage and engaging in a monetary transaction with more than $10,000 from the proceeds of crime. The evidence at trial showed that in April of 2007, she used her sister’s mortgage brokerage company, Lending Leaders, to apply for a $500,000.00 loan from Saxon Mortgage of Fort Worth, Texas. Saxon required her to provide twelve months of bank statements to support her income and assets. The jury heard evidence that the bank statements had been altered by adding more than $100,000.00 to the ending balance on each statement, by deleting her husband’s name as an account holder, and by removing numerous overdraft fees.
At the closing on May 4, 2007, Battles signed a final loan application that stated falsely that she earned $344,677.92 per year and had $165,907.70 in her bank account. According to a tax return that she filed in March of 2009, Battles’s adjusted gross income for 2006 was $14,001.00; according to the records of First Security Bank, her actual account balance on May 4, 2007, was $852.50.
Based on the application information, a forged letter, and communications with the mortgage brokerage on the day of closing, Saxon Mortgage authorized $102,630.01 from the loan proceeds to be paid to a local builder. Battles took the $102,630.01 check at closing, deposited into her own bank account, and used it for her own purposes. The money-laundering count relates to a $15,000.00 check that Battles wrote to her mother, Trina Tahir, two days after she deposited the $102,630.01 check.
Today, United States District Judge Timothy D. DeGiusti sentenced Battles to thirty months in prison and ordered her to pay restitution of $326,902.34. She will be required to serve two years on supervised release after her prison term, including 104 hours of community service. The court also imposed a forfeiture judgment in the amount of $102,630.01. The sentence was based on the counts of conviction, as well as fraud that Battles perpetrated in connection with five other residential mortgages.
This sentence is the result of an investigation conducted by the IRS Criminal Investigation and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorneys Scott E. Williams and Chris M. Stephens.
Former Owner of Metro Pool Company Pleads Guilty to Tax FraudRead the Press Release
Oklahoma City, Oklahoma – Today, THEODORE MICHAEL ZACHRITZ, of Nichols Hills, Oklahoma, pled guilty to willfully failing to pay over to the Internal Revenue Service federal taxes that he withheld from his employees’ wages, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
For many years, Zachritz and his wife owned and operated Lifestyle Pools, LLC in Oklahoma City. As owner of the company, Zachritz deducted and withheld federal income taxes, Social Security taxes, and Medicare taxes (commonly called “payroll taxes”) from wages of Lifestyle Pools employees. Under federal law, an employer must deduct and withhold payroll taxes from employees’ wages, and then pay over those withheld taxes to the IRS at the end of each quarter.
On January 22, 2013, the United States charged Zachritz with willfully failing to collect and pay over to the IRS the federal income taxes, Social Security taxes, and Medicare taxes withheld from wages of Lifestyle Pools employees for the third quarter of 2006 through the end of 2009. At today’s plea hearing, Zachritz admitted that he deducted and withheld more than $290,000 in payroll taxes from his employees’ wages during that period. He also admitted that he knew he was required by law to turn over to the IRS the withheld federal payroll taxes each quarter, but he did not do so. Zachritz admitted that he still has not paid over to the IRS any of the payroll taxes that he withheld from 2006 to 2009.
At sentencing, Zachritz faces a potential penalty of up to five years in prison, a fine up to $250,000, and restitution to the IRS. In a plea agreement, Zachritz agreed to pay restitution to the IRS in the amount of his criminal conduct. The court will determine the specific amount of restitution due to the IRS at sentencing, which will take place in approximately ninety days.
This case is the result of an investigation conducted by the IRS Criminal Investigation and is being prosecuted by Assistant U.S. Attorney Chris M. Stephens.
Former Convicted Felon and Gang Member to Serve 46 Months in Prison for Possession of Firearms Purchased at Gun ShowRead the Press Release
Oklahoma City, Oklahoma – JORDAN ABE CHAVIRA, 22, of Oklahoma City, was sentenced by United States District Judge Stephen P. Friot to serve 46 months in prison for unlawful possession of firearms as a prior convicted felon, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. The firearms were purchased at a local gun show.
"It is a priority of this office to work with law enforcement to keep firearms out of the hands of felons," said U.S. Attorney Coats. "The defendant, a convicted felon, was able to purchase two semiautomatic firearms and ammunition at a local gun show without the necessity of a background check. Fortunately, alert Oklahoma City Police Officers were able to arrest and unarm the defendant before a violent crime was committed. Anyone who is legally prohibited from possessing firearms or ammunition, including convicted felons, better think twice before doing so. Law enforcement is committed to protecting law-abiding citizens from gun violence, and at the core of that effort is the apprehension and prosecution of felons who possess guns."
"The successful prosecution of Chavira by U.S. Attorney Coats highlights the cooperation between the Oklahoma City Police Department and ATF during the last 13 months to proactively keep firearms out of the hands of criminals who use gun show venues to purchase firearms," said OCPD Chief Bill Citty.
"This investigation is an example of ATF's partnership with the Oklahoma City Police Department to address violent crime associated with violent gangs and convicted felons in the Oklahoma City area as they attempt to illegally acquire firearms as tools of their trade," said Robert R. Champion, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives.
According to Judge Friot’s findings at sentencing, attached below, Chavira is a convicted felon and former member of the Southside Locos, a gang with a long history of violent criminal activity in Oklahoma City. On March 18, 2012, gang enforcement officers from the Oklahoma City Police Department were participating in a surveillance of a gun show in Oklahoma City. At the gun show, officers overheard Chavira approach a vendor and say, “no paperwork right,” referring to an ATF form used for a background check in order to purchase a firearm. After the dealer stated that paperwork was required because he was a federal firearms licensee, Chavira walked away and did not purchase any items from that dealer.
At the gun show, Officers observed Chavira purchase an Intratec 9 mm semiautomatic machine pistol with a high capacity magazine walk from one private vendor, a Glock Model 22, 40 caliber semiautomatic handgun from a different private vendor, and ammunition from a yet another private vendor. Each of these purchases was made by Chavira with cash and without any receipts or other paperwork completed.
Chavira and his friend left the gun show in a vehicle which was subsequently stopped by OCPD officers. In the vehicle, officers found a 9 mm semiautomatic handgun capable of handling a large capacity 32-round magazine, a .40 caliber Glock Model 22 semiautomatic handgun, three high capacity magazines, one box of 9 mm bullets with 40 rounds, and .22 caliber bullets.
Chavira was indicted on June 5, 2012. On August 10, 2012, he pled guilty to the indictment without a plea agreement.
Judge Friot ordered that Chavira serve 46 months in federal prison, followed by three years of supervised release. As a convicted felon, Chavira is prohibited from possessing firearms or ammunition in the future.
This case was the result of an investigation conducted by the Oklahoma City Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant U.S. Attorney Lee Borden.
Reference is made to court documents for further information.
Former College Bursar Sentenced to 27 Months in Prison for Embezzlement SchemeRead the Press Release
Ordered to Repay Over $398,000 in Restitution to College
Oklahoma City, Oklahoma – Today, BRANDI J. HENSON, 49, of Yukon, Oklahoma, was sentenced to 27 months in federal prison in connection with a scheme to embezzle nearly $400,000 from Oklahoma City Community College, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Henson worked as the bursar at Oklahoma City Community College (“OCCC”) from 2003 through 2011. As bursar, she had access to the college’s PayPal account. PayPal allows users to maintain financial accounts for the purpose of transferring money over the Internet. In her duties as bursar, Henson used OCCC’s PayPal account to process refunds to students’ credit cards.
Henson was charged on July 10, 2012, with wire fraud relating to a scheme to embezzle money from OCCC. On August 16, 2012, Henson pled guilty to one count of wire fraud. At the plea hearing, she admitted that she improperly used the college’s PayPal account to post refunds/credits to her personal credit cards. Henson also admitted that the embezzlement scheme lasted from 2004 to 2011. According to the Information filed against her, Henson paid off more than $398,000 in personal credit card bills with OCCC refunds that she posted to her personal accounts.
At today’s sentencing, United States District Judge David L. Russell sentenced Henson to 27 months in federal prison, followed by three years of supervised release. In addition, Judge Russell ordered Henson to pay restitution to OCCC in the amount of $398,315.12. Henson must report to federal prison on February 18, 2013.
The case is the result of an investigation conducted by the Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorney Chris M. Stephens.
Former DHS Worker Sentenced to 37 Months in Prison for FraudRead the Press Release
Oklahoma City, Oklahoma – Yesterday, KATHARINE ANNE DAUGHERTY, 57, of Bethany, Oklahoma, was sentenced to serve 37 months in prison in connection with a scheme to take money by false pretenses from the United States Department of Labor, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Daugherty worked for many years as an Adult Protective Services Specialist with the Oklahoma Department of Human Services ("DHS"). At DHS, Daugherty oversaw the financial accounts of persons placed under the guardianship of DHS Adult Protective Services. In 2009, an Oklahoma state judge appointed DHS as the guardian for "L.J.A.," an elderly man in a Bethany nursing facility. Daugherty was added as a trustee and signatory to L.J.A.’s bank account in May 2009. L.J.A. received monthly disability compensation benefits from the Office of Workers’ Compensation Programs within the United States Department of Labor. L.J.A. died in March 2010, and his entitlement to federal benefits ended upon his death.
On September 11, 2012, Daugherty was charged in a one-count Information with wire fraud. The Information alleged that from March 2010 to May 2011, Daugherty defrauded the Department of Labor through false documents that induced the agency after L.J.A.’s death to continue paying monthly benefits to L.J.A.’s bank accounts that Daugherty controlled. According to the Information, Daugherty caused the Department of Labor to issue more than $27,000 in fraudulent benefits after L.J.A.’s death.
On September 27, 2012, Daugherty pled guilty to the wire fraud count. Daugherty admitted that after L.J.A.’s death, she closed out his case at DHS, but did not notify the Department of Labor of his death. She admitted that in July 2010, months after L.J.A.’s death, she used DHS letterhead to write a letter asking the Department of Labor to mail L.J.A.’s benefits to her at the DHS office. She also admitted that she submitted to the Department of Labor a forged state-court order that appeared to continue DHS guardianship well after L.J.A.’s death. She admitted that in December 2010, she set up and controlled a bank account in L.J.A.’s name to deposit the federal benefits issued in his name. Finally, at the plea hearing, she admitted to using for her personal benefit money that came into L.J.A.’s accounts after his death.
At yesterday’s sentencing, United States District Judge Joe Heaton sentenced Daugherty to 37 months in federal prison, followed by three years of supervised release. Daugherty was ordered to pay restitution to the United States Department of Labor in the amount of $5,451.99. She was also ordered to pay $1,985 in restitution for theft from an unrelated victim under DHS guardianship. Daugherty must report to federal prison on February 4, 2013.
This case is the result of an investigation conducted by the United States Department of Labor – Office of Inspector General and the Oklahoma Department of Human Services – Office of Inspector General. The case was prosecuted by Assistant United States Attorney Chris M. Stephens.
Altus Man to Serve Two Years in Prison for Illegal Possession of Claymore MineRead the Press Release
Oklahoma City, Oklahoma – DALE HOWARD BRUNO, 59, from Altus, Oklahoma, was sentenced by United States District Judge David L. Russell to serve 24 months in federal for illegal possession of a functional Claymore mine, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to Court records and proceedings, Bruno was an Army instructor at Fort Sill, Oklahoma, and stole a Claymore mine while working at Fort Sill. Following a tip that Bruno had a Claymore mine, law enforcement discovered Bruno to be in possession of a fully functional Claymore mine on October 28, 2011. A Claymore mine is a military weapon containing approximately1.5 pounds of C4 plastic explosive and embedded approximately 700 steel ball bearings. It is engineered as a directional antipersonnel weapon to inflict death or serious bodily injury over a large area.
Bruno pled guilty on September 24, 2012, to unlawful possession of the Claymore mine. At sentencing, Judge Russell ordered that Bruno serve 24 months in prison followed by two years of supervised release.
This case was the result of an investigation conducted by the Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorney Ed Kumiega.