District of Oregon
Press releases recorded for this federal judicial district.
Jackson County Man Sentenced to 10 Years in Prison for Distributing Cocaine and Trading Cocaine for FirearmsRead the Press Release
MEDFORD, Ore.—On Thursday, April 18, 2019, Jonathan Alan Ochoa, 31, of Talent, Oregon, was sentenced to 120 months in federal prison and five years’ supervised release for conspiring to distribute and possess with intent to distribute cocaine and possessing a firearm in furtherance of a drug trafficking crime.
“Mr. Ochoa’s actions show a blatant disregard for the law and public safety. The lengthy prison sentences ordered in this case reflect the seriousness of mixing firearms and drug trafficking,” said Billy J. Williams, U.S. Attorney for the District of Oregon. “I thank the ATF agents involved in bringing Mr. Ochoa and Mr. Manzer to justice. Our communities are safer thanks to their efforts.”
“Mr. Ochoa compounded his drug dealing by accepting firearms in trade for illicit drugs,” said ATF Seattle Field Division Special Agent in Charge Darek Pleasants. “His willingness to engage in this lawless behavior undermines the safety and security of his community and contributes to other related criminal activities. His sentence is appropriate and serves to send a message to the community that actions like this will not be tolerated.”
According to court documents, between July and August 2017, Ochoa agreed and conspired with co-defendants Gonzalo Manzo, Jr. and Rodolfo Quevedo to send more than 500 grams of cocaine from California to Oregon to sell and distribute to others. During this time, Ochoa and Manzo negotiated a sale of cocaine with an undercover agent from the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) in exchange for multiple firearms.
On August 17, 2017, at Manzo’s request, Quevedo transported approximately 1000 grams of cocaine from California and delivered it to Ochoa in the Medford area. The firearms and cash were intended to be transported back to California but agents arrested Ochoa and his co-conspirators and the firearms were seized by law enforcement.
Manzo pleaded guilty to the same charges in August 2018 and was sentenced to 188 months in prison and three years’ supervised release on December 11, 2018. Quevedo pleaded guilty in September 2018 to a single count of conspiracy to distribute and possess with intent to distribute cocaine and was sentenced to one year and one day in prison and five years’ supervised release on December 20, 2018.
Ochoa previously pleaded guilty to one count each of conspiracy to distribute and possess with intent to distribute cocaine and possession of a firearm in furtherance of a drug trafficking crime on October 29, 2018.
This case was investigated by ATF and is being prosecuted by Nathan J. Lichvarcik and Adam E. Delph, Assistant U.S. Attorneys for the District of Oregon.
The case is part of Project Safe Neighborhoods (PSN). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Former Aequitas Owner and Executive Vice President Pleads Guilty in Fraud and Money Laundering ConspiracyRead the Press Release
PORTLAND, Ore.—U.S. Attorney Billy J. Williams announced today that Brian A. Oliver, a former owner and executive vice president of Aequitas Management, LLC and several other Aequitas-related companies has pleaded guilty to conspiring to commit mail and wire fraud and money laundering.
According to court documents, Oliver, 54, of Aurora, Oregon, and unnamed co-conspirators used the Lake Oswego, Oregon, based company to solicit investments in a variety of notes and funds, many of which were purportedly backed by trade receivables in education, health care, transportation, and other consumer credit areas. Oliver was the company’s primary fundraiser and shared responsibility for the operation and management of Aequitas-affiliated companies and investment products as well as for the use of investor money.
From June 2014 through February 2016, Oliver and others solicited investors by misrepresenting the company’s use of investor money, the financial health and strength of Aequitas and its related companies, and the risks associated with its investments and investment strategies. Oliver and his co-conspirators also failed to disclose other critical facts about the company, including its near-constant liquidity and cash-flow crises, the use investor money to repay other investors and to defray operating expenses, and the lack of collateral to secure funds.
Oliver faces a maximum sentence of 30 years in prison, a $250,000 fine or twice the gross monetary gains or losses resulting from his crimes, and three years’ supervised release. He will be sentenced on August 5, 2019 before U.S. District Court Judge Michael W. Mosman.
As part of the plea agreement, Oliver has agreed to pay restitution in full to each of victim’s as determined and ordered by the court.
This case is being investigated by the FBI, IRS Criminal Investigation, and the U.S. Department of Labor Employee Benefits Security Administration. It is being prosecuted by Scott E. Bradford and Ryan W. Bounds, Assistant U.S. Attorneys for the District of Oregon.
Bend Police Department Featured in Justice Department Report on Improving Safety and Wellness of Law EnforcementRead the Press Release
WASHINGTON – On April 17, 2019, the Department of Justice released two complementary reports focusing on the mental health and safety of the nation’s federal, state, local and tribal police officers. The Bend Police Department in Bend, Oregon was featured in the report as one of eleven law enforcement agencies demonstrating a range of innovative approaches to safeguarding the mental health of both sworn and nonsworn employees.
The reports, Law Enforcement Mental Health and Wellness Act: Report to Congress and Law Enforcement Mental Health and Wellness Programs: Eleven Case Studies, were published by the Office of Community Oriented Policing Services (COPS Office) as required by the Law Enforcement Mental Health and Wellness Act (LEMHWA) of 2017.
The LEMHWA passed both chambers unanimously and without amendment and was signed by the President shortly thereafter. These actions show that its purpose and intended effects are uncontroversial among policymakers – law enforcement agencies need and deserve support in their ongoing efforts to protect the mental health and well-being of their employees. Congress took the important step in improving the delivery of and access to mental health and wellness services that will help our nation’s more than 800,000 federal, state, local, and tribal law enforcement officers.
“Serving as a law enforcement officer requires courage, strength, and dedication,” Attorney General William P. Barr said. “The demands of this work, day in and day out, can take a toll on the health and well-being of our officers, but the Department of Justice is committed to doing our part to help. I want to thank the men and women of our COPS office for their hard work to support our officers every day, and specifically for these thoughtful and insightful reports, which detail both the challenges facing our officers and some specific ways we can give them the support that they deserve.”
“We are incredibly proud of everyone at the Bend Police Department for the innovative steps taken to protect the mental health of all employees. Not only does this protect officer and staff wellbeing, but it also bolsters public safety. I am grateful to Chief of Police Jim Porter for his leadership and commitment to supporting the men and women under his command.” said Billy J. Williams, U.S. Attorney for the District of Oregon. “I hope that Bend PD’s example will mark the beginning of a new era in policing where protecting the mental health of officers and staff is universally viewed as an essential element of effective law enforcement.”
“A damaging national narrative has emerged in which law enforcement officers – whether federal, state, local, or tribal – are seen not as protectors of communities but as oppressors,” said COPS Office Director Phil Keith. “In this environment, where an inherently stressful job is made more so by a constant undercurrent of distrust and negative public opinion, the risks to officer wellness are exacerbated. This report is an important measure and reflection in our ongoing commitment to protect those who protect us.”
Under the Law Enforcement Mental Health and Wellness Act, the COPS Office was required to submit reports to Congress that addressed:
- Recommendations to Congress on effectiveness of crisis lines for law enforcement officers, efficacy of annual mental health checks for law enforcement officers, expansion of peer mentoring programs, and ensuring privacy considerations for these types of programs;
- Mental health practices and services in the U.S. Departments of Defense (DoD) and Veterans Affairs (VA) that could be adopted by federal, state, local, or tribal law enforcement agencies; and
- Case studies of programs designed primarily to address officer psychological health and well-being.
The first report, Law Enforcement Mental Health and Wellness Act: Report to Congress, includes 22 recommendations to Congress ranging from supporting programs to embed mental health professionals in law enforcement agencies to supporting the development of model policies and implementation guidance for law enforcement agencies to make substantial efforts to reduce suicide.
The case studies report, Law Enforcement Mental Health and Wellness Programs: Eleven Case Studies, is designed to provide an overview of multiple successful and promising law enforcement mental health and wellness strategies with the joint aims of informing Congress, state and local government officials, and the law enforcement field. The report includes 11 case studies from a diverse group of sites across the United States.
The Department of Justice is pleased to respond to the LEMHWA as officer safety, health, and wellness is a longstanding priority of the agency. The reports released today address some of the most pressing issues currently facing our law enforcement community.
The COPS Office has a near 25-year history of supporting the efforts of state, local and tribal law enforcement, including the management of the National Blue Alert Network. The agency awards grants to hire community policing officers, develop and test innovative policing strategies, and provide training and technical assistance to community members, local government leaders, and all levels of law enforcement. Since 1994, the COPS Office has invested more than $14 billion to help advance community policing.
Las Vegas Woman Sentenced to 39 Months in Federal Prison for Operating Fraudulent Tax Return BusinessRead the Press Release
PORTLAND, Ore.—Gloria Harris, 48, of Las Vegas, Nevada, was sentenced today to 39 months in federal prison and three years’ supervised release for operating a fraudulent tax return business. Harris was also ordered to pay more than $548,000 in restitution.
As part of the scheme, Harris prepared more than 100 fraudulent tax returns requesting nearly $600,000 in fraudulent refunds from the IRS.
According to court documents, between 2012 and 2016, Harris operated a covert tax preparation scheme whereby she would file client tax returns as “self-prepared” returns to mask her participation in the filings. Harris would increase the size of the fraudulent returns by falsely claiming that unrelated children were dependents to qualify clients for various tax breaks including the Earned Income Tax Credit.
Harris began to raise suspicion among certain clients by refusing to provide copies of file returns, chastising them for asking questions in writing, and withholding refunds. On one occasion, Harris delivered a $1,400 “refund” in cash to a client in a parking lot. Investigators later learned that this client was a due a refund of more $8,500 from the IRS.
Harris previously pleaded guilty to one count each of making false, fictitious, or fraudulent claims against the U.S. and aggravated identity theft on July 18, 2018.
This case was investigated by IRS Criminal Investigation and prosecuted by Quinn P. Harrington, Assistant U.S. Attorney for the District of Oregon.
Columbia City Man Pleads Guilty to Selling Conunterfeit Rifle Optics OnlineRead the Press Release
PORTLAND, Ore.—On Tuesday, April 16, 2019, Mark Aaron Culp, 56, of Columbia City, Oregon, pleaded guilty to knowingly trafficking counterfeit, Chinese-made Leupold-branded rifle scopes online. Leupold & Stevens, Inc., an Oregon company, manufactures its rifle scopes in Beaverton, Oregon.
According to court documents, between May and July 2015, Culp sold rifle optics bearing various Leupold trademarks and design features online via at least two commercial websites: GunBroker.com and eBay. Culp sold 13 counterfeit rifle scopes that he had imported from China, generating approximately $3,700 in revenue.
Culp’s sales were discovered by Leupold & Stevens personnel. They purchased a scope from Culp online, confirmed that it was counterfeit, and referred the matter to the Beaverton Police Department and the Department of Homeland Security’s Bureau of Immigration and Customs Enforcement.
Culp faces a maximum sentence of 10 years in prison, a $2 million fine and 3 years of supervised release. He will be sentenced on July 18, 2019 before U.S. District Court Judge Anna J. Brown.
This case was investigated by U.S. Immigration and Customs Enforcement, Homeland Security Investigations (HSI). It is being prosecuted by Ryan W. Bounds, Assistant U.S. Attorney for the District of Oregon.
Portland Man Pleads Guilty for Role in Interstate Marijuana Trafficking ConspiracyRead the Press Release
PORTLAND, Ore.—On Thursday, April 10, 2019, Paul Eugene Thomas, 38, of Portland, pleaded guilty to one count of conspiring to manufacture, possess with intent to distribute, and distribute marijuana and maintaining drug involved premises, and one count of money laundering for his role in a vast conspiracy to traffic marijuana grown in Portland to Virginia and Texas.
According to court documents, Thomas and co-defendants Jody Tremayne Wafer, 29, Trent Lamar Knight, 30, and Brittany Lesanta Kizzee, 28, of Houston, Texas and Raleigh Dragon Lau, 33, also of Portland, conspired to manufacture marijuana in Portland, transport it across state lines, and sell it in Virginia and Texas.
Drug proceeds, in the form of bulk U.S. currency, were returned to Oregon via U.S. mail and passenger luggage on commercial airlines. As part of this investigation, federal authorities have seized approximately 11,000 marijuana plants, 546 pounds of processed marijuana, more than $2.8 million in cash, 51 firearms, 26 vehicles, trailers, pieces of heavy equipment, a yacht, and three houses used as marijuana grow sites, all since August 2017.
Conspiring to manufacture, possess with intent to distribute, and distribute marijuana and maintaining drug involved premises carries a maximum sentence of 40 years in prison, a mandatory minimum sentence of 5 years in prison, a $5 million fine, and a lifetime of supervised release. Money laundering carries a max sentence of 20 years in prison, a $250,000 fine, and three years’ supervised release. As part of the plea agreement, Thomas has agreed to forfeit any criminally-derived proceeds and property used to facilitate his crimes identified by the government prior to sentencing.
Thomas will be sentenced on August 6, 2019 before U.S. District Court Judge Robert E. Jones.
Kizzee entered a guilty plea on November 27, 2018, and is scheduled to be sentenced on May 7, 2019. Lau and Knight have scheduled change of plea hearings for April 22, 2019 and May 8, 2019, respectively. Wafer is scheduled for trial on June 18, 2019.
In a related case, in August 2018, Cole William Giffiths was charged of conspiring to manufacture marijuana in Hood River, Oregon and shipping it to Florida. He has scheduled a change of plea hearing for April 22, 2019.
This case was investigated by the U.S. Drug Enforcement Administration, IRS Criminal Investigation, Homeland Security Investigations and the FBI. It is being prosecuted by the U.S. Attorney’s Office for the District of Oregon.
This case was brought as part of the Justice Department’s Organized Crime and Drug Enforcement Task Force (OCDETF) program, the centerpiece of the department’s strategy for reducing the availability of drugs in the U.S. OCDETF was established in 1982 to mount a comprehensive attack on drug trafficking by disrupting and dismantling major drug trafficking and money laundering organizations. Today, OCDETF combines the resources and expertise of its member federal agencies in coordination with state and local law enforcement.
Former Madras Police Officer Sentenced to Six Years in Federal Prison for Repeated Sexual Abuse of MinorRead the Press Release
PORTLAND, Ore.—John Joseph Wallace, Jr., 35, of Madras, Oregon, was sentenced today to 72 months in prison and life term of supervised release for the repeated sexual abuse of a minor.
According to court documents, the government’s investigation of Wallace began in January 2018, when Warm Springs Tribal Police officers responded to Wallace’s home on the Warm Springs Indian Reservation. Officers were responding to a report that Wallace had abused a young girl. The minor victim and her mother, who contacted police to report Wallace’s crimes, are both Warm Springs tribal members.
An investigation later revealed that Wallace, over a period of years, had repeatedly abused the child by touching her breasts, buttocks, and genitals, both over and under her clothing. Wallace used his cell phone to communicate with the child and facilitate multiple incidents of abuse at his home on the reservation and on a separate occasion in Madras.
On January 3, 2019, Wallace pleaded guilty in federal court to three counts of abusive sexual contact with a minor. In a related state court matter, Jefferson County Circuit Court Judge Annette C. Hillman found Wallace guilty of attempted sexual abuse in the first degree and official misconduct in the first degree. Wallace will be sentence in state court on April 12, 2019.
This case was investigated by FBI Portland’s Safe Trails Task Force, the Warm Springs Tribal Police Department, and the Oregon Department of Justice. It was prosecuted federally by Paul T. Maloney, Assistant U.S. Attorney for the District of Oregon.
The Safe Trails Task Force (STTF) unites FBI and other federal, state, local, and tribal law enforcement agencies in a collaborative effort to combat the growth of crime in Indian Country. STTF allows participating agencies to combine limited resources and increase investigative coordination in Indian Country to target violent crime, drugs, gangs, and gaming violations.
Anyone who has information about the physical or online exploitation of children are encouraged to call the FBI at (503) 224-4181 or submit a tip online at www.fbi.gov/tips.
Canadian National Arrested Aboard Sailing Vessel in International Waters Off Oregon Coast, Methamphetamine SeizedRead the Press Release
PORTLAND, Ore.—A criminal complaint was filed today in federal court alleging John Phillip Stirling, 65, a citizen of Canada, illegally possessed with the intent to distribute methamphetamine aboard a U.S. flagged vessel.
According to court documents, on April 9, 2019, while on a routine patrol, the U.S. Coast Guard Cutter Alert detected a sailing vessel traveling north 225 nautical miles from Newport, Oregon. The vessel, named Mandalay, had a home port of Seattle, Washington and visible U.S. registration numbers. When Coast Guard personnel attempted to communicate with Stirling, he went below deck and would only respond via VHF radio. Once Coast Guard personnel determined the Mandalay was a U.S. flagged vessel, they boarded and found Stirling to be the vessel’s sole occupant.
Stirling stated he did not have vessel documentation and refused to produce identification. Upon further questioning, Sterling’s speech began to deteriorate and he displayed signs of a possible drug overdose. Coast Guard personnel administered medical aid to Stirling and evacuated him by helicopter to Astoria, Oregon. He was later transported by ambulance to Adventist Health Portland for additional treatment.
Coast Guard personnel conducted a search of the Mandalay and discovered 28 seven-gallon jugs containing liquid methamphetamine.
Stirling made an initial appearance today in federal court before U.S. Magistrate Judge Stacie F. Beckerman. Stirling was ordered detained pending trial.
A criminal complaint is only an accusation of a crime, and a defendant is presumed innocent unless and until proven guilty.
This case is being investigated by the U.S. Coast Guard Investigative Service (CGIS) and Homeland Security Investigations (HSI).
Tigard Man Sentenced to 15 Years in Federal Prison for Sexually Exploiting Minors Using Social MediaRead the Press Release
PORTLAND, Ore.—David Ernest Otto, 50, of Tigard, Oregon, was sentenced today to 180 months in federal prison and lifetime supervised release after finding, contacting, grooming and sexually exploiting seven minor girls ages 13-to-17 using a variety of social media platforms.
According to court documents, on November 20, 2016, the mother of one of Otto’s minor victims contacted the Sonora Police Department in Sonora, California to report that her fifteen-year-old daughter had been communicating on Instagram with an unknown adult male. An analysis of the victim’s chat log revealed that she had engaged in highly sexual conversations with another Instagram user and, when prompted, sent the user nude photos of herself. Investigators linked the subject’s Instagram account to Otto using the IP address of his home in Tigard.
Following execution of a search warrant at the Tigard residence, investigators analyzed the data on Otto’s seized digital devices and discovered six additional minor victims located around the country. FBI agents, in cooperation with local officials, then sought to locate and interview the victims. The victims described similar crimes, in which Otto contacted them on social media or via the internet and, having built rapport with them, directed them to produce and send him images and videos of child pornography.
On February 6, 2018, Otto pleaded guilty to one count of production of child pornography.
This case was investigated by FBI Portland’s Child Exploitation Task Force (CETF) and Sonora Police Department and was prosecuted by the U.S. Attorney’s Office for the District of Oregon.
FBI Portland CETF conducts sexual exploitation investigations—many of them undercover—in coordination with other federal, state, and local law enforcement agencies. The CETF is committed to locating and arresting those who prey on children as well as recovering underage victims of sex trafficking and child exploitation.
Anyone who has information about the physical or online exploitation of children are encouraged to call the FBI at (503) 224-4181 or submit a tip online at www.fbi.gov/tips.
U.S. Attorney's Office Joins in Recognizing National Crime Victims' Rights Week, April 7-13, 2019Read the Press Release
PORTLAND— Every April, the Justice Department’s Office for Victims of Crime (OVC) leads communities across the country in observing National Crime Victims’ Rights Week (NCVRW) to honor crime victims, promote their rights and recognize those who advocate on their behalf. This year’s observance takes place April 7-13, with the theme: Honoring Our Past. Creating Hope for the Future.
The U.S. Attorney’s Office joins its federal, state, local and tribal law enforcement partners in taking this opportunity to highlight the importance of providing necessary services at the earliest possible stage of victimization and litigation. Early intervention helps prevent further victimization and encourages victim involvement in the criminal justice system, mitigating the cycle of violence and restoring hope for the future.
“Victims of crime deserve justice. This Department works every day to help them recover and to find, prosecute, and convict those who have done them harm,” said Attorney General William P. Barr. “During this National Crime Victims’ Rights Week, we pause to remember the millions of Americans who have been victims of crime and we thank public servants who have served them in especially heroic ways. This week the men and women of the Department recommit ourselves once again to ensuring that crime victims continue to have a voice in our legal system, to securing justice for them, and to preventing other Americans from suffering what they have endured.”
“Protecting the rights and dignity of crime victims is as important a part of the administration of justice as completing an investigation or bringing a case to trial,” said Billy J. Williams, U.S. Attorney for the District of Oregon. “Every day in courtrooms across the country, crime victims show great courage and strength by participating in the judicial process. It’s this courage that inspires prosecutors and law enforcement to tirelessly pursue justice in every case. I am proud to honor these victims and the people who serve them.”
OVC and the U.S. Attorney’s Office encourages widespread participation in the week’s events and in other victim-related observances throughout the year. The Justice Department will host OVC’s annual National Crime Victims’ Service Awards Ceremony in Washington, D.C. on April 12, 2019 to honor outstanding individuals and programs that serve victims of crime. For additional information about this year’s National Crime Victims’ Rights Week and how to assist victims in your community, please visit OVC’s website at www.ovc.gov.
If you or someone you know has been a victim of a crime, please contact your local law enforcement agency or your nearest FBI office immediately. The FBI Portland Field Office can be reached at (503) 224-4181.
Former Tigard Resident Sentenced to Seven Years in Federal Prison for Defrauding Investors in Ohio Gold MineRead the Press Release
PORTLAND, Ore.—Harry Dean Proudfoot III, 79, formerly a resident of Tigard, Oregon, was sentenced today to 84 months in federal prison and three years’ supervised release for running a fraudulent gold mining investment scheme and stealing approximately $4 million from more than 140 investors.
According to court documents and information shared at trial, in 2008, Harry Proudfoot created 3 Eagles Research and Development, a company based in Tigard, that he used from 2008 through 2012 to solicit investors for a purported goldmining operation in Ohio. Harry Proudfoot, along with his adult children, including co-defendant Matthew Proudfoot, falsely promised to use investors’ money to purchase mining equipment and conduct mining operations at two gravel pits in Ohio.
To entice investors, Proudfoot and his children offered high rates of return, typically 10% of gross revenues, payable once the mine became operational. They falsely told investors they had all the necessary legal and business requirements in place for the mining operation.
At the same time, Proudfoot and his children withheld important facts from investors including that Harry Proudfoot had received cease and desist orders from the States of Alaska and Oregon for selling unregistered securities through material misrepresentations in 1992, 1993, and 2003 and that Matthew Proudfoot had filed for bankruptcy in 2010. Rather than using investor money as promised, they diverted it to their personal use, funding living expenses, cars, travel, credit card bills, medical payments, lulling payments and other expenses to keep the scheme afloat.
In 2011, the U.S. Securities and Exchange Commission (SEC) began investigating the group for securities violations. Ultimately, the U.S. District Court for the District of Oregon entered a judgment against Harry Proudfoot, Matthew Proudfoot and the 3 Eagles Research and Development Company in the SEC enforcement action
On December 13, 2018, a federal jury convicted Proudfoot of conspiracy to commit wire fraud, wire fraud, conspiracy to commit money laundering, and money laundering.
Proudfoot’s son and co-defendant Matthew Proudfoot pleaded guilty to wire fraud and money laundering on November 1, 2017. He will be sentenced on July 8, 2019.
The case was investigated by the FBI and IRS Criminal Investigation, and prosecuted by Scott E. Bradford and John C. Brassell, Assistant U.S. Attorneys for the District of Oregon.
Federal Investigation of Portland Drug Trafficking Organization Reveals Black Market Peso Exchange SchemeRead the Press Release
PORTLAND, Ore.—Esteban Guillen Ramirez, 53, of Guadalajara, Jalisco, Mexico, was sentenced today to one year in federal prison and three years’ supervised release for his role in a complex black market peso exchange money laundering scheme. The scheme was uncovered in 2015 following a lengthy investigation by the U.S. Drug Enforcement Administration (DEA) into a Portland-based heroin trafficking organization.
In February 2015, the DEA executed multiple search warrants throughout the Portland and Vancouver, Washington metropolitan area following a long-term heroin trafficking investigation. Agents arrested over twenty drug trafficking defendants, seized multiple kilos of heroin and seized over $400,000 in bulk cash. At one search location, agents seized evidence of bank deposit slips and deposit instructions, in which heroin traffickers deposited drug proceeds into multiple wholesale businesses in the Los Angeles Fashion District.
Agents began a money laundering investigation. Bank records showed that the majority of cash deposits made by Portland heroin traffickers into the Los Angeles wholesale business bank accounts were systematically structured to avoid detection by the U.S. Department of Treasury’s Financial Crimes Enforcement Network (FinCEN).
In November 2015, agents executed 14 federal search warrants in the Los Angeles Fashion District. At four separate wholesale businesses, agents seized financial records identifying Stefano Fashions as the beneficiary of the cash deposits made by the Portland heroin traffickers. Stefano Fashions, owned by Guillen Ramirez, is a successful Guadalajara business engaged in the sale of women’s accessories and cosmetics. Financial investigators found evidence of a high volume of structured cash deposits and large quantities of bulk cash delivered to the wholesale businesses on behalf of Stefano Fashions. While this financial activity was highly unusual for a U.S. wholesale business, it was a telltale sign the Los Angeles Fashion District businesses and Stefano Fashions were participating in a black market peso exchange scheme to launder the drug proceeds of a Mexican drug trafficking organization.
A black market peso exchange is a trade based money laundering scheme commonly used by Mexican drug trafficking organizations to obtain pesos in exchange for U.S. dollars acquired from narcotics sales in the U.S. This complex money laundering scheme involves money derived from the sale of drugs in the United States that is laundered through wholesale business in the Los Angeles Fashion District in order to repatriate the drug proceeds back to Mexican drug trafficking organizations.
In July 2018, federal agents arrested Guillen Ramirez in Las Vegas, Nevada. Guillen Ramirez pleaded guilty to one count of conspiracy to commit money laundering on December 13, 2018. Five Los Angeles wholesale business owners and one former CEO pled guilty to money laundering, tax and structuring related crimes. Each of the business owners that has been sentenced was required to a serve prison term and more than $2 million has been seized, forfeited or applied to restitution.
Following this money laundering investigation, the national bank used by the drug traffickers to deposit proceeds, changed its policy governing third party cash deposits. Prior to this investigation, this national bank allowed third parties to make cash deposits under $10,000 into personal bank accounts without providing identification. The bank now requires individuals making cash deposits into third party accounts to provide identification and be an authorized user of the account.
This case was the result of a joint investigation by the DEA, Homeland Security Investigations (HSI), IRS-Criminal Investigation, and the U.S. Marshals Service. The money laundering prosecution was led by Steven T. Mygrant, Assistant U.S. Attorney for the District of Oregon.
This case was brought as part of the Justice Department’s Organized Crime and Drug Enforcement Task Force (OCDETF) program, the centerpiece of the department’s strategy for reducing the availability of drugs in the U.S. In 2018, the case was recognized nationally by OCDETF with the Outstanding Investigation Award for the Financial Investigation of an Opioid Network.
OCDETF was established in 1982 to mount a comprehensive attack on drug trafficking by disrupting and dismantling major drug trafficking and money laundering organizations. Today, OCDETF combines the resources and expertise of its member federal agencies in coordination with state and local law enforcement.
Two Oregon Tribes Receive Justice Department Grant Supporting Native American Crime VictimsRead the Press Release
WASHINGTON— The Office of Justice Programs’ Office for Victims of Crime today awarded more than $8 million to support crime victims in Native American communities in six states: Alaska, California, Maine, Oregon, Washington and Wisconsin. The group of 13 awards is the third in a series of grants being made by OVC to American Indian and Alaska Native communities. OVC has now awarded more than $17 million of nearly $100 million to support tribal victim service programs.
The awards—30 in total so far—will fund critical crime victim services, such as counseling, transitional housing, emergency services and transportation. The grants are supported by the Crime Victims Fund, a repository of federal criminal fines, fees and special assessments. The fund includes zero tax dollars.
“American Indian and Alaska Native communities face extensive public safety challenges, but through creative approaches that combine traditional methods with innovative solutions, they are demonstrating their determination to meet the needs of victims in their communities,” said OJP’s Principal Deputy Assistant Attorney General Matt M. Dummermuth. “These grants, part of historic levels of funding awarded by the Department of Justice to American Indian and Alaska Native communities, will provide significant resources to bring critical services to those who suffer the effects of crime and violence.”
“One of our priorities in the District of Oregon is our unwavering commitment to members of tribal communities. Our office stands firmly on the side of tribal victims and will continue to work tirelessly pursuing justice on their behalf,” said Billy J. Williams, U.S. Attorney for the District of Oregon. “The Justice Department’s tribal grant programs ensure all tribes have the resources necessary to support victims and keep their communities safe.”
According to OJP’S Bureau of Justice Statistics, American Indians and Alaska Natives experience violent crime at rates far greater than the general population.
Two Oregon tribes were among the 13 receiving grant awards today. Nearly 170 tribes are expected to receive funding this spring to help their communities support crime victims over the next three years:
- The Klamath Tribes of Oregon (Oregon) was awarded $396,793 to enhance existing services and outreach to victims of domestic violence, sexual assault, stalking, sex trafficking, and dating violence.
- The Cow Creek Band of Umpqua Tribe of Indians (Oregon) was awarded $714,783 to offer longer term transitional housing to provide stability for families and individuals while they receive restorative services.
- Aroostook Band of Micmacs (Maine) was awarded $569,086 to expand the existing victim services program by providing 24/7 staffing of the emergency shelter.
- Bad River Band of Lake Superior Tribe of Chippewa Indians (Wisconsin) was awarded $699,925 to create a central location for the victim services program, currently located in multiple locations on the reservation, and expand their crime victim services to include children and elders.
- The Jamestown S'Klallam Tribe (Washington) was awarded $369,176 to establish a satellite Children’s Advocacy Center at the Jamestown Tribe to increase accessibility to culturally relevant services; state-of-the-art recording equipment; and skilled, trained forensic interviewers.
- The Scotts Valley Band of Pomo Indians (California) was awarded $546,586 to build a culturally relevant, long-term strategic plan to improve services to victims; and develop programming around the concept of historical intergenerational trauma therapy using a practice-based curriculum.
- The Karuk Tribe (California) was awarded $719,970 to improve access to, and delivery of, services to victims of crime by establishing a Victim Services Access Center, which will include secure space for a victim interview room and a private waiting area for victims.
- The Bishop Paiute Tribe (California) was awarded $715,750 to enhance services provided through Relief After Violent Encounters by expanding the victim service program to include direct emergency supportive services.
- The Central Council Tlingit & Haida Indian Tribes of Alaska (Alaska) was awarded $1,413,000 to implement a culturally appropriate response to address elder abuse and provide crime victim services for the Native older adult population within the Juneau urban area, and also serve victims in the villages.
- The Puyallup Tribe of Indians (Washington) was awarded $407,448 to expand existing services by strengthening their continuum of care for homeless victims of crime and for victims with alcohol and substance abuse issues. Funding will also support culturally appropriate inpatient treatment services at a local or regional treatment center.
- The Big Valley Rancheria Band of Pomo Indians (California) was awarded $670,443 to conduct a community needs assessment and develop a strategic plan to help inform the implementation of crisis intervention services for men, boys, and elders who are victims of crime. The tribe will also improve case management, incorporate healing and cultural practices into their victim advocacy services, and expand community outreach and education to help connect victims to vital resources.
- The Tetlin Tribal Council (Alaska) was awarded $513,865 to conduct a community needs assessment and create a strategic plan that will guide the development, implementation, and expansion of victim services.
- The Aleut Community of St. Paul Island Tribal Government (Alaska) was awarded $562,200 to expand existing services and develop additional services for victims of crime through strategic planning and enhanced training of program staff.
“American Indian and Alaska Native crime victims continue to face challenges in accessing vital services and resources needed to help survivors address their trauma and navigate a complex system,” said OVC Director Darlene Hutchinson. “The Justice Department has made it a priority to partner with tribes to help victims and their families rebuild their lives in the aftermath of violence.”
The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Matt M. Dummermuth, provides federal leadership, grants and resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal justice system. More information about OJP and its components can be found at www.ojp.gov.
Portland Baggage Handler Pleads Guilty to Federal Charges After Stealing Firearms from LuggageRead the Press Release
PORTLAND, Ore.—Deshawn Antonio Kelly, 27, a Portland resident and former baggage handler at Portland International Airport, pleaded guilty today to five counts of possessing a stolen firearm after he was caught stealing firearms from the checked luggage of airline passengers.
According to court documents, between August 19, 2018 and September 17, 2018, Kelly was employed as a contract baggage handler at Portland International Airport. Over a four-week period beginning August 19, 2018, Kelly stole six firearms— three 9mm pistols, two .40 caliber pistols and one .45 caliber pistol—from five different checked bags. The guns were checked by passengers traveling to and from Oregon.
On September 25, 2018, Kelly was arrested at the airport and search warrants were conducted on his person, vehicle and residence. Kelly admitted to stealing the six firearms, and told investigators where they were located.
A charge of possessing a stolen firearm carries a maximum sentence of 10 years in prison, a $250,000 fine and three years’ supervised release. Kelly will be sentenced on July 29, 2019 before U.S. District Court Judge Michael H. Simon.
This case was investigated by the FBI and the Port of Portland Police and is being prosecuted by Hannah Horsley, Assistant U.S. Attorney for the District of Oregon.
Retired Attorney Pleads Guilty to Tax EvasionRead the Press Release
PORTLAND, Ore.—Bruce L. Lamon, 64, of Hillsboro, Oregon, pleaded guilty today to one count of tax evasion after failing to pay $744,000 in personal income taxes.
“As a retired attorney, Lamon was well-versed in the law and clearly knew tax evasion was a crime. It’s a crime of greed and arrogance that hurts every citizen who lawfully pays their taxes,” said Billy J. Williams, U.S. Attorney for the District of Oregon.
“Mr. Lamon’s chosen profession to serve those seeking justice from the law stands in stark contrast to his admission of guilt to evade his personal tax liability,” said IRS-Criminal Investigation Special Agent in Charge Justin Campbell. “IRS-Criminal Investigation prioritizes bringing to justice individuals who engage in tax evasion in order to protect the integrity of the tax system by ensuring everyone pays their share.”
According to court documents, between 2006 and 2012, Lamon worked as a commercial litigator at a law firm in Honolulu, Hawaii earning a substantial income. After retiring in 2012, he withdrew all the funds in his retirement account—approximately $395,000—and moved to Hillsboro. As of mid-October 2015, Lamon owed approximately $744,000 in individual income taxes for calendar years 2008 through 2013. To conceal his assets from the IRS and evade payment of his taxes, Lamon paid cash for vehicles, titling them in his former spouse’s name, and purchased rental properties with cash using an LLC registered in Hawaii.
On October 22, 2018, a federal grand jury in Portland returned a two-count indictment alleging Lamon evaded payment of his taxes for calendar years 2008 through 2013 and failed to disclose rental income in an application to proceed In Forma Pauperis in a civil case he filed in federal court in 2016.
Lamon faces a maximum sentence of five years in prison, a $250,000 fine and three years of supervised release. He will be sentenced on July 9, 2019 before U.S. District Court Judge Marco A. Hernandez.
As part of the plea agreement, Lamon will pay $744,000 in restitution to the IRS. At sentencing, the government will move to dismiss Count 2 of the October 2018 indictment charging Lamon with giving a false statement.
This case was investigated by IRS Criminal Investigation (IRS-CI) and prosecuted by Seth D. Uram, Assistant U.S. Attorney for the District of Oregon.
The U.S. Attorney’s Office and IRS-CI remind Oregonians that tax day is Monday, April 15, 2019. For tips to assist taxpayers in choosing a reputable tax professional or preparing their own taxes, visit the IRS website: https://www.irs.gov/help-resources.
Portland Nurse Practioner Sentenced to Four Years in Federal Prison for Illegal Opioid Distribution (Photo)Read the Press Release
Downloadable file: PDF Press Release
Downloadable file: Fusion Wellness Clinic
Downloadable file: Cash Found in DeMille Bedroom (1)
Downloadable file: Cash Found in DeMille Bedroom (2)Prosecution marks the first opioid pill mill case in the District of Oregon
PORTLAND, Ore.—Former nurse practitioner Julie Ann DeMille, 60, of Portland, was sentenced today to 48 months in federal prison and three years’ supervised release for illegally distributing prescription opioids, filing a false tax return and lying to federal agents.
“Our nation is drowning in substance abuse. We must wake up to this reality and stop pushing the reckless use of controlled substances. DeMille treated her nursing credentials like a license to deal opioids—a drug dealer masquerading as a medical professional. It’s hard to comprehend that in the midst of the deadliest drug crisis in history, DeMille risked the lives of hundreds to turn a profit,” said Billy J. Williams, U.S. Attorney for the District of Oregon.
“Opioid abuse is devastating our communities and we must respond aggressively to stem the flow because every person lost in this crisis is one too many,” said DEA Special Agent in Charge Keith Weis.
“This case is an excellent example of how the financial expertise of IRS-Criminal Investigation employees contributes to the federal law enforcement fabric,” said IRS-Criminal Investigation Special Agent in Charge Justin Campbell. “IRS-Criminal Investigation is committed to serving the U.S. taxpayers and working with our partners to make our communities safer. DeMille has been held accountable for her actions and we will continue to investigate and seek prosecution of individuals who do not report their taxable income, regardless of whether the income is legal or illegal.”
According to court documents, in January 2015, DeMille opened the Fusion Wellness Clinic on Southeast 122nd Avenue in Portland across the street from the Multnomah County Parole and Probation Office. From the clinic’s opening until July 2016, DeMille illegally wrote thousands of prescriptions for opioids including oxycodone and hydrocodone.
As early as 2013, DeMille began planning a move from Houston, Texas to Portland. She was attracted to Oregon where licensed nurse practitioners can write prescriptions without the oversight and approval of a physician. She moved in 2014 and was hired by a publicly funded, county health clinic. From the beginning, DeMille planned to subsidize her county income by operating an illegal opioid pill mill. By the end of 2014, DeMille had registered the “Fusion Wellness” business name and begun searching for clinic locations.
After DeMille’s first clinic opened in January 2015, word spread quickly that the small, cash-only operation was a reliable source for cheap and easy opioid prescriptions. On Friday and Saturday mornings, customers would spill into parking areas outside the clinic and wait in cars for their turn in the cramped office. The clinic quickly outgrew its original location and, in April 2015, was moved to a new location on Northeast 101st Avenue in Portland.
Before long, DeMille’s prescribing habits began attracting the attention of law enforcement and the Oregon State Board of Nursing. Shortly after the clinic opened, three of DeMille’s patients attempted to fill identical prescriptions for 30mg doses of oxycodone together at a local pharmacy. The pharmacist turned the patients away and contacted police. A Gresham police officer later contacted DeMille by phone to discuss the prescriptions and forwarded a copy of the general offense report to the state nursing board. The nursing board opened an investigation into DeMille’s prescribing practices just three weeks after the clinic opened.
In early 2015, the clinic’s patient files included very few records. Knowing her lax prescribing practices and record keeping would not pass investigative scrutiny, DeMille began forging patient signatures on newly created forms. In March 2015, DeMille met with nursing board investigators to discuss the complaint and her prescribing practices. During the course of the interview, she repeatedly lied about the nature of her practice, insisting that the clinic’s patients were treated for simple chronic diseases and a variety of other wellness issues. Ultimately, the nursing board issued a letter of concern to DeMille, but did not pursue disciplinary action.
DeMille quickly altered her practices in response to the nursing board’s investigation in an attempt to avoid further detection. Throughout the remainder of 2015, DeMille continued her work at the county health clinic while operating the clinic just two days a week. In a typical day at the clinic, DeMille saw up to 20 patients, charging each $200 in cash. In 2015, the clinic generated at least $388,000 in revenue, none of which was reported on DeMille’s income tax return. In July 2016, while conducting a federal search warrant, DEA agents found more than $51,000 in cash stored in DeMille’s bedroom.
In 2015 alone, according to data from the Oregon Prescription Drug Monitoring Program, DeMille wrote more than 1,940 prescriptions for controlled substances. Together, these prescriptions resulted in the distribution of more than 219,000 pills, 96.7% of which were opioids.
DeMille pleaded guilty on December 12, 2018 to two counts of illegally distributing a controlled substance and to one count of filing a false tax return and lying to federal agents.
DeMille’s co-conspirator and former Fusion Wellness Clinic manager, Osasuyi “Ken” Idumwonyi, pleaded guilty on February 28, 2017, to conspiring to distribute or dispense and possessing with intent to distribute or dispense the Schedule II controlled substances oxycodone and hydrocodone. He will be sentenced on June 3, 2019.
This case was investigated by the Drug Enforcement Administration, Internal Revenue Service, U.S. Marshals Service and Portland Police Bureau. It was prosecuted by Thomas S. Ratcliffe and Donna Brecker Maddux, Assistant U.S. Attorneys for the District of Oregon.
Drug abuse affects communities across the nation, and opioid abuse continues to be particularly devastating. The CDC reports that from 1999 to 2016, more than 630,000 people have died from a drug overdoses. In 2016, 66% of drug overdose deaths involved an opioid. Drug overdose is now the leading cause of injury or death in the United States. In Oregon, the total number of deaths related to drug use increased 11 percent between from 2013 to 2017, with 546 known drug related deaths in 2017.
If you or someone you know suffers from addiction, please call the Lines for Life substance abuse helpline at 1-800-923-4357 or visit www.linesforlife.org. Phone support is available 24 hours a day, seven days a week. You can also text “RecoveryNow” to 839863 between 8am and 11pm Pacific Time daily.
Madras Man Found Guilty of Discharging Firearm During Road Rage Altercation on Warm Springs Indian ReservationRead the Press Release
PORTLAND, Ore.—On Friday, March 15, 2019, a federal jury found Dat Quoc Do, 28, of Madras, Oregon, guilty of two counts of unlawful use of a weapon for discharging a firearm during a road rage altercation on the Warm Springs Indian Reservation in September 2017.
“There is simply no excuse for this sort of violence in our community. Mr. Do’s actions are very serious and could have critically injured or killed an innocent motorist,” said Billy J. Williams, U.S. Attorney for the District of Oregon. “The jury clearly saw this case for what it is: an egregious and preventable overreaction to an otherwise ordinary event on the highway.”
“These acts are shocking. Handguns are not video games and this is not a movie,” said Renn Cannon, Special Agent in Charge of the FBI in Oregon. “By shooting towards another car, Mr. Do put lives in danger and traumatized the occupants including a child inside the vehicle.”
According to court documents and information shared during trial, on September 14, 2017, Do was riding in the front passenger seat of a vehicle driven by his girlfriend, Thao Bich Tran. The two were driving at night eastbound on Highway 26 on the Warm Springs Indian Reservation when they came upon another eastbound vehicle being driven by an adult member of the tribe. Also in the second vehicle were the driver’s adult daughter and 12-year-old niece.
Tran was tailgating the vehicle when the other driver motioned for her to pass. At some point in the encounter, the other driver’s adult daughter threw a water bottle at, but did not hit Tran and Do’s vehicle. In response, Do fired several shots out the front passenger window of their vehicle, but did not hit the other driver’s vehicle. After the initial shooting, Tran raised the passenger window and continued to the follow the other vehicle. When Tran had a clear lane to pass, she moved to change lanes.
As Tran began to overtake the other vehicle, Do extended his hand holding a handgun out of their vehicle’s front passenger window. Believing that Do was pointing the gun in her direction, the other driver rapidly applied her brakes. Do fired several additional rounds as Tran drove away.
The other driver called Warm Springs Tribal Police to report the incident while continuing to follow Tran and Do’s vehicle. A patrol officer later stopped their vehicle and ordered Tran and Do out at gunpoint. Both were taken into custody. Officers recovered a Springfield Armory XD .45 caliber handgun in the front-passenger door pocket of the vehicle and a .45 caliber magazine partially loaded with five rounds in the center console.
Do faces a maximum sentence of five years in prison. He will be sentenced on Monday, June 10, 2019 before U.S. District Court Judge Michael H. Simon.
This case was investigated by the FBI and the Warm Springs Tribal Police Department and prosecuted by Paul T. Maloney and Lewis S. Burkhart, Assistant U.S. Attorneys for the District of Oregon.
Klamath County Man Found Guilty of Stealing Missing Mother's Social Security BenefitsRead the Press Release
MEDFORD, Ore.—On Wednesday, March 13, 2019, a federal jury found Theodore Martin Kirk, 64, of Klamath County, Oregon, guilty of stealing more than $30,000 in Social Security benefits dispersed in the name of his elderly mother, Nadine Kirk. Ms. Kirk has been missing since March 2010 and is presumed to be deceased.
"This case began with a single tip from an observant community member and led to the discovery of a multi-year scheme to exploit the Social Security program—a critical tax payer-funded program supporting the nation’s elderly. Tips play an important role in law enforcement and help to reveal crimes that might otherwise go undiscovered," said Billy J. Williams, U.S. Attorney for the District of Oregon.
According to court documents and information shared during trial, in July 2015, a concerned community member contacted the Klamath County Sheriff’s Office regarding the whereabouts of Ms. Kirk as she had not been seen for multiple years. At the time of this call, Ms. Kirk would have been 98 years old. Shortly thereafter, a sheriff deputy visited the residence shared by Ms. Kirk and her son, Theodore, in Bonanza, Oregon. Mr. Kirk claimed his mother had left with friends to travel to California two months prior, but would not permit the deputy to enter his property to confirm his mother was not there.
In an August 2015 interview with a detective, Mr. Kirk again told law enforcement he believed his mother was in California with friends. He added that it had been "quite some time" since his mother had seen a doctor despite having suffered from multiple strokes. Mr. Kirk claimed to be suspicious of his mother’s medications and reported previously removing her from them. Further, he acknowledged that he shared a joint checking account with his mother, into which her monthly Social Security payments were deposited.
Later in August, the Social Security Administration suspended payments to the Kirk’s joint checking account based on Ms. Kirk’s unknown whereabouts. A Social Security investigator reviewed Ms. Kirk’s bank records and found that the last transaction bearing her signature was dated January 2010. From January 2010 until August 2015, over $1,000 in benefits were deposited monthly into the joint checking account and nearly every month, Mr. Kirk would withdraw the entire amount in cash. All of the withdrawals from the account occurred in Oregon, not in California were Ms. Kirk was purported to be.
In August 2017, investigators conducted a search of the Kirk property and recovered a detailed calendar kept by Mr. Kirk. Prior to 2010, the calendar included activities for both Mr. Kirk and his mother. The calendar revealed a series of strokes experienced by Ms. Kirk beginning in 2004 and continuing into the beginning of 2010, where the calendar showed she experienced two strokes in three days. Following the multiple strokes, there were no additional calendar entries for Ms. Kirk’s activities.
Mr. Kirk faces a maximum sentence of ten years in prison. He will be sentenced on Thursday, June 27, 2019 before U.S. District Court Judge Michael J. McShane.
This case was investigated by the Social Security Administration, Office of Inspector General with the assistance of the Klamath County Sheriff’s Office and prosecuted by Adam E. Delph and Gavin W. Bruce, Assistant U.S. Attorneys for the District of Oregon.
Tualatin Man Sentenced for Money Laundering and Defrauding InvestorsRead the Press Release
PORTLAND, Ore.—Ronald Eugene Stover, 65, of Tualatin, Oregon, was sentenced today to five years of probation including two years’ house arrest for money laundering and engaging in a scheme to defraud investors.
U.S. District Court Judge Ann Aiken also ordered Stover to pay more than $3.2 million in restitution to his victims and $168,883 to satisfy a forfeiture money judgment. The court cited Stover’s age and poor health in issuing a probationary sentence.
According to court documents, beginning in 2010, Stover began soliciting short-term loan investments to fund various Xtreme Iron capital projects. Stover claimed to have a long track records of success in real estate development, business and banking and relied heavily on investor introductions made by other professional intermediaries to establish his credibility. Xtreme Iron owned a heavily-leveraged fleet of Caterpillar and John Deere heavy equipment in Frisco, Texas and maintained an office in Wilsonville, Oregon.
At Stover’s urging, investors sent funds to Tri-Core Funding Group, an entity wholly owned and controlled by Stover. Stover falsely claimed the company had a sound business model, strong growth opportunities and manageable debt exposure. In addition to Stover’s many false claims about the business’s health and viability, he advanced many falsehoods about the nature of the investment opportunity including, but not limited to: investor funds would be used exclusively for business purposes, Stover himself would provide additional capital sourcing from his own funds and investors would receive short-term repayment of their loan notes plus interest.
In May 2012, Stover emailed a victim soliciting funds to purchase heavy equipment from Caterpillar. In response to the solicitation, Stover executed a 30-day loan note promising repayment plus interest. The victim wired $175,000 to Tri-Core Funding Group the next day. Unbeknownst to the victim, Stover never intended to use the money as promised. Immediately after receiving the funds, Stover used the funds to make over a year’s worth of mortgage payments on his residence in Tualatin, which was on the brink of foreclosure. Stover never repaid his victim.
Stover previously pleaded guilty to one count of money laundering on November 13, 2018.
The IRS and FBI investigated this case. It was prosecuted by Donna Brecker Maddux and Julia E. Jarrett, Assistant U.S. Attorneys for the District of Oregon.
District of Oregon Takes Part in Largest-Ever Nationwide Elder Fraud SweepRead the Press Release
PORTLAND, Ore.—Attorney General William P. Barr and U.S. Attorney Billy J. Williams today announced the largest coordinated sweep of elder fraud cases in history, surpassing last year’s nationwide sweep. The cases during this sweep involved more than 260 defendants from around the globe who victimized more than two million Americans, most of them elderly.
"Crimes against the elderly target some of the most vulnerable people in our society," Attorney General William P. Barr said. "But thanks to the hard work of our agents and prosecutors, as well as our state and local partners, the Department of Justice is protecting our seniors from fraud. The Trump administration has placed a renewed focus on prosecuting those who prey on the elderly, and the results of today’s sweep make that clear. Today we are announcing the largest single law enforcement action against elder fraud in American history. This year’s sweep involves 13 percent more criminal defendants, 28 percent more in losses, and twice the number of fraud victims as last year’s sweep. I want to thank the Department’s Consumer Protection Branch, which led this effort, together with the Department’s Criminal Division, the more than 50 U.S. Attorneys’ offices, and the state and local partners who helped to make these results possible. Together, we are bringing justice and peace of mind to America's seniors."
"Today’s sweep sends a clear message that the Department of Justice is determined to hold accountable criminals who prey on our elderly citizens," said Billy J. Williams, U.S. Attorney for the District of Oregon. "I want to thank our law enforcement partners from across the federal government as well as the many state, local and tribal agencies here in Oregon who assisted in bringing these cases and helping to put an end to these shameful schemes."
Three District of Oregon cases were included in the sweep:
U.S. v. Stevens et al.
On January 8, 2019, a federal grand jury returned a six-count indictment charging Portland couple Ronnie Stevens, 49, and Tina Ephrem, 43, with wire fraud after they conspired to defraud an elderly couple of money and property. Stevens and Ephrem stole more than $1.5 million from the adult victims and spent the proceeds on utility bills, restaurants, cigars, retail purchases and travel to locations including Hawaii, Anaheim, California, Las Vegas, Nevada and the Spirit Mountain Lodge in Grand Ronde, Oregon. The couple was arrested on January 11, 2019 and ordered detained pending a five-day jury trial beginning on June 10, 2019. Read more.
U.S. v. Gregory
On January 22, 2019, Rodney Paul Gregory, 64, of Lebanon, Oregon, pleaded guilty to one count each of wire fraud and money laundering for his role in online romance scams, some of which targeted the elderly. Between May 2017 and January 2019, Gregory acted as a money mule, receiving proceeds from various scams and wiring the money into overseas bank accounts. Gregory faces a maximum sentence of 20 years in prison, a $250,000 fine and three years’ supervised release and will be sentenced on April 4, 2019. Read more.
U.S. v. Tucker
On February 12, 2019, Tayva Tucker, 41, of Madras, Oregon, pleaded guilty to one count of theft of government funds for stealing nearly $40,000 in Social Security payments from ten mentally disabled adults. Tucker was employed by a social services organization where she oversaw outreach to mentally disabled clients as part of the organization’s mental health program. An organizational audit uncovered unusual movement of funds between various client accounts, as well as funds transferred from client accounts to Tucker. When confronted, Tucker admitted to taking clients’ Social Security benefits for her personal use. Tucker faces a maximum sentence of 10 years in prison, a $250,000 fine and three years’ supervised release and will be sentenced on April 25, 2019. Read more.
The Department took action in every federal district across the country, through the filing of criminal or civil cases or through consumer education efforts. In each case, offenders allegedly engaged in financial schemes that targeted or largely affected seniors. In total, the charged elder fraud schemes caused alleged losses of millions of more dollars than last year, putting the total alleged losses at this year’s sweep at over three fourths of one billion dollars.
The charges are merely allegations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Since passage of the bipartisan Elder Abuse Prevention and Prosecution Act (EAPPA), the Department of Justice has participated in hundreds of enforcement actions in criminal and civil cases that targeted or disproportionately affected seniors. The Justice Department has likewise conducted hundreds of trainings and outreach sessions across the country since the passage of the Act.
A fact-sheet with technical-support fraud case information can be found here.
A fact-sheet with cases on mass mailing fraud can be found here.
A fact-sheet with examples of a few elder fraud cases involving extradition in which the Office of International Affairs played a substantial role can be found here.
Elder fraud complaints may be filed with the FTC at www.ftccomplaintassistant.gov or at 877-FTC-HELP. The Department of Justice provides a variety of resources relating to elder fraud victimization through its Office of Victims of Crime, which can be reached at www.ovc.gov.
Woodburn Man Pleads Guilty for Role in Conterfeit ID SchemeRead the Press Release
PORTLAND, Ore.—Miguel Merecias-Lopez, 24, of Woodburn, Oregon, pleaded guilty today to one count each of conspiracy to produce false identification documents and possession with intent to distribute methamphetamine.
According to court documents, from a time unknown until September 21, 2017, Merecias-Lopez and other co-conspirators were part of a Oaxaca, Mexico-based criminal conspiracy to produce and sell fraudulent U.S. government documents.
Conspirators, including Merecias-Lopez, maintained a clandestine photo lab in Woodburn where they used various computers, scanners, laminators, digital cameras and a high-resolution printer to produce the fraudulent documents. They would communicate with customers in-person and electronically via email, Facebook and Snapchat, and receive payments via PayPal, U.S. mail or in person.
On September 21, 2017, investigators arrested Merecias-Lopez in a fast food parking lot in Woodburn when he arrived to conduct a drug deal. More than a kilogram of methamphetamine was found on Merecias-Lopez’s person. A subsequent search of Merecias-Lopez’s apartment produced additional methamphetamine and equipment used in furtherance of the fraudulent document scheme. Investigators found and seized the materials needed to produce thousands of identification cards.
A review of electronic devices found in Merecias-Lopez’s apartment produced evidence that the conspiracy had operated in Woodburn for more than a decade and produced and sold more than 10,000 different fraudulent documents including driver’s licenses for more than 25 states, U.S. social security cards, immigration-related documents including non-immigrant visas and legal permanent resident cards, marriage licenses, vehicle bills of sale and titles, and birth certificates. Merecias-Lopez was personally responsible for producing more than 300 fraudulent U.S. government documents.
A charge of conspiracy to produce false identification documents carries a maximum sentence of 15 years in prison, a $250,000 fine and three years’ supervised release. A charge of possession with intent to distribute methamphetamine carries of maximum sentence of life in prison with a 10 year mandatory minimum sentence, a $10,000,000 fine and five years’ supervised release.
The government and defense counsel representing Merecias-Lopez are jointly recommending a sentence on the low-end of the non-binding U.S. Sentencing Commission guidelines range when he is sentenced on June 18, 2019 before U.S. District Court Judge Michael H. Simon.
This case was investigated by Homeland Security Investigations (HSI), the U.S. Drug Enforcement Administration (DEA), the Westside Interagency Narcotics Team (WIN), the Clackamas County Interagency Task Force (CCITF) and the Woodburn Police Department. It is being prosecuted by Peter D. Sax, Assistant U.S. Attorney for the District of Oregon.
Oregon U.S. Attorney's Office Collects Nearly $7 Million in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2018Read the Press Release
PORTLAND—U.S. Attorney Billy J. Williams announced today that the District of Oregon collected $6,996,187 in criminal and civil actions in Fiscal Year 2018. Of this amount, $5,085,876 was collected in criminal actions and $1,910,310 in civil actions.
As a whole, the Justice Department collected nearly $15 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2018. The FY 2018 collections are nearly seven times the appropriated $2.13 billion budget for the 94 U.S. Attorneys’ offices.
An example of the district’s collection efforts was U.S. v. Jumroon et al. On December 18, 2018, Paul Jumroon was sentenced to 37 months in prison for forced labor, visa fraud and filing false tax returns. Between 2011 and 2014, defendant Paul Jumroon and co-defendant Tanya Jumroon fraudulently obtained E-2 "investor" visas to bring Thai nationals into the United States to provide cheap labor at their restaurants in Lake Oswego, Oregon, and in Ridgefield, Washington. At sentencing, Paul Jumroon was ordered to pay more than $131,000 in restitution to his victims and more than $120,000 to the IRS. As part of his plea agreement, Jumroon also agreed to forfeit more than $80,000 in seized currency and gold bars and to a garnishment of more than $170,000 in retirement savings.
A second example is U.S. v. Hankins. In 2001, Anne Hankins pleaded guilty to bank fraud after submitting a false loan application for $350,000 to U.S. Bank Special Assets Group. Hankins was sentenced to 30 days in jail and, under the Mandatory Victims Restitution Act, ordered to pay $350,000 in restitution to U.S. Bank. Between 2002 and 2013, Hankins made sporadic payments ranging from $50 to $400 monthly. By July 2013, Hankins had paid $13,044. In September 2013, Hankins and Horton & Associates LLC, a firm U.S. Bank had previously assigned its restitution interest to, agreed to settle the outstanding restitution for a mere $5,000. In April 2015, the Treasury Offset Program garnished $21,765 from Hankins, who had stopped making restitution payments after her purported agreement with Horton & Associates LLC. Displeased with the garnishment, Hankins filed a motion in the district court for full satisfaction of the restitution judgment. The district court denied the motion and Hankins appealed.
The government successfully argued on appeal before the Ninth Circuit Court of Appeals that restitution cannot be settled for less than the full amount ordered and that if a victim declines
receipt of restitution, the balance should be paid to the national Crime Victims Fund. The ruling resulted in a full restitution judgment of $331,995 from Hankins going directly to the Crime Victims Fund.
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims Fund, which distributes the funds collected to federal and state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, the Department of Health and Human Services, the Internal Revenue Service, the Small Business Administration and the Department of Education.
Oregon Man Sentenced for Depredation of Government Property in the Umatilla National ForestRead the Press Release
PORTLAND, Ore.—John M. Wasson, 74, of Irrigon, Oregon, was sentenced today to five years’ probation including 60 days in a community corrections facility for misusing a mining claim on the North Fork of the John Day River in the Umatilla National Forest resulting in the depredation of government property. Wasson was also ordered to pay $28,817 in restitution.
"Like all Americans, Oregonians expect public lands to be protected from degradation and misuse. This defendant, over a series of years, treated Forest Service land as if it were his own, causing significant environmental damage," said Billy J. Williams, U.S. Attorney for the District of Oregon. "We take these crimes seriously and will continue to pursue those who violate our shared resources."
"Our wild and scenic rivers are special places that hold many values for our public, while providing habitat and resources for a variety of species and ecosystems," said Eric Watrud, Umatilla Forest Supervisor. "I’m thankful for the professional support from DOJ to hold people accountable that ignore the rules on our public lands. Our National Forests provide a wide array of resources and benefits, which our multiple use mission sustains through wise use and permitted activities."
According to court documents, Wasson was the claimant on the Slippery Rocks Mining Claim, an unpatented claim giving him possessory interest in the site for prospecting, mining or processing operations. Beginning in 2012, Wasson developed a personal interpretation of mining laws that permitted him to take any action on the claim that he believed to be reasonably incident to his mining. Over a period of years, despite court orders, misdemeanor convictions and the U.S. Forest Service officials’ repeated attempts to work with Wasson to bring his conduct into compliance, Wasson’s misuse of the claim grew more expansive and egregious.
By 2017, Forest Service officials observed that Wasson established a semi-permanent encampment on the claim, violating Forest Service regulations prohibiting occupancy for more than 14 days in a 30 day period without Forest Service authorization. Wasson’s camp included three tents, one with a foundation Wasson constructed of treated lumber, sand and gravel; a camper; a truck and a pop-up outhouse. Wasson had constructed a new road to the claim by driving through a riparian area, compacting soil and native vegetation. Additionally, Wasson created a walking path across the John Day River and used plastic sheeting to line a wing dam he made to hold water. The plastic lining was catching and holding juvenile steelhead, preventing them from accessing the flowing portion of the river.
The Forest Service paid a hazardous waste disposal company more than $19,000 to remove three quarters of a ton of contaminated soil, 90 gallons of vegetable oil, and quantities of pesticides, insecticides and rodenticides from the campsite.
Wasson was previously found guilty of one count of depredation of government property in a four-day jury trial ending on November 8, 2018.
This case was investigated by the U.S. Forest Service and prosecuted by Jennifer Martin and John Brassell, Assistant U.S. Attorneys for the District of Oregon.
Justice Department Secures Denaturalization of Convicted War Criminal Who Fraudulently Obtained Refugee Status and U.S. CitizenshipRead the Press Release
WASHINGTON – On March 1, Judge Marco A. Hernandez of the U.S. District Court for the District of Oregon entered an order revoking the naturalized U.S. citizenship of a convicted war criminal. The court held that defendant Sammy Rasema Yetisen aka Rasema Handanovic aka Zolja, a native of the former Yugoslavia, illegally procured her U.S. citizenship. The court’s order was based on its finding that Yetisen lacked the good moral character required to naturalize because she had executed six unarmed civilians and prisoners of war during the 1990s Balkans Conflicts because of their religion and ethnicity. She later concealed her crimes to procure refugee status and U.S. citizenship in the United States.
"War criminals will find no safe haven in the United States," said Principal Deputy Associate Attorney General Jesse Panuccio. "The Justice Department will continue to prosecute those who fraudulently obtain U.S. citizenship and willfully abuse our refugee program."
"Sammy Rasema Yetisen’s denaturalization is yet another example of the Justice Department’s enduring commitment to ensuring war criminals find no sanctuary in our country," said Billy J. Williams, U.S. Attorney for the District of Oregon. "The long passage of time will neither shelter nor immunize those who have defrauded the United States by concealing such heinous crimes."
Yetisen, 46, was part of an elite unit of the Army of the Republic of Bosnia and Herzegovina that attacked the village of Trusina in April 1993, in what is known as the Trusina massacre. The unit targeted Bosnian Croats who resided in the village because of their Christian religion and Croat ethnicity, killing 22 unarmed individuals including women and the elderly. Yetisen played a key role in the massacre, serving as part of a firing squad that lined up and executed six unarmed prisoners of war and civilians. Yetisen was admitted to the United States as a refugee before naturalizing in 2002. In her naturalization application, Yetisen indicated that she had never had any military service "in the United States or in any other place."
In April 2012, Yetisen was convicted in a Bosnian court pursuant to a guilty plea of war crimes against prisoners of war and war crimes against civilians based on the firing squad execution-style killings. In exchange for her plea and cooperation, Yetisen was sentenced to five years and six months in prison. Upon her release from prison, Yetisen returned to the United States and resides in Oregon. The Justice Department previously secured the denaturalization of Edin Dzeko, one of Yetisen’s fellow soldiers and another perpetrator of the Trusina massacre.
Before their war crimes had come to light, Dzeko and Yetisen each requested and received refugee status from the United States, claiming themselves to be victims of persecution. Dzeko and Yetisen concealed and affirmatively misrepresented their criminal history, military service, and persecutory acts throughout their immigration proceedings. Such benefits would have been denied had immigration authorities known about their roles in the Trusina massacre.
"This case exemplifies the work of the Human Rights Violators and War Crimes Center. We will use all available resources, collaborate with all possible partners and explore all mechanisms of the law to bring these cases of horrendous human rights violations to justice," said Mark Shaffer, Chief of the Human Rights Violators and War Crimes Center. "Our inter-disciplinary, inter-agency team continues to delve into the human rights abuses that occurred in the former Yugoslavia and around the world, and we will not rest until we are certain that the United States does not serve as a safe haven for those who would commit such abuses."
This case was investigated by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations Human Rights Violator and War Crimes Center and the Civil Division’s Office of Immigration Litigation, District Court Section (OIL-DCS) National Security and Affirmative Litigation Unit (NS/A Unit), with consultation and support from ICE’s Office of the Principal Legal Advisor (OPLA) Seattle Office of the Chief Counsel, and the Criminal Division’s Human Rights and Special Prosecutions Section.
The case was jointly prosecuted by Chief Timothy Belsan and Senior Counsel for National Security Aram Gavoor of OIL-DCS’s NS/A Unit and Trial Attorney Steven Platt of OIL-DCS, and Assistant U.S. Attorney Dianne Schweiner of the U.S. Attorney’s Office for the District of Oregon.
Members of the public who have information about foreign nationals or naturalized U.S. citizens suspected of engaging in human rights abuses or war crimes are encouraged to call the ICE tip line at 1-866-DHS-2-ICE or to complete its online tip form; or the Justice Department’s Human Rights and Special Prosecutions Section at 1-202-616-2492. Callers may remain anonymous.
Former Oregon State University Student Sentenced for Threatening Campus ShootingRead the Press Release
EUGENE, Ore.—Christopher Adam Strahan, 33, of Corvallis, Oregon, pleaded guilty today to threatening a campus shooting and was sentenced to time served in federal prison and three years’ supervised release.
According to court documents, on February 27, 2018, the Director of Public Safety for Oregon State University (OSU) was notified of Twitter posts threatening a campus shooting at OSU. A request to Twitter revealed the account in question, "Hard Belly Dorm," was owned by Strahan. A detective from Oregon State Police (OSP) positively identified Strahan from the account’s profile photo. The detective was familiar with Strahan from an investigation in February 2017 for similar threats to OSU.
Later on February 27, a 911 tip produced a possible residential address for Strahan. OSP and FBI responded to the address in an attempt to locate him. While at the address, Strahan arrived in his own vehicle, was arrested and transported to the Benton County Jail.
Strahan was held in the Benton County Jail from February 27 until he was ordered detained pending trial in federal court and transferred to FCI Sheridan on March 27, 2018.
As a condition of Strahan’s supervised release, he is prohibited from contacting or entering the property of Oregon State University or the Linn Benton Community College.
Strahan was previously convicted in Benton County Circuit Court of second degree disorderly conduct for Twitter threats made in February 2017. He was sentenced to 20 days in jail, civilly committed to the state mental hospital for six months and ordered to pay $438.
This case was investigated by OSP, the Corvallis Police Department and the FBI and prosecuted by Amy Potter, Assistant U.S. Attorney for the District of Oregon.
Warm Springs Man Pleads Guilty to Involuntary Manslaughter and Illegal Firearm PossessionRead the Press Release
PORTLAND, Ore.—Harold Blackwolf Jr., 35, of Warm Springs, Oregon, pleaded guilty today to two counts of involuntary manslaughter and one count of possession of a firearm as a convicted felon.
According to court documents, on September 28, 2017, Blackwolf was at a friend’s house on the Warm Springs Indian Reservation. While under the influence of alcohol, Blackwolf left his friend’s house and entered his Dodge Durango, a sport utility vehicle. Blackwolf drove away at a high rate of speed with his headlights off. As he was departing, he struck two adult men who were in the road, killing both. Blackwolf, a convicted felon, was arrested on April 20, 2018 and found to be in possession of a single firearm, a Taurus .38 special revolver.
Involuntary manslaughter is punishable by up to eight years in prison, a $250,000 fine and three years’ supervised release. Possessing a firearm as a felon is punishable by up to 10 years in prison, a $250,000 fine and three years’ supervised release. Blackwolf will be sentenced on June 11, 2019 before U.S. District Court Judge Anna J. Brown.
The government will seek an order of restitution on behalf of Blackwolf’s victims at sentencing.
This case was investigated by the FBI and the Warm Springs Tribal Police Department. It is being prosecuted by Benjamin Tolkoff, Assistant U.S. Attorney for the District of Oregon.
Former Lake Oswego Financial Advisor Sentenced to 36 Months in Federal Prison for Defrauding InvestorsRead the Press Release
PORTLAND, Ore.—Shayne Kniss, 43, formerly of Lake Oswego, Oregon, was sentenced today to 36 months in federal prison and three years’ supervised release for defrauding clients of his investment firm, Iris Capital Management Group, LLC. Kniss was also ordered to pay more than $529,000 in restitution to his victims.
According to court documents, Kniss founded Iris Capital in October 2010 and offered real estate based investments in several different funds to investors. Through various means, including brochures, private placement memoranda, emails, and personal presentations, Kniss misrepresented how he would manage investor funds.
Between February 2011 and April 2013, 47 people invested approximately $4.3 million in Kniss’s funds. Kniss commingled investor money among the funds, used new investments to make payments to prior investors, and used more than $500,000 for person use, including investing in a retail marijuana enterprise.
Kniss previously pleaded guilty to one count of wire fraud on May 8, 2018.
The FBI investigated this case. It is being prosecuted by Seth D. Uram, Assistant U.S. Attorney for the District of Oregon.
Wisconsin Resident Involved in Nigerian Identity Theft and Tax Fraud Scheme Sentenced to Federal PrisonRead the Press Release
EUGENE, Ore. – Curtis Sherman Pethley, 62, a resident of Wisconsin, was sentenced today to 57 months in federal prison and ordered to pay more than $440,000 for his role in a nationwide conspiracy to commit mail fraud and aggravated identity theft.
According to court documents, IRS-Criminal Investigation began a lengthy investigation into the fraud scheme when, in May 2013, a victim in Medford, Oregon notified the IRS that false federal and Oregon state tax returns were filed electronically using her and her husband’s personal identifying information including their social security numbers and dates of birth.
IRS determined the scheme required co-conspirators to amass a large supply of stolen U.S. taxpayer identities; obtain IRS filing PINs using victim identities; acquire prepaid debit cards in victims’ names; use fictitious email addresses; file fraudulent tax returns and conceal refund proceeds by wiring cash to Nigeria. Fraudulent tax returns were filed using the identities of thousands of Oregon and Washington taxpayers. In total, the scheme lasted several years and netted co-conspirators more than $11.6 million in fraudulent tax returns.
Pethley, working along with his Nigerian contact, acquired numerous debit cards for use in the scheme including the card connected with the Medford, Oregon victim. He helped his Nigerian contact by providing information about the preparation of federal income tax returns including how to calculate withholdings on a W-2 form. Pethley withdrew fraudulent tax refunds from the prepaid debit cards and, after taking his 10 to 20 percent cut of the proceeds, wired the money to Nigeria. In addition, he used refund proceeds to purchase merchandise and money orders and sent them to co-conspirators throughout the U.S. as instructed.
When IRS agents executed a search warrant on Pethley’s residence, they discovered approximately 150 prepaid debit cards and seized numerous money orders totaling nearly $50,000.
Pethley previously pleaded guilty to three counts of mail fraud, conspiracy to commit mail fraud and aggravated identity theft on August 27, 2018. He is currently serving a separate 60-month federal prison sentence for distributing child pornography in a case from the Western
District of Wisconsin. The Court ordered that 37 months of Pethley’s Oregon sentence should run consecutively to the sentence he is currently serving.
This case results from a joint investigation by IRS-Criminal Investigation, the U.S. Department of Health and Human Services Office of Inspector General, the Federal Bureau of Investigation, and Homeland Security Investigations with support provided by the Department of Treasury, Inspector General for Tax Administration, the U.S. State Department, and the Oregon Department of Revenue Policy and Systems Unit and was prosecuted by Byron Chatfield and Gavin Bruce, Assistant U.S. Attorneys for the District of Oregon.
Salem Man Sentenced to 78 Months in Prison for Dealing Methamphetamine and CockfightingRead the Press Release
PORTLAND, Ore. – Arturo Aispuro, 37, of Salem, Oregon, was sentenced today to 78 months in federal prison and 5 years’ of supervised release for conspiring to distribute methamphetamine. He also received a concurrent sentence of 60 months for abusing hundreds of roosters by raising and training them to participate in cockfights.
According to court documents, Aispuro was a member of a drug trafficking conspiracy operating in and around Salem. In April 2017, with the assistance of a co-conspirator, Aispuro sold 882 grams of methamphetamine to a confidential informant in Milwaukie, Oregon. Later, in May 2017, law enforcement intercepted Aispuro while he was transporting an additional 442 grams of methamphetamine for further distribution.
In June 2017, Drug Enforcement Administration (DEA) agents executed a search warrant on Aispuro’s home in Salem where they found marijuana, cocaine, body armor, a digital scale, vacuum sealers and more than 20 firearms. Agents also found and seized cockfighting literature, vitamins and supplements used to increase roosters’ stamina and sets of gaffs, sharp metal spurs that attach to a rooster’s legs.
Agents also executed a search warrant on Aispuro’s ranch in Scio, Oregon where they found more 200 roosters being raised and trained for fighting. The roosters’ combs and wattles had been removed to make them more effective fighting birds. Aispuro admitted to raising and selling roosters for use in cockfighting derbies for as much as $500 a bird.
Aispuro previously pleaded guilty to one count each of conspiring to distribute methamphetamine and training and selling of fighting animals on June 12, 2018.
This case was investigated by the DEA with the assistance of the U.S. Department of Agriculture, Office of Inspector General, and the Linn County Sheriff’s Office and prosecuted by Peter D. Sax, Assistant U.S. Attorney for the District of Oregon.
Hermiston Woman Sentenced to Six Months in Federal Prison for Dealing FentanylRead the Press Release
PORTLAND, Ore. – Veronica Rivera, 46, of Hermiston, Oregon, was sentenced today to 6 months in federal prison and 3 years’ supervised release for selling fentanyl.
According to court documents, in October 2017, the Tactical Diversion Squad of the Drug Enforcement Administration (DEA) and the Blue Mountain Enforcement Narcotics Team began investigating a drug trafficking organization selling small blue pills pressed to look like 30 milligram oxycodone tablets but that actually contained fentanyl.
On two separate occasions in March 2018, Rivera sold a total of 167 of the fentanyl pills in Hermiston. In April 2018, investigators seized approximately 100 pills from a location where Rivera had hidden them and an additional 129 pills from her Hermiston residence.
On April 25, 2018, a federal grand jury in Portland returned a two-count indictment charging Rivera with distribution of fentanyl and possession with intent to distribute fentanyl. She pleaded guilty to one count of distribution of fentanyl on August 14, 2018.
This case was investigated by the DEA and Blue Mountain Enforcement Narcotics Team and prosecuted by William Narus, Assistant U.S. Attorney for the District of Oregon.
U.S. Attorney Statement on the Joint Terrorism Task Force (JTTF)Read the Press Release
The decision to withdraw the Portland Police Bureau from the Joint Terrorism Task Force is a mistake that defies logic. It’s disappointing that in spite of the overwhelming evidence presented of JTTF successes in Oregon and across the nation, a majority of the city council chose a politically-expedient broadside against the federal government over the safety and well-being of their constituents. The law enforcement community’s duty and commitment to ensuring public safety and protecting civil rights will not be deterred by the politics of the moment.
-- Billy J. Williams, U.S. Attorney for the District of Oregon
Jury Convicts San Diego Man of Traveling to Portland for Sex with MinorRead the Press Release
EUGENE, Ore.—A federal jury found David George Hopkins, 60, of San Diego, California, guilty today for traveling with the intent to engage in sex with a minor and other related charges.
“This case is another example of the extraordinary lengths some will go in an attempt to victimize children,” said Billy J. Williams, U.S. Attorney for the District of Oregon. “It is also an example of the dogged determination of federal law enforcement to intercept individuals who seek to victimize children. I hope this conviction will serve as a warning to would-be child predators who believe they can pursue minors online without consequences.”
“Today’s conviction started with one person who was so concerned that she reported her disturbing interactions with Mr. Hopkins to law enforcement. Her willingness to step forward was critical to our ability to protect children from this predator. I would ask anyone with such information in the future to contact the nearest FBI office or submit tips online at https://tips.fbi.gov,” said Renn Cannon, Special Agent in Charge of the FBI in Oregon.
According to court documents and information shared at trial, on June 9, 2017, Hopkins traveled from San Diego to Portland, Oregon believing he would be able to have sex with a 13-year-old girl named Paula along with her mother, Norma, and her mother’s friend, Ana, with whom he had been chatting online. Unbeknownst to Hopkins, he had been chatting with an FBI Special Agent acting as both Norma and Paula, and with a person using the alias Ana.
Hopkins and Ana began chatting online in 2012, and during one of the conversations, Hopkins raised the topic of having sex with a minor female in Peru and sent Ana a photo of what was purportedly him receiving oral sex from a minor.
In February 2017, Hopkins again contacted Ana and they began communicating using Skype and Facebook. In their first few conversations after reconnecting, Hopkins disclosed more details about his sexual relations with a minor in Peru. He also claimed to have had similar illicit contact with a minor in Panama. Hopkins later wrote, “did it bother u i [sic] had sex with young girls?” Hopkins did not present his conduct as a fantasy and Ana did not believe it was.
Concerned by the information shared with her, Ana reported Hopkins to the Eugene Police Department who referred the matter to the FBI. In March 2017, Ana met with an FBI Special Agent and agreed to cooperate with an investigation of Hopkins.
Ana continued chatting with Hopkins and their conversations grew increasingly more detailed and graphic as Hopkins shared information about his claimed past sexual experiences with minors and his desire to continue such behavior. In one conversation, Ana mentioned her fictitious Peruvian friend Norma. Hopkins asked if they could all have sex together. Ana also mentioned that Norma had a daughter named Paula. Hopkins also expressed an interest in having sex with Paula.
Ana told Hopkins that Norma had agreed to let him have sex with Paula. Shortly thereafter, Hopkins began communicating directly with Norma, the FBI Special Agent. The conversation quickly turned sexual and they discussed Hopkins flying to Oregon. In subsequent conversations, Hopkins began asking Norma about having sex with Paula, and, later, began communicating online directly with Paula. Hopkins chatted with Paula about having sex with her, describing in detail what he wanted to do.
In June 2017, Hopkins flew from San Diego to Portland with intent to engage in sexual conduct with Paula. He was met and arrested by the FBI at Portland International Airport upon his arrival. Hopkins claims of abusing children have not been corroborated.
In an indictment returned on June 20, 2018, a federal grand jury in Eugene charged Hopkins with one count each of attempting to use a minor to produce a visual depiction of sexually explicit conduct, attempting to coerce or entice a minor, traveling with the intent to engage in illicit sexual conduct and transferring of obscene material to a minor.
Hopkins will be sentenced on May 23, 2019, by U.S. District Court Judge Michael J. McShane.
This case was investigated by the FBI with assistance from the Eugene Police Department. It was prosecuted by Amy Potter and Jeff Sweet, Assistant U.S. Attorneys for the District of Oregon.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Anyone who has information about the physical or online exploitation of children are encouraged to call the FBI at (503) 224-4181 or submit a tip online at https://tips.fbi.gov.
Heppner Physician Pleads Guilty to Tax EvasionRead the Press Release
PORTLAND, Ore.—On February 12, 2019, Kenneth Wenberg, 72, a medical doctor from Heppner, Oregon, pleaded guilty to a single count of tax evasion. The government demonstrated it could prove Dr. Wenberg failed to report income resulting in a tax loss of approximately $187,000.
According to court documents, Dr. Wenberg created nominee entities to hide assets and income he personally earned while serving as a physician at the Morrow County Health District (MCHD) and Urgent Health Care Center (UHCC) in Heppner. Dr. Wenberg instructed MDHD and UHCC to make payments for services he performed directly to sham entities to avoid income tax liabilities. Dr. Wenberg opened numerous bank accounts and purchased real property in the names of his nominee entities. He also paid for his and his family’s personal living expenses out of the nominee accounts. Dr. Wenberg failed to report his income to the IRS, despite knowing he owed taxes.
Wenberg faces a maximum sentence of five years in prison, a $250,000 fine and three years of supervised release. He will be sentenced on June 6, 2019 before U.S. District Court Judge Marco A. Hernandez.
As part of the plea agreement, Wenberg has agreed to pay restitution to the IRS in the full amount of the tax loss as determined by the court after sentencing.
This case was investigated by IRS-Criminal Investigation (IRS-CI) and is being prosecuted by Clemon D. Ashley and Seth D. Uram, Assistant U.S. Attorneys for the District of Oregon.
The U.S. Attorney’s Office and IRS-CI remind Oregonians that tax day is Monday, April 15, 2019. For tips to assist taxpayers in choosing a reputable tax professional or preparing their own taxes, visit the IRS website: https://www.irs.gov/help-resources
Oregon Man Pleads Guilty to Federal Hate Crime for Threatening Shooting Spree at Eugene ChurchRead the Press Release
EUGENE, Ore.—Benjamin Jaramillo Hernandez, 69, of Eugene, pleaded guilty today to a federal hate crime and illegal possession of ammunition charge arising from a series of progressively more threatening and violent actions targeting St. Mary Catholic Church in Eugene in September 2018. Assistant Attorney General Eric Dreiband for the Civil Rights Division, U.S. Attorney Billy J. Williams for the District of Oregon and Special Agent in Charge Renn Cannon of the FBI in Oregon made the announcement.
“The Civil Rights Division stands firm in the belief that all people should be able to live their lives free from threats of violence,” said Assistant Attorney General Dreiband. “The Department of Justice will continue to uphold the rights of individuals who are victimized for exercising their religious beliefs and prosecute those who seek to violate those rights.”
“Hate crime laws protect fundamental American values including the free expression of religion. Today’s guilty plea reaffirms the basic principle that no one should live in fear because of their faith,” said U.S. Attorney Williams. “Our office will continue to vigorously investigate and prosecute hate crimes, pursuing justice for all victims.”
“Threatening violent action strikes at the heart of our fundamental right as Americans to live, work and worship without fear. Working with the community and our local law enforcement partners, we will always find strength in our shared values of keeping everyone safe regardless of race, religion or political belief,” said Special Agent in Charge Cannon.
According to court documents, on September 9, 2018, Hernandez was escorted from St. Mary property following an angry outburst during the sacrament of communion. Five days later, on September 14, a church employee reported to the Eugene Police Department that someone had dispensed pepper spray on the exterior door handles and through the mail slot of the St. Mary office front door. Employees reported burning sensations in their fingers and respiratory distress. A Eugene police officer and FBI agent identified Hernandez in church surveillance footage as the person responsible for both incidents.
On September 16, 2018, Hernandez was again spotted near St. Mary. A witness saw Hernandez across the street from the church when he stopped near the Eugene Public Library and shouted at the witness, “I’ve got something for you right here,” while pointing to a bag he was carrying.
A few days later, on September 20, St. Mary employees reported finding a threatening note and seven 10mm Sig hollow point bullets left in the office. The note threatened the church with “2 MP5s w/ 50 rounds each,” a type of submachine gun. The note concluded: “Eugene is going on the [expletive] map.”
A Eugene police officer again reviewed church surveillance footage and identified Hernandez as the individual who dropped off the note and bullets. On September 21, 2018, Eugene Police arrested Hernandez at the Eugene Public Library and charged him with second degree intimidation, second degree criminal mischief and two counts of second degree criminal trespass. During a search of Hernadez’s person, officers located a partially empty can of pepper spray, three .410 shotgun shells and thirteen 10mm Sig hollow point bullets.
Hernandez was charged by criminal information with one count each of obstruction of persons in the free exercise of religious beliefs and felon in possession of ammunition.
He faces a maximum sentence of 20 years in prison and a fine of up to $250,000 for the hate crime conviction, and 10 years in prison for the unlawful possession of ammunition. Hernandez will be sentenced on May 22, 2019 before U.S. District Court Judge Ann Aiken.
This case was investigated by the Eugene Police Department and the FBI and is being prosecuted by Gavin W. Bruce, Assistant U.S. Attorney for the District of Oregon, and Cameron Bell, Trial Attorney for the Civil Rights Division.
For more information about DOJ’s work to combat and prevent hate crimes, visit www.justice.gov/hatecrimes: a one-stop portal with links to DOJ hate crimes resources for law enforcement, media, researchers, victims, advocacy groups, and other organizations and individuals.
Oregon Man Pleads Guilty to Federal Hate Crime for Threatening Shooting Spree at Eugene ChurchRead the Press Release
The Justice Department today announced that defendant Benjamin Jaramillo Hernandez, 69, pleaded guilty today to a federal hate crime and illegal possession of ammunition charge arising from a series of progressively more threatening and violent actions targeting St. Mary Catholic Church in Eugene in September 2018. Assistant Attorney General Eric Dreiband for the Civil Rights Division and U.S. Attorney for the District of Oregon Billy J. Williams made the announcement.
“The Civil Rights Division stands firm in the belief that all people should be able to live their lives free from threats of violence,” said Assistant Attorney General Eric Dreiband. “The Department of Justice will continue to uphold the rights of individuals who are victimized for exercising their religious beliefs and prosecute those who seek to violate those rights.”
“Hate crime laws protect fundamental American values including the free expression of religion. Today’s guilty plea reaffirms the basic principle that no one should live in fear because of their faith,” said U.S. Attorney Williams. “Our office will continue to vigorously investigate and prosecute hate crimes, pursuing justice for all victims.”
“Threatening violent action strikes at the heart of our fundamental right as Americans to live, work and worship without fear. Working with the community and our local law enforcement partners, we will always find strength in our shared values of keeping everyone safe regardless of race, religion or political belief,” said Special Agent in Charge Renn Cannon.
According to court documents, on Sept. 9, 2018, Hernandez was escorted from St. Mary property following an angry outburst during the sacrament of communion. Five days later, on September 14, a church employee reported to the Eugene Police Department that someone had dispensed pepper spray on the exterior door handles and through the mail slot of the St. Mary office front door. Employees reported burning sensations in their fingers and respiratory distress. A Eugene police officer and FBI agent identified Hernandez in church surveillance footage as the person responsible for both incidents.
On Sept. 16, 2018, Hernandez was again spotted near St. Mary. A witness saw Hernandez across the street from the church when he stopped near the Eugene Public Library and shouted at the witness, “I’ve got something for you right here,” while pointing to a bag he was carrying.
A few days later, on September 20, St. Mary employees reported finding a threatening note and seven 10mm Sig hollow point bullets left in the office. The note threatened the church with “2 MP5s w/ 50 rounds each,” a type of submachine gun. The note concluded: “Eugene is going on the [expletive] map.”
A Eugene police officer again reviewed church surveillance footage and identified Hernandez as the individual who dropped off the note and bullets. On Sept. 21, 2018, Hernandez was arrested by Eugene Police at the Eugene Public Library and charged with second degree intimidation, second degree criminal mischief and two counts of second degree criminal trespass. During a search of Hernandez’s person, officers located a partially empty can of pepper spray, three .410 shotgun shells and thirteen 10mm Sig hollow point bullets.
Hernandez was charged by criminal information with one count each of obstruction of persons in the free exercise of religious beliefs and felon in possession of ammunition.
Hernandez faces a maximum sentence of 20 years in prison and a criminal fine of up to $250,000 for the hate crime, and he faces a maximum sentence of 10 years in prison for the unlawful possession of ammunition. Hernandez will be sentenced on May 22, 2019 before U.S. District Court Judge Ann Aiken.
This case is being prosecuted by Assistant U.S. Attorney Gavin Bruce of the U.S. Attorney’s Office of Oregon, and Trial Attorney Cameron Bell with the Civil Rights Division of the U.S. Department of Justice. The case was investigated by the Eugene Division of the FBI and the Eugene Police Department.
For more information about DOJ’s work to combat and prevent hate crimes, visit www.justice.gov/hatecrimes: a one-stop portal with links to DOJ hate crimes resources for law enforcement, media, researchers, victims, advocacy groups, and other organizations and individuals.
Madras Woman Pleads Guilty to Stealing Social Security Payments from Disabled AdultsRead the Press Release
EUGENE, Ore.—Tayva Tucker, 41, of Madras, Oregon, pleaded guilty today to one count of theft of government funds for stealing nearly $40,000 in Social Security payments from ten mentally disabled adults.
According to court documents, beginning in March 2014, Tucker was employed by a social services organization in Madras where she oversaw outreach to mentally disabled clients as part of the organization’s mental health program. As part of her work, Tucker assumed representative payee duties for some her disabled clients’ Title II and Title XVI Social Security benefits. A representative payee is appointed when the beneficiary is incapable of managing his or her benefits. As a representative payee, Tucker was required to use the Social Security payments for the current and future needs of her clients.
In the summer of 2016, an organizational audit uncovered unusual movement of funds between various client accounts, as well as funds transferred from client accounts to Tucker. When confronted, Tucker admitted to taking clients’ Social Security benefits for her personal use. An investigation revealed that Tucker had stolen $39,277 from 10 victims.
Tucker faces a maximum sentence of 10 years in prison, a $250,000 fine and three years of supervised release. She will be sentenced on April 25, 2019 before U.S. District Court Judge Ann Aiken.
As part of the plea agreement, Tucker has agreed to pay $39,277 in restitution.
This case was investigated by the Social Security Administration Office of Inspector General, the Department of Health and Human Services Office of the Inspector General, and is being prosecuted by Gavin W. Bruce, Assistant U.S. Attorney for the District of Oregon.
Jury Convicts Former President of Oregon Foster Care Agency on Theft, Money Laundering and Tax Evasion ChargesRead the Press Release
Downloadable file: U.S. v. Ayala - Exhibit #311
PORTLAND, Ore.—A federal jury found Mary Holden Ayala, 59, of Portland, guilty today of stealing nearly $1 million from an Oregon foster care agency, money laundering and filing false personal income tax returns.
From at least 2008 to 2015, Ayala, a longtime Portland resident, served as the President, Executive Director and primary agent of Give Us This Day (GUTD), a private foster care agency and residential program for youth.
“Children in foster care rely heavily on the agency to which they are entrusted and these agencies are responsible for protecting and caring for them. Mary Holden Ayala grossly neglected her duties and selfishly stole from children in need,” said Billy J. Williams, U.S. Attorney for the District of Oregon. “This prosecution demonstrates our firm commitment to protecting the integrity of federally-funded social service programs.”
“Abuse, drug addiction and violent crime can force children into a foster care system that is supposed to give them a second chance at a better life. One person's greed can corrupt that system, though, leading to victimization of these vulnerable kids. Help stop such victimization and strengthen important institutions by reporting public corruption when you see it,” said Renn Cannon, Special Agent in Charge of the FBI in Oregon.
“Mary Ayala’s theft of nearly $1 million was nothing short of stealing food and shelter from the most vulnerable of our population,” said Acting Special Agent in Charge Troy Burrus, IRS-Criminal Investigation, Seattle Field Office. “Instead of ensuring the children entrusted to her care were properly clothed and fed, Ayala used the money for luxury home renovations, a pilot for a reality show, extensive travel to luxury resorts, music recording studio, luxury shoes and purses. Her final act of contempt was to attempt to hide the stolen money by filing federal tax returns without declaring the stolen funds.”
“Ms. Ayala’s crimes are disturbing: she embezzled money meant to assist foster care children and their families,” said Special Agent in Charge Steven J. Ryan of the Department of Health and Human Services Office of Inspector General. “We will continue to investigate such greed-fueled fraud schemes.”
According to court documents, since its inception in 1979, GUTD was primarily funded by the Oregon state and federal government for foster care services including hiring and screening foster parents for community placements, compensating foster parents for services and placing foster children in residential or group homes. GUTD federal funding originated from the Administration for Children and Families, a division of the U.S. Department of Health and Human Services, and was administrated by ODHS.
From 2009 through 2015, Ayala exercised sole and complete control over GUTD finances. No other GUTD employee or board member had access to the organization’s bank accounts or statements during this time. With no internal controls in place, Ayala wrote checks, used the GUTD debit card and withdrew cash at will, using the organization’s bank accounts as her own.
Ayala used the money stolen from GUTD to pay her mortgage, remodel her home and fund other retail, travel and transportation expenses. Additionally, she used the money to fund other, non-GUTD business ventures including a media company and Big Mary’s, a fish and ribs restaurant in Portland, and to purchase and flip a commercial property.
In total, Ayala stole nearly $1 million from GUTD. As a result, her employees, foster parents and foster children in GUTD’s care suffered tremendously. GUTD residential center and house managers complained about a lack of basic necessities, including but not limited to food, toiletries and cleaning supplies.
In 2015, the day after Ayala resigned her position at GUTD, she filed five false federal income tax returns for tax years 2009 through 2013. Shortly thereafter, she filed a sixth false return for tax year 2014. Ayala failed to file a tax return in 2015.
In a superseding indictment returned on May 3, 2017, a federal grand jury in Portland charged Ayala with five counts of theft concerning programs receiving federal funds, one count of concealment of money laundering, one count of failure to file a personal federal tax return and two counts each of engaging in monetary transactions with criminally derived property and filing a false personal federal tax return. The government dropped the concealment of money laundering charge prior to trial.
Ayala will be sentenced on May 29, 2019 by U.S. District Court Judge Marco A. Hernandez.
The government has seized more than $450,000 in criminally-derived proceeds from Ayala that it will seek to forfeit by court order post sentencing.
This case was investigated by the FBI, the Department of Health and Human Services Office of Inspector General and IRS-Criminal Investigation. It was prosecuted by Donna Maddux, Clemon Ashley and Julia Jarrett, Assistant U.S. Attorneys for the District of Oregon.
Sandy Child Molester Sentenced to over 18 Years in Federal Prison for Online Enticement and Child Pornography OffensesRead the Press Release
PORTLAND, Ore.—Larry Lewis Hudson, 46, of Sandy, Oregon, was sentenced today to 220 months in federal prison for the attempted enticement of children online and possession and distribution of child pornography. Upon completion of his prison sentence, Hudson will be on supervised release for 20 years, during which he will be subject to stringent conditions of supervision, including a requirements that he participate in and complete sex offender treatment, and that he register as a sex offender.
“This defendant has now been convicted twice for exploiting and abusing children,” said Billy J. Williams, U.S. Attorney for the District of Oregon. “His first prison sentence was not enough to deter him from victimizing more children. This 18-year sentence will do just that—protect our most vulnerable community members from a known predator.”
According to court documents, Hudson’s crimes were identified by independent law enforcement investigations conducted by agencies in four different states.
The earliest began in July 2015, when a father in Louisiana reported that a person using the name “Brian Johnson” had exchanged sexually explicit messages with and received at least one explicit photo from his 13-year-old daughter using the Kik Messenger mobile application. Later, in January 2016, a mother in Illinois called police after learning that her developmentally disabled 16-year-old daughter had sent explicit images of herself to “Brian Johnson” using Kik. In March 2016, a detective in Arizona who was posing online as a 15-year-old girl was contacted by “Brian Johnson” who claimed to be a 22-year-old living in Sandy. A few days after that exchange, “Brian Johnson” contacted an investigator in Texas posing online as a 14-year-old girl from Georgia. Hudson was later identified as the person calling himself Brian Johnson.
During online exchanges with the two detectives, Hudson repeatedly engaged in sexually explicit conversations, sent them child pornography and asked them if they would engage in the depicted sex acts with him. He asked them for explicit images of themselves, told the detective in Arizona that he planned to move there and asked if she would get together with him to have sex.
On March 29, 2017, FBI agents executed a federal search warrant at Hudson’s residence in Sandy. They seized a number of electronic devices including two cell phones. A forensic examination of the phones revealed 49 explicit images depicting children engaged in sexual acts with adults, including many of the images Hudson sent to the detectives. Hudson later admitted to using the “Brian Johnson” alias and sending sexually-explicit materials to minors.
Hudson pleaded guilty to one count each of attempted online enticement of a minor, distribution of child pornography and possession of child pornography on July 17, 2018.
In December 2000, Hudson was convicted in Clackamas County Circuit Court of unlawful sexual penetration with a foreign object and first degree sexual abuse after repeatedly molesting a girl under 12 over a seven month period. Hudson was sentenced to and served three years in prison. His prison sentence was followed by a 10-year term of post-prison supervision during which he repeatedly violated his supervision conditions.
The FBI investigated this case. It was prosecuted by Assistant United States Attorney Gary Y. Sussman, Project Safe Childhood Coordinator for the District of Oregon.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
The FBI’s Child Exploitation Task Force (CETF) conducts sexual exploitation investigations – many of them undercover – in coordination with other federal, state, and local law enforcement agencies. The Portland FBI’s CETF consists of agents and task force officers from the Beaverton Police Department, Portland Police Bureau, Tigard Police Department, Hillsboro Police Department, and the Clackamas County Sheriff’s Office. The FBI’s CETF is committed to locating and arresting those who prey on children as well as recovering underage victims of sex trafficking and child exploitation.
Anyone who has information about the physical or online exploitation of children are encouraged to call the FBI at (503) 224-4181 or submit a tip online at www.fbi.gov/tips.
ICYMI: Shutdown Updates from Federal Court in OregonRead the Press Release
PORTLAND. Ore.—During the recent lapse in appropriations, the U.S. Attorney’s Office was required to curtail some operations pursuant to applicable law and policy. Nevertheless, the office continued to fulfill its law enforcement responsibilities by prosecuting criminal cases. Below is a summary of notable case events that occurred during the shutdown:
U.S. v. Hediger
On January 23, 2019, Pamela S. Hediger, 55, of Corvallis, Oregon, was sentenced to 46 months in federal prison and three years’ supervised release for tax evasion and money laundering. Hediger was also ordered to pay more than $1.9 million in restitution.
According to court documents, between 2010 and 2017, Hediger was an attorney, president, and managing shareholder of a law firm in Corvallis. Hediger focused on personal injury cases and independently managed her own client relationships. During her association with the firm, Hediger systematically embezzled funds from the firm’s client trust and business operating accounts, both of which she had signing authority over. The embezzled funds came from insurance proceeds payable to Hediger’s clients.
Hediger failed to file income tax returns on nearly $2.2 million between 2011 and 2017, evading more than $471,000 in taxes due. Hediger previously pleaded guilty to one count each of attempting to evade or defeat taxes and engaging in monetary transactions with property derived from specific unlawful criminal activity on November 6, 2018.
This case was investigated by IRS-Criminal Investigation (IRS-CI) and prosecuted by Claire M. Fay, Assistant U.S. Attorney for the District of Oregon.
U.S. v. Smith
On January 15, 2019, Victor William Smith, Jr., 45, of Warm Springs, Oregon, was sentenced to 144 months in federal prison and three years’ supervised release for assaulting two Warm Springs Tribal Police detectives serving a deputized federal task force officers. Smith was also ordered to pay $8,305 in restitution.
According to court documents, on June 8, 2017, Smith forcibly assaulted the officers by attempting to run them down with his pickup truck. The officers ultimately apprehended Smith and found a stolen Remington shotgun in his truck. Smith admitted to knowingly possessing the stolen firearm at the time of his arrest.
Smith previously pleaded guilty to two counts of assault with a deadly weapon on a federal officer and one count of felon in possession of a firearm.
This case was investigated by the FBI and the Warm Springs Tribal Police Department and prosecuted by Benjamin Tolkoff, Assistant U.S. Attorney for the District of Oregon.
U.S. v. Britton
On January 23, 2019, Shane Britton, 43, of Pendleton, Oregon, was sentenced to five years’ probation and ordered to pay $1,803 in restitution for abusive sexual contact on the Umatilla Indian Reservation.
According to court documents and evidence presented at trial, in June 2016, Britton was staying at a residence shared by the victim and her mother on the Umatilla Indian Reservation. The victim and her mother are both enrolled members of the Confederated Tribes of the Umatilla Indian Reservation. Britton is not a tribal member.
During his stay, Britton subjected the victim to a series of unwanted and progressively more invasive physical encounters. In a recorded interview, Britton initially denied the allegation of abusive sexual contact, but later admitted he inappropriately touched the victim. Britton eventually told law enforcement officers that “in no way shape or form did [the victim] do anything wrong or provoke” his abusive conduct.
A federal jury in Portland convicted Britton on one count of abusive sexual contact on October 18, 2018.
The FBI investigated this case in partnership with the Umatilla Tribal Police Department. It was prosecuted by Jennifer Martin and Natalie Wight, Assistant U.S. Attorneys for the District of Oregon.
U.S. v. Stevens et al.
On January 8, 2019, a federal grand jury returned a six-count indictment charging Ronnie Stevens aka Tim Ephrem, 49, and Tina Ephrem aka Lisa Ann Peterson, 43, both of Portland, with wire fraud.
The indictment alleges that between September 2016 and December 2018, the couple conspired with one another to defraud an elderly couple, Adult Victim 1 (AV1) and Adult Victim 2 (AV2), of both money and property.
The scheme began in September 2016 when AV1 offered a commercial trailer for sale at his business. Stevens told AV1 that he brokered vehicle sales and could sell the trailer in exchange for a cut of the profit. Stevens did not sell the trailer, but quickly ingratiated himself with AV1 who later described him as “humble and honest” but “down on his luck.” Stevens told AV1 that he supported a wife and teenage daughter, and that he suffered with health issues.
Stevens later approached AV1 with an alleged lucrative investment opportunity. Stevens claimed that a friend named Tammy Ward was set to inherit an estate valued in excess of $100 million from her recently deceased father, but could not come up with the fees and legal costs necessary to release the state. Stevens told AV1 that if AV1 could advance the funds to release the estate, AV1 would be given title to valuable classic cars and vans that were part of the estate.
AV1 gave Stevens approximately $15,000 in cash followed by $25,000 in cash two weeks later. The payments escalated over time as Stevens told AV1 various stories about delays and increased costs associated with the release of the estate. As part of the conspiracy, AV1 and AV2 both spoke to a woman on the phone who claimed to be Tammy Ward. Investigators later revealed this person to by Tina Ephrem. Between 2016 and 2018, Stevens placed more than 5,000 outgoing calls to AV1 and AV2.
Stevens and Ephrem collected more than $1.5 million from AV1 and AV2 over the course of the conspiracy, spending the proceeds on utility bills, restaurants, cigars, retail purchases and travel to locations including Hawaii, Anaheim, California, Las Vegas, Nevada and Spirit Mountain Lodge in Grand Ronde, Oregon.
Stevens and Ephrem were arrested on January 11, 2019. They made their initial appearances in federal court the same day and were ordered detained pending a five-day jury trial beginning on March 12, 2019.
This case was investigated by the FBI and is being prosecuted by Donna Brecker Maddux, Assistant U.S. Attorney for the District of Oregon.
An indictment is only an accusation of a crime, and a defendant is presumed innocent unless and until proven guilty.
U.S. v. Newman
On January 15, 2019, Steven Wayne Newman, 50, of Hillsboro, Oregon, was sentenced to 60 months in prison followed by five years of supervised release for distributing child pornography.
According to court documents, in October 2016, an FBI task force officer identified an IP address offering to share files containing child pornography via the BitTorrent peer-to-peer file sharing network. The officer downloaded ten files from a computer at that IP address, four of which depicted prepubescent children engaging in sexually explicit conduct with adults and with each other. The IP address was later traced to Newman’s home in Hillsboro.
The FBI was not the only law enforcement agency investigating Newman’s IP address. Investigators from the Linn County Sheriff’s Office, the Albany Police Department, and the Benton County Sheriff’s Office also downloaded child pornography from a computer at the same address. A Linn County Sheriff’s Office detective downloaded 247 files containing a total of 91 videos and 426 images of child pornography.
On January 20, 2017, FBI agents executed a federal search warrant at Newman’s home. They seized a laptop and external hard drive, both of which contained contraband material. Agents found 212 videos and 665 images depicting the sexual exploitation of children. Newman’s BitTorrent file sharing software had been run 272 times, most recently on the day prior to the search warrant.
This case was investigated by the FBI’s Child Exploitation Task Force (CETF), the Linn County Sheriff’s Office, the Albany Police Department, and the Benton County Sheriff’s Office. It was prosecuted by Gary Y. Sussman, Assistant U.S. Attorney for the District of Oregon.
U.S. v. Gregory
On January 22, 2019, Rodney Paul Gregory, 64, of Lebanon, Oregon, pleaded guilty to one count each of wire fraud and money laundering for his role in various online romance scams.
According to court documents, between May 2017 and January 2019, Gregory acted as a money mule for online romance scams. As part of the scheme, unknown co-conspirators would target individuals through online dating. These co-conspirators would impersonate military or civilian personnel working overseas, pretending they needed funds for foreign taxes, travel costs, or other false representations. Victims would wire money based on these false statements.
Instead of wiring the money directly overseas, victims were asked to wire money to bank accounts in the U.S. Gregory incorporated companies and opened numerous business bank accounts in order to receive these wires transfers from victims. Upon receipt of the wire, Gregory would send the money to overseas bank accounts.
On May 11, 2017, federal agents interviewed Gregory and he claimed he was not aware that the funds wired to his accounts were the proceeds of fraud. He claimed he did the work as a result of promises of love from the woman he met on an online dating website. Following his interview with investigators, Gregory continued to open new business bank accounts using fraudulent information, continued receiving wires from victims and continued wiring the victim’s money overseas. Between the May interview and the end of August 2017, Gregory wired or otherwise withdrew over $200,000 in fraudulent proceeds.
Gregory faces a maximum sentence of 20 years in prison, a $250,000 fine and three years’ supervised release. Under the terms of his plea agreement, Gregory agreed to pay restitution in full to his victims as ordered by the court at sentencing. He will be sentenced on April 4, 2019.
This case was investigated by the FBI and IRS-Criminal Investigation and is being prosecuted by Gavin W. Bruce, Assistant U.S. Attorney for the District of Oregon.
U.S. v. Burkleo
On January 23, 2019, Bud O’Neil Burkleo, 36, of Warrenton, Oregon pleaded guilty to four counts of communicating a false distress message and one count of making a false statement.
According to court documents, Burkleo made four hoax distress calls to the U.S. Coast Guard between April and November of 2016. In response to each call, the Coast Guard dispatched rescue personnel in an attempt to protect life and property. Burkleo also lied to federal investigators.
Burkleo will be sentenced on May 13, 2019.
This case was investigated by the U.S. Coast Guard Investigative Service and prosecuted by Paul T. Maloney, Assistant U.S. Attorney for the District of Oregon.
U.S. v. Ugwa
On November 14, 2018, a federal grand jury returned a 14-count indictment charging Bob Ibenne Ugwa, 49, of Portland, with seven counts each of cyberstalking and anonymous telecommunications harassment.
The indictment alleges that, between 2003 and 2018, Ugwa used an interstate electronic communication service to engage in conduct reasonably expected to cause substantial emotional distress and made telephone calls without disclosing his identity with the intent to abuse, threaten, and harass seven different individuals.
Each charge of cyberstalking under 18 U.S.C. § 2261A(2)(B) and anonymous telecommunications harassment under 47 U.S.C. § 223(a)(1)(C) is punishable by up to five and two years in prison, respectively.
Ugwa was detained pending trial. A three-day jury trial is scheduled to begin on March 26, 2019.
This case was investigated by the FBI and is being prosecuted by Hannah D. Horsley, Assistant U.S. Attorney for the District of Oregon.
An indictment is only an accusation of a crime, and a defendant is presumed innocent unless and until proven guilty.
Superseding Indictment Adds Four Defendants to Gypsy Joker Motorcycle Club Racketeering ConspiracyRead the Press Release
Downloadable file: PDF Press Release
Downloadable file: Superseding IndictmentPORTLAND. Ore.—A federal grand jury has returned a five-count superseding indictment charging six members and associates of the Gypsy Joker Outlaw Motorcycle Club (GJOMC) for racketeering, kidnapping and murder.
The superseding indictment was announced by Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division; U.S. Attorney Billy J. Williams of the District of Oregon; Special Agent in Charge Darek Pleasants of the Bureau of Alcohol, Tobacco, Firearms, and Explosive’s (ATF) Seattle Field Division; and Chief of Police Danielle Outlaw of the Portland Police Bureau (PPB).
GJOMC National President Kenneth Earl Hause, 61, of Aumsville, Oregon; Mark Leroy Dencklau, 58, of Woodburn, Oregon; Earl Deverle Fisher, 48, of Gresham, Oregon; Ryan Anthony Negrinelli, 36, of Gresham; Joseph Duane Folkerts, 61, of Battleground, Washington; and a sixth unnamed defendant are charged, as members and associates of the GJOMC, with conspiring to conduct and participate in the activities of a racketeering enterprise.
Additionally, Dencklau, Fisher, Negrinelli, Folkerts and the unnamed defendant are charged with murder in aid of racketeering; kidnapping in aid of racketeering, resulting in death; kidnapping resulting in death; and conspiracy to commit kidnapping, resulting in death for the June 30 to July 1, 2015 kidnapping and murder of Robert Huggins, a former GJOMC member and resident of southeast Portland, for the purpose of maintaining and increasing their positions in the GJOMC criminal enterprise.
“According to the indictment, since at least 2003, the Gypsy Jokers have engaged in a wide range of crimes, including kidnapping, murder, drug dealing, robbery, extortion, and witness tampering,” said Assistant Attorney General Benczkowski. “Thanks to the efforts of ATF, the Portland Police Department, and federal prosecutors, we will work hard to hold accountable the leaders and members of this brutal and highly organized gang for their alleged crimes.”
“Kenneth Hause is the leader of a criminal organization that, through its many chapters and support clubs, has sowed violence and intimidation throughout the Pacific Northwest. This is an organization whose members and associates pride themselves on living outside the law and use kidnapping, assault, murder and other forms of violence to extend and maintain their power. Kenneth Hause and his co-defendants will soon face the consequences of their crimes thanks to a seamless partnership of federal, state and local law enforcement agencies,” said U.S. Attorney Williams.
“This is a continuation of ATF’s operations against the Gypsy Joker Outlaw Motorcycle Club for racketeering, kidnapping and murder,” said ATF Special Agent in Charge Pleasants. “As president of a criminal organization, Mr. Hause put the community at risk and showed contempt for law and order. It is among ATF’s core commitments to protect the public from violent criminals such as these Gypsy Jokers.”
“The Portland Police Bureau is proud to be a part of this cooperative effort,” said Chief Outlaw. “Violent crime deeply affects our community. By working with our partners, we can utilize a collective group of strategies and tactics to investigate and apprehend those responsible for committing violent acts or profiting from people’s fear through extortion and intimidation.”
According to the superseding indictment, the GJOMC preserves, promotes and protects its power, territory and profits through violence and intimidation and enriches its members through extortion, robbery and the distribution of narcotics. The organization is known for using fear through its members and associates as a tactic for establishing and maintaining its power. The GJOMC oversees several “support clubs” in Oregon and Washington, including the Road Brothers Northwest Motorcycle Club, Solutions Motorcycle Club, Northwest Veterans Motorcycle Club, High-Side Riders, and the Freedom Fellowship Motorcycle Club.
Dencklau, Fisher and Tiler Evan Pribbernow, 37, of Portland were first charged in a four-count indictment unsealed in July 2018. Pribbernow pleaded guilty to a single count of conspiring to conduct and participate in the activities of a racketeering enterprise on November 7, 2018. Dencklau and Fisher are detained pending trial.
In addition to the criminal charges brought against the named defendants, the government is seeking forfeiture of a property located in Salem, Oregon used as a GJOMC clubhouse.
An indictment is only an accusation of a crime, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
This case was investigated by the PPB and ATF, with assistance from the U.S. Marshals Service, IRS-Criminal Investigation, Clark County, Washington Sheriff’s Office, the Oregon State Police, and the Oregon and Washington State Crime Labs. Leah K. Bolstad and Steven T. Mygrant, Assistant U.S. Attorneys for the District of Oregon, are prosecuting the case with Rebecca A. Staton, Trial Attorney for the Criminal Division’s Organized Crime and Gang Section.
This case is part of Project Safe Neighborhoods (PSN), the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
ICYMI: Oregon Man Sentenced to Life in Prison for Sexually Abusing Children at Orphanage in CambodiaRead the Press Release
EUGENE, Ore.—On January 18, 2019, Daniel Stephen Johnson, 40, of Coos Bay, Oregon, was sentenced to life in federal prison for repeatedly sexually abusing children who lived at an orphanage operated by the defendant in Cambodia.
In a jury trial ending on May 16, 2018, Johnson was convicted on six counts of engaging in illicit sexual conduct in a foreign place and one count each of travel with intent to engage in illicit sexual conduct and aggravated sexual assault with a child. He was sentenced to 30 years in prison on each count of illicit sexual conduct in a foreign place, 30 years for traveling with the intent to engage in illicit sexual conduct, and life in prison for aggravated sexual assault with children. The sentences for engaging in illicit sexual conduct in a foreign place will run consecutively.
According to court documents and information shared during trial, between November 2005 and his arrest in December 2013, Johnson systematically and repeatedly molested children who lived at an unlicensed orphanage he started and ran in Phnom Penh, Cambodia. Johnson funded the orphanage by soliciting donations from church groups in Oregon, California, Texas and elsewhere. Ten Cambodian victims—who ranged in age from seven to 18 years old at the time of abuse—have disclosed Johnson’s abuse or attempted abuse.
Victims described a pattern of molestation that includes, among other things, Johnson making them perform oral sex on him and anally raping them. Multiple victims said they were, on numerous occasions, awoken to Johnson abusing them. Following the abuse, Johnson would sometimes provide his impoverished victims with small amounts of money or food. On one occasion, Johnson gave a victim the equivalent of $2.50 in Cambodian currency.
In 2013, a warrant was issued for Johnson’s arrest on an unrelated case by officials in Lincoln County, Oregon. Local law enforcement officers worked with the FBI to locate Johnson overseas. The FBI in turn worked with the U.S. Department of State to revoke Johnson’s passport based on the Oregon warrant. Through the work of the FBI, Action Pour Les Enfants, a non-governmental organization dedicated to ending child sexual abuse and exploitation in Cambodia, and the Cambodian National Police (CNP), Johnson was located in Phnom Penh.
On December 9, 2013, CNP arrested Johnson. Based on disclosures made by children at the orphanage, Cambodian officials charged Johnson and detained him pending trial. In May 2014, Johnson was convicted by a Cambodian judge of performing indecent acts on one or more children at the orphanage and sentenced to a year in prison. Following his release from prison, Johnson was escorted back to the U.S. by the FBI.
Based on the sexual-abuse allegations against him, the FBI undertook a lengthy investigation of Johnson. During the course of their investigation, agents interviewed more than a dozen children and adults who had resided at the orphanage. Many of the interviews were audio- and video-taped and, in several instances, conducted in Cambodia by trained child-forensic interviewers. Some victims were interviewed multiple times before disclosing Johnson’s abuse.
Johnson was indicted by a federal grand jury in Eugene, Oregon on December 20, 2014 on one count of engaging in illicit sexual conduct in a foreign place. Seven additional charges were added by superseding indictment on May 17, 2017.
While in custody awaiting trial, Johnson made multiple efforts to tamper with witnesses and obstruct justice. Johnson contacted his victims online, encouraging them to lie and offering money and gifts. One message, sent via his relative’s Facebook account to an adult in Cambodia, discussed visiting a victim’s family and encouraging them to convince the victim to retract their statement, potentially in exchange for $10,000. Another message explains the need for a victim to say they were under duress and “pushed by police” to thumbprint a document.
This case was investigated by the FBI with the assistance of the Toledo, Oregon Police Department. It was prosecuted by Jeffrey S. Sweet and Ravi Sinha, Assistant U.S. Attorneys for the District of Oregon, and Lauren E. Britsch, Trial Attorney for the Justice Department’s Child Exploitation and Obscenity Section. Amy E. Potter, Assistant U.S. Attorney for the District of Oregon, assisted with the prosecution.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Launched in May 2006 by the U.S. Department of Justice and led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Nationwide Sting Operation Targets Illegal Asian Brothels, Six Indicted for RacketeeringRead the Press Release
PORTLAND, Ore.—A federal grand jury in Oregon has returned two indictments charging six people with running sex trafficking organizations operating in the U.S., Canada and Australia. The indictments were unsealed today following a series of arrests by FBI Portland’s Child Exploitation Task Force (CETF) resulting from a multi-district takedown operation on Tuesday, January 15, 2019.
The FBI partnered with local law enforcement agencies in more than a dozen cities across the nation to coordinate sting operations targeting the organizations operated by defendants under indictment in Oregon, along with other Asian sex trafficking networks. As part of the takedown operation, the FBI seized the primary website used by one of the organizations, www.supermatchescort.com, and about 500 other associated domains, including 25 location-specific sub-sites.
In addition to the arrests, the FBI assisted five victims in Oregon. The FBI and U.S. Attorney’s Office victim services programs worked with local non-profits to ensure the victims have access to social, medical and legal services.
Zongtao Chen aka Mark Chen, 46, of Toronto, Canada; Weixuan Zhou aka Marco Zhou, 37, of Guangzhou, China; Yan Wang aka Sarah Wang, 33, of Temecula, California; Chaodan Wang, 32, of Beaverton, Oregon; and Ting Fu, 35, of Beaverton, Oregon, are charged with conspiracy and use of interstate facilities to promote, manage, establish, carry on or facilitate a racketeering enterprise. In a separate indictment, Hui Ling Sun, 40 of Portland, is charged with using interstate facilities to promote, manage, establish, carry on or facilitate a racketeering enterprise.
“Protecting vulnerable foreign nationals from criminal traffickers seeking to exploit them for profit is a critically important law enforcement mission. Trafficking adults for sex can at times be overlooked by our society because some believe the adult victims have a choice. This notion is false. These victims are powerless and often thousands of miles away from their home, native language and personal connections who might help them escape. We have always and will continue to aggressively pursue criminals who exploit vulnerable victims,” said Billy J. Williams, U.S. Attorney for the District of Oregon.
“Vulnerable women looking for a new life in the U.S. instead find traffickers who cash in on their cultural isolation by profiting from the sale of sex services. In many cases, these women lack the language skills and understanding of American civil rights to ask for help or assistance from law enforcement. For that reason, we need community members who suspect such illegal activity to come forward to help us identify these instances of human trafficking so we can recover the victims and provide them the social, medical and legal services they need,” said Renn Cannon, Special Agent in Charge of the FBI in Oregon.
According to the indictments, Mark Chen headed a criminal enterprise that recruited women, primarily from China, to travel to the U.S. and elsewhere to engage in prostitution and other sex trafficking activities. Within the cities the organization was operating, a “boss” would oversee and manage a local brothel in a hotel or apartment complex. Customers seeking to engage in acts of illegal prostitution would call a number listed on www.supermatchescort.com or related websites, or send a message by text, email, or WeChat, an encrypted internet messaging service based in China. The organization employed dispatchers who would receive incoming requests from potential customers to set up “dates.” The dispatchers would coordinate and schedule the “dates” with women working at the various brothels.
Dispatchers used a computer program to schedule and track all of the prostitution dates. This computer program had a customer database that logged more than 30,000 customer phone numbers with details from previous dates. In Oregon, defendant Zongtao “Mark” Chen promoted illegal prostitution activities that occurred at brothels in Portland, Tigard and Beaverton.
Hui Ling Sun made her initial appearances in federal court in Portland on January 15, 2019 and was detained pending trial. Ting Fu is expected to appear in Portland today. Yan Wang, arrested by the FBI’s Los Angeles Division, made an appearance before a magistrate judge in the Central District of California on January 15, 2019. The Toronto Police Service Human Trafficking Enforcement Team and Fugitive Squad have provisionally arrested Chen in Canada with a view towards extradition. Investigators believe Weixuan Zhou is in China and Chaodan Wang’s location is unknown.
Anyone with information on these investigations or who would like to report a federal crime may contact the nearest FBI office or submit information online at https://tips.fbi.gov.
An indictment is only an accusation of a crime, and defendants are presumed innocent unless and until proven guilty.
The FBI Portland’s CETF investigated this case with assistance from Homeland Security Investigations (HSI) agents in Omaha, Nebraska. The Toronto Police Service, which maintained a parallel investigation, also provided assistance. CETF member organizations who participated in the takedown include Portland Police Bureau, Beaverton Police Department, Tigard Police Department and Clackamas County Sheriff’s Office.
The FBI CETF conducts sexual exploitation investigations—many of them undercover—in coordination with other federal, state and local law enforcement agencies. The CETF is committed to locating and arresting those who prey on children as well as recovering victims of sex trafficking and child exploitation.
The National Cyber Forensics and Training Alliance (NCFTA) assisted in the seizure of the websites related to the Chen investigation. The NCFTA, established in 2002, is a nonprofit partnership between private industry, government and academia for the sole purpose of providing a neutral, trusted environment that enables two-way collaboration and cooperation to identify, mitigate and disrupt cybercrime.
Scott Kerin and Julia Jarrett, Assistant U.S. Attorneys for the District of Oregon, are prosecuting the case.
Please Note: During the lapse in appropriations, the U.S. Attorney’s Office is required to curtail some operations pursuant to applicable law and policy. Nevertheless, the office continues to fulfill its law enforcement responsibilities by prosecuting criminal cases. The office will provide public information about certain significant cases including those impacting public safety and national security.
U.S. v. Chen et al. Indictment U.S. v. Sun IndictmentOregon Man Indicted for Instagram Threats Against Portland Mayor Ted WheelerRead the Press Release
PORTLAND, Ore. – A one-count indictment was unsealed in federal court today charging Kermit Tyler Poulson, 39, with transmitting threatening communications with the intent to extort Portland Mayor Ted Wheeler.
“Using social media to extort or threaten violence against any citizen is a crime. This conduct is unacceptable in any context and has no respectable place in public discourse. Threats of violence, both in person and on social media, are taken very seriously by federal law enforcement,” said Billy J. Williams, U.S. Attorney for the District of Oregon.
“Every day, the Portland JTTF’s role is to assess, address and mitigate threats against the people of Oregon. If you become aware of someone threatening violence against others, we ask that you contact us right away so we can work with you to create a safe community for all,” said Renn Cannon, Special Agent in Charge of the FBI in Oregon.
Poulson was arrested in Missoula, Montana on January 8, 2019 after visiting the Missoula Police Department to file a complaint on an unrelated matter. Missoula Police Department officers executed the arrest after locating Poulson’s federal arrest warrant in the National Crime Information Center (NCIC) database. Poulson recently resided in Portland, but has no known permanent residence.
If convicted, Poulson faces a maximum sentence of two years in prison and a $250,000 fine.
This case was investigated by the Portland FBI Joint Terrorism Task Force (JTTF) and the Portland Police Bureau (PPB). The Portland JTTF includes FBI special agents and more than a dozen state and local law enforcement officers.
An indictment is only an accusation of a crime, and a defendant is presumed innocent unless and until proven guilty.
Hillsboro Man Pleads Guilty to Federal Charge After Stealing Labor Union FundsRead the Press Release
PORTLAND, Ore.—John Jason Burgess, 43, of Hillsboro, Oregon, pleaded guilty today to one count of concealing or destroying labor union records.
According to court documents, between 2008 and 2016, Burgess served as the president of Local 304, an independent labor union representing approximately 140 employees of Pacific Stainless Products (PSP), a manufacturer of stainless steel equipment headquartered in St. Helens, Oregon. Local 304 represents its members in negotiating with PSP on employment issues and, under the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA), is required to file an annual financial report with the Secretary of Labor. Members fund the union entirely through biweekly dues of $12.50 withheld from their paychecks.
As president, Burgess was added as a signatory to Local 304’s bank account in 2011 and received a debit card linked to the account. At around the same time, Burgess assumed responsibility for maintaining the union’s financial records as required by LMRDA. Burgess was not authorized to draw any compensation for his duties as an officer of Local 304.
Burgess was fired from PSP in January 2016 and thus became ineligible to continue as a member or officer of Local 304. He surrendered his debit card linked to the union’s bank account, but did not produce or otherwise make available the financial records he had maintained during his time as president. Burgess admitted to abusing his position to convert to personal use more than $32,000 in union funds while failing to keep or disclose receipts relating to his unauthorized expenditures as required under LMRDA.
Burgess faces a maximum sentence of 12 months in prison, a $100,000 fine and a one-year term of supervised release. He will be sentenced on April 10, 2019, before U.S. District Court Judge Anna J. Brown. As part of the plea agreement, Burgess will pay restitution of no less than $10,600 to Local 304, as ordered by the court. Burgess has already repaid $21,580 to the union.
The U.S. Department of Labor, Office of Labor-Management Standards, investigated this case. It is being prosecuted by Ryan W. Bounds, Assistant U.S. Attorney for the District of Oregon.
Washington County Sheriff's Office Civilian Employee Accused of Enticing a Minor Online and Distributing Child PornographyRead the Press Release
PORTLAND, Ore. – A criminal complaint was unsealed today in federal court alleging Luke De Roy Krieger, 39, of Camas, Washington, engaged in the coercion and enticement of a minor and distributed child pornography.
As alleged in the criminal complaint, on approximately August 14, 2018, undercover officers from the United Kingdom (UK) Police Eastern Regional Special Operations Unit contacted Homeland Security Investigations (HSI) London, England, office requesting assistance regarding a mobile app user who had engaged them in sexualized chat regarding young children. The user, later identified as Krieger, discussed his sexual interest in children and talked about traveling to the UK to engage in sexual activity with the undercover officer’s minor daughter.
Working with the mobile app maker and Frontier Communications, investigators were able to locate two IP addresses Krieger used to conduct the illicit communication. One IP address was associated with a residential internet account for Krieger’s home in Camas. The second was linked to a business internet account registered to the Washington County Sheriff’s Office in Hillsboro, Oregon, where Krieger is employed as a non-sworn Information Systems Analyst.
Investigators continued communicating with Krieger via the mobile app, posing both as an adult male residing in Boise, Idaho, and as a 13-year-old female the adult male was supposedly living with and sexually abusing. Krieger revealed having sexual fantasies about several minor females, including children who he had come into contact with regularly. He also shared his desire to use a spy cam to take voyeuristic photos and videos of minor girls in a state of undress.
Krieger repeatedly requested and sent photos of child pornography to the undercover officers and, on at least one occasion, a nude photo of himself from the neck down. In response to repeated statements by both the undercover adult and minor, Krieger confirmed that he was aware of the minor’s age. Eventually, the undercover adult invited Krieger to travel to Boise for the purpose of having sex with the undercover minor. Krieger was arrested without incident on December 18, 2018, in Hillsboro before attempting to travel out of state.
Krieger made an initial appearance today in federal court before U.S. Magistrate Judge Youlee Yim You. He will remain in custody pending a detention hearing scheduled for December 21, 2018.
A criminal complaint is only an accusation of a crime, and a defendant is presumed innocent unless and until proven guilty.
This case is being investigated by HSI and the Vancouver, Washington Police Department’s Digital Evidence Gathering Unit. The Washington County Sheriff’s Office has fully supported and cooperated with the investigation.
This case is part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
HSI encourages the public to report suspected child predators and any suspicious activity through its toll-free Tip Line at 1-866-DHS-2-ICE or by completing its online tip form. Both are staffed around the clock by investigators. From outside the U.S. and Canada, callers should dial 802-872-6199. Hearing impaired users can call TTY 802-872-6196.
Madras Man Pleads Guilty to Bank Robbery and Conspiracy to Distribute MethamphetamineRead the Press Release
EUGENE, Ore.—Tyler Wayne Fuller, 29, of Madras, Oregon, pleaded guilty today, in separate criminal cases, to one count each of bank robbery and conspiracy to distribute and possess with intent to distribute methamphetamine.
According to court documents, on August 21, 2017, a man later identified as Fuller walked into the U.S. Bank branch on Southwest C Street in Madras. Fuller approached the victim teller and passed her a note that read “Give me your money and nobody gets hurt.” Fuller then told the teller not to play games. The teller gave Fuller $517 and pressed her alarm button as he exited the bank. Fuller was later arrested without incident during a traffic stop.
In a separate criminal matter, Fuller has admitted to being a member of a drug distribution conspiracy and possessing more than fifty grams of methamphetamine.
Fuller faces a maximum sentence of life in prison with a 10-year mandatory minimum, a $10 million fine and five years of supervised release. He will be sentenced on April 8, 2019 before U.S. District Court Judge Michael J. McShane.
As part of the plea agreement, Fuller has agreed to pay $517 in restitution.
The FBI, the Central Oregon Emergency Response Team, and Madras Police Department investigated this case. It is being prosecuted by Frank R. Papagni, Jr., Assistant U.S. Attorney for the District of Oregon.
Portland Man Sentenced to 60 Months in Prison for Distributing Child Pornography via Bittorrent NetworkRead the Press Release
PORTLAND, Ore. – Jordan Thomas Prentice, 28, of Portland, was sentenced today to 60 months in federal prison for distributing child pornography using a BitTorrent peer-to-peer file-sharing network. Upon completion of his prison sentence, Prentice will be on supervised release for five years.
According to court documents, on July 3, 2015, an undercover agent with the Vancouver, Washington Police Department downloaded multiple files depicting infants, toddlers and other prepubescent children being sexually abused from a BitTorrent file-sharing network. Investigators traced the IP address associated with the files to Prentice’s residence in Portland. The National Center for Missing and Exploited Children (NCMEC) identified numerous files downloaded from Prentice’s IP address that depicted children identified in prior investigations and some of whom resided outside of Oregon.
On January 27, 2016, Homeland Security Investigations (HSI) agents executed a federal search warrant at Prentice’s Portland home. Prentice admitted to having viewed child pornography since he was 15 years old and having downloaded the illicit files for years using uTorrent software. Agents seized multiple devices from Prentice’s home and later located more than 600 images and 126 video files depicting child sexual abuse.
Prentice previously pleaded guilty to one count of distribution of child pornography on August 8, 2018. As part of his plea agreement, Prentice agreed to pay restitution to his victims and forfeit personal property used to facilitate his crimes.
This case was investigated by HSI and the Vancouver Police Department. It was prosecuted by Jane Shoemaker, Natalie Wight and Amy Potter, Assistant U.S. Attorneys for the District of Oregon.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
HSI encourages anyone with information about the physical or online exploitation of children to call its toll-free tip line at 1-866-DHS-2-ICE or submit an online tip form. Both reporting methods are staffed around the clock by investigators. From outside the U.S. and Canada, callers should dial 802-872-6199. Hearing impaired users can call TTY 802-872-6196.
Suspected child sexual exploitation may also be reported to the National Center for Missing & Exploited Children via its toll-free 24-hour hotline, 1-800-THE-LOST.
Oregon Restaurant Owner Sentenced to Prison in Connection with Immigration-Related Forced Labor SchemeRead the Press Release
PORTLAND, Ore. — Paul Jumroon, also known as Veraphon Phatanakitjumroon, 55, formerly of Beaverton and Depoe Bay, Oregon, and a naturalized citizen originally from Thailand, was sentenced today by U.S. District Judge Anna J. Brown to 37 months in prison and ordered to pay more than $131,000 in restitution to four victims and more than $120,000 to the IRS in taxes due. The defendant previously pleaded guilty to forced labor, visa fraud conspiracy, and filing false tax returns. Today’s sentence was announced by Assistant Attorney General Eric Dreiband of Justice Department’s Civil Rights Division, U.S. Attorney Billy J. Williams of the District of Oregon, Acting Special Agent in Charge Steve Palmer of the FBI’s Portland Field Office, and Acting Special Agent in Charge Troy Burrus of IRS Criminal Investigation’s Seattle Field Office.
According to documents filed in court, between 2011 and 2014, defendant Paul Jumroon and co-defendant Tanya Jumroon fraudulently obtained E-2 “investor” visas to bring Thai nationals into the United States to provide cheap labor at their restaurants in Lake Oswego, Oregon, and in Ridgefield, Washington. The defendants no longer own either restaurant. Paul Jumroon then lured four Thai chefs to the United States to work at the restaurants through the promise of a visa and false representations about their salaries and job responsibilities. Once the victims arrived, he confiscated their passports and documents and exploited and coerced their labor through debts, verbal abuse, and threats of financial and reputational harm, requiring them to work significant hours for minimal pay. Tanya Jumroon witnessed the mistreatment of the victims, and she benefited financially from their forced labor at the restaurants that she co-owned. Additionally, the defendants filed multiple false tax returns with the IRS by failing to report cash income earned from the restaurants between 2012 and 2015.
“Paul Jumroon’s violation of the law by obtaining fraudulent visas and exploiting vulnerable individuals for his own personal profit is disgraceful,” said Acting Assistant Attorney General Eric Dreiband. “The Department of Justice will continue to prosecute traffickers vigorously and secure justice for victims who have been mistreated and degraded by criminals.”
“Paul Jumroon has been brought to justice for preying on the hopes of vulnerable workers and using fear to compel work for little pay. He and his wife Tanya profited off of a degrading crime,” said U.S. Attorney Billy J. Williams. “This case demonstrates our firm commitment to holding traffickers accountable and restoring the rights, freedom and dignity of victims.”
“Life in America is built on the promise of freedom and choice. When these victims came to this country seeking a better life, Paul Jumroon instead cooked up a scheme of false promises, forced labor and abuse,” said FBI Acting Special Agent in Charge Steve Palmer. “Today’s sentence brings justice for them while also sending a strong message to those who think they can profit off others through coercion and intimidation.”
“Mr. and Mrs. Jumroon bullied and intimidated employees that trusted them in order to line their own pockets” said Troy Burrus, IRS Criminal Investigation Acting Special Agent in Charge. “The defendants thought they were above the law. They abused multiple victims and stole money from the American taxpayers. Today’s sentence demonstrates the government's determination to hold them accountable for their actions.”
Tanya Jumroon, also known as Thunyarax Phatanakit Jumroon, 59, of Beaverton, Oregon, will be sentenced tomorrow for conspiring with Paul Jumroon and others to commit visa fraud, for making and subscribing a false tax return, and benefitting financially from forced labor. Tanya Jumroon pleaded guilty to these charges in June 2018.
The District of Oregon is one of six districts designated through a competitive, nationwide selection process as a Phase II Anti-Trafficking Coordination Team (ACTeam), through the interagency ACTeam Initiative of the Departments of Justice, Homeland Security and Labor. ACTeams focus on developing high-impact human trafficking investigations and prosecutions involving forced labor, international sex trafficking and sex trafficking by force, fraud or coercion through interagency collaboration among federal prosecutors and federal investigative agencies.
This prosecution is the result of the joint investigation by the Oregon Foreign-Born Human Trafficking Taskforce, FBI, Homeland Security Investigations, IRS Criminal Investigation and Department of State’s Diplomatic Security Service, with assistance from the Department of Labor’s Wage and Hour Division and Portland Police Bureau. The case is being prosecuted by Assistant U.S. Attorneys Hannah Horsley, Scott Bradford and Steven Mygrant of the District of Oregon, and Lindsey Roberson of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Oregon Restaurant Owner Sentenced to Prison in Connection with Immigration-Related Forced Labor SchemeRead the Press Release
Paul Jumroon, also known as Veraphon Phatanakitjumroon, 55, formerly of Beaverton and Depoe Bay, Oregon, and a naturalized citizen originally from Thailand, was sentenced today by U.S. District Judge Anna J. Brown to 37 months in prison with three years’ supervised release and was ordered to pay more than $131,000 in restitution to four victims and more than $120,000 to the IRS in taxes due. The defendant previously pleaded guilty to forced labor, visa fraud conspiracy, and filing false tax returns. Today’s sentence was announced by Assistant Attorney General Eric Dreiband of Justice Department’s Civil Rights Division, U.S. Attorney Billy J. Williams of the District of Oregon, Acting Special Agent in Charge Steve Palmer of the FBI’s Portland Field Office, and Acting Special Agent in Charge Troy Burrus of IRS Criminal Investigation’s Seattle Field Office.
According to documents filed in court, between 2011 and 2014, defendants Paul Jumroon and Tanya Jumroon fraudulently obtained E-2 “investor” visas to bring Thai nationals into the United States to provide cheap labor at their restaurants in Lake Oswego, Oregon, and in Ridgefield, Washington. The defendants no longer own either restaurant. Paul Jumroon then lured four Thai chefs to the United States to work at the restaurants through the promise of a visa and false representations about their salaries and job responsibilities. Once the victims arrived, he confiscated their passports and documents and exploited and coerced their labor through debts, verbal abuse, and threats of financial and reputational harm, requiring them to work significant hours for minimal pay. Tanya Jumroon witnessed the mistreatment of the victims, and she benefited financially from their forced labor at the restaurants that she co-owned. Additionally, the defendants filed multiple false tax returns with the IRS by failing to report cash income earned from the restaurants between 2012 and 2015.
“Paul Jumroon’s violation of the law by obtaining fraudulent visas and exploiting vulnerable individuals for his own personal profit is disgraceful,” said Acting Assistant Attorney General Eric Dreiband. “The Department of Justice will continue to prosecute traffickers vigorously and secure justice for victims who have been mistreated and degraded by criminals.”
“Paul Jumroon has been brought to justice for preying on the hopes of vulnerable workers and using fear to compel work for little pay. He and his wife Tanya profited off of a degrading crime,” said U.S. Attorney Billy J. Williams. “This case demonstrates our firm commitment to holding traffickers accountable and restoring the rights, freedom and dignity of victims.”
“Life in America is built on the promise of freedom and choice. When these victims came to this country seeking a better life, Paul Jumroon instead cooked up a scheme of false promises, forced labor and abuse,” said FBI Acting Special Agent in Charge Steve Palmer. “Today’s sentence brings justice for them while also sending a strong message to those who think they can profit off others through coercion and intimidation.”
“Mr. and Mrs. Jumroon bullied and intimidated employees that trusted them in order to line their own pockets” said Troy Burrus, IRS Criminal Investigation Acting Special Agent in Charge. “The defendants thought they were above the law. They abused multiple victims and stole money from the American taxpayers. Today’s sentence demonstrates the government's determination to hold them accountable for their actions.”
Tanya Jumroon, also known as Thunyarax Phatanakit Jumroon, 59, of Beaverton, Oregon, will be sentenced tomorrow for conspiring with Paul Jumroon and others to commit visa fraud, for making and subscribing a false tax return, and benefitting financially from forced labor. Tanya Jumroon pleaded guilty to these charges in June 2018.
The District of Oregon is one of six districts designated through a competitive, nationwide selection process as a Phase II Anti-Trafficking Coordination Team (ACTeam), through the interagency ACTeam Initiative of the Departments of Justice, Homeland Security and Labor. ACTeams focus on developing high-impact human trafficking investigations and prosecutions involving forced labor, international sex trafficking and sex trafficking by force, fraud or coercion through interagency collaboration among federal prosecutors and federal investigative agencies.
This prosecution is the result of the joint investigation by the Oregon Foreign-Born Human Trafficking Taskforce, FBI, Homeland Security Investigations, IRS Criminal Investigation and Department of State’s Diplomatic Security Service, with assistance from the Department of Labor’s Wage and Hour Division and Portland Police Bureau. The case is being prosecuted by Assistant U.S. Attorneys Hannah Horsley, Scott Bradford and Steven Mygrant of the District of Oregon, and Lindsey Roberson of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Jury Convicts Former Tigard Resident for Defrauding Investors in Ohio Gold MineRead the Press Release
PORTLAND, Ore.—On Wednesday, December 12, 2018, a federal jury in Portland returned guilty verdicts against Harry Dean Proudfoot III, 78, formerly of Tigard, Oregon, for running a fraudulent gold mining investment scheme that he used to steal $3.2 million from 140 investors. Proudfoot was convicted of conspiracy to commit wire fraud, wire fraud, conspiracy to commit money laundering, and money laundering.
“Harry Proudfoot and his children made many promises to their investors—promises they never intended to fulfill. They now join a long list of financial criminals whose schemes were cut short by diligent investigators working on behalf of victims. Pursuing criminals who prey on unknowing investors is a top priority for federal law enforcement in Oregon,” said Billy J. Williams, U.S. Attorney for the District of Oregon.
“The FBI is committed to investigating fraud schemes and deceptive practices by those who can cause devastating and irreparable financial harm to the members of our community. Together with its law enforcement partners, the FBI is dedicated to protecting the interests of the American public, so they can both invest and lend with confidence,” said Renn Cannon, Special Agent in Charge of the FBI in Oregon.
“Mr. Proudfoot and his children built a ‘house of cards’ with their false promises and when it collapsed, as these houses do, IRS-Criminal Investigation is proud to support its law enforcement partners to expose and bring to justice those responsible,” said IRS-Criminal Investigation Special Agent in Charge Darrell Waldon.
According to court documents and information shared at trial, in 2008, Harry Proudfoot created 3 Eagles Research and Development, a company based in Tigard that he used from 2008 through 2012 to solicit investors for a purported goldmining operation in Ohio. Harry Proudfoot, along with his adult children, including co-defendant Matthew Proudfoot, falsely promised to use investors’ money to purchase mining equipment and conduct mining operations at two gravel pits in Ohio.
To entice investors, Proudfoot and his children offered high rates of return, typically 10% of gross revenues, payable once the mine became operational. They falsely told investors they had all the necessary legal and business requirements in place for the mining operation.
At the same time, Proudfoot and his children withheld important facts from investors including that Harry Proudfoot had received cease and desist orders from the States of Alaska and Oregon for selling unregistered securities through material misrepresentations in 1992, 1993, and 2003 and that Matthew Proudfoot had filed for bankruptcy in 2010. Rather than using investor money as promised they diverted it to their personal use, funding living expenses, cars, travel, credit card bills, medical payments, lulling payments and other expenses to keep the scheme afloat.
In 2011, the States of Washington and Colorado and the U.S. Securities and Exchange Commission (SEC) began investigating the group for securities violations. Ultimately, the U.S. District Court for the District of Oregon entered a judgment against Harry Proudfoot, Matthew Proudfoot and the 3 Eagles Research and Development Company in the SEC enforcement action.
Harry Proudfoot faces a maximum sentence of 20 years in prison, a $250,000 fine and three years’ supervised release on each count of wire fraud and 10 years in prison, a $250,000 fine and three years’ supervised release on each count of money laundering. He will be sentenced on April 3, 2019 before U.S. District Court Judge Michael H. Simon.
Co-defendant Matthew Proudfoot pleaded guilty to wire fraud and money laundering on November 1, 2017. He will be sentenced on January 9, 2019.
The case was investigated by the FBI and IRS-Criminal Investigation, and prosecuted by Scott E. Bradford and John C. Brassell, Assistant U.S. Attorneys for the District of Oregon.