District of Oregon
Press releases recorded for this federal judicial district.
Career Offender Sentenced to 110 Months for Possession with Intent to Distribute MethamphetamineRead the Press Release
EUGENE, Ore. – On June 9, 2014, Gretchan Anderson, 43, of Portland, Oregon, was sentenced by U.S. District Judge Michael McShane to 110 months in federal prison, in addition to the time she has been in custody since July of 2013, for possession with intent to distribute methamphetamine. Upon her release from prison, Anderson will be on supervised release for four years.
Anderson is a career offender who was caught twice last year dealing methamphetamine. The first of those two incidents happened on February 26, 2013 in Portland and resulted in state charges. During the pendency of that state case, on July 19, 2013, law enforcement apprehended Anderson as she was traveling from Portland to Lane County to distribute methamphetamine, which resulted in the instant federal charge. Anderson has a lengthy criminal history including convictions for burglary in the first degree and manufacture of a controlled substance.
This case was investigated by DEA and the Lane County Interagency Narcotics Enforcement Team, and was prosecuted by Assistant U.S. Attorney Nathan J. Lichvarcik.
D&R Car Lot Owners Sentenced to Federal Prison for Flooring Loan FraudRead the Press Release
PORTLAND, Ore. — U.S. District Court Judge Michael Simon sentenced the former owners of D&R Auto Sales, D&R Motors, and D&R Ford/Mercury to federal prison for conspiring to defraud KeyBank in a car flooring loan scheme. On May 27, 2014, Judge Simon sentenced David Spangenberg, 55, to 18 months in federal prison, and sentenced Roger Spangenberg, 52, to one year and one day in federal prison. Upon their release, both Spangenbergs will serve a five-year term of supervised release. Judge Simon also ordered the brothers to pay $2.5 million in restitution to KeyBank.
The Spangenberg brothers owned the now-closed D&R automobile dealerships, formerly located in Hermiston and Enterprise, Oregon, and co-defendant Steven Johnson served as a manager. All three defendants have pled guilty to the bank fraud conspiracy. They have admitted that from January 2007 through August 2008, they conspired to defraud KeyBank in connection with a Floorplan Line of Credit and Security Agreement, known in the automobile industry as a “flooring loan.” KeyBank extended a line of credit to the D&R dealerships to purchase new inventory, but the Spangenbergs and Johnson failed to repay KeyBank after they sold the inventory. The Spangenbergs and Johnson deceived KeyBank into believing the dealerships had not yet sold inventory, including asking customers to return recently purchased automobiles to the dealerships to receive a free service on the day of an audit, and misrepresenting to KeyBank that automobiles not present on the lot were being used as rental cars. The defendants also submitted false Vehicle Identification Numbers (VIN) to KeyBank to receive funding for inventory the dealerships never purchased, and “double floored” vehicles with more than one financial institution. Steven Johnson is scheduled to be sentenced on July 9, 2014.
“Bank fraud victimizes not only the bank and its employees, but also every consumer in this district,” stated U.S. Attorney Amanda Marshall. “Fraudsters who steal from banks will find themselves in federal prison, alongside those who rob banks, for the harm is indistinguishable.”
This case stemmed from a joint investigation by the Internal Revenue Service Criminal Investigation Division and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Stacie Beckerman.
Defendant Pleads Guilty to $400,000 Tax Refund FraudRead the Press Release
PORTLAND, Ore. – Kathryn Keneally, Assistant Attorney General, Tax Division, and U.S. Attorney Amanda Marshall for the District of Oregon, announced today that Latisha L. Simmons, formerly of Portland, Oregon, pleaded guilty before the U.S. District Judge Anna J. Brown to three counts involving tax refund fraud. Simmons pleaded guilty to one count of wire fraud, one count of false claims against the government, and one count of aggravated identity theft. She was indicted in December 2013, and was arrested in January 2014 in Phoenix, Arizona, where she currently resides.
According to the plea agreement, Simmons filed more than 50 false federal income tax returns from Portland, Oregon. She filed them during a two-week period in January 2012, requesting a total of more than $400,000 in fraudulent income tax refunds. Simmons obtained names, social security numbers, and dates of birth for other individuals, which she used to file fraudulent income tax returns claiming fictitious wages and inflated withholding amounts to generate fraudulent refunds of up to $8,400 per return. Simmons caused the fraudulent refunds to be direct-deposited onto stored-value debit cards and mailed to her own address or other addresses she controlled. Simmons has agreed to pay full restitution to the IRS.
Simmons faces maximum sentences of 20 years in prison for the wire fraud conviction, five years for the false claims against the government count, and a mandatory two-year consecutive sentence for the aggravated identity theft conviction. Sentencing has been scheduled for August 27, 2014.
This case was investigated by the IRS Criminal Investigation Stolen Identity Refund Fraud Task Force. Trial Attorneys Leslie A. Goemaat and Lori A.Hendrickson of the Justice Department’s Tax Division are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax.
Sibling Sentenced to 4 Months in Jail for Theft of Sister's Welfare BenefitsRead the Press Release
PORTLAND, Ore. – A Portland woman was sentenced to four months in jail for stealing more than $10,000 in benefits intended for her disabled sister. Killda I. Boutros, 46, appeared in federal court for sentencing last week after previously pleading guilty to Social Security fraud in November.
According to court records and Boutros’ admissions in court, Boutros became her sister’s Representative Payee in September 2006, which enabled her to receive her sister’s Supplemental Security Income (SSI), a needs-based benefit administered by the Social Security Administration (SSA). As the Representative Payee, Boutros was required to report to SSA if her sister left the United States for more than 30 days. While her sister and other family members were outside the United States for months at a time, Boutros failed to report to SSA as she repeatedly withdrew the benefits. The government also showed the court documents seized from the Boutros family residence that included receipts for restaurant meals, groceries, utilities, and rent that were intended to be used by Boutros as proof of her sister’s expenses. In fact, the receipts were for time periods that her sister was outside the United States, indicating Boutros saved receipts of her own expenses to deceive SSA.
Citing the nature and circumstances of the offense, including the fact that Boutros committed the offense within months of becoming a naturalized U.S. citizen, U.S. District Judge Michael Simon sentenced Boutros to four months in custody, despite her lack of criminal history and her assurances that she would not re-offend. She was further ordered to pay $142,337.10 in restitution to SSA and the U.S. Department of Health and Human Services for SSI and Medicaid benefits fraudulently obtained by other family members. Judge Simon also advised Boutros that the jail sentence should send a message of “general deterrence” to the public.
Boutros was ordered to begin her jail sentence on June 19, 2014. Boutros’ brother, Jason, was sentenced to six months in jail in March, and will begin serving his sentence May 19, 2014. Two family members also charged in the indictment remain fugitives.
This case was investigated by agents for the Medicaid Fraud Unit, the Department of Health and Human Services, and the Social Security Administration, Office of Inspector General. The case was prosecuted by Special Assistant United States Attorney Helen L. Cooper as part of a partnership venture between the U.S. Attorney’s Office in Portland, Oregon, and the Seattle Region of the Social Security Administration, Office of the General Counsel.
Mail and Identity Theft Results in Three and a Half Year Federal SentenceRead the Press Release
Southern Oregon Victims the Subject of Identity Theft and FraudMEDFORD, Ore. - Michelle Renee Lustig, 45, of Grants Pass, Oregon, was sentenced to 42 months in federal prison by Senior U.S. District Judge Owen M. Panner, after her convictions for conspiracy to commit mail theft, conspiracy to commit bank fraud and aggravated identity theft. As part of her sentence, Lustig received a mandatory consecutive term of two years in prison required by federal statute where a victim’s identification was possessed or used in committing bank fraud. Lustig was also ordered to pay $12,387.06 in restitution to victims of the fraud. Her co-defendant, Gregory Stephen Brooks, 50, also of Grants Pass, Oregon, was sentenced last month by Judge Panner to 81 months in federal prison.
Between March 2013 and July 2013, Lustig and Brooks stole substantial quantities of mail from the mailboxes of over 400 victims in Jackson and Josephine Counties. Some of the stolen mail was recovered discarded along the roadside, and two boxes of stolen mail, which included financial instruments, were recovered from a U-Haul truck being used by Lustig and Brooks. Additional boxes of stolen mail were recovered from a residence where they both were staying in Grants Pass. The two forged and deposited stolen checks, and used stolen debit and credit cards for making withdrawals from victim bank accounts and fraudulent retail purchases. They also used victims’ personal identification to apply for and obtain credit and debit cards from victim companies. When Lustig was arrested, law enforcement discovered additional stolen mail in her car, including mail previously stolen that was in the process of being returned by postal authorities to earlier victims from the Onion Mountain area of Josephine County.
This case was investigated by the Jackson County Sheriff’s office, Grants Pass Department of Public Safety and the U.S. Postal Inspection Service, and was prosecuted by Assistant U. S. Attorney Byron Chatfield.
Grants Pass Armed Career Criminal Sentenced to 20 Years in Federal PrisonRead the Press Release
MEDFORD, Ore. - On Monday, May 12, 2014, Senior U.S. District Judge Owen M. Panner sentenced Christopher Darrell Joseph Sage, 49, of Grants Pass, Oregon, to 20 years in federal prison, after he previously pleaded guilty to being a felon in possession of a firearm and possession of methamphetamine with intent to distribute. Sage will be on supervised release for five years after he completes his prison sentence.
On January 2, 2013, Rogue Area Drug Enforcement Team (RADE) detectives observed Sage enter and leave the Grants Pass apartment of a previously arrested methamphetamine dealer. A Grants Pass patrol unit and a RADE detective followed Sage to a motel parking lot. Sage got out of his pickup and began walking away, ignoring the officers’ multiple commands to stop and take his hands out of his pockets. Sage fought with the officers and had to be tasered three times before he was finally subdued and handcuffed. Officers discovered that Sage was a multiple convicted felon and probation absconder. Officers searched Sage’s truck and found a stolen Bushmaster AR-15 semi-automatic assault rifle with two 30 round magazines and several boxes of .223 ammunition, a Remington 12 gauge shotgun, digital gram scales, ziplock plastic baggies, and drug notes. In his coat pocket Sage had a quarter pound of methamphetamine and a handwritten list of firearms.
Under federal law, any person who possesses a firearm or ammunition after being previously convicted of three violent felonies or felony drug trafficking crimes is an Armed Career Criminal and faces a 15 year mandatory minimum prison sentence. Sage is an Armed Career Criminal based upon his prior felony convictions for assault on a police officer (2 counts), and three felony convictions for manufacture of methamphetamine. His criminal history additionally includes previous felony convictions for felon in possession of a firearm, unauthorized use of a vehicle, and possession of methamphetamine, and receiving stolen property, and misdemeanor convictions for forgery, theft, obstructing police, DUII, and reckless driving.
This case was investigated jointly by the Rogue Area Drug Enforcement Team, the Grants Pass Department of Public Safety, and the Bureau of Alcohol, Tobacco, and Firearms, and was prosecuted by Assistant U.S. Attorney Douglas W. Fong.
Mail and Identity Theft Convictions Result in a Federal Prison SentenceRead the Press Release
Mail Theft Victims Subjected to Identity Theft and FraudMEDFORD, Ore. – Gregory Stephen Brooks, 50, Grants Pass, Oregon was sentenced Monday to 81 months in federal prison by Senior U.S. District Judge Owen M. Panner after his convictions for conspiracy to commit mail theft, conspiracy to commit bank fraud and aggravated identity theft. As part of the sentence, Brooks received a mandatory consecutive term of two years in prison required by federal statute where a victim’s identification was possessed or used in committing bank fraud. Brooks was also ordered to pay $12,387.06 in restitution to victims of the fraud.
Between March 2013 and July 2013, Brooks and his co-defendant, Michelle Renee Lustig, 45, Grants Pass, Oregon, stole substantial quantities of mail from over 400 residential and business mailboxes in Jackson and Josephine Counties. Large quantities of stolen mail were recovered at a series of locations: discarded along the roadside; in a U-Haul truck being used by defendants; and from a residence where defendants were staying in Grants Pass. Defendants forged and deposited stolen checks, used stolen debit and credit cards to make withdrawals from victim bank accounts and to make fraudulent retail purchases, and used victim personal identification to apply for and obtain fraudulent credit and debit cards from victim companies. Brooks has an extensive criminal history of convictions dating back to 1981 including numerous thefts and burglaries, as well as drug trafficking offenses. Lustig is scheduled to be sentenced next month for her role in the criminal activity.
This case was investigated by the Jackson County Sheriff’s Office, Grants Pass Department of Public Safety and the U.S. Postal Inspection Service and prosecuted by Assistant U. S. Attorney Byron Chatfield.
School Custodian Sentenced to Five Years in Prison for Possession and Distribution of Child PornographyRead the Press Release
EUGENE, Ore. – On April 17, 2014, Cecilio Galan, 45, of Metolius, Oregon, was sentenced today to 63 months in prison and 5 years of supervised released for possession and distribution of child pornography.
Defendant possessed child pornography he located on the internet. He then made that pornography available to others on a file sharing site in the hopes that he could obtain additional child pornography himself. Defendant carried on his possession and distribution activities while serving as a custodian in a local school and after having served as a reserve police office and a bus driver. The investigation did not reveal any evidence that Galan had any inappropriate contact with the students at the school where he worked.
This case was investigated by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Jefferson County Sheriff’s Office and was prosecuted by Assistant U.S. Attorney Amy Potter.
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 United States 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.usdoj.gov/psc For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Former Bend Resident Sentenced for $311,000 Fruadulent Refund Scheme and for Filing Retaliatory Liens Against IRS EmployeesRead the Press Release
EUGENE, Ore. – On Wednesday, April 16, 2014, U.S. District Judge Ann Aiken sentenced Mark Timothy Ellis, 38, of Oregon City, Oregon, for making a fraudulent claim to the United States and for filing a false lien against a federal employee to serve 12 months and one day in prison and three years of supervised release, and ordered him to pay $311,459 in restitution.
According to court documents, Ellis admitted that he made a false claim to the United States when he filed a series of fraudulent documents with the Internal Revenue Service (IRS), including false 1099s and false tax returns, and obtained a fraudulent $311,459 refund based on those false documents. Ellis also admitted that he filed a false and retaliatory lawsuit and false and retaliatory liens against the IRS employees who were investigating his illegal conduct, including the special agent who was investigating him for tax fraud, as a means of retaliation and intimidation.
This case was investigated by IRS Criminal Investigations and the U.S. Treasury Inspector General for Tax Administration and was prosecuted by Assistant U.S. Attorney Scott E. Bradford.
Career Offender Bank Robber Sentenced to More than 14 Years in Federal PrisonRead the Press Release
EUGENE, OR. – On April 17, 2014, Chief United States District Judge Ann Aiken sentenced career offender Leodis Robert Roach, 31, of Multnomah County, Oregon, to serve fourteen years and four months in federal prison for robbing the Eugene downtown branch of the Bank of America, and a ten-year concurrent sentence for possessing a loaded pistol while he was a passenger in a car outside of Spokane, Washington. Roach will serve his federal sentences concurrently with state prison sentences he is presently serving in Oregon for first degree robbery and being a felon in possession of a firearm.
In 2001, Roach shot a person in Portland, Oregon, over an illegal drug debt and was convicted of assault in the first degree. He was released from prison in 2009, and attended classes at Lane Community College in Eugene, Oregon.
In April 2010, Roach was convicted of attempting to elude Portland police, a felony. In May 2011, Roach was arrested by U.S. Marshals for illegally possessing a loaded .45 caliber pistol near Spokane, Washington. Roach was released from custody pending his trial on the federal firearm charge.
On June 21, 2011, while committing a robbery, Roach exchanged gunfire with a drug dealer in a commercial area of Portland, Oregon. On July 22, 2011, Roach robbed the Bank of America in Eugene and, with the aid of an accomplice, returned to Portland, Oregon. On August 19, 2011, Roach was arrested by Portland police for the June 21, 2011, robbery. On March 20, 2013, an Oregon state judge sentenced Roach to ten years in prison after a jury found him guilty of first degree robbery and being a felon in possession of a firearm.
On November 14, 2013, Roach appeared in federal court in Eugene and pled guilty to robbing the Bank of America in Eugene as a career criminal. Roach earlier pleaded guilty to illegally possessing the loaded pistol in Washington. Today, Judge Aiken imposed the 14 year sentence for the federal offenses, and ordered them to be served concurrently with Roach’s state sentences.
The federal cases were investigated by the Federal Bureau of Investigation, the Bureau of
Alcohol, Tobacco and Firearms, the Portland Police Department, the Eugene Police Department and the Washington State Patrol. They were prosecuted by Assistant U.S. Attorney Frank R. Papagni, Jr., and Assistant United States Attorney Aine Ahmed.
California Man Receives 10-Year Federal SentenceRead the Press Release
EUGENE, Ore. – Victor Rivera-Cruz, 39, of Orange County, California, was sentenced today by U.S. District Court Chief Judge Ann Aiken to a 10-year prison term for possession with the intent to distribute methamphetamine. Following his release from prison, Rivera-Cruz will be on supervised release for five years.
In April 2012, the Oregon State Police conducted a traffic stop of defendant’s vehicle near Glenwood, Oregon. A search of the vehicle revealed nearly four pounds of methamphetamine. Rivera-Cruz’ criminal history includes convictions in 2001 and 2002 for possession of controlled substances, and convictions in 2005 for possession for sale of heroin, cocaine, methamphetamine and marijuana, felon in possession of a firearm, and child abuse.
This case was investigated by the Eugene Resident Office of the Drug Enforcement Administration and the Oregon State Police. Assistant United States Attorney Jeffrey Sweet prosecuted the case.
Taquarius Ford Charged with Sex Trafficking by Force, Fraud, CoercionRead the Press Release
PORTLAND, Ore. — Taquarius Kaream Ford, also known as “Cameron,” has been indicted by a federal grand jury on sex trafficking and conspiracy charges. Ford has pled not guilty to all charges. Following a detention hearing today, U.S. Magistrate Court Judge Janice M. Stewart detained Ford, pending his trial. Trial is currently set for June 3, 2014, before U.S. District Court Judge Garr M. King.
The grand jury indictment alleges that Ford and a co-conspirator sex trafficked adult females in the District of Oregon and elsewhere, by force, fraud and coercion. In its’ court filings, the government alleges that Ford recruited young women in suburban shopping malls and elsewhere across the United States by posing as a modeling executive and promising them a modeling contract. He convinced young women to travel to Los Angeles, wined and dined them in Hollywood, and then told them that if they want to be models, they must first work for him as prostitutes. In one case, he recruited an 18-year-old girl at a suburban mall, flew her to Los Angeles, and took her to Hollywood parties. He then coerced her to work in his escort business, and when she protested, he forcibly raped her. Ford and his co-defendant also threatened to harm the victim’s family. Thereafter, defendants transported the victim to Portland for the purpose of prostitution, where she was rescued at an airport hotel by Port of Portland officers. Further investigation by the FBI’s Child Exploitation Task Force revealed that defendant had recruited other young women across the country into his “escort” business. The FBI has identified additional victims in Idaho, Arizona, and Georgia.
Sex trafficking by force, fraud, and coercion carries a mandatory minimum sentence of 15 years in prison, and a statutory maximum of life imprisonment. A criminal indictment is only an allegation and not evidence of guilt. Defendant is presumed innocent unless and until proven guilty.
The FBI urges anyone who was victimized by Taquarius “Cameron” Ford, to contact the Portland FBI office at (503) 224-4181.
The charges stem from a continuing investigation by the FBI and the Tigard Police Department, members of the FBI’s Child Exploitation Task Force. The case is being prosecuted by Assistant U.S. Attorney Stacie Fatka Beckerman, and Special Assistant U.S. Attorney Glen Ujifusa of the Multnomah County District Attorney’s Office.
Robber Receives 20-Year Federal SentenceRead the Press Release
Four Banks and Two Motels Robbed During Crime Spree Last FallPORTLAND, Ore.- Andrew Frank Laviguer, 57, was sentenced today by Senior U.S. District Judge Robert E. Jones to 240 months in federal prison for the robbery of four banks and two motels in Oregon and Washington during August and September of last year. Laviguer pled guilty to the charges in November of 2013 and has been in custody since the time of his arrest on September 9, 2013.
Laviguer was sentenced for the following robberies: (1) August 14, 2013, armed robbery (replica firearm) of the Columbia Bank on NE Halsey Street in Portland, Oregon; (2) August 30, 2013, robbery of the Key Bank on 17th Avenue SW in Seattle, Washington; (3) September 4, 2013, robbery of the Sterling Savings Bank on Tacoma Mall Blvd. in Tacoma, Washington; (4) September 7, 2013, robbery of the Super 8 Motel on SW Parkway Avenue in Wilsonville, Oregon; (5) September 8, 2013, attempted robbery of the Roadway Inn on Astoria Way NE in Salem, Oregon; and (6) September 9, 2013, armed robbery (replica firearm) of the Wells Fargo Bank on NW 11th Avenue in Portland, Oregon.
Laviguer was arrested by Portland Police Bureau officers after he robbed the Wells Fargo Bank in September of 2013. Laviguer received a sentence of 180 months, following a 1992 Salem bank robbery. After serving that sentence and being released, he was convicted of robbing a bank in Gresham in 2007 and was sentenced to 77 months in prison. Following his release from the Federal Correctional Institution in Williamsburg, South Carolina, on July 9, 2013, he was ordered to report to the Lane County Work Release Center to begin his supervised release for the 2007 bank robbery. He failed to report and the robbery spree began less than one month later.
In order to achieve the 20-year sentence, Jones found that Laviguer was a “career offender” under federal sentencing law and departed upward from that sentencing range because of Laviguer’s aggravated criminal history and the number of robberies he committed.
This case was investigated by the FBI, the Portland Police Bureau, the King County Sheriff’s Office, the Tacoma Police Department, the Clackamas County Sheriff’s Office and the Salem Police Department. It was prosecuted by Assistant U.S. Attorney Fred Weinhouse.
Portland Sex Trafficker Sentenced to 204 Months in Federal PrisonRead the Press Release
PORTLAND, Ore. — Keith Lawrence McMurray, 32, of Portland, Oregon, was sentenced to 204 months in prison today by United States District Judge Marco A. Hernandez for sex trafficking a 17-year old Beaverton girl. On September 4, 2013, McMurray pleaded guilty to one count of sex trafficking a minor. Upon release from custody, McMurray will serve a 10-year period of supervised release. During his supervised release, he must abide by a number of conditions, including registration as a sex offender.
“Sex trafficking a minor continues to be a huge concern for this community,” said U.S. Attorney Amanda Marshall. “Young girls and boys in our community are preyed upon for commercial sex, and are used by traffickers as simply a way to gain money. We will continue to prosecute aggressively anyone who exploits, aids or recruits our children into this dark world.”
In imposing the 204-month sentence, Judge Hernandez noted that defendant’s objectification of the victim was extremely concerning.
The government alleged that McMurray recruited the victim into prostitution when she was 17 years old. He used various prostitution web sites to advertise the minor and even posed as a customer in order to promote her on one of the web sites. In addition, McMurray filmed sex acts with her during the time she was a minor. All of this was done while the defendant was on post-prison supervision.
This case stemmed from a coordinated investigation by the Federal Bureau of Investigation’s (FBI) Child Exploitation Task Force and Multnomah County Parole and Probation. The FBI’s Child Exploitation Task Force marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children through sex trafficking, as well as to identify and rescue victims. The case was prosecuted by Special Assistant U.S. Attorney JR Ujifusa.
Madras Man Sentenced in Federal Court to over 11 Years in Prison for Possession with Intent to Distribute MethamphetamineRead the Press Release
Police Seize Methamphetamine, Handguns, and Cash from Defendant’s HomePORTLAND, Ore. – Juan Miguel Lopez, 29, of Madras, Oregon, was sentenced on Monday, March 31, 2014, to 135 months in federal prison by U.S. District Judge Marco A. Hernandez. In December 2013, Lopez pled guilty to one count of possession with intent to distribute more than 50 grams of actual methamphetamine. The defendant is currently in the custody of the United States Marshals Service. After Lopez has completed his 135-month prison term, he will be required to serve 5 years of supervised release, during which time he will be prohibited from associating with any gang members.
“Mr. Lopez was a dangerous, armed drug dealer who spread destruction throughout Central Oregon and Warm Springs,” stated U.S. Attorney Amanda Marshall. “The long prison term imposed by Judge Hernandez will protect the public from this prolific drug dealer.”
Lopez, who went by the nickname “Monster,” told police that he was associated with the Mexican Mafia. Prior to this federal case, Lopez had five prior felony convictions for either delivery or possession of drugs. Lopez also has a prior conviction in Jefferson County Circuit Court for reckless endangerment, based on his hurling a bottle at a woman and throwing gang signs at Cove Palisades State Park.
This federal conviction for possession with intent to distribute methamphetamine is based on a search warrant executed at Lopez’s home on August 6, 2012, in Madras. During the search warrant, police officers seized approximately one-half pound of methamphetamine, a .45 caliber semiautomatic handgun, a .40 caliber semiautomatic handgun, ammunition, scales, drug packaging materials, and $2,655 in cash. Defendant, who was on Jefferson County probation at the time, was arrested that same day.
An investigation by the Warm Springs Police Department’s High Intensity Drug Trafficking Area (“HIDTA”) task force revealed that Lopez had been selling drugs around the Madras and Warm Springs areas. The defendant admitted to police that the two handguns seized from his home did, in fact, belong to him. Lopez told the police that he bought the firearms from an unidentified person at the Indian Head Casino in Warm Springs.
The case was investigated by the Warm Springs Police Department’s HIDTA task force. Assistant U.S. Attorney Scott Kerin prosecuted the case.
Southern Oregon Couple Sentenced to Federal Prison for Fraud and Tax ChargesRead the Press Release
MEDFORD, OR – Kenneth Johnson, 62, and Diana Arredondo, 56, both of Central Point, Oregon, were sentenced to federal prison based on an embezzlement and tax fraud scheme relating to the operation of a local hotel. Johnson was a partner in the Super 8 Hotel in Central Point, Oregon since it opened in October 2005. He was in charge of the hotel’s daily operations and reported the hotel’s revenue to his partners in Montana. Johnson hired his girlfriend, Arredondo, as the assistant hotel manager. They operated the hotel from October 2005 through 2011. Johnson engaged in a scheme to defraud his hotel partners by providing them false information regarding the amount of cash collected by the hotel, and diverting some of the funds for his and Arredondo’s use. Over a period of time, Johnson diverted a total of about $500,000 and shared some of the tainted funds with Arredondo. In addition, both defendants filed fraudulent income tax returns, failing to report the money embezzled from the hotel. Based on a plea agreement entered into with the government, Johnson pleaded guilty to tax fraud and wire fraud and Aredondo pleaded guilty to tax fraud.
On Monday, March 31, 2014, Senior U.S. District Judge Owen M. Panner sentenced Johnson to 33 months in federal prison and Arredondo to 10 months in prison. Johnson was ordered to pay $561,101.05 in restitution and Arredondo was ordered to pay $16,229.00 in restitution.
This case was investigated by the Federal Bureau of Investigation, Internal Revenue Service, Criminal Investigation, and was prosecuted by Assistant U. S. Attorney Judith Harper.
Portland Man Receives 30-Month Federal Sentence for Hurling Molotov Cocktail at Portland Police CarRead the Press Release
PORTLAND, Ore. – Yesterday, U.S. District Judge Marco A. Hernandez sentenced Sergey Yefimovich Turzhanskiy, 26, to 30 months in federal prison for possession of an unregistered destructive device. Turshanskiy pleaded guilty to using the device, a Molotov cocktail, in a 2012 attack on a Portland Police Bureau (PPB) patrol car.
Turzhanskiy entered PPB’s North Precinct parking lot at 449 North Emerson Street at about 1:30 am on November 5, 2012. He ignited the Molotov cocktail (a glass beer bottle with fuel and a cloth wick), and hurled it at a parked patrol car. The device bounced off the hood of the car onto the ground and initially failed to break. Turzhanskiy picked up the device and threw it a second time at the vehicle. It hit the pavement, broke and caused a fire next to the car. Turzhanskiy fled on a bicycle but was apprehended by the police a few blocks away.
A native of Ukraine, Turzhanskiy immigrated to the United States as a child, became a U.S. citizen, and grew up in Chicago, Illinois. He had lived in Portland a short time when the crime occurred.
After serving the prison sentence, Turzhanskiy will be on supervised release for three years. In light of Turzhanskiy’s prior associations, Judge Hernandez ordered as a special condition of supervised release that he “shall have no communication or contact with anarchist groups or affiliates” in the future. He has already paid $1,314.12 in restitution to the City of Portland for damage to the patrol car.
“We are pleased with the sentence imposed by Judge Hernandez,” stated United States Attorney Amanda Marshall. “Violent attacks such as this one on law enforcement deserve substantial punishment as a deterrent to similar conduct by others.”
In addition to the Portland Police Bureau, investigative work in the case was performed by the Federal Bureau of Investigation and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant U.S. Attorney Stephen F. Peifer.
Sibling Sentenced to 6 Months in Jail for Theft of Welfare BenefitsRead the Press Release
PORTLAND, Ore. – A Portland man was sentenced to 6 months in jail for stealing more than $8,000 in benefits intended for his disabled sister. Jason I. Boutros, 49, appeared in federal court for sentencing yesterday after previously pleading guilty to Social Security fraud in December.
According to court records and Boutros’ admissions in court, Boutros became his sister’s Representative Payee in February 2009, which enabled him to receive his sister’s Supplemental Security Income (SSI), a needs-based benefit administered by the Social Security Administration (SSA). As the Representative Payee, Boutros was required to report to SSA if his sister left the United States for more than 30 days. While his sister and other family members were outside the United States for months at a time, Boutros failed to report to SSA as he repeatedly withdrew her benefits. In addition to his sister’s SSI, Boutros withdrew the SSI benefits being paid to his parents, Zakia and Iskander Boutros, who have also been indicted and are currently fugitives living outside the United States.
Telling Boutros that he had a “moral obligation” to repay the funds, the Honorable Michael H. Simon ordered Boutros to pay more than $220,000 in restitution to SSA and the Oregon Department of Human Services for the SSI and Medicaid benefits his family received. He further ordered that $1,900 in currency found in defendant’s residence be applied towards the restitution. Judge Simon found Boutros’ guideline range to be 0-6 months, stating that despite the government’s “well-marshalled evidence of falsehoods,” the government had not proven that Boutros deserved a higher guideline range for being an organizer, manager, or supervisor of his family’s fraud scheme. He further stated that he believed a 12-month prison term was justified, but that he did not believe the record supported an upward departure to a higher guideline range.
Boutros was ordered to begin his jail sentence on May 19, 2014. Boutros’ sister Killda Boutros is scheduled for sentencing April 17, 2014, at 2:00 p.m.
This case was investigated by agents for the Medicaid Fraud Unit, the Department of Health and Human Services, and the Social Security Administration, Office of Inspector General. The case is being prosecuted by Special Assistant United States Attorney Helen L. Cooper as part of a partnership venture between the U.S. Attorney’s Office in Portland, Oregon, and the Seattle Region of the Social Security Administration, Office of the General Counsel.
Federal Search Warrant Reveals Beneficiary Funds MissingRead the Press Release
PORTLAND, Ore. – Federal agents of the Social Security Administration, Office of Inspector General, Office of Investigations, working with the U.S. Attorney’s Office, obtained a search warrant for Safety Net of Oregon, a Representative Payee organization, located on SE Morrison Street. The warrant was executed on March 6, 2014.
According to the affidavit in support of the search warrant, the Social Security Administration terminated Safety Net as an Organizational Representative Payee effective April 1, 2014, following a review of Safety Net that revealed that approximately $600,000 of beneficiary funds was unaccounted for.
Prior to the execution of the warrant, the Social Security Administration began contacting each of the approximate 900 beneficiaries by telephone or letter to advise them of Safety Net’s termination as an Organizational Representative Payee. During the execution of the warrant, clients of Safety Net who arrived at the business were provided a flyer advising them of Safety Net’s termination and directing them to contact the Social Security Administration. They were also provided names of organizations that could potentially serve as Representative Payees. Employees of the local Social Security Administration field offices have been working with local disability organizations and social service agencies with the goal that all of Safety Net clients will be transitioned to a new Representative Payee as soon as possible.
The U.S. Attorney’s Office’s investigation is on-going. A search warrant is an investigative tool and not evidence of guilt. The subjects of the search warrant are presumed innocent unless and until they are proven guilty.
The U.S. Attorney’s Office urges any beneficiaries who were clients of Safety Net and who have not yet contacted the Social Security Administration, to do so immediately in order to avoid any interruption in the payment of their benefits.
Social Security hours:
Monday, Tuesday, Thursday, Friday: 9:00 AM – 3:00 PM
Wednesday 9:00 – NoonLocal Social Security Offices
SOCIAL SECURITY
194 BEVERLY DRIVE
OREGON CITY OR 97045
BUSINESS: (866) 964 4264
SOCIAL SECURITY
1538 SW YAMHILL ST
PORTLAND OR 97205
BUSINESS: (888) 632 6990SOCIAL SECURITY
17925 SE DIVISION ST
PORTLAND OR 97236
BUSINESS: (866) 331 6402SOCIAL SECURITY
1229 SE 3RD STREET SUITE 100
PENDLETON OR 97801
BUSINESS: (877) 405 0480SOCIAL SECURITY
11975 SW 2ND ST SUITE 100
BEAVERTON OR 97005
BUSINESS: (866) 964 2036SOCIAL SECURITY
1750 MCGILCHRIST ST SE STE 110
SALEM OR 97302
BUSINESS: (866) 593 1559Representative Payee Organizations
Share and Care
13855 Pacific Highway
Tigard, OR 97281
503-684-8882
*If you cannot get to the Tigard location, call them and the payee will arrange to meet you.
--------------------------------------------------------------------Action Payee Services Inc.
503-352-5349
* Contact by phone and the payee will arrange to meet you.
----------------------------------------------------------------------On the Budget
971-227-6294* Contact by phone and the payee will arrange to meet you.
Federal Judge Sentences Manager of Heroin Conspiracy that distributed heroin resulting in death to twenty years in prisonRead the Press Release
PORTLAND, Ore. - On March 18, 2014, U.S. District Court Judge Marco Hernandez sentenced Samuel Navarrette-Aguilar, 41, a citizen of Mexico, to 240 months for his managerial role in a heroin trafficking conspiracy involving a kilogram or more of heroin. A federal jury found the defendant guilty of the conspiracy in June of 2013. Judge Hernandez further found by a preponderance of evidence that heroin distributed by the defendant resulted in the death of Erin Freeman, 22, who overdosed on heroin in her Portland residence in June of 2012. Judge Hernandez cited this and other factors to support his sentence including the fact that the defendant committed this crime after escaping from a Washington state prison sentence for drug trafficking and having remained at large since 1999. Although the quantity of heroin subjected the defendant to a statutorily mandated minimum sentence of twenty years, Judge Hernandez indicated he would have pronounced the same sentence independent of the mandatory minimum requirement.
Reaching into the upper echelon of a trafficking conspiracy from the tragic scene of a young woman’s last failure against heroin addiction, required a fast moving investigation led by the Portland Police Bureau Drugs and Vice Division with support from the Federal Bureau of Investigation and the Drug Enforcement Administration.
“This sentence serves justice. In 2012 we lost 147 Oregonians to heroin, many of those, like Erin Freeman, were far too young”, said U.S. Attorney Amanda Marshall. “This defendant and other purveyors of this deadly drug face heavy penalties as Oregon and communities across the nation address the clear and present danger of this heroin epidemic.”This case was prosecuted by Assistant U.S. Attorney Kathleen Bickers.
Southern Oregon Sex Offender Sentenced to 37 Years in Federal Prison for Producing Child PornographyRead the Press Release
MEDFORD, Ore.—On Monday, March 17, 2014, Senior U.S. District Judge Owen M. Panner sentenced Christopher Keith Hammer, 43, of Central Point, Oregon, to 37 years in federal prison for production of child pornography.
In February 2013, a nationwide FBI child pornography investigation revealed that sexually explicit photos of a four year old child were being distributed from an e-mail account linked to Hammer’s residence. The Southern Oregon High Tech Crimes Task Force (SOHTCTF) executed a search warrant at Hammer’s residence, identified the child, and matched the clothing and furniture depicted in the sexually explicit photos. Hammer was arrested immediately. Hammer’s e-mail account contained several thousand images of child pornography, along with dozens of photos of the four year old child in sexually explicit poses, which Hammer took over the course of a year. Hammer e-mailed the photos to several other child molesters he met online, and described his ongoing sexual abuse of the child, and his plans to take photos and videos of the sexual abuse. Hammer also indicated a desire to sexually abuse other children, and encouraged other child molesters to sexually abuse their own children and send photos of the abuse to Hammer.
Hammer has two previous felony convictions in California for Lewd and Lascivious Acts Upon a Child Under 14 in 1994, in which he sexually abused his six year old and eight year old relatives. Under federal law, any person who produces child pornography after two previous felony convictions for child sex abuse faces a mandatory minimum of 35 years in prison.
“These pictures represent the worst type of child sex offender—one who not only sexually exploits children, but also documents and shares his experiences with others, and encourages others to do the same, “” said U. S. Attorney Amanda Marshall. “The severe penalties imposed by federal law are well deserved and necessary to protect our most vulnerable victims--children.”
This case was investigated by the SOHTCTF, a multi-jurisdictional computer crimes task force comprised of the FBI, Department of Homeland Security, Central Point PD, Medford PD, Ashland PD, Jackson County Sheriff's Office, and the Jackson County District Attorney's Office, and was prosecuted by Assistant U. S. Attorney Douglas W. Fong.
Former Portland and Bend Area Attorney Sentenced to 63 Months for Embezzling more than $1.1 Million of Client fundsRead the Press Release
EUGENE, Ore. – Today, U.S. District Judge Michael McShane sentenced Bryan Gruetter, 55, of Portland, Oregon, to 63 months in prison and ordered him to pay $1,144,487.97 in restitution. According to court documents, Gruetter, a former personal injury lawyer, embezzled more than $1.1 million from his clients between 2008 and 2012.
Gruetter, an attorney licensed to practice law in Oregon, had offices in Portland and Bend, Oregon, and primarily worked personal injury and wrongful death cases. In 2012, law enforcement began investigating Gruetter’s use of his clients’ money and determined that between January 2008 and January 2012 he had illegally diverted more than $1.1 million of his clients’ money to pay for personal and business expenses rather than to pay the clients or to pay the clients’ legal, medical, insurance, or other associated costs. When interviewed, Gruetter admitted that he was “robbing Peter to pay Paul” because his law firm’s monthly income was insufficient to cover the monthly overhead, which included personal family payments and expenses. On March 9, 2012, defendant resigned his law license, deciding not to challenge the allegations.
Currently, the Oregon State Bar through the Client Security Fund has paid more than $900,000 to some of his clients in an attempt to mitigate some of the damage Gruetter caused. In fact, the Gruetter claims exhausted the Client Security Fund reserves, requiring an increase in bar members’ annual assessments from $15 to $45 until the reserve is fully funded.
U. S. Attorney S. Amanda Marshall commented, “As a lawyer, this defendant had a solemn duty to help his clients seek justice. Instead, he betrayed their trust and victimized vulnerable individuals by lying to them and stealing their money. His conduct tarnishes a profession full of hard-working, ethical attorneys who work hard every day helping people solve complex problems. My office will not tolerate this type of behavior from professionals who violate the public's trust in this manner.”
This case was investigated by the FBI, the IRS, the Deschutes County District Attorney’s Office, and the Bend Police Department and is being prosecuted by Assistant U.S. Attorney Scott E. Bradford.
Federal Fugitive Killed During Encounter with PPB OfficerRead the Press Release
PORTLAND, Ore. - On March 12, 2014, federal fugitive Kelly Vern Mark Swoboda, 49, was killed during an encounter with a Portland Police Bureau Officer near Wilson High School. Swoboda was a wanted federal fugitive based on a supervised release violation issued in connection with his prior bank robbery conviction. He was convicted of the bank robbery in 2006 in Portland and received a sentence of 70 months in prison. His supervised release commenced last March and a supervised release violation warrant was issued in November of last year. The United States Marshal’s Service Fugitive Task Force had been actively trying to locate Swoboda since the warrant was filed.
Yesterday, a federal indictment was filed against Swoboda alleging that he committed three bank robberies: (1) November 22, 2013, NW Priority Federal Credit Union in Milwaukie, Oregon, (2) December 6, 2013, Cutting Edge Federal Credit Union in Milwaukie, Oregon and (3) December 21, 2013, Unitus Community Credit Union in Portland, Oregon.
Drug Trafficking Organization Manager Sentenced to Twelve Years for Heroin Overdose of Milwaukie ManRead the Press Release
PORTLAND, Ore. - On March 12, 2014, U.S. District Court Judge Michael Simon sentenced Charly Aguayo-Caro to 12 years in prison for his role in distributing heroin that resulted in the death of Michael Rael. Aguayo-Caro, 24, of Xalisco, Nayarit, Mexico, was responsible for managing the day-to-day operations of an active heroin distribution business operating out of Portland, Oregon. Aguayo-Caro managed the business and accepted telephone orders for heroin from customers. Aguayo-Caro then employed couriers to distribute the heroin throughout the Portland metro-area beginning in 2008 and continuing until 2012.
On September 10, 2012, Michael Rael, 23, of Milwaukie, Oregon, was found deceased from a heroin overdose near his residence. Rael recently moved to Oregon from New Mexico to pursue higher-education and full-time employment. Following Rael's death, Clackamas County Interagency Task Force officers specializing in overdose investigations began re-tracing the heroin ingested by Rael. Investigators were able to trace the heroin to the drug-trafficking organization managed by Aguayo-Caro. On September 18, 2012, investigators arrested Aguayo-Caro in Wilsonville, Oregon where he was returning from California.
At sentencing, Judge Simon acknowledged the "national emergency" communities are facing from heroin overdoses. Simon referenced United States Attorney General Eric Holder's recent public statement about the "urgent and growing public crisis" heroin is having in communities across the country where heroin overdose deaths have increased 45 percent nationally between 2006-2010. U.S. Attorney Amanda Marshall echoed Simon and Holder by affirming her commitment to prosecuting drug trafficking organizations that are responsible for saturating the Portland market with heroin that led to the heroin overdose deaths of 147 Oregonians in 2012. Marshall stated: "We will continue to use every tool at our disposal to actively dismantle these drug trafficking organizations that are responsible for the devastating effects of heroin in our communities." This case was prosecuted under the "Len Bias" sentencing enhancement which increases mandatory sentences for individuals and organizations that distribute heroin which ultimately results in an overdose death.
The federal charges stem from an investigation led by state and federal law enforcement agencies including the Clackamas County Inter-Agency Task and the Federal Bureau of Investigation with the assistance of the Clackamas County District Attorney's Office.
The case was prosecuted by Special Assistant U. S. Attorney Steve Mygrant.
Vancouver, Washington, Man Sentenced to 24 Months in Federal Prison for Mailing 100 Threatening Letters with White PowderRead the Press Release
Letters Went to U.S. Senators, Representatives, and Members of the MediaPORTLAND, Ore.—U. S. District Judge Michael H. Simon sentenced Christopher Lee Carlson to 24 months in prison today on a charge of conveying false information and a hoax containing a purported biological toxin. Carlson, 41, of Vancouver, Washington, pleaded guilty to mailing approximately 100 threatening letters with white powder to U.S. Senators, Representatives and media personalities in February 2012.
About 24 of the letters were received and opened by staff members before law enforcement was able to intercept the remainder. The letters were sent to Congressional offices in Washington, D.C., and their field offices across the country. Results included evacuated offices, responses by hazardous materials units, decontamination procedures for affected persons, and interrupted workdays. Dozens of law enforcement and emergency response teams responded in 24 federal districts. Examination of the powder revealed it to be celery salt and cornstarch.
The threatening letters expressed frustration with politicians, corporations, and lobbyists. Promising a new American Revolution, some included the warning:
“Oh yeah, the powder. 50 Senators were randomly selected to receive this letter as opposed to the other one. Since I put the bug in ten of these letters, again randomly selected, there’s a 20% chance that you’ve just been exposed. If you aren’t wearing a biohazard suit, anyway.”
In addition to serving 24 months in custody, Carlson must pay $36,311.07 in restitution to state and local law enforcement agencies for expenses incurred in the emergency responses. After serving his prison sentence, Carlson will be on three years of supervised release and must comply with mental health treatment and medication requirements.
U. S. Attorney, Amanda Marshall, noted, “These types of hoaxes threaten the health and safety of the American people. They instill fear in the public, overburden the resources of law enforcement and emergency responders, and harm the nation’s morale and economy.”
The Federal Bureau of Investigation led the nationwide investigation from its Portland office. Valuable assistance was provided by the U.S. Capitol Police and the U.S. Postal Inspection Service.
“Anthrax hoaxes are no joke,” said Kevin Rickett, Acting Special Agent in Charge of the FBI in Oregon. “They cause fear for those who receive these letters, and they cost taxpayers a great deal of money during the resulting investigation. We must treat these events as real threats, and that, in turn, forces agents and staff to spend significant time and resources investigating and resolving these crimes,” he added.
The case was prosecuted by Assistant U. S. Attorneys Stephen F. Peifer and David L. Atkinson.
Portland Man Sentenced for Tax Refund FraudRead the Press Release
Received over $296,000 in Fraudulent RefundPORTLAND, Ore. – Ricky Lee Greenwood, 32, of Portland, Oregon, was sentenced in federal court for a wide-spread tax refund fraud scheme, announced U.S. Attorney S. Amanda Marshall for the District of Oregon. Today, Greenwood was sentenced to 40 months in prison. The sentence will be followed by three years of supervised release. In October 2013, Greenwood pleaded guilty to aggravated identity theft, wire fraud, and filing a false, fictitious, or fraudulent claim against the government.
According to court documents, Greenwood electronically filed at least 66 false tax returns with fictitious wage and false dependent information, requesting more than $300,000 in fraudulent refunds. Greenwood obtained the names and Social Security numbers of unemployed individuals in order to file fraudulent tax returns in their names. According to court documents, Greenwood also obtained the social security numbers of children and claimed them on the tax returns of unrelated individuals to maximize refundable credits – such as the Earned Income Tax Credit and the Additional Child Tax Credit – and further inflate the fraudulent refunds. Greenwood had more than $296,000 in fraudulent refunds deposited into accounts that he controlled or delivered to addresses he could access. Today, Greenwood was ordered to pay $296,106 in restitution to the IRS.
This case was investigated by the IRS Criminal Investigation Stolen Identity Refund Fraud Task Force. Trial Attorneys Leslie A. Goemaat and Todd P. Kostyshak of the Justice Department’s Tax Division are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax.
Ex-Oregon Department of Human Services Employee Sentenced for Theft of Welfare BenefitsRead the Press Release
PORTLAND, Ore – Yesterday, U.S. District Judge Marco A. Hernandez sentenced Denise Lachelle Palfrey, 38, of Tacoma, Washington, for stealing welfare benefits while employed at the St. John’s branch of the Oregon Department of Human Services (ODHS). On November 18, 2013, pursuant to a plea agreement, Palfrey pleaded guilty to one count of theft of government funds and one count of Supplemental Nutrition Assistance fraud, both felony offenses. Judge Hernandez sentenced Palfrey to three years of probation, including eight months of home detention, and full restitution in the amount of $4,233.76.
In pleading guilty, Palfrey admitted that in November and December of 2011, she stole Supplemental Nutrition Assistance (SNAP) benefits (previously known as food stamps) and Temporary Assistance for Needy Families (TANF) benefits.
Palfrey previously worked for the ODHS in the St. John’s branch office in Portland. Defendant’s duties included screening applications for welfare programs, determining applicant eligibility for SNAP benefits and other welfare programs, and issuing Oregon Trail cards to clients. An Oregon Trail card is an Electronic Benefits Transfer (EBT) card, similar to a bank debit card. When individuals qualify for food or cash benefits, Oregon Trail card accounts are set up for them. Benefits are automatically deposited onto the card each month. The Oregon Trail card is used to access the SNAP food benefits and TANF cash benefits.
An investigation revealed that in November and December of 2011, Palfrey fraudulently cancelled eight Oregon Trail EBT cards without the knowledge or consent of the cardholder and, forged the victim cardholder’s name in a log kept in the St. John’s ODHS branch office. Palfrey issued and then converted the new Oregon Trail EBT card to her own use. Palfrey activated each of the Oregon Trail cards and used the benefits on the card at local merchants within days of activation. Palfrey used or transferred to others the Oregon Trail cards with SNAP benefits for use at merchants including Costco, Safeway, and others. The TANF benefits were withdrawn from the Oregon Trail cards as cash at merchant and bank EBT terminals.
The ODHS, Office of Payment Accuracy and Recovery and the U. S. Department of Agriculture, Office of Inspector General – Investigations (USDA-OIG) jointly conducted the investigation. Assistant U. S. Attorney Donna Brecker Maddux handled the prosecution.
Ex-BLM Employee Sentenced for Theft of Government FundsRead the Press Release
PORTLAND, Ore. – Today, U.S. District Judge Michael H. Simon sentenced Maria Lana Gilbert for embezzling funds from her employer, the Bureau of Land Management (BLM), Salem District Office (SDO), between 2007 and 2011. A felony information, dated September 13, 2013, charged Gilbert with one count of theft of government funds. On November 13, 2013, pursuant to a plea agreement, Maria Gilbert pleaded guilty to the single count of theft of government funds. U.S. District Judge Simon sentenced Gilbert to two years of probation, including six months of home detention, and full restitution to BLM in the amount of $41,276.33.
In pleading guilty, Gilbert admitted that between September 1, 2007 and May 1, 2011, she knowingly stole and converted to her own use BLM funds using her government issued credit card to purchase items and gift cards for her personal use.
Historically, supervisors in the BLM and the SDO provided employees with gift cards as performance awards. BLM awards included gift cards for specific merchants and general use gift cards that could be used with any merchant capable of processing debit or credit card purchases. SDO authorized defendant Gilbert to purchase gift cards with her government credit card from merchants in Oregon and from retail Internet sites to be used as part of the reward program.
BLM undertook an agency-wide audit of the gift card program in 2010, including a review of Gilbert’s purchases, which resulted in the suspension of Gilbert’s government credit card in May 2011. The BLM investigation into Gilbert’s purchases revealed that she used her government issued credit card to buy items and gift cards totaling at least $41,276.33 for her personal use. Records from merchants confirmed that Gilbert submitted fraudulent receipts to her supervisor in an effort to hide the items she purchased for personal use.
According to the terms of the plea agreement, in addition to her sentence and restitution order, Gilbert resigned from the BLM effective November 13, 2013, and if Gilbert seeks future employment with any other federal agency, she must disclose the facts and details of this conviction. Also pursuant to the plea agreement, Gilbert paid the full amount of restitution to BLM at the time of sentencing.
BLM’s Office of Law Enforcement and Security investigated this case. Assistant U. S. Attorney Donna Brecker Maddux handled the prosecution.
Beaverton, Oregon Man Sentenced to 70 Months in Prison for Money LaunderingRead the Press Release
PORTLAND, Ore. – Larry Fuentes, 33, of Beaverton, Oregon, was sentenced yesterday by U.S. District Judge Marco A. Hernandez to 70 months in prison for the crime of money laundering. He was also ordered to pay $48,243 to the government in the form of a money judgment. Fuentes pleaded guilty to the crime of money laundering in October of last year, and the money judgment represents a portion of the approximately $120,000 that he admitted to laundering with his co-defendant and ex-girlfriend, Janelle Fuston. Fuentes was separately prosecuted in Washington County for possession and distribution of cocaine, and his federal sentence will run concurrently to the 48-month sentence he received last summer in Washington County for those drug charges.
Between April 2011 and April 2012, Fuentes conspired with Fuston, who was employed at the time by First Tech Federal Credit Union in Beaverton, to launder over $120,000 in Fuentes’s drug proceeds using several of Fuston’s accounts at First Tech. Before their crime was discovered, Fuston and Fuentes spent all but approximately $11,000 of the laundered drug proceeds, enjoying the fruits of their illegal conduct in the form of vacations, tanning salons, and other luxuries.
Once the money laundering conspiracy was discovered, Fuston was fired from her job at First Tech. She promptly admitted to her role in the conspiracy, took responsibility for her actions, and broke off all ties with Fuentes. She had no previous criminal history, and was sentenced in October to five years of probation and 200 hours of community service for her role in the crime. In contrast, Fuentes is a repeat offender with a lengthy criminal history that includes prior drug-related offenses. In addition, Fuentes repeatedly violated a judge’s order to have no contact with Fuston by sending her letters from prison urging her not to cooperate with authorities, telling her “It makes me angry how you believe [law enforcement] over the man you loved.”
“Drug crimes --- like many crimes --- are motivated by greed. This sentence underscores that those who launder the proceeds of crime can and will be prosecuted,” said U.S. Attorney Amanda Marshall. “Those who would use our nation’s financial institutions to legitimize their criminal proceeds will be held to account."
“The laundering of illegal drug profits is the way drug traffickers fund their illegal operations,” stated Kenneth Hines, Special Agent in Charge of IRS Criminal Investigation’s Seattle Field Office. “IRS Criminal Investigation will utilize all its expertise and resources to cut the flow of money that funds these drug traffickers that harm our communities.”
The investigation of this case was conducted by the High Intensity Drug Trafficking Area Interdiction Task Force, including the Portland Police Bureau’s Drugs and Vice Division, the Department of Homeland Security, and the Internal Revenue Service Criminal Investigation. The case was prosecuted by Assistant U.S. Attorney Katie Lorenz.Southern Oregon Career Felon Sentenced to 15 Years Federal Prison for Possessing Firearms and MethamphetamineRead the Press Release
MEDFORD, Ore. - On Tuesday, February 18, 2014, U. S. District Judge Michael McShane sentenced Allen Donn Richins, 53, of Trail, Oregon, to 15 years in federal prison for felon in possession of a firearm and possession of methamphetamine with intent to distribute.
During the late evening on August 9, 2012, Jackson County Sheriff deputies went to defendant’s rural property in Trail, Oregon, to investigate a reported accidental shooting. They found defendant’s car in the driveway, the front door to his house wide open, the light and TV on, and a handgun holster and a taser on the entryway floor. The deputies called out but received no response. Deputies conducted a safety sweep of the house, observed two handguns and drug paraphernalia, and obtained a search warrant. They eventually seized 11 ounces of methamphetamine, scales, packaging materials, $5,500 cash, five handguns, and three rifles, including a semi-automatic assault rifle with several loaded high capacity magazines. Defendant apparently fled the area when the deputies arrived. Two weeks later, the deputies tracked defendant to a house in Grants Pass, where the Grants Pass Police surrounded the house and ordered defendant out; defendant surrendered thirty minutes later. Defendant admitted selling methamphetamine and trading methamphetamine for firearms.
Defendant is a multiple convicted felon with six prior burglary convictions in addition to prior felony convictions for possession of methamphetamine in 2011 and 2006, unauthorized use of a vehicle in 1992 and 1989, supplying contraband in 1994, four counts of first degree forgery from 1988 and 1989, and felon in possession of a firearm and theft in 1998. He was previously convicted of felon in possession of a firearm and sentenced to 15 years prison as an Armed Career Criminal in 1993.
This case was investigated by the Jackson County Sheriff’s Office with assistance from the Grants Pass Department of Public Safety, the U.S. Bureau of Alcohol, Tobacco, and Firearms, and the U.S. Drug Enforcement Administration, and was prosecuted by Assistant U.S. Attorney Douglas W. Fong.
Malheur County Man Faces 15-Year Mandatory Minimum Sentence After Pleading Guilty to Felon in Possession of a Firearm and AmmunitionRead the Press Release
EUGENE, Ore. – On February 18, 2014, Ramiro Martinez Tristan, 39 and a resident of Ontario, Oregon, pled guilty today in federal court in Eugene to a single count of Felon in Possession of a Firearm and Ammunition. Law enforcement caught Tristan with a loaded .40 caliber handgun on September 10, 2013, and he has prior felony convictions for multiple counts of assault, felon in possession of a firearm, and burglary in the second degree. At sentencing on May 28, 2014, Tristan will face a 15-year mandatory minimum sentence as an Armed Career Criminal.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Ontario Police Department, and is being prosecuted by Assistant U.S. Attorney Nathan J. Lichvarcik.
Tractor Trailer Accident in Sherman County Leads to Federal Indictment Charging Multiple Drug CrimesRead the Press Release
Largest Reported Seizure in Oregon HistoryPORTLAND, Ore. – Salvador Martinez-Perez, 53, East Wenatchee, Washington, appeared today before U.S. Magistrate Dennis J. Hubel and plead not guilty to a federal indictment charging him with four counts of conspiracy and possession with the intent to distribute methamphetamine, cocaine and heroin. On January 17, 2014, Sherman County Sheriff’s Office (SCSO) responded to a semi-tractor trailer rollover on HWY 97 in Sherman County, Oregon. Upon arriving at the accident scene, SCSO Deputies identified one sole occupant/driver of the subject vehicle who was transporting fresh produce. The driver was not injured and was released from the scene. The following day, a private tow company was dispatched to the accident scene to remove the inoperable semi-tractor trailer. While tow company employees were unloading the inside of the cargo bed, two bundles of narcotics fell from the produce pallets. SCSO were contacted and responded to the scene and located inside the trailer approximately 190 pounds of methamphetamine, 7.5 kilograms of cocaine, and 11 pounds of heroin.
Defendant remains in federal custody pending a trial date of April 22, 2014. An indictment is only an accusation of a crime, and a defendant should be presumed innocent unless and until proven guilty.
This case was investigated by Sherman County Sheriff’s Office, DEA, and Oregon State Police. Assistant U.S. Attorney Kemp Strickland is handling the prosecution of the case.
Bank Robber Sentenced to Federal PrisonRead the Press Release
Defendant Sentenced as a Career Offender for Two Oregon RobberiesMEDFORD, Ore. – John Edward Perdue, 54, of Grants Pass, Oregon, was sentenced today to 151 months in federal prison for committing two bank robberies in Grants Pass. During the February 21, 2013 robbery of the Umpqua Bank, Perdue, with his face partially concealed by a hooded sweatshirt, rushed through the front door and went behind the service counter where the teller was on the telephone with a customer. Perdue tapped her on the shoulder, and ordered her to get off the phone and unlock the drawer at her teller station. Perdue grabbed money from the drawers and fled the bank with $10,580. The teller told detectives that she felt “panicked” and “surprised,” fearing that if she did anything contrary to what he was asking, he might harm her.
During the April 1, 2013 robbery of the Bank of the Cascades, Perdue entered the bank and again walked behind the service counter, ordering the male teller to get on his knees and not get up. Perdue emptied the money from the male teller’s drawer. Perdue then ordered a female teller to unlock an adjoining drawer, but when she was unable to open it he removed money from the drawer at her station. As Perdue was leaving the bank he dropped some of the cash and scrambled around on the floor trying to pick up as much as he could before fleeing with $8,612. The teller told detectives that she was scared during the ordeal due to the excited manner in which Perdue was acting and how he was ordering them around. This was the second time Perdue had robbed this same bank while she was employed as a teller. That robbery occurred in 2008.
According to sentencing documents filed by AUSA Byron Chatfield, Perdue was previously convicted in 1996 for committing two other bank robberies while he was an escapee from the Oregon Department of Corrections. He was sentenced to 87 months in prison for those robberies. He also received additional state sentences for the escape, as well as subsequent sentences for weapons possession and an attempted escape from the Oregon State Penitentiary. Thereafter, within a month of his release from custody, Perdue committed two additional bank robberies, one at the Bank of the Cascades in Grants Pass in 2008 and the other at the US Bank in Roseburg, Oregon. Perdue was sentenced to 28 months in state prison, as well as additional 24 month consecutive sentence in federal prison. Perdue has been incarcerated for committing criminal offenses for much of the last 20 years and he committed the current bank robberies less than a year after his release from custody.
Senior U.S. District Judge Owen M. Panner sentenced Perdue as a Career Offender, which enhances the sentence for commission of a serious violent felony after two or more convictions for other serious violent felonies. Perdue was also ordered to pay $19,192 in restitution to the banks.
This case was investigated by the Grants Pass Department of Public Safety and the FBI, Medford, Oregon and prosecuted by Assistant U. S. Attorney Byron Chatfield.
Attorney General Will Not Seek the Death Penalty Against Pedersen or GrigsbyRead the Press Release
PORTLAND, Ore. - U. S. Attorney Amanda Marshall announced today that Attorney General Eric Holder has decided not to seek the death penalty against defendants David Joseph “Joey” Pedersen or Holly Ann Grigsby for the 2011 murders of David Jones “Red” Pedersen of Everett, Washington, Leslie Mae “Dee Dee” Pedersen of Everett, Washington, Cody Faye Myers of Lafayette, Oregon, and Reginald Alan Clark of Eureka, California.
U.S. Attorney Marshall stated, “While I understand the public interest in this matter, we have rules that limit the release of information and the scope of public statements. The process by which this decision was made is confidential, and I cannot comment further about it except to say that it entailed a careful and detailed consideration of all the circumstances of this case.”
A federal grand jury indicted the pair in August 2012 on racketeering and other charges, including five potential capital offenses. Trial is set for July 7, 2014 before U. S. District Judge Ancer L. Haggerty. An indictment is only an accusation of a crime, and a defendant should be presumed innocent unless and until proven guilty.
The official notice is attached Here.
Confederated Tribes of the Umatilla Indian Reservation to Prosecute Domestic Violence Cases Under VAWA 2013Read the Press Release
Pilot Project Allows Tribal Prosecution of Non-Indian Abusers For the First Time in More Than Three DecadesMISSION, Ore. – The Confederated Tribes of the Umatilla Indian Reservation (“CTUIR”) will be one of three American Indian tribes to be the first in the nation to exercise special criminal jurisdiction over crimes of domestic and dating violence, regardless of the defendant’s Indian or non-Indian status, under a pilot project authorized by the Violence Against Women Reauthorization Act of 2013 (“VAWA 2013”). Besides the CTUIR, two other tribes, the Pascua Yaqui Tribe of Arizona and the Tulalip Tribes of Washington, will also begin exercising special criminal jurisdiction under VAWA 2013.
“Umatilla has once again shown that it is a national leader in criminal justice reform,” said Amanda Marshall, United States Attorney for the District of Oregon. “This expanded jurisdiction will give Umatilla tribal court the authority it needs to protect victims of domestic violence and hold offenders accountable.”
The Reauthorization of the Violence Against Women Act of 2013 expands the inherent jurisdiction of tribes that meet certain conditions to prosecute non-Indian domestic violence offenses perpetrated against Indian victims. It also permits those tribes to prosecute non-Indian
protection order violations when the protected person is an Indian. Such authority is limited to non-Indians who reside, go to school, or work on a tribe’s reservation. To exercise this enhanced authority, a tribe must guarantee certain rights to defendants similar to those guaranteed by the United States Constitution, such as the right to a public defender and effective assistance of counsel. Tribes must also include non-Indians in jury pools. The CTUIR meets these requirements.From February 20, 2014 forward, any non-Indian who commits a qualifying crime in the Indian country of the CTUIR will be subject to prosecution in tribal court. A copy of the Criminal Code is available on the CTUIR’s website. Since this is an exercise of the CTUIR’s inherent sovereignty, any tribal prosecution would not preclude the United States Attorney’s Office from also prosecuting the non-Indian defendant in federal court for the same offense.
"This is important not only for the CTUIR in exercising and expanding our sovereignty, but for the sovereignty of all tribes,” said Umatilla Board of Trustees Chair Gary Burke. “I am proud of the work and dedication of staff, the Court, the Law and Order Committee, and the General Counsel to support and push this effort forward. Once again, CTUIR is blazing a path forward for the good of all tribes.”
For over thirty years, tribes have been prohibited from exercising criminal jurisdiction over non-Indian defendants. Even a violent crime committed by a non-Indian husband against his Indian wife, in the presence of her Indian children, in their home on the Indian reservation, could not be prosecuted by the tribe. In granting the pilot-project requests of the Umatilla, Pascua Yaqui, and Tulalip tribes today, the United States is recognizing and affirming the tribes’ inherent power to exercise “special domestic violence criminal jurisdiction” over all persons, regardless of their Indian or non-Indian status.
The Department of Justice is posting notices of the pilot-project designation on the Tribal Justice and Safety Web site (www.justice.gov/tribal/) and in the Federal Register. In addition, each tribe’s application questionnaire and related tribal laws, rules, and policies will be posted on the Web site. These materials will serve as a resource for those tribes that may also wish to participate in the pilot project or to commence exercising “special domestic violence criminal jurisdiction” in the future.
For more information on VAWA 2013, please visit www.justice.gov/tribal/vawa-tribal.html.
Felon in Possession of Firearm Sentenced to 41 MonthsRead the Press Release
EUGENE, Ore. – On January 31, 2014, Scott Alan Gorman, 46 years old, was sentenced by U.S. District Chief Judge Ann Aiken to 41 months in federal prison for unlawful possession of a firearm. Upon his release from prison, Gorman will be on supervised release for three years.
On January 7, 2013, Gorman made threatening statements about having a firearm and an underground bomb shelter that scared employees at an adult care facility. The next morning, law enforcement responded to Gorman’s home and found in his bedroom a loaded Bushmaster .223 semi-automatic rifle and four loaded 30-round magazines. Gorman has a prior felony conviction for unlawful use of a weapon.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Eugene Police Department, and was prosecuted by Assistant U.S. Attorney Nathan J. Lichvarcik. The Lane County District Attorney’s Office is also prosecuting Gorman based upon an unrelated alleged assault.
Expatriate American Sex Offender Sentenced to Thirty Years in Prison in Foreign Sexual Abuse and Child Pornography CaseRead the Press Release
PORTLAND, Ore. – A previously-convicted sex offender who moved to Ecuador, sexually abused young boys there, and produced and distributed images of the abuse was sentenced in federal court this morning to 30 years in prison followed by a life term of supervised release. U.S. District Judge Michael H. Simon imposed the sentence on Kenneth Robert McVicker III, 50, following McVicker’s plea of guilty to traveling in foreign commerce and engaging in illicit sexual conduct with minors. While on supervised release, McVicker will be subject to stringent conditions of supervision, including prohibitions on associating with minors and frequenting places where children congregate, and restrictions on his use of computers. McVicker will also be required to participate in sex offender treatment, and must register as a sex offender.
McVicker was convicted of a number of child molestation offenses in Maryland in the 1980s, for which he spent close to 15 years in prison. After his release, and after completing a term of post-prison supervision, McVicker moved to a small coastal village in Ecuador, where he taught English and worked as an artist and soccer coach. While in Ecuador, he sexually abused at least eight young boys between the ages of five and twelve, took photographs and made videos of the abuse, and distributed the images to child pornography traders and collectors in Canada, India, Thailand, and Mexico. McVicker used the images he created as currency to obtain images of child sexual abuse from others. Agents from the U.S. Department of Homeland Security, Homeland Security Investigations (HSI) learned of McVicker’s activities after one of those collectors, a convicted American child pornographer living in Mexico, sent hundreds of McVicker’s self-produced images to an undercover HSI agent in Oregon posing as a child pornography collector. The collector in Mexico is presently serving a 15-year federal sentence following his conviction in Oregon for transportation of child pornography.
McVicker was indicted in Oregon and arrested in Belize after he travelled there to work on a commercial art project. Acting on information provided by HSI, authorities in Ecuador served an Ecuadoran search warrant at McVicker’s residence and seized his computer equipment. Forensic examinations of the equipment revealed a vast collection of over 360,000 images and more than 1,300 videos depicting the graphic sexual abuse of young children.
At the sentencing hearing, McVicker said that while he was born in the United States, he did not grow up here, and does not consider the United States his country. He believes that he should be facing charges in Ecuador, not in the United States. The government noted that McVicker’s conduct violated the laws of the United States, and was no less serious because his victims lived in Ecuador.
Judge Simon asked McVicker what “we, as a society” can do to prevent the sexual abuse of children in the future. McVicker replied, “Nothing at all.” He also apologized to “everyone who got hurt” by his conduct. Judge Simon urged McVicker to consider participating in scientific research geared toward better understanding and preventing future instances of child sexual abuse “in part, to repay for harms you’ve already caused.”
U.S. Attorney Amanda Marshall praised the sentence imposed on McVicker. “This sentence sends a strong message that there is no safe haven for predators who sexually abuse children – not in this country, and not abroad,” she said. McVicker’s conduct was “particularly egregious” because “he created images of the abuse, distributed the images, and used them to amass a horrific library of sexual abuse images and videos.” She also praised the “extraordinary efforts of the HSI agents, both here and abroad,” in identifying and locating McVicker. Because of those efforts, Marshall said, “Kenneth McVicker will never again be able to sexually abuse a child.”
HSI officials echoed Marshall’s comments. “Kenneth McVicker repeatedly abused young children to satisfy his sexual desires, and continued doing so even after moving to another country,” said Brad Bench, special agent in charge of HSI’s Seattle office, which oversees Oregon investigations. “Americans who travel overseas to abuse children are not beyond the reach of U.S. law. HSI special agents will go anywhere in the world to track down child predators and bring them to justice.”
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 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.
This case was investigated by the Homeland Security Investigations and was prosecuted by Assistant U. S. Attorneys Gary Sussman, Project Safe Childhood Coordinator for the U.S. Attorney’s Office in Oregon, and Kelly Zusman, Appellate Chief for the District of Oregon.
District of Oregon Assistant United States Attorneys Chosen as Recipients of 30th Annual Director's AwardsRead the Press Release
PORTLAND, Ore. - Four Assistant United States Attorneys (AUSAs) in the District of Oregon have been selected as recipients of the 2014 Director’s Awards by the Executive Office for United States Attorneys in Washington, D.C. The Director’s Awards are awarded for distinguished service to the mission of the Department of Justice through extraordinary professional achievements and excellence.
AUSA Gary Sussman was awarded the Director’s Award for Superior Performance as a Criminal AUSA for his work as the Project Safe Childhood Coordinator (PSC). He has served in this capacity for over seven years. AUSA Sussman has worked with federal, state, and local law enforcement and prosecutors to investigate child sexual abuse and exploitation offenses with an eye towards federal prosecution for particularly serious offenders. PSC prosecutions doubled between 2011 and 2012. As a result of his efforts, many sexual predators are serving substantial federal prison sentences.
AUSAs Tim Simmons, Craig Gabriel, and Billy Williams received the Director’s Awards for Superior Performance in Indian Country. All three AUSAs serve as Tribal Liaisons to the nine federally recognized tribes in Oregon. They received this award for their achievements in promoting the safety of Indian Tribal communities, establishing trusted government-to-government relationships, prosecuting Indian Country cases, and their work on jurisdictional complexities. Their work has concentrated on fulfilling the United States’ trust responsibilities by helping to protect Indian treaty and ancestral rights, and facilitating partnerships between tribal officials and both federal and state law enforcement regulatory agencies. They have instituted concrete changes in Indian country in promoting partnerships necessary for effective Indian Country law enforcement. This has led to effective and aggressive prosecution strategies and a dramatic reduction in crimes and violence affecting tribal communities in Oregon.
“This recognition by the Executive Office of U.S. Attorneys is a huge honor for all of the employees of the United States Attorney’s Office in the District of Oregon. Nationwide, many Department of Justice employees are nominated for these prestigious awards”, said U.S. Attorney Amanda Marshall. “I am particularly proud to have our Indian Country and Project Safe Childhood prosecutors recognized in this way as it speaks to the hard work of our office, prioritization, and continued commitment in these areas. Having four of our AUSAs recognized for their significant contributions to the mission of the Department of Justice, and the citizens of Oregon is a testament to the commitment, dedication, and hard work of all our employees.”
Armed Career Criminal Sentenced to 15 Years in Prison for Possessing a FirearmRead the Press Release
EUGENE, Ore. – On Tuesday, February 4, 2014, U.S. District Chief Judge Ann Aiken sentenced Michael Lee Fry, 38, of Douglas County, Oregon, to a prison term of 15 years for being a felon in possession of a firearm. Following his release from prison, the defendant will be on supervised release for five years.
On November 13, 2011, a Sutherlin Police Officer stopped the defendant’s vehicle for a traffic violation and for suspicion that the defendant was driving under the influence. A female passenger ran away from the vehicle and the defendant was detained for not having a driver’s license. A pat down of the defendant revealed a knife with crystal residue and he showed several signs of having used methamphetamine. The defendant’s vehicle was searched and a pistol was located in his backpack. The defendant’s felony convictions include unlawful use of a weapon, delivery of a controlled substance, attempt to elude and first degree burglary.
This case was investigated by the Sutherlin Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives and was prosecuted by Assistant U.S. Attorney Jeffrey S. Sweet.
Portland Woman Indicted for Tax Refund FraudRead the Press Release
Allegedly Sought $400,000 in Fraudulent RefundsPortland, Ore. – Latisha L. Simmons, 34, of Portland, Oregon, has been indicted on sixteen counts of wire fraud, sixteen counts of filing false claims for tax refunds, and one count of aggravated identity theft, the Justice Department announced. Simmons made her initial appearance in court today before U.S. Magistrate Steven P. Logan in Phoenix, Arizona. The defendant was released on pre-trial conditions pending an initial appearance in U.S. District Court in Oregon on February 20, 2014.
According to the 33-count indictment, Simmons electronically filed at least 52 false tax returns, requesting at least $400,000 in fraudulent refunds. Simmons is alleged to have obtained the names and Social Security numbers of other individuals, including those of a deceased person, in order to file false tax returns in their names. According to the indictment, Simmons had the fraudulent refunds deposited onto stored-value debit cards and mailed to her own address, addresses she could access or control, or deposited into bank accounts that she could access or control.
An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Simmons faces a maximum sentence of five years in prison for each false claims count, up to 20 years in prison for each wire fraud count, and a mandatory two-year sentence on the aggravated identity theft count. If convicted, she could be subject to fines, mandatory restitution, and a money judgment.
This case was investigated by the IRS Criminal Investigation Stolen Identity Refund Fraud Task Force. Trial Attorneys Leslie A. Goemaat and Todd P. Kostyshak of the Justice Department’s Tax Division are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax.
U.S. Attorney's Office Prosecutes Record Number of Sex Trafficking Cases in 2013Read the Press Release
Portland, Ore. — U.S. Attorney Amanda Marshall announced today that the U.S. Attorney’s Office for the District of Oregon prosecuted a record number of sex trafficking defendants in 2013. In 2012, the U.S. Attorney’s Office created the “Gang and Sex Trafficking Unit” which included additional prosecutorial resources to fight sex trafficking in Oregon. The following year, the office filed thirteen federal indictments, more than triple the number of sex trafficking indictments filed in any prior year. The past year, 2013, fourteen defendants were charged with federal sex trafficking crimes in the District of Oregon. In addition, thirteen defendants were convicted or sentenced in the district for sex trafficking crimes in 2013, also a record.
"Every day traffickers are recruiting our teenage girls in shopping malls, on public transportation, and on the street, and every night these children are being raped by johns in hotel rooms across Oregon,” said U.S. Attorney S. Amanda Marshall. “This is modern day slavery, and we will not rest until every victim is rescued, and every trafficker sent to prison.”
Most of the new federal cases involved the sex trafficking of children, ranging in age from 13 to 17. Others involved the sex trafficking of young adult women through force, fraud, or coercion. Three of the charged sex traffickers were women. For the first time in this district, the federal grand jury also charged a consumer of a sex trafficked child, commonly referred to as a “john,” under the federal sex trafficking laws.
All of the trafficked victims in these new cases were local girls or young women, living in Oregon or Washington at the time of recruitment.
Under federal law, the mandatory minimum sentence for a defendant convicted of sex trafficking a child (aged 14-17 years old) is ten years in prison, or fifteen years in prison if the child is less than 14 years old. The mandatory minimum sentence for a defendant convicted of sex trafficking through force, fraud, or coercion, is also fifteen years in prison. The statutory maximum sentence for these crimes is life imprisonment.
The United States Attorney’s Office works closely with the Federal Bureau of Investigation’s (FBI) Child Exploitation Task Force (CETF) to combat the commercial sexual exploitation of children in the district. The CETF marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children through sex trafficking, as well as to identify and rescue victims. The CETF partners with local law enforcement agencies, to include the Portland Police Bureau, Tigard Police Department, Beaverton Police Department, and Vancouver Police Department.
Portland Man Sentenced in Armed Bank RobberiesRead the Press Release
Armed Bank Robber Sentenced to 22 ½ Years in Federal PrisonPORTLAND, Ore. – Daniel Arthur Carter, who engaged in several takeover-style armed robberies in late 2012, was sentenced today by United States District Judge Marco A. Hernandez to serve 270 months in federal prison. He was sentenced for armed robberies of a U.S. Bank branch on November 21, 2012, and a Chase Bank branch on October 22, 2012, and for using a firearm in those robberies. Carter, 32, most recently resided in Portland, Oregon before his arrest in this case.
In pleading guilty, Carter admitted that on October 22, 2012, he entered a Chase Bank branch located in Tigard, Oregon wearing a mask and a hooded sweatshirt, and wielding a semiautomatic handgun. As he entered the bank he yelled demands to customers and employees, telling them to get down and to not activate any alarms. At gun point, he demanded that the tellers stuff his backpack with money. He then stole a car from one of the customers which he used to get away with $17,401 stolen in the robbery.
He also admitted that on November 21, 2012, he entered a U.S. Bank branch in SW Portland, Oregon wearing a mask and a hooded sweatshirt and wielding a semiautomatic handgun. As he entered the bank he yelled demands to customers and employees, telling them to get down and to not activate any alarms. At gun point, he demanded that the tellers stuff his backpack with money. He then unsuccessfully attempted to steal cars from customers before running away with $11,800 stolen in the robbery. He was apprehended by Portland Police Bureau officers as he was running from the bank.
Carter was sentenced to serve 186 months in federal prison for the armed bank robberies, consecutive to an additional 84 months for using a firearm during the violent crime. He was ordered to pay complete restitution of $29,401 for the robberies. He was also ordered to forfeit the firearm and ammunition which were used in the robberies, and the $17,401 in unrecovered money from the Chase Bank robbery. Carter’s sentence was enhanced because he stole property from a financial institution, used a firearm, physically restrained people, engaged in carjacking, and stole a considerable amount of money.
Carter also agreed to plead guilty in Multnomah County Circuit Court to armed robberies of the following Southwest Portland businesses:
- 45th Street Pub and Grill on July 10, 2012 during which $4,557 was stolen;
- Hillsdale Liquor Store on July 26, 2012 during which $3,821.05 was stolen.;
- Old Market Pub on August 19, 2012 during which ,$2,500 was stolen; and,
- Comfort Suites on July 31, 2012, during which $287.00 was stolen.
Upon release from custody, Carter will serve a five year period of supervised release. During his supervised release he must abide by a number of conditions which include mental health counseling, education and employment.
The case was investigated by the Portland Police Bureau. The case was prosecuted by Assistant U. S. Attorney Sean B. Hoar.
Oregon U.S. Attorney's Office Collects More Than $32 Million for U.S. Taxpayers in Fiscal Year 2013Read the Press Release
PORTLAND, Ore. - U.S. Attorney Amanda Marshall announced today that the District of Oregon collected more than $32 million for U.S. taxpayers during Fiscal Year 2013. This total included:
- $26,579,155.45 collected in criminal actions
- $371,698.67 collected in civil actions
- over $5,700,000 collected in forfeiture actions arising out of drug trafficking and fraud prosecutions
Additionally, Oregon worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $794,100 in cases pursued jointly with these offices. Of this amount, $26,745 was collected in criminal actions and $767,355 was collected in civil actions.
Attorney General Eric Holder announced on Thursday that the Justice Department collected approximately $8 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2013. The more than $8 billion in collections in FY 2013 represents nearly three times the appropriated $2.76 billion budget for the 94 U.S. Attorney’s offices and the main litigating divisions in that same period.
“The department’s enforcement actions help to not only ensure justice is served, but also deliver a valuable return to the American people,” said Attorney General Holder. “It is critical that Congress provide the resources necessary to match the department’s mounting caseload. As these figures show, supporting our federal prosecutors is a sound investment.”
“The U.S. Attorney’s Office in Oregon is critical in recovering funds for victims of crime,” said U.S. Attorney Amanda Marshall. “My office places a high priority on recovering the proceeds of crime and returning those funds to the victims.” This past year, the District of Oregon recovered $23 million in a single case in cooperation with the Bankruptcy court, arising out of the criminal fraud case against four former owners of Summit Accommodators, operating out of Bend, Oregon. The entire amount was returned to the victims who were clients of the Summit group.
Other cases involving significant collections during the past fiscal year include:
- U.S. v. David Gilbert, who pled guilty to conspiracy to commit bank fraud and was ordered to pay $2,177,603.31 restitution. The Financial Litigation Unit issued numerous writs of execution on various bank accounts and has collected over $680,000 to date for victims.
- As part of her sentence, Judith Eubank was ordered to pay $333,903.25 in restitution to Social Security and Oregon Department of Human Services after her guilty plea to the crime of theft of government funds. Her plea agreement included a payment of $100,000 toward restitution at sentencing.
- In the case of U.S. v. Geoffrey Montani , the defendant pled guilty to wire fraud and was ordered to pay $1,492,545.74 restitution. As part of the plea agreement, defendant paid $50,000 towards restitution prior to sentencing and another $76,458.97 was collected through garnishment by the Financial Litigation Unit.
In addition to the highlighted cases above, which involved large lump sum payments, most of the funds collected in the District of Oregon were obtained through the focused process of reviewing every defendant’s case for assets. The successful collection comes after pursuing those assets through filing of liens, issuing writs of garnishment on bank accounts, retirement accounts, pensions and wages, and issuing writs of execution on real and personal property. Also, working with the Asset Forfeiture Unit, $31,867 was recovered from forfeited funds and applied to restitution for victims.
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
Additionally, the U.S. Attorney’s office in Oregon working with partner agencies and divisions,collected $5,770,000 in asset forfeiture actions in FY 2013. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
Ringleader and Co-Conspirators Sentenced to Federal Prison in Mail Theft and Bank Fraud SchemeRead the Press Release
More Than 2,000 Pieces Of Stolen Mail Recovered Belonging to Over 845 Mail Theft VictimsMEDFORD, Ore. – Robert Lee Powelson, 30, Medford, Oregon was sentenced Tuesday to 161 months in federal prison by Senior U.S. District Judge Owen M. Panner after his convictions for, and his leadership role in, conspiracy to commit mail theft, conspiracy to commit bank and mail fraud, and aggravated identity theft. Dallas Lee Tedford, 32, and Kayla Ann Strange, 23, both of Medford, were sentenced to federal prison Monday by U.S. District Judge Michael J. McShane for their convictions for conspiracy to commit mail theft, conspiracy to commit bank fraud, and aggravated identity theft. Tedford was sentenced to 44 months; Strange was sentenced to 50 months. As part of each sentence, each defendant received a mandatory consecutive term of two years in prison required by federal statute where a victim’s identification was possessed or used in committing bank or mail fraud. Each defendant was also ordered to pay $70,380.09 in restitution to victims of the fraud.
Between September 2012 and March 2013, Powelson, Tedford, Strange, and other conspirators, repeatedly stole large quantities of U.S. mail from residents and businesses in the Medford, Oregon area. After stealing the mail, they removed financial instruments, financial documents, and identity documents of victims, and collected personal identifiers from those documents to create profiles of victims to further their fraud schemes. The fraud schemes included forging and cashing or depositing stolen personal checks into bank accounts defendants controlled; applying for and controlling credit card accounts in the names of victims; taking control of checking accounts of victims; and opening American Express Bluebird reloadable cards in the names of victims. As part of the bank fraud scheme, victim identities from the stolen mail were used to obtain fraudulent credit cards which were mailed to residences where the defendants retrieved and used them.
According to sentencing documents submitted by AUSA Byron Chatfield, a total of seven search warrants were executed at three motels, two vehicles, and two residences in the Medford area during the investigation. One of the victims had just recently moved from the state of Alaska to Ashland, Oregon to be with family and friends because of terminal cancer, and died while unknowingly being victimized by the defendants and the other co-conspirators. Another victim learned that their personal identifying information was being used in the fraud scheme while they were with their sick child at Doernbecher Children’s Hospital in Portland. As a result, the victim’s family experienced financial problems with their bank accounts and credit cards during a required lengthy stay with their child at Doernbecher’s.
Powelson also eluded police in two separate high-speed vehicle pursuits while involved in stealing mail. The subsequent search of the car Powelson and Strange used to elude police following one pursuit uncovered 12 financial account cards and 84 pieces of stolen mail including checks, check books, and financial and tax documents such as W-2’s and 1099 forms belonging to 81 Medford victims. The identity documents and checks recovered from the vehicle were collected together by Strange after they had been stolen from the mail. Also, Strange documented stolen victim identifying information in notebooks for future use. Following the second high speed pursuit, police found Powelson along with other associates at a local motel and upon searching their room police seized approximately 1,000 pieces of stolen mail belonging to approximately 365 individuals and businesses from the Medford area.
During a search of a residence where Strange and Powelson received mail and credit cards in victim’s names, police recovered 300 pieces of stolen mail including financial and tax information and 128 stolen checks that belonged to 161 victims from the Medford area. Police also discovered cell phone text messages between Tedford and another co-conspirator with instructions about how to activate a victim’s stolen credit card. A later search of Tedford’s apartment by police recovered a large quantity of stolen mail, victim identity profiles, 138 stolen and altered checks, and American Express Bluebird cards.
Numerous fraudulent checks seized from Tedford’s apartment had been loaded and reloaded on multiple Bluebird cards through smart phone imagery. Often the checks were altered in between load attempts in an effort to deceive the check scanning software and/or manual review of the checks at the time the checks were uploaded. Fraudulent Bluebird cards were also recovered during several of the other search warrants and intercepted from the mail stream destined for addresses used by Powelson, Strange, and Tedford for the fraud. Many of the fraudulent Bluebird cards were determined to be related through shared account information, card-to-card transactions, the use of the same email addresses, and the loading of fraudulent checks through smart phone imagery. Transaction analysis related to those cards disclosed a total attempted fraud of at least $214,697.
The other federally charged defendants, Eduardo Navarro, 24, and Lana Marshall, 29, both of Medford, Oregon, are scheduled to be sentenced within the next few weeks.
This case was investigated by the Medford Police Department, Talent Police Department and the U.S. Postal Inspection Service and prosecuted by Assistant United States Attorney Byron Chatfield.
Portland Gang Associate Sentenced to 20 Years in Prison After Being Convicted for Federal Gun ChargeRead the Press Release
Defendant, an Armed Career Criminal, was Just Recently Released from Federal CustodyPORTLAND, Ore. – December 24, 2013, Sid Edward Willis Jr., 34, of Portland, Oregon, was sentenced to 20 years in prison after being convicted of being a felon in possession of a firearm after he threatened a couple with a loaded .357 caliber handgun.
On May 24, 2012, at approximately 10:00 p.m., a couple drove into the Plaid Pantry parking lot located at SE 162nd and SE Division, in Portland, Oregon, to pick up a couple of things on their way home. After the male driver exited the car and went into the store the defendant walked up to the female passenger, who was still sitting in the car, and asked her "why is your man mugging me." As he was talking to the passenger the defendant showed her a silver handgun that he had tucked into his waistband. Alarmed, the passenger exited the car and went into the market to tell her boyfriend what had happened and that they needed to leave. Immediately after leaving the store, the defendant called out to the male driver and stated why "you mugging me?" The male driver turned to walk toward the defendant who then pulled out his gun and pointed it directly at the male driver’s face stating, "You can’t be mugging me...I'll kill you...I'm a gangsta.” Part of the incident at the Plaid Pantry, including the defendant pointing a gun at the victim's face, was captured on the store security video tape.
The couple immediately left the store and called 911. Portland Police Officers responded and captured defendant Willis a short time later down the street. After defendant Willis was taken into custody, officers located a loaded .357 caliber revolver hidden in some bushes where the defendant was trying to hide from the police. When he was being booked into the Multnomah County Jail the defendant blurted out to the police that he had done everything and then said, "Just give me a deal, I want 15 years in the state, don't send me to the feds!"
The defendant had been released from federal custody less than two months prior to this incident after serving a 10-year drug sentence. The defendant was arrested on federal charges and initially charged on a federal criminal complaint on May 29, 2012. On June 5, 2013, he was indicted by the federal grand jury for being a felon in possession of a firearm as an armed career criminal. The defendant pled guilty on July 22, 2013. At the time of the crime, the defendant had 10 prior felony convictions, including four felony drug trafficking offenses.
U. S. District Court Judge Anna J. Brown sentenced the defendant to 15 years in prison on the new felon in possession of a firearm charge. The new crime was also a violation of the defendant’s federal supervised release. Judge Brown also revoked the defendant’s federal supervision and imposed a consecutive five year sentence. When he is released from prison the defendant will serve an additional three years of supervised release.
This case was investigated by the Portland Police Bureau and the Gang Enforcement Team. The case was prosecuted by Assistant U. S. Attorney Scott Kerin, the Chief of the U.S. Attorney’s Office Drug Unit and former head of the Gang and Sex Trafficking Prosecution Team.
“When Congress enactedthe Armed Career Criminal Act it recognized that a very small percentage of repeat offenders commit a large percentage of violent or potentially violent crimes,” said U. S. Attorney Amanda Marshall. “The law was designed to incapacitate criminals, like the defendant, through the imposition of very lengthy prison terms in an effort to keep our community safe from our most dangerous offenders.”United States of America v. City of Portland, Case No. 3:12-cv-2265 Notice of Fairness HearingRead the Press Release
Tuesday, February 18, 2014, 9:00 a.m., Courtroom 13BOverview of the Case
The U.S. Department of Justice has found reasonable cause to believe that the Portland Police Bureau has an unconstitutional “pattern or practice” of using excessive force against persons with actual or perceived mental illness. Based on that finding, the U.S. sued the City of Portland. The City of Portland reached a proposed Settlement Agreement with the U.S. to remedy the identified problems. The Settlement Agreement has been considered and deemed fair and reasonable by the Portland Police Association. The Albina Ministerial Alliance Coalition for Justice and Police Reform does not object to the acceptance of the Settlement Agreement by the Court and has agreed to advocate for the implementation of the Settlement Agreement reforms that the AMA Coalition supports. The Court will hold a Fairness Hearing to decide whether the proposed Settlement Agreement is fair, reasonable, and adequate. The Fairness Hearing will be held on Tuesday, February 18, 2014, beginning at 9:00 a.m., in Courtroom 13B. The Fairness Hearing will be open to the public.
The Complaint in this case, the proposed Settlement Agreement, the Court’s Order setting the Fairness Hearing and its governing procedures, and the Testimony Form for persons wanting to submit oral or written testimony regarding the Settlement Agreement are available free of charge at the District Court’s Civil Intake Counter and at http://ord.uscourts.gov/fh.
Procedures Before the Fairness Hearing
The Court invites members of the public to testify, in writing or orally, on the following topics:
Is the Agreement fair to everyone affected?
Is the Agreement reasonable?
Is the Agreement adequate to solve the problems identified in the Complaint?To do so, persons are encouraged to submit the Testimony Form or a similar written submission no later than January 31, 2014. Submissions may be made to the Clerk of the Court in person or via first class mail, or via email to [email protected]. If anyone is unable to attend the scheduled hearing and wishes to provide oral testimony, he or she may do so by video and submit a DVD. Submissions will be retained by the Court until the close of the case, but will not be part of the public record unless the Court orders otherwise.
Procedures at the February 18, 2014 Fairness Hearing
Upon arrival at the Courthouse, members of the public will sign-in at Courtroom 13B. Those who previously provided a written submission requesting oral testimony will be given priority. Those who did not provide advance notice of their intent to testify may testify, at the Court’s discretion and if time permits. The Court will determine the order of the individuals providing testimony. Each member of the public will be provided five (5) minutes to testify. Organizations will be limited to presenting three (3) representatives and each representative will have ten (10) minutes to testify. The Court may extend time for testimony for good cause. Only testimony that is relevant, as determined by the Court, will be allowed at the hearing.The Testimony Form can be found Here
Armed Career Criminal Sentenced to 15 Years in PrisonRead the Press Release
Jefferson County Man Pleads Guilty io Being an Armed Career Criminal and Admits to Possessing Firearms Stolen in BurglaryEUGENE, Ore. – Daniel Chase Kennedy, 27, a resident of Jefferson County, Oregon, appeared before U. S. District Court Chief Judge Ann Aiken in Eugene yesterday and was sentenced to 15 years in prison. On July 10, 2013, Kennedy pled guilty to being an armed career criminal and admitted possessing shotguns and rifles he and two accomplices stole while burglarizing a Jefferson County home.
Chief Judge Aiken sentenced Kennedy as an armed career criminal because he possessed the firearms after being previously convicted in Oregon courts of twelve felonies including robbery, coercion and deliveries of methamphetamine.
According to court documents and statements made in court, Kennedy and two accomplices used methamphetamine before breaking into the unoccupied home and stealing the guns and jewelry. Oregon State Police officers recovered four of the stolen guns, stolen property, and methamphetamine at Kennedy’s Madras residence. Kennedy was on Oregon post-prison supervision for four felonies when arrested by the Oregon State Police and the Jefferson County Sheriff.
Kennedy’s guilty plea, admissions and sentence of 180 months in prison were part of his plea agreement with the U. S. Attorney’s Office for the District of Oregon, Jefferson County District Attorney’s Office, and Deschutes County District Attorney’s Office.
This case was investigated by the U.S. Bureau of Alcohol, Tobacco and Firearms, Oregon State Police and the Jefferson County Sheriff’s Office. Assistant U.S. Attorney Frank R. Papagni, Jr., with the assistance of Jefferson County Deputy District Attorney Laura Moszer and Deschutes County Deputy District Attorney Brigid Turner, prosecuted the case.
Silk Road Methamphetamine Distributors Indicted in Federal Case Involving Four DefendantsRead the Press Release
PORTLAND, Ore. – U.S. Attorney for the District of Oregon Amanda Marshall announced today that a federal indictment has been returned charging four individuals involved in a conspiracy to distribute methamphetamine over the Internet, conspiracy to export methamphetamine to other countries, and fifteen counts of international and domestic money laundering.
The Oregon indictment is an outgrowth of an investigation which began when, in September 2011, Homeland Security Investigations (HSI) special agents in Baltimore received information regarding an online illegal drug marketplace known as “Silk Road.” Subsequently, the Baltimore Silk Road Task Force, led by HSI, and including U.S. Secret Service, the Drug Enforcement Administration (DEA), the U.S. Postal Inspection Service (USPIS), and the Internal Revenue Service (IRS), was created. The ensuing investigation revealed the Silk Road website had been in operation since approximately March 2011 and had more than 957,079 registered users who conducted over $1.2 billion in transactions. Silk Road provided a forum for drug distributors and suppliers to offer their products via the Internet to buyers through an encrypted network known as The Onion Router (TOR) network. Silk Road also facilitated the sale of weapons and fraudulent ID. This encrypted network used by suppliers and users masked their true IP addresses, thereby providing complete anonymity.
The indictment unsealed today alleges Jason Weld Hagen, 39, and Chelsea Leah Reder, 23, both residents of the Vancouver, Washington area, and Richard Egan Webster, 45, and Donald Ross Bechen, 39, both Washington County residents, conspired to distribute methamphetamine across the globe using the Silk Road website. The indictment alleges the conspirators used internet anonymizing software, including Pretty Good Privacy and TOR, to distribute methamphetamine in exchange for the virtual currency known as BitCoins. The indictment alleges that the conspirators would then use commercial carriers to deliver the methamphetamine to various buyers throughout the United States and in Australia, Canada, the Czech Republic, Italy, and the United Kingdom. The Silk Road web site was seized in October, 2013, when FBI agents arrested the alleged administrator.
The indictment alleges that Hagen and his three Portland-area conspirators were responsible for the sale of over 17 pounds of methamphetamine to various buyers via Silk Road on approximately 3,169 occasions. In addition, the indictment alleges that Hagen, using the Silk Road alias “hammertime,” would receive payment in Bitcoins and then convert them to U.S. currency using various electronic money transfer systems including Paypal and Western Union, along with various reloadable and stored value cards.
The matter is scheduled for a seven-day jury trial before Senior U.S. District Judge Robert E. Jones on February 18, 2014. All defendants appeared before U.S. Magistrate Judge John V. Acosta today for arraignment and detention hearings. Judge Acosta ordered defendants Hagen, Webster, and Bechen held in federal custody pending trial, and released defendant Reder under conditions of pre-trial supervision.
Agencies cooperating in the Portland-area investigation include HSI, IRS—Criminal Investigations Division, U.S. Postal Inspection Service, U.S. Marshals Service, U.S. Secret Service, DEA, Portland Police Bureau, Washington County Sheriff’s Office, Westside Interagency Narcotics (WIN) Team, Clark-Vancouver Drug Task Force, the Beaverton Police Department and the Washington County District Attorney’s Office.
A criminal indictment is only an allegation and is not evidence of guilt. All defendants are presumed to be innocent unless and until proven guilty.
This case is being prosecuted by Assistant U.S. Attorney Johnathan S. Haub and Assistant U.S. Attorney AnneMarie Sgarlata.
Prison Sentences Imposed on Three Former Owners of Summt Accommodators in Bend for $13.7 Million FraudRead the Press Release
PORTLAND, Ore. –Yesterday, U.S. District Court Judge Anna J. Brown imposed prison sentences on Mark Neuman (78 months), Tim Larkin (54 months), and Lane Lyons (54 months), for lying to and misleading clients about how they held and used millions in client funds while operating Summit Accommodators, Inc., previously headquartered in Bend, Oregon. In addition to their prison sentences, the defendants must each serve three years of supervised release.
“Attorneys, certified public accountants and business executives who, motivated by greed, lie to clients to gain use of their money for personal purposes are especially deserving of prosecution and punishment,” said U.S. Attorney Amanda Marshall. “This office and our federal and state partners will do whatever it takes to bring dishonest professionals to justice. Besides seeking tough sentences for white-collar fraudsters, we will continue to go after their ill-begotten assets to compensate victims of these schemes.”
On July 3, 2013, on the 17th day of trial, a jury in federal court in Portland convicted the three former owner/operators of Summit Accommodators, Inc., of Bend, of conspiracy to commit mail fraud and conspiracy to commit money laundering in connection with a 10-year fraud scheme. About 10,000 clients entrusted them with almost $1 billion from 1999 to 2008, when the business closed and filed for bankruptcy. The defendants used $75 million of client funds for undisclosed personal investments in real estate, investments in businesses in the Bend area, and loans to business associates and family members.
Neuman and his business partner Brian Stevens, both Certified Public Accountants, created Summit in 1991 to help customers take advantage of lawful federal income tax deferral transactions. In a typical transaction, a customer would sell income producing property, allow Summit to hold the proceeds of the sale, and then buy another income producing property within 180 days. Federal income tax laws then allowed the customer to defer paying taxes on the profits from sale of the first property. Summit eventually opened affiliate offices in Texas, Washington, Utah, Montana, Wyoming, Nevada, and Lake Oswego, Oregon.
In 2002, Neuman and Stevens hired Larkin as Summit’s Chief Operating Officer. In 2005, Neuman and Stevens hired Lyons as Summit’s in-house counsel. In 2006, Larkin and Lyons became equal partners in Summit with Neuman and Stevens.
The trial evidence showed that although Neuman and Stevens began using their clients’ exchange funds for personal investments before 1999, they promised their clients their exchange funds would remain in Summit bank accounts and would only be used to complete their tax deferral exchanges. Neuman was responsible for language in Summit marketing brochures and Summit’s website. Both falsely promised Summit would maintain client funds in bank accounts or in government securities.
From 2004 through October 2008, Summit held between $49 million and $109 million of its customers’ money in a typical month. The defendants routinely transferred large amounts of client money to Inland Capital Corp., another company they owned and controlled. Through Inland, the conspirators used client funds for over 100 real estate projects in Central Oregon in which one or more of them had direct personal interests.
In 2006, defendant Lyons warned his partners in a confidential memo that “the use of exchange funds by Inland constitutes … a misrepresentation to our clients under their exchange agreements” and further stated if the use of client funds came to light “fraud charges will be leveled” against each owner. Despite this warning, the defendants continued to solicit and take in new client funds until days before shutting their doors.
The co-conspirators hid the fraud scheme by concealing from most of Summit’s employees and from most of the owner-operators of Summit’s branch offices that the conspirators were using Summit customer money to invest in real estate and for loans to themselves and others. In February 2007, when Summit’s clients and branch owner-operators began to express concern about the safety of Summit client money, the conspirators lied by saying that all Summit client money was deposited and maintained in financial institutions or invested in highly-secured short term notes.
“Summit clients lost millions while the owners of Summit Accommodators tried to make easy money,” said Kevin Rickett, Acting Special Agent in Charge of the FBI in Oregon. “While today’s sentencing brings about closure to this criminal investigation, we should remember the long-term toll that such scams can have on the victims.”
“Fraud, like many financial crimes, threatens the financial health of our communities,” stated Tamera Cantu, Assistant Special Agent in Charge of IRS Criminal Investigation. “IRS Criminal Investigation is committed to ensure that those who engage in these illegal activities are investigated and brought to justice.”
Summit co-owner Brian Stevens previously pleaded guilty to identical charges and testified against his former partners at trial.
This case was investigated by the Federal Bureau of Investigation; IRS, Criminal Investigation; the United States Postal Inspection Service; and the Oregon Division of Finance and Corporate Securities. Assistant U.S. Attorneys Seth D. Uram and Donna Maddux handled the prosecution of the case.
Sixth Alien Found Guilty of Conspiracy to Grow Marijuana in a National Forest and of Damaging Government Property in Largest Marijuana Grow Ever Found in OregonRead the Press Release
91,000 Plants Found Encompassing a Stretch Over A Mile and a HalfPORTLAND, Ore. – A federal jury in Portland returned verdicts of guilty Monday, December 16, 2013, in the trial of Fredy Figueroa-Montes, age 34. The counts of conviction included conspiracy to manufacture marijuana which carries a maximum penalty of 20 years in prison and a fine of $1,000,000; and depredation of government property which carries a maximum penalty of 10 years in prison, and a fine of $250,000.
Trial evidence showed that the defendant joined five co-defendants in growing more than 91,000 marijuana plants in the Wallowa Whitman National Forest, and that they used more than 500 pounds of illegal rodenticides, pesticides, herbicides and fertilizer to cultivate the marijuana, causing an estimated $97,000 in damage to the Wildcat Creek riparian area. Investigating officers found an Uzi long gun and two pistols in the campsite. The five co-defendants previously pled guilty and were sentenced to periods of incarceration ranging from 30 months to 120 months.
“These convictions are the result of the effective collaboration between local, state and federal law enforcement partners,” said U.S. Attorney Amanda Marshall. “Here in Oregon, federal prosecutors will remain aggressive when it comes to protecting federal enforcement interests that include preventing marijuana from growing on public lands, as well as preventing violence and the use of firearms in the cultivation and distribution of marijuana.”
Testimony presented by the government described the outdoor grow as “staggering”, encompassing a stretch over one mile and a half in the Wildcat Creek riparian zone, where the marijuana growers disrupted the natural terrain with extensive terracing. The plants were concealed in several separate pods developed by removing trees and underbrush to camouflage the grow site, and miles of plastic irrigation tubing was found. The Marijuana Enforcement Team, a trained group of state troopers who work with law enforcement agencies during the summer months to assist with marijuana eradication and investigations related to outdoor marijuana grows, called this the largest marijuana grow ever found in the State of Oregon saying many people would be outraged at the damage to public lands caused by illegal marijuana growers. Evidence presented identified an extensive amount of trash including tubing, plastic planter containers, herbicide and other toxic chemicals that were dumped along a river’s edge.
The five-day trial was held in the Federal District Court in Portland, Oregon, with Judge Michael W. Mosman presiding.
The investigation of the marijuana grow site was led by the Wallowa County Sheriff's Office, the La Grande Police Department, and the Union/Wallowa County Drug Task Force, the Oregon State Police SWAT Team, the Blue Mountain Enforcement Narcotics Team (BENT), Wallowa County Search & Rescue, Enterprise Police Department, the Union County Sheriff’s Office, the United States Forest Service Law Enforcement and Investigations, Union County Sheriff's Office, the Baker County Narcotics Enforcement Team, the Oregon Army National Guard Counterdrug Program, and the Oregon State Police Marijuana Enforcement Team, as well as the Oregon Department of Justice, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the United States Marshals Service, the Drug Enforcement Administration, Immigration and Customs Enforcement Homeland Security Investigations and the Wallowa County District Attorney’s Office.
Assistant U. S. Attorney Jennifer J. Martin and Certified Law Clerk Courtney Peck prosecuted the case.