Eastern District of Pennsylvania
Press releases recorded for this federal judicial district.
Appellate Court Agrees with Government that Supervised Injection Sites are Illegal under Federal Law; Reverses District Court RulingRead the Press Release
In a precedential opinion, the Third Circuit ruled yesterday that it is a federal crime to open a supervised injection site or “consumption room” for illegal drug use. Local nonprofit Safehouse planned to open the nation’s first such consumption room in the City of Philadelphia, where individuals would be invited to inject heroin and use other drugs under supervision. But the Third Circuit ruled that doing so “will break the law” because Safehouse knows and intends that visitors to its consumption room will have a significant purpose of using illegal drugs. In agreeing with the government’s interpretation of the Controlled Substances Act, the Court explained that, “[t]hough the opioid crisis may call for innovative solutions, local innovations may not break federal law.”
“The Court’s decision re-affirms that ‘safe’ injection sites are a violation of federal law,” said Acting Attorney General Jeffrey A. Rosen. “The Department supports efforts to curb the opioid crisis ravaging this country, but injection sites are not the solution. There are more productive ways to address drug abuse, and today’s ruling by the Third Circuit has confirmed that these sites are illegal and therefore not the answer.”
“The rule of law is still alive and well in Philadelphia – having been re-affirmed by the U.S. Court of Appeals for the Third Circuit, which held that it is a federal crime to open a heroin injection site or ‘consumption room’ for illegal drug use,” said U.S. Attorney for the Eastern District of Pennsylvania William M. McSwain. “The Third Circuit’s opinion is a faithful reading of the statute’s plain language and is consistent with Congress’s intent to protect American neighborhoods from the scourge of concentrated drug use.”
The Controlled Substances Act prohibits any person from knowingly and intentionally maintaining a place for the purpose of illegal drug use. In this appeal, the Government argued that if Safehouse opens a consumption room, knowing and intending that drug users will inject heroin there, Safehouse will break the law. The Court agreed with the Government, holding that Safehouse will violate the law because people will visit its facility with the purpose of using drugs. As the Court explained, though Safehouse will provide other services, “Safehouse’s main attraction is its consumption room.” The Court also held that Safehouse itself has the purpose that visitors use drugs within its “consumption room.” As the Government has argued throughout this suit, it defied logic to suggest that a so-called “consumption room” is not intended to be a place where people consume drugs.
Statement of United States Attorney McSwain on Today’s Appellate Ruling in the United States v. Safehouse LitigationRead the Press Release
PHILADELPHIA, PA – United States Attorney William M. McSwain issued the following statement regarding the opinion issued by the U.S. Court of Appeals for the Third Circuit this morning:
“I’m pleased to report that the rule of law is still alive and well in Philadelphia – having been re-affirmed by the U.S. Court of Appeals for the Third Circuit, which held that it is a federal crime to open a heroin injection site or “consumption room” for illegal drug use. The Third Circuit’s opinion is a faithful reading of the statute’s plain language and is consistent with Congress’s intent to protect American neighborhoods from the scourge of concentrated drug use. Philadelphia is known around the world as the birthplace of our wonderful nation and of liberty itself. Due to the dedicated work of those at the U.S. Attorney’s Office, it will not be known as the birthplace of heroin injection sites.”
Philadelphia Woman Sentenced to 35 Years for Enticing and Inducing a Child to Produce Child Pornography OnlineRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Linda Paolini, 45, of Philadelphia, Pennsylvania, was sentenced to 35 years in prison, a lifetime of supervised release, and ordered to pay more than $15,000 in fines by United States District Court Judge Nitza I. Quiñones Alejandro for child pornography and enticement offenses.
In October 2019, the defendant pleaded guilty to two counts of manufacturing child pornography and one count of online enticement of a minor. The defendant used social media to engage in sexually explicit communications with a 16-year-old Florida boy and coerce him to produce and send her videos of him masturbating. She did this by assuming the persona of a 16-year-old girl, sending the boy provocative images of her own daughter in order to manipulate him into thinking that an attractive, same-aged girl was in love with him. Ultimately, during an online video chat, Paolini faked a suicide attempt in order to induce the boy to attempt suicide himself in solidarity with her. Further, the defendant’s crimes were not limited to just this child; she also admitted to similar criminal communications with at least two other minor boys.
“This defendant’s criminal conduct was so heinous and cold-hearted that it almost defies description,” said First Assistant U.S. Attorney Williams. “She maliciously manipulated a child into making and sending her pornography of himself. But that was not enough for this defendant. She then manipulated the vulnerable child into attempting suicide. As a result of this prosecution and today’s sentencing, she will be behind bars for decades and will no longer pose a danger to other children.”
“Linda Paolini sexually exploited a boy the same age as her teen daughter. She even used pictures of her daughter to do it,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “These were predatory, premeditated acts, solely for her own gratification. Today’s sentence ensures she is held accountable for the considerable damage done, and keeps her from victimizing anyone else’s child.”
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Michael J. Rinaldi.
United States Brings Voting Rights Lawsuit Against IBEW Local 98 Alleging Interference and Intimidation in 2020 Union ElectionRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that the U.S. Attorney’s Office for the Eastern District of Pennsylvania filed a civil lawsuit on behalf of the U.S. Secretary of Labor (the “Secretary”) against the International Brotherhood of Electrical Workers Local 98 union (“Local 98”) for violating Title IV of the Labor-Management Reporting and Disclosure Act of 1959, 29 U.S.C. §§ 481–483 (“LMRDA”).
The United States alleges that Local 98, through its incumbent officers and their supporting members, intimidated and threatened other members who sought to challenge incumbent union leadership in the union’s June 2020 officer elections, causing these members to withdraw from nominations. As a result, incumbent union leadership ran unopposed and all officers – including the president and five executive board members – were declared reelected without opposition. The United States alleges that Local 98’s interference, threats, and retaliation against the intended challengers violated its members’ rights under the LMRDA to nominate, be nominated, and vote for candidates of their choice without improper interference or threat of reprisal.
The United States alleges that the Local 98 officers and members who subjected the intended challengers and their supporters to intimidation, harassment, and retaliation include Business Manager John Dougherty, Business Representative Robert Bark, and Business Representative Rodney Walker, among others. Based on the allegations outlined in the Complaint, the United States asks the Court to declare the results of Local 98’s June 2020 officer election void, and order Local 98 to conduct a new election with new nominations under the Secretary’s supervision as provided by the LMRDA.
“As alleged in the Complaint, entrenched union leadership engaged in a pattern of illegal interference, including threats and intimidation, to ensure it faced no opposition in Local 98’s June 2020 election,” said First Assistant U.S. Attorney Williams. “Not only were members in good standing allegedly intimidated out of exercising their right to seek union office, but the entire Local 98 membership was allegedly denied its right to nominate and vote for candidates of its choosing.”
According to the Complaint, on the evening of June 9, 2020, when nominations for the election were to be held, at least 150 people, primarily supporters of Dougherty and his longstanding slate of incumbents, gathered as a crowd on the grounds of the union hall. They refused to speak to one intended challenger or his supporters. Further, to get inside the union hall for the meeting, nominees and nominators allegedly had to walk through the crowd of Dougherty’s supporters gathered in the parking lot and down the steps to the basement, which one intended candidate and other witnesses described as like “walking the gauntlet.” The Complaint states that the intended candidate and his supporters found the atmosphere imposing and felt intimidated.
The Complaint further alleges that Local 98, controlled by a slate of officers that has not changed in years, has had a pattern of interfering with the efforts of rank-and-file members to run for local union office since at least 2014.
“Every union member has a federally-protected right to have his or her voice heard in a free and fair union election. It is protected by law. If union leadership interferes with anyone’s right to vote or seek office within the union, the United States will hold them accountable,” Williams said.
“Ensuring fairness and integrity in labor organizations is a major priority for the U.S. Department of Labor’s Office of Labor-Management Standards. We will continue to work with our investigative partners to ensure that those who are affiliated with labor organizations adhere to the highest standards of conduct to protect the civil rights of union members,” said OLMS Northeastern Regional Director Andriana Vamvakas.
Separate from and unrelated to this civil litigation against Local 98, the U.S. Attorney’s Office for the Eastern District of Pennsylvania is prosecuting a 116-count criminal Indictment that charges Dougherty and several other union employees with federal crimes, including embezzlement of union funds, wire fraud, and public corruption offenses. (Cr. No. 19-64 EDPA). The criminal matter is being prosecuted by Assistant United States Attorneys Richard Barrett, Bea Witzleben, Frank Costello, and Paul Gray. The trial date in the criminal matter is currently set for March 1, 2021.
The civil complaint contains allegations only, and not findings of liability.
The civil investigation was conducted by the U.S. Department of Labor’s Office of Labor-Management Standards. The civil litigation is being handled by Assistant United States Attorney Lauren DeBruicker.
Two North Carolina Men Charged in Gunpoint Robbery of Puppies from Lancaster County BreederRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Christopher Lamont Stimpson, Jr., 22, and Wilbert Curtis Trey Artis, III, 29, both of Greensboro, North Carolina, were arrested and charged by Indictment with robbery which interferes with interstate commerce, interstate transportation of stolen goods, and aiding and abetting, as a result of their alleged October 29, 2020 gunpoint robbery of a Lancaster County puppy breeder and theft of five French Bulldog puppies [see attached photo] valued at more than $23,000.
Stimpson and Artis are charged with posing as customers seeking to purchase five French Bulldog puppies allegedly in order to steal the puppies at gunpoint. One of the victims recorded the registration of the defendants’ getaway vehicle, which was traced back to a rental company in Greensboro, North Carolina. According to court documents, a customer of the breeder who had also been interested in purchasing one of the puppies later discovered an Instagram posting which featured a video and a photograph of the puppies, as well as photographs of Stimpson and Artis.
On December 8, 2020, both defendants were arrested by the Greensboro (North Carolina) Police Department on the bench warrants which had been issued in the Eastern District of Pennsylvania. On January 4, 2021, during a virtual initial appearance in the Eastern District of Pennsylvania before the United States Magistrate Judge Henry S. Perkin, Stimpson was ordered to home confinement pending trial. Artis made a virtual initial appearance before Judge Perkin today and was ordered to home detention pending trial.
“Robbery at gunpoint is always a severe crime, and in this case the defendants are charged with stealing living creatures at gunpoint – puppies - and transporting them across state lines,” said First Assistant U.S. Attorney Williams. “These are serious federal offenses which will be strenuously prosecuted by this office. We are thankful to our partners here in Pennsylvania and in North Carolina for their swift investigation and apprehension of these defendants.”
“This wasn't just some dognapping caper, it was a violent armed robbery that saw the victim menaced at gunpoint,” said Michael J. Driscoll, Special Agent in Charge of the FBI's Philadelphia Division. “We're glad the FBI and our partners could help safely recover the pups, and determined to see the perpetrators held accountable.”
“The quick apprehension of these individuals is a prime example of how well interagency cooperation between municipal and federal law enforcement agencies work,” said Ephrata Police Department Chief John E. Petrick. “The Project Safe Neighborhoods program allows for a law enforcement agency to coordinate an investigation with other law enforcement partners hundreds of miles away without delay.”
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
If convicted, each defendant faces a maximum possible sentence of 30 years’ in prison and a $500,000 fine.
The case was investigated by the Federal Bureau of Investigation, the Ephrata Police Department, and the Greensboro (NC) Police Department, and is being prosecuted by Assistant United States Attorney Mark S. Miller.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Police Officer Sentenced to 14+ Years in Prison for Distributing Child Pornography While on DutyRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that James Strohm, 49, of Philadelphia, PA, a 20-year veteran of the Philadelphia Police Department, was sentenced to 172 months in prison, 20 years of supervised release, and ordered to pay $79,000 in restitution and more than $27,000 in special assessments by United States District Court Judge Gerald A. McHugh for possession and distribution of child pornography.
In July 2019, the defendant pleaded guilty to one count of possession of child pornography and one count of distribution of child pornography. The charges against Strohm stemmed from a tip submitted to the National Center for Missing and Exploited Children from a gaming and social networking application about a user account, “fungirl12321,” containing thousands of images depicting child pornography. A phone number and IP address connected to the account were associated with the defendant. Investigators then determined that Strohm was viewing, downloading and distributing child pornography, including during hours when he was officially working as a Philadelphia Police Officer.
“The defendant abused his position of power and trust by distributing images involving the sexual exploitation of children, some as young as infants,” said First Assistant U.S. Attorney Williams. “James Strohm not only committed these crimes from his home, but also, abhorrently, while on duty as a police officer. He will now spend years behind bars where he will be unable to exploit the suffering of children any longer.”
“James Strohm was viewing child sexual abuse material while employed as a police officer, at times even from police workspace,” said Michael J. Driscoll, Special Agent in Charge of the FBI's Philadelphia Division. “He violated his sworn oath and broke the law in a particularly disturbing way. Today's sentencing sends a message that, no matter who you are, if you're perpetuating the exploitation of children by seeking and trading this horrific content, the FBI will step in, put a stop to it, and see you brought to justice.”
This case is part of Project Safe Childhood (PSC), a program bringing together all levels of law enforcement and the communities they serve to reduce the sexual exploitation and abuse of children.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Meaghan A. Flannery.
Pennsylvania Man Sentenced for Conspiracy to Commit Arson and Defraud Insurance Company of More than $100,000Read the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced today that Jason Gusoff, 45 years old, of Richboro, PA was sentenced today by United States District Court Judge C. Darnell Jones, II, to 60 months in prison followed by three years of supervised release, and ordered to pay $105,486 in restitution for conspiring to destroy his business by arson in order to collect insurance proceeds.
In 2008, Gusoff enlisted a co-conspirator to set fire to Gusoff’s business, California Tanning Salon, located on Roosevelt Boulevard in Philadelphia. Once the damage was caused, Gusoff submitted requests for payment to the business’ insurance company while making materially false representations that he was not responsible for the loss caused by the fire. These false representations resulted in Gusoff receiving $105,486 from the insurance company.
The defendant was indicted for the crime in February 2011 but then fled the United States prior to trial. In February 2019, thanks to the coordinated efforts of the Cambodian Police, the United States Marshal Service (USMS), the Diplomatic Security Service (DSS), and the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the defendant was captured in Cambodia and promptly returned to the Eastern District of Pennsylvania to answer to his crimes.
“If you are charged with a federal crime in the Eastern District of Pennsylvania, you will not be able to evade justice by fleeing to another country,” said First Assistant U.S. Attorney Williams. “We will find you and hold you accountable for your actions. In this case, the defendant was captured, convicted, and will spend five years behind bars.”
“Arson is a violent crime which ATF takes very seriously,” said Matthew Varisco, Special Agent in charge of ATF’s Philadelphia Field Division. “The capture and subsequent sentencing of Gusoff exemplifies the dedication of ATF and the United States Attorney’s office to fully prosecute those individuals who commit acts of arson.”
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and is being prosecuted by Assistant United States Attorney Jeanine Linehan.
Philadelphia Man Sentenced to 12 1/2 Years for Trafficking Methamphetamine and Weapons, Including 'Ghost Guns,' Near SchoolsRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Matthew Stephens, 52, of Philadelphia, PA, was sentenced to 151 months in prison and ten years of supervised release by United States District Judge Harvey Bartle III for his role in a scheme to traffic pounds of methamphetamine, several dozen firearms, machine gun conversion devices, and hundreds of rounds of ammunition between 2017 and 2019.
The defendant pleaded guilty in November 2019 to seven counts of drug trafficking and firearms charges, and then pleaded guilty again in August 2020 to nine additional firearms offenses charged in two Superseding Indictments. The specific charges included conspiracy to distribute methamphetamine, distribution of methamphetamine within 1,000 feet of a school, possession of a machine gun, possession of a non-registered machine gun, possession of a firearm by a felon, and dealing in firearms without a license.
The charges against Stephens stemmed from a long-term investigation conducted by the ATF into methamphetamine and firearms trafficking in the area of two public schools in the Kensington neighborhood of Philadelphia. In 2018 and 2019, during the course of this investigation, the defendant sold dozens of firearms to the ATF through a confidential informant. Many of these firearms had serial numbers that were obliterated, and still others were homemade, un-serialized, AR-15 style assault rifles, commonly referred to as “ghost guns” or “PMFs” (Privately Made Firearms) due to the complete absence of traceable manufacturer markings. Stephens also sold to the ATF during dozens of transactions parts designed to convert a semiautomatic firearm into a fully automatic firearm (“auto sears”), Glock machine gun conversion “kits,” two rifles and more than one hundred rounds of ammunition.
On March 27, 2019, Stephens was arrested during an ATF sting operation in the parking lot of a Wawa convenience store on Bustleton Avenue in North Philadelphia. At the time of his arrest, the defendant was in possession of over three kilograms of methamphetamine. For his criminal conduct, which included his role in three different conspiracies between 2017 and 2019, Stephens was later charged in three separate Indictments.
In total, Stephens sold 52 firearms, 44 machinegun conversion devices, and hundreds of rounds of ammunition, as well as more than $50,000 worth of methamphetamine. Many of the transactions occurred within one block of a public elementary school in Philadelphia. Two of the transactions involving methamphetamine occurred at a rest stop on the New Jersey Turnpike.
“This defendant personally threatened the safety of our communities,” said First Assistant United States Attorney Williams. “He sold drugs and firearms, including homemade untraceable firearms, immediately adjacent to two public schools, directly endangering the lives of children. Thanks to the steady, determined efforts of investigators at the ATF, Stephens’ revolving door of criminal contraband has been cut off.”
“Trafficked firearms represent a danger to our community, because they can end up in the hands of convicted felons, violent criminals, and many other kinds of people who are prohibited from having firearms,” said Matthew Varisco, Special Agent in charge of ATF’s Philadelphia Field Division. “This successful investigation and prosecution is a testament to our terrific partnership with the U.S. Attorney’s Office, and a reflection of our commitment to aggressively pursuing firearms traffickers in our communities.”
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and is being prosecuted by Assistant United States Attorneys Justin Ashenfelter and Priya T. De Souza.
Identity Thief Extradited from Dominican Republic Sentenced to Two and ½ Years in Prison for Using Stolen Information to Commit Tax FraudRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Arleny Reyes Nunez, 42, of Philadelphia, PA and the Dominican Republic, was sentenced to 30 months in prison and three years of supervised release, and ordered to pay $154,528 in restitution by United States District Judge Harvey Bartle III, for using the personal identification information of others to file fraudulent tax returns, resulting in more than $150,000 in losses to the federal government.
In August 2020, the defendant pleaded guilty to charges of criminal conspiracy to defraud the federal government, theft of government funds, and the unlawful possession and use of a means of identification. The charges were the result of the defendant and her co-conspirators acting together to defraud the United States by filing fraudulent tax returns using the identities of others.
From 2010 through May 2014, Reyes Nunez prepared and filed approximately 29 false tax returns, retrieved the refund checks (sometimes paying a minor child to retrieve paper checks from mailboxes at vacant Philadelphia properties), and deposited the checks into bank accounts associated with fake businesses she created in furtherance of this scheme. Later, in order to avoid apprehension, the defendant fled to her home country of the Dominican Republic, where she was ultimately arrested by local authorities for using a false passport and extradited back to the United States in January 2020.
“The defendant played a key role in a scheme to exploit others’ personal information in order to steal from the federal government,” said First Assistant U.S. Attorney Williams. “Further, when Reyes Nunez became aware that authorities had a warrant for her arrest, she abandoned her family and fled the United States in order to avoid facing criminal consequences. But she could not outrun justice, and now she will pay her debt to society.”
“Ms. Reyes Nunez thought she could flee the country to evade prosecution,” said IRS Criminal Investigation Special Agent in Charge Thomas Fattorusso. “What she failed to count on is that IRS Criminal Investigation special agents work diligently to identify and bring to prosecution those who engage in tax fraud. Her extradition and sentencing should serve as a reminder that we are committed to vigorously pursuing those who undermine the integrity of the U.S. tax system.”
The case was investigated by the Internal Revenue Service - Criminal Investigation and the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Priya T. De Souza.
Statement of U.S. Attorney McSwain Regarding Court Ruling in Philadelphia Vietnam Veterans Memorial Society v. Kenney, et al.Read the Press Release
PHILADELPHIA, PA – On Wednesday, December 23, 2020, U.S. District Court Judge Nitza I. Quinones Alejandro issued a Memorandum Opinion on Plaintiff’s Motion for a Preliminary Injunction. Plaintiff alleged that the City had an unconstitutional policy of treating protests more favorably than other First Amendment-protected activity, such as parades. While the Opinion denied the Plaintiff’s Motion, it did so on the basis that the City has abandoned its policy.
I want to congratulate the Philadelphia Vietnam Veterans Memorial Society for successfully protecting the First Amendment rights of all Philadelphians. Its lawsuit has achieved its purpose: the court has now confirmed that the City has abandoned its policy of favoring protests over other constitutionally protected speech, like parades.
The U.S. Attorney’s Office first objected to the City’s policy back on July 22, 2020, when I wrote a letter to City Solicitor Marcel Pratt. In that letter, I outlined the various unconstitutional aspects of the City’s July 14, 2020 Special Events Moratorium and explained how the City could not “pick and choose” by banning parades or other First Amendment-protected activity while simultaneously allowing and supporting protests. Unlike the City’s July 14, 2020 policy, the First Amendment does not discriminate.
Soon thereafter, the Vietnam Veterans Memorial Society also objected to the City’s policy. In response, the City “expressly rescinded the restrictions” in the July 14, 2020 policy, as the court explained. Significantly, organizations may now “hold a parade without a permit, on equal footing with all other events, and without threat of being dispersed,” according to the court.
Thus, any organization that wants to express a message via an outdoor parade in Philadelphia can have at it – the City cannot and will not stop you. And if the City attempts to return to the days of discriminating against certain types of speech, it will find itself right back in court.
Former Philadelphia City Controller’s Office Employee Sentenced to 22 Months in Prison for Bribery SchemesRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Jeffrey Blackwell, 47, of Philadelphia, PA, was sentenced today to 22 months in prison, three years of supervised release, and ordered to pay $25,612 in restitution by United States District Court Judge Chad F. Kenney for misusing his official position with the Philadelphia City Controller’s Office to enrich himself by soliciting and accepting bribes, and for committing additional tax crimes.
Blackwell pleaded guilty in August 2020 to charges of honest services wire fraud, filing a false tax return, and two counts of failure to file a tax return. A former City of Philadelphia employee in the Investigations Division of the Office of the City Controller, the defendant committed a series of frauds between 2013 and 2015, accepting more than $20,000 in bribes for city services.
Blackwell solicited bribes from at least five individuals who were seeking permits or contracts from the City. One of the individuals owned a furniture store and paid Blackwell for permits to park a storage container on the street. The second person was renovating a house and paid Blackwell for permits to allow that renovation. The third person owned a construction business and paid Blackwell to obtain a plumbing permit. The fourth person owned an auto body shop and paid Blackwell in the hope of getting a license to buy and sell cars, as well as a City contract to install decals on police vehicles. The fifth person, who was cooperating with the FBI at the time, told Blackwell that he needed permits from the City to renovate a house. The defendant also filed a fraudulent 2012 federal income tax return that falsely deducted travel expenses and falsely claimed a dependent; finally, he failed to file a return as required by law for tax years 2013 and 2014.
“During my tenure as U.S. Attorney, we have made it a top priority to uncover and prosecute public corruption in Philadelphia wherever it exists,” said U.S. Attorney McSwain. “Jeffrey Blackwell used his public position to enrich himself to the detriment of all Philadelphians who expect and deserve honest services from the City’s employees. Today’s sentence puts Mr. Blackwell where he belongs – in prison.”
“Jeffrey Blackwell figured he’d boost his city salary by taking bribes and kickbacks on the side,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “In doing so, he undermined the mission and integrity of the controller’s office where he worked and deprived Philadelphians of the honest government services they deserve. Public corruption does so much damage to people’s trust in the system, at every level. That’s why the FBI is committed to holding crooked public employees like Blackwell accountable.”
“Mr. Blackwell ignored his duties to provide honest services to the citizens of Philadelphia and to file accurate tax returns; instead he solicited bribes, lied, and cheated on his taxes,” said IRS Criminal Investigation Special Agent in Charge Thomas Fattorusso. “Today, his greed landed him in prison. Those contemplating similar behavior have been put on notice about the consequences of such criminal conduct.”
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service, with assistance from the Philadelphia Office of Inspector General. It is being prosecuted by Assistant United States Attorney David J. Ignall.
Virginia Man Arrested for Online Sextortion SchemeRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Terrell Ashby, 22, of Williamsburg, VA, was arrested and charged by Complaint for cyberstalking a young woman residing in Delaware County, PA in connection with a “sextortion” scheme.
According to the Complaint, in August 2020, Terrell Ashby used a social-media platform to contact a 20 year-old woman (the victim). Ashby, using the online moniker “Jason Brandon,” sent a message to the victim offering her a large sum of money and enticing her to communicate with him on another electronic messaging application. The victim agreed and subsequently engaged in a nude video chat with the defendant.
Unbeknownst to the victim, Ashby recorded portions of their video chat, and subsequently sent her multiple messages demanding $40 in exchange for deleting a nude photo he had captured of her. Specifically, he wrote, in part, “When you send the $40 I will delete your nudes offline” and “Just send the $40 and you’re good lol[.] We aren’t good until you send the $40[,] simply send the $40 and I’ll delete it[.]” The victim then paid the $40 by transferring money via an online payment platform to an account provided by Ashby.
However, that was not the end of Ashby’s alleged abuse of the victim. The defendant then sent the victim multiple messages demanding all of the money in her bank account. In these messages, Ashby threatened to disseminate the nude photos of the victim to her college and other social media friends and followers if she did not pay him more money. For example, Ashby wrote, in part: “Your expose page is being created right now and I’m also going to tag your college[.] I’ll end you[.] I’m not someone you want to [expletive] with[,] go tell your father that… Just [sent] your nudes to [name redacted][.] Already exposed you whore[.] Your life is over[.] You’re dumb if you thought this was over its not over until my $134 is sent[.] I’ll make sure our whole school sees your nudes[.]”
As a result of the defendant’s alleged conduct, the victim became distraught and ingested a number of prescription pills in an attempt to calm her emotional distress. She was rushed to an emergency room in an ambulance and ultimately recovered. While she was hospitalized, Ashby began advertising the nude photos of the victim using various online accounts. For example, the defendaNt posted a photo of the victim on a social-media platform, using an account named “[name redacted]sextape” with the following caption: “Everyone [message] me to see [the victim] nudes … she [video chatted] me naked I have the full [video chat] call saved [message] me to see everyone.”
Ashby was arrested at his residence in Williamsburg, Virginia this morning and is expected to appear before a magistrate judge in the Eastern District of Virginia later this afternoon.
“As detailed in the Complaint, Ashby’s alleged exploitation and manipulation of this victim are abhorrent,” said First Assistant U.S. Attorney Williams. “Protect yourself and avoid falling victim to this type of scheme. And if you have been victimized, know that you are not alone and should not be shamed into silence. Please come forward so that we can investigate and prosecute the offenders. These criminals are counting on your silence to get away with it; don’t let them.”
“Terrorizing someone with threats to release their explicit images is unconscionable,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “Imagine the emotional toll it takes on a victim, living in fear of being so personally exposed. Unfortunately, the FBI is seeing more and more sextortion cases, with people of all ages targeted. It’s not some sick game, it’s a crime, and the FBI will continue to unmask these cyber predators and hold them firmly accountable.”
If convicted, the defendant faces a maximum possible sentence of 5 years’ imprisonment, 3 years’ supervised release, and a $250,000 fine.
The case was investigated by the Philadelphia FBI, and is being prosecuted by Assistant United States Attorney Sarah Wolfe. The FBI and U.S. Attorney’s Office in the Eastern District of Virginia also provided assistance in the investigation.
A criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Man Sentenced to 6 ½ Years for Series of Greater Philadelphia Area Bank Robberies in 2019Read the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Michael Edmondson, 53, of Philadelphia, PA, was sentenced to 78 months in prison, three years of supervised release, and ordered to pay more than $6,700 in restitution by United States District Judge Mitchell S. Goldberg for robbing four banks in a spree across the Southeastern Pennsylvania counties of Delaware, Montgomery, Bucks, and Philadelphia.
In September 2019, the defendant pleaded guilty to a four-count Indictment charging him with four counts of bank robbery. The charges arose from Edmondson’s early 2019 crime spree, targeting the Wells Fargo Bank in Trevose on February 19; the Citizens Bank in Havertown’s Giant Foods on February 24; the Wells Fargo Bank in King of Prussia on February 27; and the Santander Bank on Market Street in Philadelphia on March 6. The defendant stole a total of $7,958 from the four banks, committing the offenses shortly after absconding from a halfway house where he was living while on state parole. In all four cases, Edmondson threatened to shoot himself and other people if the bank employees did not hand him cash.
“The defendant, now in his fifties, has a decades-long history of run-ins with the law,” said First Assistant United States Attorney Williams. “The simple fact is that Edmondson is a danger to the community. He has proven that, when given the opportunity, he will revert to threatening the safety of others and himself. The streets of Philadelphia and the surrounding counties are safer with the defendant behind bars once again.”
“At each stop on Michael Edmondson’s bank robbery spree, he told tellers he had a gun and was about to start shooting,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “Taking those who terrorize the community off the street is a priority for the FBI and our law enforcement partners, as we work together to crack down on violent crime and keep the public safe.”
The case was investigated by the Bensalem Township Police Department, the Haverford Township Police Department, the Philadelphia Police Department, the Upper Merion Township Police Department, and the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Kevin Jayne.
Former Philadelphia Attorney Sentenced to 7 1/2 Years for Stealing from ClientsRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Harris Roy Rosen, 65, of Sag Harbor, NY, was sentenced to 90 months in prison and one year of supervised release by United States District Court Judge Wendy Beetlestone for perpetrating a scheme to steal over $796,000 from clients who had entrusted him with their insurance settlement and estate funds.
The defendant pleaded guilty in March 2020 to charges of wire fraud, aggravated identity theft, and tax evasion. From approximately 2013 through 2017, he perpetrated a complex fraud scheme through which he stole from clients of his Philadelphia law firm, Rosen and Rosen PC, to support his lavish lifestyle, including multiple homes and a luxury vehicle. The defendant routinely lied to clients about the status of their funds; forged clients’ names on settlement checks to deposit them into his personal bank accounts; forged checks to steal money from a client; and created fake bank statements to lull clients into believing that their settlement or estate funds were in appropriate bank accounts waiting to be disbursed. Ultimately, many clients did not get any of the settlement or estate funds to which they were entitled. To conceal these crimes and the resulting illicit income, Rosen also intentionally failed to file tax returns resulting in a tax loss of over $260,000.
“The defendant committed serious criminal offenses for years, stealing funds from twenty clients – I repeat, twenty clients - who trusted him with their money,” said First Assistant U.S. Attorney Williams. “As a lawyer, Rosen was required to abide by the highest ethical standards with regard to his clients, but instead he greedily took advantage of them. This office will continue to protect the public against fraudsters like Rosen who abuse their positions of trust.”
“It seems like Harris Rosen worked harder to steal his clients’ settlement and estate money than he did in securing those funds,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “For years, he told lies upon lies, forging checks and bank statements, all to support an extravagant lifestyle to which he apparently felt entitled. The greed and abuse of trust here are stunning. Today’s sentencing means Rosen is finally being held accountable for his actions. The FBI will continue to work to find justice for the victims of financial fraud.”
“Mr. Rosen violated the trust placed in him by his clients when he deceived and stole from them; all to enrich himself,” said IRS Criminal Investigation Special Agent in Charge Thomas Fattorusso. “While we enforce the nation's tax laws, we also take particular interest in cases where someone, for their own personal benefit, has taken what belonged to others. Today, justice is served and Mr. Rosen has been held fully accountable for his crime.”
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigative Division, and is being prosecuted by Assistant United States Attorney Lesley S. Bonney.
Delaware County Man Detained on Child Pornography Charges for Preying on Young Boys over Online Gaming SystemsRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Geoffrey Hines, 34, of Upper Darby, PA, was arrested and charged by Indictment with 29 counts of child pornography offenses. The defendant made his initial appearance in federal court this afternoon in front of United States Magistrate Court Judge Richard Lloret, who ordered him detained pending trial.
The Indictment charges Hines with multiple counts each of enticing a minor to engage in sexually explicit conduct, manufacturing and attempting to manufacture child pornography, and possession of child pornography. According to court documents, for at least five years, the defendant preyed on young boys over their online games like Fortnite and Minecraft using X-box and PlayStation systems, communicating with them for days at a time and ultimately convincing them to live-stream sexually explicit images of themselves. In most instances Hines disguised his true identity so that the children were unaware that the person they were communicating with was actually an adult man in his thirties who was secretly recording them as they exposed themselves. In some cases, if a child was reluctant to remove his clothes, Hines allegedly made donations to the child’s gaming account or sent the child a code to redeem a gift card if the child complied with his demands. Dozens of young boys ranging in age from 8 to 13 years old were allegedly victimized by this defendant, who was also found to be in possession of more than 47,000 images and videos of child pornography at the time of his arrest.
“The defendant’s alleged conduct in this case is nightmare scenario for parents of children who like to play games online,” said First Assistant U. S. Attorney Williams. “Here, Hines is charged not only with sexually exploiting his many victims online, but also surreptitiously recording these children, forever preserving their exploitation and trauma. To parents out there whose children interact with third parties during online gaming, please speak with them frequently about the dangers and pay very close attention to their online activities and communications. And to anyone out there who is considering using online gaming platforms to prey on children in this disgusting manner, you can be confident that we will find you, we will prosecute you, and we will convict you.”
“The internet connects our homes and families to the world — and vice versa,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “In doing so, unfortunately, it offers a potential way in for those despicable individuals looking to prey on children. Geoffrey Hines allegedly victimized boys as young as eight, plying them with gifts in exchange for sexually explicit images. It’s a disturbingly common scenario, one the FBI and our partners are working each and every day to combat. We’d urge parents to talk directly with their children about cybersafety and the risk of online predators. If you need some support in doing so, you can find more information and resources at fbi.gov/sextortion.”
If convicted, the defendant faces a maximum possible sentence of life imprisonment.
This case is part of Project Safe Childhood (PSC), a program bringing together all levels of law enforcement and the communities they serve to reduce the sexual exploitation and abuse of children. The case was investigated by the Federal Bureau of Investigation, the Delaware County District Attorney’s Office, and is being prosecuted by Assistant United States Attorney Michelle Rotella.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Statement of U.S. Attorney William M. McSwain Regarding Federal Charges for the Murder of Philadelphia Police Sergeant James O’ConnorRead the Press Release
PHILADELPHIA, PA – On December 10, 2020, U.S. Attorney McSwain convened a press conference to announce federal charges against four defendants for the murder of Philadelphia Police Sergeant James O’Connor on March 13, 2020 and related drug and weapons charges. Below are his remarks from the press conference.
Good afternoon, everyone. We are here to announce that the U.S. Attorney’s Office has unsealed an Indictment against four individuals – Hassan Elliott, Bilal Mitchell, Khalif Sears and Sherman Easterling – for the murder of Philadelphia Police Sergeant James O’Connor, as well as related drug and weapons charges. As we all know, Sergeant O’Connor was tragically killed in the line of duty in the early morning hours of March 13, 2020 in the City’s Frankford section, while attempting to serve a murder warrant with his SWAT unit on Mr. Elliott, who was suspected of committing a murder in 2019.
Before I get into more details about the Indictment, I want to thank the members of the prosecution team who have worked tirelessly on this case literally from the moment that we learned of the murder. Specifically, I want to thank Sal Astolfi, the Deputy Chief of our Criminal Division; Jeanine Linehan, the Chief of our Violent Crime Unit; and Jonathan Ortiz, the Deputy Chief of our Violent Crime Unit. And standing with me today, I want to thank Ashley Martin and Lauren Stram, both Special Assistant U.S. Attorneys cross-designated to our Office from the Pennsylvania Attorney General’s Office; and Assistant U.S. Attorney Christopher Diviny. I also want to thank the Bureau of Alcohol, Tobacco, Firearms and Explosives, which is the federal agency partner on this case, and the Philadelphia Police Department, for their support. Standing with me today are Matt Varisco, the Special Agent in Charge of ATF’s Philadelphia Field Division; Melvin Singleton, the First Deputy Philadelphia Police Commissioner; and John McNesby, the President of the Fraternal Order of Police, Lodge 5. I want to thank Sergeant O’Connor’s family for being here today for this announcement. And I want to thank his extended family of fellow officers who loved him for being here, as well.
The four defendants in this case are alleged members of a drug trafficking group known by several names, including “1700 Scattergood,” operating within the Frankford section of Northeast Philadelphia and surrounding areas, that obtained and distributed crack cocaine and other controlled substances. According to the Indictment, all four defendants are responsible for the murder of Sergeant O’Connor, which occurred as he was climbing the stairs at 1688 Bridge Street, an alleged stash house for the drug gang. Significantly, the Indictment also contains a Notice of Special Findings against Mr. Elliott. These Special Findings make him eligible for the federal death penalty.
Sergeant O’Connor was a 23-year veteran of the Philadelphia Police Department. He was a married father of two whose family has deep roots in the Department. His father was a Philadelphia Police Officer; his son and his daughter-in-law are both Philadelphia Police Officers, as well. His daughter serves in the U.S. Air Force. Sergeant O’Connor was a loving son, husband, father and grandfather. He leaves behind a legacy of public service, honor, integrity – and bravery. He literally gave his life to protect our community.
Sergeant O’Connor’s murder was entirely preventable. As I have already explained in detail in previous public statements on March 16 and March 19, Hassan Elliott never should have been on the street in the first place – he should have been in jail. The only reason he was out of jail was because of the pro-violent defendant policies of the Philadelphia District Attorney, Larry Krasner. These policies prioritize “decarceration” of violent offenders over public safety.
Krasner’s policies coddle and embolden violent criminals, create a culture of lawlessness, and have inevitable consequences – one of which is a murder rate in Philadelphia that is the highest it has been in several decades. In 2020, we have already seen more shootings in Philadelphia than in any other year – ever. As I explained in my public statements on September 14, many of these shootings and murders were possible only because of District Attorney’s willingness – indeed, his eagerness – to return violent offenders to the streets, where they can continue to threaten, assault, shoot and kill.
In order to address this epidemic of violence in our city, we must have the courage to tell the truth. The truth is that, as a practical matter, Krasner’s pro-violent defendant policies are what put Elliott on the street; they put this horrible chain of events in motion; and in that sense, these policies are every bit as responsible for Sergeant O’Connor’s alleged murder as the defendants.
Given these facts, it would be absurd, even grotesque, to leave it up to Krasner to direct the prosecution of Sergeant O’Connor’s alleged killers. And it would be cruel to ask Sergeant O’Connor’s family to simply cross their fingers and hope that Krasner’s pro-defendant agenda does not victimize them yet again. That absurdity ends today.
No family should ever have to go through what the O’Connors have experienced over the past nine months, or what they will have to experience for the rest of their lives. We cannot bring their loved one back, but we can honor him by seeking justice and by doing all that we can to prevent this type of tragedy from occurring again. We promise the O’Connor family, we promise the Philadelphia Police Department, and we promise the community, that we will do exactly that. Thank you.
Four Men Indicted on Federal Murder Charges for Death of Philadelphia Police Sergeant James O’ConnorRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that an Indictment was unsealed today charging four defendants with the murder of Philadelphia Police Corporal James “Jimmy” O’Connor, posthumously promoted to Sergeant, and related drug trafficking and firearms offenses. The defendants charged in the Indictment are Hassan Elliott, a/k/a “Haz,” age 22; Bilal Mitchell, a/k/a “Omar,” a/k/a “Walkdown,” age 20; Khalif Sears, a/k/a “Leaf,” a/k/a “Lil Leaf,” age 19; and Sherman Easterling, a/k/a “Foot,” a/k/a “Foot on da gas,” age 25, all of Philadelphia, PA.
During a news conference outside the federal courthouse, U.S. Attorney McSwain discussed the charges in the seven-count Indictment. All four defendants are charged with: murder in the course of using or carrying a firearm during and in relation to a drug trafficking crime; using or carrying a firearm during and in relation to a drug trafficking crime; possession of a firearm in furtherance of drug trafficking; conspiracy to distribute “crack” cocaine and marijuana; possession with the intent to distribute “crack” cocaine and marijuana; and maintaining a drug involved premises. Additionally, the Indictment charges defendants Elliott and Easterling with possession of a firearm by a felon.
The Indictment alleges that the defendants are members of a violent drug trafficking group known as “1700 Scattergood,” which operates in the Frankford section of Northeast Philadelphia. The defendants allegedly sold narcotics from a stash house they maintained where they kept an arsenal of weaponry, drugs and drug paraphernalia. On March 13, 2020, the defendants were inside the stash house property in the 1600 block of Bridge Street when Sergeant O’Connor and other members of the Philadelphia Police Department’s SWAT team arrived with arrest and search warrants. As Sergeant O’Connor and his fellow officers ascended the staircase to the second floor of the residence and announced their presence multiple times, Elliott allegedly fired a semi-automatic assault rifle 16 times, striking and killing Sergeant O’Connor.
A subsequent search of the property revealed the scope of the defendants’ alleged drug trafficking conspiracy: ten firearms, bulk and packaged “crack” cocaine, bulk and packaged marijuana, and items commonly used to package and sell narcotics, such as a scale and packaging materials.
“The murder of a police officer is one of the most agonizing things that a community can experience, and my heart goes out to the O’Connor family. Sadly, this year has already seen more shootings in Philadelphia than in any other year – ever,” said U.S. Attorney McSwain. “In order to address this epidemic of violence in our city, we must have the courage to tell the truth. The truth is that, as a practical matter, District Attorney Larry Krasner’s pro-violent defendant policies are what kept Hassan Elliott on the street; they put this horrible chain of events in motion; and in that sense, they are every bit as responsible for Sergeant O’Connor’s alleged murder as the defendants. While we cannot bring Sergeant O’Connor back, we can honor him by seeking justice and doing all that we can to prevent this type of tragedy from occurring again.”
“This indictment shows ATF’s commitment to working with our local, state and federal partners to help diminish the violent crime that continues to plague Philadelphia,” said Matthew Varisco, Special Agent in charge of ATF Philadelphia’s Filed Division. “I commend the hard work of the investigators and detectives of the Philadelphia Police Department that made these charges possible and that hopefully will prevent another potential crime or death. I also thank the U.S. Attorney's Office for their guidance and work prosecuting this case.”
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
If convicted, the defendants face a maximum possible penalty of lifetime imprisonment. However, contained within the Indictment is a Notice of Special Findings for defendant Elliott with regard to the charge of murder while using or carrying a firearm. This Notice makes Elliott eligible for the death penalty.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Christopher Diviny and Special Assistant United States Attorneys Ashley Martin and Lauren Stram.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Pennsylvania Marketer Pleads Guilty to Filing False Tax ReturnsRead the Press Release
A Bryn Mawr resident pleaded guilty today to filing false tax returns, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney William M. McSwain for the Eastern District of Pennsylvania.
According to court documents and statements made in court, Jordan Richter sold marketing services and products, including email lists, to stock promoters. From 2012 to 2014, Richter did business through Diamond Spot Media LLC, a partnership in which he was a 99.5 percent owner. Richter inflated business expenses on Diamond Spot’s tax returns to reduce the partnership’s reported income. These falsities also resulted in Richter underreporting income on his personal returns for the years 2012 through 2014. In total, Richter caused a tax loss to the IRS of over $100,000.
U.S. District Judge C. Darnell Jones II, scheduled sentencing for March 8, 2021. At sentencing, Richter faces a maximum sentence of three years for each count. Richter also faces a period of supervised release, restitution, and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney William M. McSwain commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorney Chingos of the Tax Division and Assistant U.S. Attorneys Murray and Smith, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Former DeSales University Priest Indicted on Child Pornography OffensesRead the Press Release
A former DeSales University priest was charged by indictment with three counts of child pornography offenses.
Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division, U.S. Attorney William M. McSwain of the Eastern District of Pennsylvania, and Special Agent in Charge Brian A. Michael of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) Philadelphia made the announcement.
William McCandless, 56, of Wilmington, Delaware, was charged with possessing child pornography for importation into the Unites States, transporting child pornography in interstate and foreign commerce, and attempting to access with intent to view child pornography.
During his initial appearance before U.S. Magistrate Judge Henry S. Perkin, the defendant was arraigned on the pending charges and ordered to be placed on home confinement, to submit to electronic monitoring and to surrender his passport because he frequently traveled overseas and has numerous contacts abroad.
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 U.S. 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.justice.gov/psc.
The case was investigated by HSI and is being prosecuted by CEOS Trial Attorney Ralph Paradiso and Assistant U.S. Attorney Sherri A. Stephan.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Former DeSales University Catholic Priest Indicted on Child Pornography OffensesRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced today that William McCandless, 56, of Wilmington, Delaware, a former DeSales University priest, was charged by Indictment with three counts of child pornography offenses.
Specifically, McCandless was charged with possessing child pornography for importation into the United States, transporting child pornography in interstate and foreign commerce, and attempting to access with intent to view child pornography.
During his initial appearance today in front of United States Magistrate Court Judge Henry S. Perkin, the defendant was arraigned on the pending charges. He was also ordered to be placed on home incarceration with electronic monitoring and to surrender his passport because he has frequently traveled overseas and has numerous contacts abroad. In fact, from 2010 until January 2017, as a member of the Catholic order of Oblates of St. Francis DeSales, McCandless was assigned to St. Charles Parish in the European Principality of Monaco.
While he was working overseas in Monaco, McCandless allegedly amassed a collection of thousands of images of child pornography, including what can be described as the torture of very young children, which he brought back with him to the United States when he returned in January 2017. Further, once back in the United States, the defendant allegedly attempted to access similar images, and also conducted Internet searches for things like how to get “off the grid,” how to “disappear” and how to erase items from “the cloud.”
“McCandless’ alleged conduct here is extremely disturbing. It occurred not just overseas but continued while he crossed international borders, purporting to do the work of the Church,” said U.S. Attorney McSwain. “The innocent children in these images will have to deal with the impact of this alleged abuse for the rest of their lives. We can never make them fully whole again, but we can bring them some measure of justice by investigating and prosecuting the people who drive the demand for this abuse, no matter their affiliations.”
“For a priest and university faculty member to violate his position of trust by allegedly engaging in the depraved activity for which he has been indicted is reprehensible,” said Brian A. Michael, Special Agent in Charge for HSI Philadelphia. “Homeland Security Investigations and our law enforcement partners around the world will continue to coordinate closely to ensure our communities are protected from child predators who seek to exploit vulnerable victims.”
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 U.S. Attorneys’ Offices and the 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.justice.gov/psc.
If convicted, the defendant faces a maximum possible sentence of 60 years in prison.
The case was investigated by Homeland Security Investigations and is being prosecuted by Assistant United States Attorney Sherri A. Stephan and Trial Attorney Ralph Paradiso of the Child Exploitation and Obscenity Section of the Department of Justice.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Pennsylvania Attorney Sentenced for Role in $2.7 Million Ponzi SchemeRead the Press Release
An Allentown, Pennsylvania, attorney was sentenced today to 78 months in prison followed by three years of supervised release for his role in a $2.7 million investment fraud scheme that victimized his law clients.
Acting Assistant Attorney General Brian Rabbitt of the Justice Department’s Criminal Division, U.S. Attorney William M. McSwain of the Eastern District of Pennsylvania and Special Agent in Charge Michael J. Driscoll of the FBI’s Philadelphia Field Office made the announcement.
Todd H. Lahr, 60, of Nazareth, Pennsylvania, was sentenced by U.S. District Judge Edward G. Smith of the Eastern District of Pennsylvania who also ordered Lahr to pay $2,106,918.60 in restitution and $273,091 in forfeiture.
Lahr, an attorney licensed to practice law in Pennsylvania and the District of Columbia, and with offices in Allentown, pleaded guilty in April 2020 to one count of conspiracy to commit securities fraud and wire fraud, two counts of securities fraud, and four counts of wire fraud.
According to Lahr’s admissions at the plea hearing and sentencing, from 2012 through 2019, Lahr conspired with others to perpetrate a securities fraud scheme targeting his own law clients, which involved the fraudulent sale of the securities of two entities, THL Holdings LLC and Ferran Global Holdings Inc.
Lahr initially sold THL Holdings investments, promising that the money raised would be used to pursue specific business opportunities, including mining operations in Papua New Guinea and the acquisition of the shares of a penny stock. In reality, the money was used for Lahr’s personal expenses and to make Ponzi scheme payments to prior investors, among other things. Once Lahr realized that he was running out of investor money to pay the THL Holdings investors, he sought investors for a second entity, Ferran. He told the Ferran investors that their money would be used for business opportunities, including even more mining in Papua New Guinea and residential property leases in Spain and England—but, in fact, these funds were used to repay the prior THL Holdings investors and, again, for Lahr’s personal expenses to fund his lifestyle. Among these personal expenses were his home mortgage, his child’s school tuition, utility bills, and other personal debt. Total investor losses are estimated to be over $2.7 million.
Even after he was caught, Lahr continued his deception by lying in sworn testimony before the U.S. Securities and Exchange Commission (SEC). In this testimony, Lahr denied writing checks to his personal accounts from the THL Holdings accounts, when, in fact, he had written at least 25 separate checks to himself over a three-year period.
The FBI investigated this case. Trial Attorney Philip Trout of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Michael J. Rinaldi of the Eastern District of Pennsylvania are prosecuting the case.
The department appreciates the substantial assistance provided by the SEC.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Lehigh Valley Attorney Sentenced for Orchestrating $2.7 Million Ponzi Scheme That Targeted His Own Clients to Invest in Fake Business OpportunitiesRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Todd H. Lahr, 60, of Nazareth, PA, was sentenced to six and one half years in prison, three years of supervised release, and ordered to pay $2,106,918 in restitution by United States District Court Judge Edward G. Smith for orchestrating a $2.7 million Ponzi scheme and securities fraud that targeted his own law clients, and involved the fraudulent sale of the securities of two entities, THL Holdings, LLC and Ferran Global Holdings, Inc.
Lahr, an attorney licensed to practice law in Pennsylvania and the District of Columbia, and with offices in Allentown, pleaded guilty in April 2020 to one count of conspiracy to commit securities fraud and wire fraud, two counts of securities fraud, and four counts of wire fraud. In furtherance of his fraudulent schemes, the defendant solicited investments from his clients, telling them that their money would be used for a variety of business opportunities which were, in fact, nonexistent (like mining operations in Papua New Guinea, the acquisition of the shares of a penny stock, and property leases in Spain and England). In reality, the money was used for Lahr’s personal expenses and to make Ponzi-scheme payments to prior investors. Among these personal expenses were his home mortgage, his child’s school tuition, utility bills, and other personal debt. Total investor losses are estimated to be over $2.7 million.
Even after he was caught, Lahr continued his deception by lying in sworn testimony before the U.S. Securities and Exchange Commission (SEC). In this testimony, Lahr denied writing checks to his personal accounts when, in fact, he had written at least 25 separate checks to himself over a three-year period.
Last month, the SEC filed a parallel civil enforcement action to the criminal charges listed above, in the Eastern District of Pennsylvania, based on the same course of conduct. In this SEC civil case, the court has entered judgment against Lahr, ordering injunctive relief and disgorgement and prejudgment interest.
“Lahr took advantage of the very people he had an obligation to represent in good faith: his own clients,” said First Assistant U.S. Attorney Williams. “Stealing millions of dollars from people paying him for a professional services, legal counsel and expert judgment is reprehensible. My Office will continue to aggressively pursue securities and other financial frauds, particularly when perpetrated by lawyers and other professionals who are obligated to respect the law and protect their clients.”
“Todd Lahr’s clients trusted him,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “Lahr knew that and used it to his devious advantage, selling them on bogus investment opportunities and pocketing those funds. After years of living off of other people’s money, he’s finally being held accountable. The FBI will continue to shut down crooks like this, to help find justice for their victims and prevent anyone else from being harmed.”
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Michael J. Rinaldi and Trial Attorney Philip B. Trout of the U.S. Department of Justice, Criminal Division, Fraud Section. The U.S. Attorney’s Office appreciates the substantial assistance of the U.S. Securities and Exchange Commission in this matter.
Defendant Convicted at Trial in Massive Drug Trafficking Conspiracy Sentenced to Twelve YearsRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Malik Martin a/k/a “Leek”, 37, of Philadelphia, PA was sentenced to 12 years in prison and five years of supervised release by United States Senior District Court Judge R. Barclay Surrick for his role in an extensive, national drug trafficking conspiracy.
Martin was convicted after a four week trial in October 2018 of conspiracy to distribute 1,000 kilograms of more of marijuana and conspiracy to commit money laundering. Martin and his co-conspirators were part of a long-running drug-trafficking organization which distributed thousands of kilograms of marijuana, and then laundered the drug proceeds. The organization used tractor-trailer drivers to transport bulk quantities of marijuana from Arizona, California, and Texas to the East Coast, for distribution in the greater Philadelphia area. Martin worked closely with the head of the organization to bring money out to the West Coast, coordinate the purchase of the marijuana while there, and load the delivery of marijuana to the East Coast.
“Martin and his co-conspirators shipped tons of drugs from one end of this country to the other for decades,” said First Assistant U.S. Attorney Williams. “The sentence handed down today demonstrates our office’s commitment to taking down criminal organizations in order to keep our communities safe from the scourge of drug trafficking.”
“Malik Martin took part in a cross-country conspiracy that saw thousands of pounds of marijuana trucked here to Philadelphia,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “The FBI will continue to investigate and disrupt sprawling drug trafficking operations like this, as we work to take illegal drugs off the street and make this city safer.”
The case was investigated by the FBI, and is being prosecuted by Assistant United States Attorney Justin Ashenfelter.
Philadelphia Electrical Contractor Indicted for Bank, Tax Fraud and Theft of Union Benefit FundsRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Donald Dougherty, 54, of Philadelphia, PA, the owner of Dougherty Electric, Inc., (DEI) an electrical contracting business based in Philadelphia, PA, was charged by Indictment with multiple charges of bank fraud, tax fraud and theft from employee benefit plans. Also charged in the Indictment is Michael McKale, 47, of Warrington, PA, an accountant who worked for Dougherty, with counts related to tax fraud.
Specifically, Dougherty was charged with conspiracy to defraud the IRS, six counts of filing false tax returns, bank fraud, making a false statement to a bank, ten counts of filing false reports with unions, and 18 counts of failing to make contributions to union employee benefit funds on behalf of employees. McKale was charged with conspiracy to defraud the IRS and three counts of aiding and abetting the preparation and filing of false income tax returns.
According to the Indictment, Dougherty and his accountant, McKale, worked together to falsify corporate records so that Dougherty could pay less federal income tax than he was legally required to pay. The Indictment also charges that Dougherty gave his wife a no-show job at DEI, which paid $166,400 annually, mere weeks before she purchased a Jersey shore condominium for more than $900,000, and that he caused the falsification of corporate records in order to disguise her no-show salary as a legitimate business expense. In total, the defendant is charged with claiming a total of approximately $1.16 million in improper business expense deductions, causing a tax loss of approximately $416,300.
The Indictment further charges that in November 2015, Dougherty learned that the IRS had received an anonymous letter which reported that his wife had been given a no-show job and that DEI labor had renovated her condominium. Allegedly, after receiving that information, Dougherty filed amended income tax returns which removed certain improper business deductions but which still claimed false business deductions for his wife’s salary and car expenses. The Indictment alleges that McKale helped him commit this fraud while working remotely on DEI’s internal bookkeeping records by secretly changing properly recorded personal expenditures to make them appear to be business expenses in order to suppress Dougherty’s tax liability through fraud.
The Indictment also charges that Dougherty fraudulently represented to Wells Fargo Bank that he and his wife could not pay the mortgages on their $1.7 million South Philadelphia home, ultimately causing the bank to accept a one-time payment of $900,000 to settle the mortgages. However, according to the Indictment, Dougherty’s claims of financial distress were false and, in reality, DEI’s gross income increased from roughly $3 million in 2010 to about $23 million in 2013, causing the defendant’s personal income to surpass $2 million.
In addition to the above, the Indictment alleges that Dougherty committed multiple thefts from employee benefit plans. Specifically, the Indictment charges that Dougherty employed nonunion labor in Pittsburgh and paid them through a pass-through company created by his brother, all in order to avoid more than $500,000 in required contributions to the employee benefit fund of International Brotherhood of Electrical Workers Union Local 5 in Pittsburgh. The Indictment also alleges that Dougherty hired nonunion labor in Philadelphia and failed to pay $26,000 in contributions to IBEW Local 98’s employee benefit fund on their behalf.
“Donald Dougherty’s alleged schemes to enrich himself had multiple victims: hard-working union employees, bank stakeholders, and honest American taxpayers who pay their tax obligations,” said First Assistant U.S. Attorney Williams. “Further, he found an accountant to help him defraud the IRS by secretly changing properly recorded expenses into fraudulent ones. And when the defendants thought their scheme might be uncovered, they allegedly cooked the books even further to cover their tracks. The wide-ranging fraud alleged in this Indictment displays greed compounded by more greed, and it will be met with criminal consequences befitting such audacious conduct.”
“Donald Dougherty and Michael McKale are suspected of falsifying financial records to hide Donald Dougherty’s use of his business as a personal piggy bank,” said IRS Criminal Investigation Special Agent in Charge Thomas Fattorusso. “Criminal behavior like this is a slap in the face to all hardworking Americans who pay their tax obligations. Rest assured that protecting the integrity of the tax system continues to be a top priority for IRS-CI, as we strive to ensure that everyone pays their fair share.”
“Donald Dougherty allegedly cheated the government, his bank, and his employees,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “Simply put, anyone seeking to evade their legitimate financial obligations through blatant and willful deception needs to answer for that fraud.”
“Employers may not, by scheme or subterfuge, deprive their employees of the hard–earned contributions due their employee benefit plans. The U.S. Department of Labor, Employee Benefits Security Administration, and its law enforcement partners will vigorously investigate this activity and pursue criminal charges as warranted,” said Michael Schloss, Regional Director of EBSA’s Philadelphia Regional Office.
If convicted, Dougherty faces in excess of 200 years in prison, 5 years of supervised release, and a $9,250,000 fine, and McKale faces a maximum sentence of 14 years in prison, 3 years of supervised release, and a $1,000,000 fine.
The case was investigated by the FBI, the IRS Criminal Investigation Division, and the Department of Labor, Employee Benefits Security Administration, and is being prosecuted by Assistant U.S. Attorneys Paul L. Gray and Frank R. Costello.
Fifteen Members and Associates of the Philadelphia Mafia Indicted on Federal Racketeering and Related ChargesRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that a Superseding Indictment was unsealed today against 15 defendants, including alleged members and associates of the South Philadelphia and Southern New Jersey-based criminal organization La Cosa Nostra (LCN), known as the “mafia” or the “mob.” The Superseding Indictment charges various crimes including racketeering conspiracy, illegal gambling, loansharking, extortion, and drug trafficking.
The defendants charged in the seven-count Superseding Indictment are Steven Mazzone, aka “Stevie,” age 56; Domenic Grande, aka “Dom,” aka “Mr. Hopkins,” aka “Mr. Brown,” aka “Dom14,” age 41; Joseph Servidio, aka “Joey Electric,” age 60; Salvatore Mazzone, aka “Sonny,” age 55; Joseph Malone, age 70; Louis Barretta, aka “Louie Sheep,” age 56; Victor DeLuca, aka “Big Vic,” age 56; Kenneth Arabia, aka “Kenny,” age 67; Daniel Castelli, aka “Danny,” aka “Cozzy,” aka “Butch,” aka “Harry,” age 67; Carl Chianese, age 81; Anthony Gifoli, aka “Tony Meatballs,” age 73; John Romeo, age 58; Daniel Malatesta, age 75; Daniel Bucceroni, age 66; and John Michael Payne, age 34.
According to court documents, the Philadelphia LCN is one of a number of LCN organized crime families based in various cities throughout the United States. The purpose of the LCN in Philadelphia and elsewhere is to make money through the commission of various crimes, including illegal gambling, loansharking, drug trafficking, and extortion.
Like other LCN families, the Philadelphia LCN is operated through a defined hierarchical structure, including a Boss, an Underboss (defendant Steven Mazzone), and Captains (defendant Domenic Grande), who oversee “crews” consisting of “soldiers” and “associates.” As detailed in the Superseding Indictment, soldiers are members of the family who have been formally initiated through a ritual called a “making ceremony,” during which they swear allegiance to LCN above all else, take a vow of secrecy about the organization (the Code of Silence or “Omerta”), and agree to commit violence on behalf of the LCN, if necessary. After this ceremony, these men (who must be of 100% Italian ancestry) are then referred to as “made members” of the LCN. Associates are men who engage in criminal activity on behalf of LCN but who have not been formally “made,” either because they are up-and-coming and aspire to full membership, or because they are ineligible to be made because they lack fully Italian ancestry. Made members and associates who break Omerta may be targeted for death by other members of the group.
As described in the Superseding Indictment, the Philadelphia LCN sought to use its reputation and influence to exercise control over criminal rackets, like bookmaking and loansharking in Philadelphia and southern New Jersey, particularly Atlantic City. During a period beginning in August 2015, ten of the defendants allegedly conspired to conduct and participate in the affairs of the Philadelphia LCN through both a pattern of racketeering activity and through the collection of unlawful debts. The remaining five defendants are charged with allegedly committing a variety of other offenses, including conducting an illegal gambling business, conspiracy to make extortionate extensions of credit, and conspiracy to distribute controlled substances, in partnership with other members and associates of the Philadelphia LCN.
As alleged in the Superseding Indictment, on October 15, 2015, defendants Steven Mazzone, Domenic Grande and Salvatore Mazzone participated in a “making ceremony” (as detailed above) in a South Philadelphia residence, during which several new soldiers were inducted into the Philadelphia LCN. The Superseding Indictment goes on to describe the various acts allegedly committed by the defendants and others as members of the group, including the distribution of heroin, cocaine, fentanyl, methamphetamine and oxycodone pills; the disbursement and collection of tens of thousands of dollars of unlawful bookmaking and other debts “owed” to the group at interest rates as high as 400%; and even an alleged conspiracy to kidnap or murder a drug dealer in order to protect the reputation of the Philadelphia LCN after the dealer sold members of the group fake drugs.
“Thanks to the dedicated and courageous efforts of federal law enforcement over the past several decades, the Philadelphia mob isn’t what it used to be, and thank God for that,” said U.S. Attorney McSwain. “But it is still a problem and is still allegedly committing serious federal crimes, which is why we at the Department of Justice are focused on stamping it out. We will not rest until the mob is nothing but a bad memory.”
“The charges unsealed today against these 15 alleged members and associates of the Philadelphia La Cosa Nostra show that the mafia remains a criminal presence in our city and beyond,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “From loansharking and illegal gambling to drug trafficking and extortion, the mob continues to keep its fingers in many different pots, in its ceaseless quest for illegal profits. This group should’ve learned by now that the FBI is as committed to eradicating organized crime as wise guys are to embracing it.”
The case is being investigated by the FBI, including its Philadelphia Field Division and Atlantic City Resident Agency, as part of a long-running investigation, with the assistance of the Philadelphia Police Department, the Pennsylvania State Police and the Pennsylvania Office of the Attorney General. The case is being prosecuted by Assistant United States Attorney Jonathan Ortiz of the Eastern District of Pennsylvania and Trial Attorney Alexander Gottfried of the Department of Justice Criminal Division, Organized Crime and Gang Section.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Fifteen Members and Associates of Philadelphia La Cosa Nostra Indicted on Federal Racketeering ChargesRead the Press Release
A superseding indictment was unsealed today against 15 defendants, including alleged members and associates of the South Philadelphia and Southern New Jersey-based criminal organization La Cosa Nostra (LCN), popularly known as the ‘mafia’ or ‘mob.’ The superseding indictment charges various crimes including racketeering conspiracy, illegal gambling, loansharking, extortion, and drug trafficking.
Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division, U.S. Attorney William M. McSwain of the Eastern District of Pennsylvania, and Special Agent in Charge Michael Driscoll of the FBI’s Philadelphia Field Office made the announcement.
The defendants charged in the seven-count superseding indictment are Steven Mazzone, aka “Stevie,” 56; Domenic Grande, aka “Dom,” “Mr. Hopkins,” “Mr. Brown,” and “Dom14,” 41; Joseph Servidio, aka “Joey Electric,” 60; Salvatore Mazzone, aka “Sonny,” 55; Joseph Malone, 70; Louis Barretta, aka “Louie Sheep,” 56; Victor DeLuca, aka “Big Vic,” 56; Kenneth Arabia, aka “Kenny,” 67; Daniel Castelli, aka “Danny,” “Cozzy,” aka “Butch,” aka “Harry,” age 67; Carl Chianese, age 81; Anthony Gifoli, aka “Tony Meatballs,” 72; John Romeo, 58; Daniel Malatesta, 75; Daniel Bucceroni, 66; and John Michael Payne, 33.
According to court documents, the Philadelphia LCN is one of a number of LCN organized crime families based in various cities throughout the United States. The purpose of the LCN in Philadelphia and elsewhere is to make money through the commission of various crimes, including illegal gambling, loansharking, drug trafficking, and extortion.
Like other LCN families, the Philadelphia LCN is operated through a defined hierarchical structure, including a Boss, an Underboss (Steven Mazzone), and Captains (Grande), who oversee “crews” consisting of “soldiers” and “associates.” As detailed in the superseding indictment, soldiers are members of the family who have been formally initiated through a ritual called a “making ceremony,” during which they swear allegiance to LCN above all else, take a vow of secrecy about the organization (the Code of Silence or “Omerta”), and agree to commit violence on behalf of the LCN if necessary. After this ceremony, these men (who must be of 100 percent Italian ancestry) are then referred to as “made members” of LCN. Associates are men who engage in criminal activity on behalf of LCN but who have not been formally “made,” either because they are up-and-coming and aspire to full membership, or because they are ineligible to be made because they lack fully Italian ancestry. Made members and associates who break Omerta are looked upon unfavorably as “rats” and may be targeted for death by other members of the group.
As described in the superseding indictment, the Philadelphia LCN sought to use its reputation and influence to exercise control over criminal rackets like sports bookmaking and loansharking operating in Philadelphia and southern New Jersey, particularly Atlantic City. During a period beginning in August 2015, 10 of the defendants allegedly conspired to conduct and participate in the affairs of the Philadelphia LCN through both a pattern of racketeering activity and through the collection of unlawful debts. The remaining five defendants are charged with allegedly committing a variety of other offenses, including conducting an illegal gambling business, conspiracy to make extortionate extensions of credit, and conspiracy to distribute controlled substances, in partnership with other members and associates of the Philadelphia LCN.
As alleged in the superseding indictment, on Oct. 15, 2015, defendants Steven Mazzone, Grande, and Salvatore Mazzone participated in a “making ceremony” (as detailed above) in a South Philadelphia residence, during which several new soldiers were inducted into the Philadelphia LCN. The superseding indictment describes the various acts allegedly committed by the defendants and others as members of the group including the distribution of heroin, cocaine, fentanyl, methamphetamine and oxycodone pills; the disbursement and collection of tens of thousands of dollars of unlawful bookmaking and other debts ‘owed’ to the group at interest rates as high as 400 percent; and even an alleged conspiracy to kidnap or murder a drug dealer in order to protect the reputation of the Philadelphia LCN after the dealer sold members of the group fake drugs.
The case is being investigated by the FBI’s Philadelphia Field Office and Atlantic City Resident Agency with the assistance of the Philadelphia Police Department, the Pennsylvania State Police and the Pennsylvania Office of the Attorney General. The case is being prosecuted by Trial Attorney Alexander Gottfried of the Criminal Division’s Organized Crime and Gang Section Assistant U.S. Attorney Jonathan Ortiz of the Eastern District of Pennsylvania.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Florida Man Charged with Manipulating Publicly Traded Stocks in Multiyear “Pump and Dump” Securities Fraud Scheme Worth over $19 MillionRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Jeffrey D. Martin, 61, of Orlando, FL, was charged by Superseding Indictment with conspiracy and multiple counts of securities fraud and wire fraud, related to his manipulation of several publicly-traded securities in a “pump and dump” scheme in which Martin and his co-schemers allegedly defrauded investors out of over $19 million.
According to the Superseding Indictment, from about April 2012 until December 2019, Martin and others allegedly manipulated the stock of Mainstream Entertainment, Inc., now known as Volt Solar Systems, Inc., Resort Savers, Inc., Axiom Corp., Virtual Medical International, Inc., and Union Bridge Holdings, Ltd. The alleged manipulation involved fraudulent press releases, fraudulent securities disclosures filed with the U.S. Securities and Exchange Commission, and other fraudulent communications, as well as manipulative stock trading. The defendant and others were thus allegedly able to fraudulently inflate the price of the stock, and then sell their own shares at inflated prices and reap illicit proceeds—a classic “pump and dump” scheme. Through this conspiracy, Martin and his co-conspirators allegedly defrauded investors to enrich themselves; Martin himself received more than $989,000 in illicit proceeds from the sale of over-inflated stock of just one of the companies.
“Pump and dump stock schemes have real victims: those who play by the rules and save and invest in the markets,” said U.S. Attorney McSwain. “Market manipulation also causes generalized harm to the markets and to our economy because it erodes public trust that the markets are free and fair. Thanks to the excellent work of the FBI, SEC, and prosecutors from my Office, Martin will now face the consequences of his alleged actions.”
“Pump and dump schemers enrich themselves on the backs of innocent investors, turning a pile of lies into a mountain of money,” said Michael J. Driscoll, Special Agent in Charge of the FBI's Philadelphia Division. “The FBI is committed to cracking down on such harmful market manipulation, in order to protect both the investing public and the integrity of the financial system.”
If convicted, the defendant faces a maximum possible sentence of 245 years imprisonment, a $12.5 million fine, a 3-year period of supervised release, and a $1,200 special assessment.
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Michael J. Rinaldi. The U.S. Attorney’s Office appreciates the assistance of the U.S. Securities and Exchange Commission and the Financial Industry Regulatory Authority.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Three City of Philadelphia Revenue Department Employees Charged with Soliciting and Accepting BribesRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that three City of Philadelphia employees who worked in the Revenue Department were charged with soliciting and accepting bribes in connection with their employment. All three were charged with one count of federal program bribery.
Jarredd McQueen, 50, of Philadelphia, PA, was charged by Information. He was employed as a Customer Collection Representative for the City of Philadelphia’s Revenue Department when he allegedly accepted $9,000 of bribes in connection with his work. McQueen’s alleged criminal conduct began in May of 2018 and ended in November of 2018. He resigned from his employment on July 17, 2020.
Demarys Natal, 56, of Philadelphia, PA, was also charged by Information. She was employed as a Customer Collection Representative for the City of Philadelphia’s Revenue Department when she allegedly accepted $26,600 of bribes in connection with her work. Natal’s alleged criminal conduct began in February of 2018 and ended in September of 2019. She resigned from her employment on November 5, 2019.
Nicole Mixon, 44, of Philadelphia, PA, was charged by Indictment. She was also employed as a Customer Collection Representative for the City of Philadelphia’s Revenue Department when she allegedly accepted $22,300 of bribes in connection with her work. Mixon’s alleged criminal conduct began in November of 2019 and ended in March of 2020. She resigned from her employment yesterday.
As Revenue Department employees, McQueen and Mixon accessed the Taxpayer Information Payment System (“TIPS”), a computer system the City of Philadelphia uses to track the status of various financial obligations. The financial obligations include real estate taxes, refuse (i.e., trash) fees, and small business fees, that are owed to the City by property owners. McQueen and Mixon used TIPS to adjust the outstanding balances on various types of taxes and/or fees for a particular property after meeting with taxpayers about money they owed to the City.
McQueen and Mixon allegedly used their official positions collecting monies owed to the City as an opportunity to enrich themselves, while depriving the City of money owed to it by certain taxpayers. For example, the Information against McQueen alleges that he erased a $5,644.88 trash fee in exchange for a $1,500 cash bribe paid by an individual cooperating with the FBI. The Indictment against Mixon alleges that she erased a $1,210 trash fee in exchange for a $800 cash bribe paid by an individual cooperating with the FBI.
As an employee of the Revenue Department working in the Major Tax Unit, Natal collected delinquent business tax payments on Philadelphia properties. The collection efforts required Natal to meet and correspond with taxpayers about their outstanding debts. Natal allegedly used her official position collecting monies owed to the City as an opportunity to enrich herself, while depriving the City of money owed to it by certain taxpayers.
For example, the Information alleges that Natal told a taxpayer to bring two $500 postal money orders to the Municipal Services Building to satisfy the judgment for unpaid business taxes. Natal instructed the taxpayer to leave the payee section of the money orders blank. She later sent a text message instructing the taxpayer to “to leave them blank there [sic] doing us a personal favor so u can get ur $$$ instead of city.” An individual cooperating with the FBI presented Natal with two $500 money orders with the payee section blank, and in return, Natal allegedly erased $10,000 in fees associated with business taxes on a Philadelphia property. Natal deposited the $500 money orders into her bank account with the memo section reading “Repair/Remodeling” and “Flooring.”
“Bribes and corruption must have no place in Philadelphia’s municipal government,” said U.S. Attorney McSwain. “Corruption is an insidious disease that destroys the public’s confidence in its government, which is why we at the U.S. Attorney’s Office are so determined to root it out. Here, these three Revenue Department employees will now face the consequences of their alleged brazen and illegal acts.”
“When municipal employees decide to take bribes, they’re openly putting their own interests above those of the city they serve,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “The defendants’ alleged actions benefitted themselves and those who paid them off, at the expense of Philadelphia’s revenues and its residents. The FBI will continue to aggressively investigate allegations of public corruption, and work with our partners to ensure that those who violate their obligation to the public are held fully accountable.”
“I want to thank our federal partners for working with us from start to finish on this investigation. Public service demands integrity and honesty and together we send a strong message that there is no place for City employees who are unable to meet this standard,” said City of Philadelphia Inspector General Alexander DeSantis.
If convicted, McQueen, Natal, and Mixon each face a maximum possible sentence of 10 years in prison.
All three cases were investigated by the Federal Bureau of Investigation and the Philadelphia Office of the Inspector General, and are being prosecuted by Assistant United States Attorney Jason P. Bologna.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former Owners of Therakos, Inc. Pay $11.5 Million to Resolve False Claims Act Allegations of Promotion of Drug-Device System for Unapproved Uses to Pediatric PatientsRead the Press Release
PHILADELPHIA, PA – United States Attorney William M. McSwain announced that Johnson & Johnson (“J&J”) subsidiary Medical Device Business Services, Inc. (“MDBS”) agreed to pay $10 million to settle allegations under the False Claims Act that Therakos, Inc., a former J&J subsidiary, engaged in promotion of the UVAR XTS and CELLEX extracorporeal photopheresis (“ECP”) systems for unapproved uses in pediatric patients between 2006 and 2012. The Gores Group (“TGG”) agreed to pay an additional $1.5 million to resolve allegations that Therakos continued those alleged improper sales and promotion practices after TGG acquired Therakos from J&J in 2012.
In 1999, the Food and Drug Administration (“FDA”) approved UVADEX, the drug administered by the Therakos ECP systems, for “the palliative treatment of the skin manifestations of cutaneous T-cell lymphoma that is unresponsive to other forms of treatment.” Cutaneous T-cell lymphoma is a cancer of the immune system in which cancerous T-cells migrate to the skin, causing lesions. Therakos’s ECP drug/device systems administer the medication UVADEX (methoxsalen) by first removing a portion of the patient’s blood and separating the red blood cells from the white blood cells by using a centrifuge. The red cells are returned to the patient and the UVADEX solution is combined with the white cells. The device then irradiates the drug-cell mixture with ultraviolet light and returns the treated cells to the patient.
The government alleges that between 2006 and 2015, Therakos marketed and promoted its ECP systems to treat pediatric patients for indications that were not approved by the FDA. At no time during this period were the ECP drug/devices approved by the FDA for use in the pediatric population. The government further alleges that Therakos’s improper promotion caused false claims to be submitted to three federal healthcare programs: Medicaid, the Federal Employee Health Benefits Program, and Tricare.
“While physicians are free to exercise their independent medical judgment to prescribe medications for uses beyond FDA approved indications, pharmaceutical and device companies cannot interfere with doctors’ judgment by allegedly pushing the sale of their drugs or devices for non-FDA approved uses, especially in vulnerable populations,” said U.S. Attorney McSwain. “That is what allegedly happened here, and my Office will continue to investigate such cases and hold companies accountable when there could be an effect on pediatric or other vulnerable patients.”
“Investigating allegations of the False Claims Act is a top priority,” said Maureen R. Dixon, Special Agent in Charge for the Office of the Inspector General, U.S. Department of Health and Human Services. “We will continue to work with the U.S. Attorney’s Office to ensure the integrity of the Medicare and Medicaid Programs.”
“The OPM OIG will always prioritize protecting the health and well-being of our most vulnerable patients” said Norbert E. Vint, Deputy Inspector General Performing the Duties of the Inspector General, OPM OIG. “I would like to acknowledge our investigative staff and Department of Justice Partners for their hard work. This settlement represents our joint commitment to not only fighting against false claims but also protecting patients from harm.”
This settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The civil lawsuit was filed in the Eastern District of Pennsylvania and is captioned United States ex rel. Johnson et al. v. Therakos, Inc. et al., No. 12-cv-1454. The qui tam complaint was filed by Brian McCormick of Ross Feller Casey LLP in Philadelphia, PA.
“We thank the relators and relators’ counsel for their contributions to this case. Without information from citizens like the relators, detecting fraud and conserving government program funds would be much more difficult,” said U.S. Attorney McSwain.
The claims resolved by the settlement are allegations only; there has been no determination of liability.
This case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General, the U.S. Office of Personnel Management Office of the Inspector General, and Department of Defense, Office of Inspector General, Defense Criminal Investigative Service. For the U.S. Attorney’s Office, the investigation and settlement were handled by Assistant United States Attorney Charlene Keller Fullmer, Deputy Chief of the Civil Division, Assistant United States Attorney John T. Crutchlow, and former Auditor Denis Cooke.
Bangladeshi Husband and Wife Plead Guilty to Conspiring to Provide Material Support to ISISRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain and Assistant Attorney General for National Security John C. Demers announced that Shahidul Gaffar, 40, and Nabila Khan, 35, both residents of Pennsylvania, pleaded guilty today to conspiracy to provide material support and resources to ISIS, a designated Foreign Terrorist Organization. United States District Court Judge Joshua D. Wolson presided over the proceeding.
According to court documents unsealed today, in 2015, Gaffar and Khan, a married couple originally from Bangladesh, provided and attempted to provide financial support to two of Khan’s brothers who traveled to Syria to join ISIS fighters. Gaffar and Khan discussed the brothers’ travel plans in detail with each other, as well as with the brothers and other family members, as early as September 2014. In January 2015, Khan asked her sister living in Bangladesh to sell some of Khan’s gold and provide the money to their oldest brother, J.K., in order to assist him in travelling to Syria. Khan then flew to Bangladesh to wish J.K. farewell before his departure in February 2015. Gaffar, who remained in Pennsylvania, sent supportive messages to Khan’s mother stating: “Be [p]roud mother for the noble cause and for the sake of Allah!!!”
Further, according to the criminal Information, Khan’s second brother, I.K., had come to the United States on a student visa and resided with Khan and Gaffar in Pennsylvania from June 2014 until February 2015, when he returned to Bangladesh. Over the next few months, Khan, who was still in Bangladesh, observed I.K. watching terrorist propaganda videos featuring Anwar al-Awlaki, a designated global terrorist and key leader of ISIS. Around the same time, Gaffar began sending international money transfers to I.K. in Bangladesh. These funds had multiple purposes, but one was to support I.K.’s travel to Syria to join ISIS. In June 2015, Gaffar sent a message to Khan, stating: “Let [I.K.] know that I will manage and send 3000 dollars if Allah wills. Let's help him, my love, for the good cause who knows that might be enough to get forgiveness from Allah and accept[ance] [in]to heaven.” In July 2015, Gaffar continued to communicate with Kahn regarding the conspiracy, saying in part: “I feel bad for mom and dad, at the same time, I feel very proud. [W]hat a lucky mom and dad.”
In early July 2015, I.K. traveled to Syria to join ISIS. The next day, Gaffar and Khan discussed via electronic messages how Khan had tried to give I.K. more money right before he left, and days later, Kahn exchanged multiple electronic messages with a family member discussing I.K.’s arrival in Syria and reunion there with J.K. Gaffar sent reassuring messages to Khan, stating that it was “cool” that she had been able to observe I.K.’s radical Islamist “changes” from “beginning to end.”
According to court documents, in May 2016, Khan received an electronic message that I.K. had been wounded in the fighting in Syria, and in August 2016, Khan’s mother sent a message to Kahn with photographs of I.K.’s wounds sustained while in Syria. In September 2016, I.K. changed his online social media account profile picture to an image depicting himself, his brother and another male sitting in front of the black ISIS flag with firearms on a table in front of them, overtly identifying himself and his brother as members of ISIS. I.K. was ultimately killed in the fighting in Syria in March 2019.
“Protecting our country from terror attacks is the first priority of the Department of Justice and the U.S. Attorney’s Office,” said U.S. Attorney McSwain. “The defendants encouraged and supported Nabila Kahn’s brothers joining the murderous terrorist group ISIS, which is a direct threat to the safety and security of the United States. The public can rest assured that my Office – together with our partners from the FBI and the National Security Division of the Department of Justice – is working tirelessly every day to protect America and her residents from terrorism.”
“With their pleas today, Gaffar and Khan admit to providing material support to ISIS terrorists from American soil,” said Michael J. Driscoll, Special Agent in Charge of the FBI's Philadelphia Division. “As this case shows, extremists need not take up arms themselves to threaten lives and do real harm. The FBI’s Joint Terrorism Task Force will never stop working to identify those aiding terrorist groups that consider our country their sworn enemy.”
The defendants each face a maximum possible sentence of five years’ imprisonment, a $250,000 fine, and three years’ supervised release.
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorneys Sarah Wolfe and Robert Livermore.
United States Brings Civil False Claims Act Suit Against Delaware-Based Textile Manufacturer for Bribery of an Amtrak Official and Conspiracy to Rig BidsRead the Press Release
PHILADELPHIA— United States Attorney William M. McSwain announced that his Office filed suit against First State Manufacturing, Inc. (“FSM”), a Milford, Delaware corporation, for violating the False Claims Act. The United States alleges that FSM, through its executive management, bribed Timothy Miller, a former Amtrak procurement official, in order to receive lucrative contracts from Amtrak. More specifically, the United States alleges that FSM executives provided cash, kickbacks, and vacations to Miller and, in exchange, Miller provided FSM with bidding information that allowed FSM to win the contracts. Once FSM secured the contracts, it allegedly furnished substandard textile products and conspired with Miller to inflate prices, costing taxpayers even more. FSM allegedly attempted to conceal the bribery scheme by directing Miller to falsify records and establish a fake company through which FSM paid him as a “consultant.” The complaint alleges that as a result of this scheme, FSM secured six contracts from Amtrak between August 2015 and April 2018.
The United States and FSM have also entered into a Consent Judgment, subject to the Court’s approval, that would resolve the matter without litigation. If approved by the Court, the Judgment would require FSM to pay $393,250.07 to the United States. The settlement amount is based in part upon the company’s financial status.
Previously, Miller and two FSM executives were criminally prosecuted by the U.S. Attorney’s Office for the Eastern District of Pennsylvania. For his role in this scheme, Miller was sentenced to one year and one day in prison. Donald Scott Crothers, FSM’s Vice President for Marketing and Contract Administration, received a sentence of eighteen months in prison for his role in the scheme. John Gonzales, FSM’s Chief Executive Vice President and Chief Financial Officer, is awaiting sentencing.
“As alleged, FSM performed an end-run around an honest bidding process, illegally stacking the deck in its favor,” said U.S. Attorney McSwain. “The United States’ complaint lays out, in painstaking detail, FSM’s alleged bribery scheme, including kickbacks through a fake consulting company, cash payments made under the cover of night, and improper price adjustments directed by a corrupt organization. Let this be a warning to anyone who thinks they can perpetrate and hide a bribery or bid rigging scheme: my Office will bring to bear all of its resources, both civil and criminal, to make sure that all culpable parties are held accountable.”
“Today’s actions represent our commitment to seek justice and hold accountable those who violate the law,” said Kevin Winters, Amtrak’s Inspector General. “We appreciate the seamless collaboration with the U.S. Attorney's Office as well as the sustained professionalism exhibited by our investigative staff and partner agencies in moving the case to this next phase.”
“Today’s civil complaint against First State Manufacturing demonstrates our commitment to use all available legal remedies with respect to those who seek to enrich themselves through fraud, bribery, and bid-rigging at the expense of the Federal government and honest businesses,” said DOT OIG Regional Special Agent-In-Charge Douglas Shoemaker. “DOT OIG will continue to work with our law enforcement and prosecutorial partners to pursue financial justice on behalf of the American taxpayer.”
The complaint contains allegations only, and not findings of liability.
The investigation was conducted by the Amtrak Office of Inspector General and the Department of Transportation Office of Inspector General. The civil investigation, litigation, and resolution are being handled by Assistant United States Attorney Paul J. Koob.
Two Brothers, Both Senior City of Philadelphia Officials, Charged with Fraud and EmbezzlementRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that two brothers, Leo and Paul Dignam, were charged by Information with fraud and embezzlement, and a third person, Barbara Conway, was also charged by Information with theft.
Leo Dignam, 61, of Philadelphia, PA, was charged with two counts of wire fraud and one count of embezzling from a program receiving federal funds. Leo’s brother, Paul Dignam, 58, also of Philadelphia, was charged with one count of mail fraud and one count of embezzling from a program receiving federal funds. Barbara Conway, 61, of Drexel Hill, PA, was charged with one count of theft of funds from a program receiving federal funds. At the time of the charged offenses, Leo and Paul Dignam were senior officials with the City of Philadelphia, and Conway was the Food Voucher Coordinator for the Philadelphia Health Management Corporation (PHMC), an agency contracted by the City to manage the Food Voucher Program.
Leo Dignam was an Assistant Managing Director in the Managing Director’s Office and, prior to serving in that position, was the Deputy Commissioner for Programs with the Philadelphia Parks and Recreation (“PPR”) Department. In these positions, he oversaw the administration of major events in the city, such as the Philadelphia Marathon, the Broad Street Run and the Mummers Parade. Mr. Dignam worked for the City of Philadelphia for approximately 38 years.
Over the course of several years, from 2012 through 2019, Leo Dignam allegedly engaged in a scheme to defraud the City of Philadelphia of approximately $150,000 by misusing two bank accounts he controlled on behalf of the City that existed to support the work of PPR, namely, recreational activities for citizens. In particular, he opened a bank account purportedly to support the activities of PPR in connection with a non-profit organization, the Junior Baseball Federation (“JBF”). The JBF partnered with the Philadelphia Phillies to raise most of its funds through the sale of tickets for Phillies games.
Instead of using the JBF bank account solely for its intended public purpose, Leo Dignam allegedly misused the account by converting funds from the account to pay for personal expenses he incurred on an American Express (“AMEX”) credit card that he opened in connection with the JBF account. He used the AMEX card, and shared it with family members, for purchases from retail stores, grocery stores, pharmacies, gas stations, online retailers and service providers, and other businesses. He then used the funds in the JBF bank account to pay off the personal expenses on the credit card.
According to the Information, he similarly misused another account that was created for the benefit of PPR and the citizens of Philadelphia, the Program Advisory Fund Account. The defendant used this account to pay personal expenses by transferring funds directly to a personal account, solely for his own benefit, and by using it to pay personal expenses on a Verizon Wireless Account.
Paul Dignam was the Regional Manager for the South Region of Philadelphia Parks and Recreation. In this position, he oversaw the administration of local recreation centers and playgrounds and supervised the activities of several PPR district managers. In 2011, Paul Dignam opened a bank account that purported to be for use by a recreation advisory council, a commonly used governance structure in PPR that exists to support local recreation centers and playgrounds by helping to raise funds, develop programs, and maintain play sites.
Beginning in 2012 and continuing through 2019, he allegedly misused this bank account by repeatedly writing checks on the account made payable to himself. He helped conceal this fraud by having bank statements mailed to his personal residence and having another individual act as a signatory on the account. The defendant then forged the other individual’s signature on the misappropriated checks and falsely noted in the memo line of the checks that they were “reimbursements” for expenses he incurred by making purchases on behalf of PPR. In sum, Paul Dignam wrote himself approximately 102 checks worth approximately $119,000.
Finally, Barbara Conway was the Food Voucher Coordinator for the Philadelphia Health Management Corporation (PHMC), an organization contracted by the City to manage a Food Voucher Program designed to provide emergency assistance to people living with HIV/AIDS. This initiative is funded by the Ryan White HIV/AIDS Program, a federal program that provides grants to states, cities, counties, and other local organizations to fund care and treatment services for individuals living with the disease.
The Information alleges that beginning in 2015 through 2019, Conway stole more than $39,000 worth of food vouchers intended for HIV/AIDS patients receiving services through the Food Voucher Program.
“All three of these defendants allegedly made the same bad choice to steal funds from federally-funded programs,” said U.S. Attorney McSwain. “Further, in all three cases, the defendants stole money from programs designed to benefit groups that desperately needed the assistance – from patients struggling with HIV/AIDS who require emergency assistance to meet basic necessities to a youth baseball organization serving many underprivileged children. The callousness that the defendants displayed by stealing from these programs is stunning.”
“We share a collective and long-standing devotion to integrity in City government, and I wish to thank the United States Attorney’s Office and the FBI for their partnership in the investigation of the Dignam brothers and our broader mission,” said City of Philadelphia Inspector General Alexander DeSantis. “Further, the Conway case shows our continuing commitment to root out fraud and corruption in all forms, including by employees of city contractors involved in programs that affect some of Philadelphia’s most vulnerable populations.”
If convicted, Leo Dignam faces a maximum possible sentence of 50 years in prison, Paul Dignam faces a maximum possible sentence of 30 years in prison, and Barbara Conway faces a maximum possible sentence of ten years in prison.
All three cases were investigated by the Federal Bureau of Investigation and the Philadelphia Office of the Inspector General. The cases of Paul and Leo Dignam are being prosecuted by Deputy United States Attorney Louis D. Lappen, and the case of Barbara Conway is being prosecuted by Assistant United States Attorney Richard Barrett.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Remarks by U.S. Attorney William M. McSwain at the Chester County Bar Association's Annual Veterans Day Ceremony at the Historic Chester County CourthouseRead the Press Release
PHILADELPHIA, PA – On Wednesday, November 11, 2020, U.S. Attorney McSwain delivered the Veterans’ Address at the Chester County Bar Association’s Annual Veterans Day Ceremony. U.S. Attorney McSwain, a Chester County native and a member of the Chester County Bar Association, served in the U.S. Marine Corps infantry from 1993 to 1997. He was introduced by his friend, Brian Nagle, who is a former President of the Chester County Bar Foundation.
Remarks as Prepared for Delivery
Good morning, and thank you, Brian, for that kind introduction. I also want to thank Matt Holliday, Executive Director of the Chester County Bar Association, for inviting me to speak here today. I am delighted to participate in this annual ceremony that honors America’s veterans.
Veterans’ Day is an important marker – it reminds every citizen in this great country of the sacrifice that the men and women of the Armed Forces have made to preserve and protect the American dream. It is our opportunity to honor and thank all Americans who have served our country in uniform. That includes those living and dead, those who served in war and peace, those who serve today and those who served yesterday. In particular, I want to recognize and thank the veterans with us this morning: with this ceremony, we honor your sacrifice, courage, and bravery. We owe our way of life to you. Thank you for your service.
We also must thank you for the example you set for every American citizen. That example is your unity of purpose. When you signed up to serve in the military, you committed yourself to live by the military ethos of self-sacrifice in the name of a greater good. You knew when you committed that you would likely serve under multiple presidents and military leaders, not necessarily knowing who they would be. You did not know where or with whom you would serve. Many of you did not know what forces you would be fighting or the identity of the enemy. Still, none of that mattered: you signed up to serve because you love your country and everything that America stands for.
And that is because no matter who is in charge, the ideals of patriotism, freedom, democracy, and service remain the same. Even with all of the unknowns I just mentioned, the reason you decided to serve is the constant in the equation.
That unity of purpose is what binds the men and women who serve; it is also what unites every American in our expression of gratitude for your service. Your love of country is the example you set for every American. We owe you a tremendous debt of gratitude for your service and for your living example of patriotism.
The timing of Veterans’ Day has historical significance, but it is also culturally significant. We celebrate Veterans’ Day on November 11 because the holiday has its roots in Armistice Day – the official end of World War I. On the 11th day, at the 11th hour, of the 11th month, a bugle call signified the truce among all nations and a recommitment to world peace. But the world did not remain a peaceful place for very long. After World War II and the Korean War, Armistice Day was renamed Veterans’ Day.
I think we can all agree that this has been a tough year. From the global pandemic to the divisions in our country that led to a hard-fought election by all involved, nothing has come easily this year. Sometimes it may seem as if there’s nothing we can all agree upon. But that’s not true. We all agree that our veterans are heroes. Veterans’ Day brings us together as a nation to express our profound gratitude for what our veterans have done and for what our military stands for.
Our military is one of the greatest unifying forces for good in our country today. The outpouring of support for our veterans on this day reminds us of what is important: love of country and love of freedom, which you have bravely protected at every turn.
God Bless you all. And God Bless the United States of America. Thank you.
United States Attorney McSwain Announces Successful Results of ADA Accessibility Review for All Polling Places in the Eastern District of PennsylvaniaRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced the results of a review of all election polling places in the Eastern District of Pennsylvania to determine their compliance with the Americans with Disabilities Act (ADA) of 1990. This massive undertaking, which was announced on February 19 of this year, involved nine counties and was the Department of Justice’s first-ever ADA review of an entire district. The ADA prohibits discrimination on the basis of disability in all programs, activities, and services provided by public entities. The ADA requires that public entities provide voting facilities that are accessible to people with disabilities.
As part of the review, election officials in Berks, Bucks, Chester, Delaware, Lancaster, Lehigh, Montgomery, Northampton, and Philadelphia counties were asked to complete survey questions pertaining to polling place accessibility in their county. The United States Attorney’s Office then followed up with the county officials to address any access issues and to make sure each county remedied those issues. All nine counties responded to the survey and have now either resolved those issues or are in the process of remediating them.
By way of example, Lancaster County was one of the first counties to respond to the survey, demonstrating full accessibility and an extensive ADA plan in place for the county. Delaware County identified access issues with the entrance to Lamb of God Church in Havertown. Through a bipartisan agreement, the county was able to move that polling place to an accessible location at Chestnutwold School. Bucks County identified an inaccessible polling place in Lower Southampton, and the county is in the process of remediating that situation. Philadelphia County is currently finalizing its review and expects to have all issues resolved before election day.
“Polling place accessibility for the disabled is a critically important issue and one of the many ways that my Office is working hard to provide a free and fair 2020 election,” said U.S. Attorney McSwain. “People with disabilities deserve equal access to polling places, and we are committed to making sure that they have it. We also appreciate the seriousness with which the counties approached our review, during this 30th anniversary of the Americans with Disabilities Act.”
Any citizen with ADA-related polling place concerns in the Eastern District of Pennsylvania is encouraged to contact Assistant U.S. Attorney Jacqueline C. Romero, Civil Rights Coordinator, at 215-861-8200 or [email protected].
Levittown Man Who Led Middletown Township Police on High-Speed Chase Sentenced to 16 Years for Firearms and Narcotics OffensesRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Dennis D. Davis, 34, of Levittown, PA, was sentenced to 16 years in prison and three years of supervised release by United States District Judge Mitchell S. Goldberg for firearms and narcotics offenses, stemming from an arrest after a dangerous and dramatic car chase in July 2017.
The defendant was convicted after trial in March 2020 of possession of a firearm by a felon and possession with intent to distribute crack cocaine. While driving in Bucks County in July 2017, Davis refused to pull over for Middletown Township Police, and a pursuit ensued. Davis continued to flee at high speed and caused a crash at a busy intersection near the border of Middletown and Bristol Townships. The defendant then fled on foot.
As he ran from police officers, Davis discarded a purse containing a firearm, drug paraphernalia, and crack cocaine. Police officers eventually caught Davis and took him into custody. The officers recovered the purse and its contents, and also found over $1,000 in cash in the defendant’s car. The government presented evidence at trial that included the physical evidence recovered at the scene, fingerprints from the gun, civilian eyewitnesses, and several law enforcement witnesses who participated in the chase and the defendant’s arrest.
“In choosing to flee from police and cause a car crash at a busy intersection, Davis showed complete disregard for the safety of innocent people,” said U.S. Attorney McSwain. “He also showed complete disregard for the law by illegally possessing a firearm and dangerous drugs. The streets of Bucks County are safer now that Davis will be behind bars for many years.”
“In possession of a loaded revolver and large quantity of crack cocaine, Dennis Davis decided to evade a lawful traffic stop,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “He ran because he wasn’t supposed to have that gun, wasn’t meant to be dealing drugs again, and didn’t want to go back to prison. Clearly, it didn’t work. We’re just fortunate no one was badly injured or killed as he recklessly fled that day. Getting guns, drugs, and dangerous criminals like Davis off the street is a priority for the FBI and our local law enforcement partners.”
The case was investigated by the Federal Bureau of Investigation, with assistance from the Middletown Township and Bristol Township police departments, and was prosecuted by Assistant United States Attorney Michael J. Rinaldi and former Assistant United States Attorney Melanie Babb Wilmoth.
U.S. Attorney William M. McSwain Announces DOJ Statement of Interest Filed in Lawsuit Challenging Philadelphia’s Public Event MoratoriumRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that the U.S. Department of Justice has filed a Statement of Interest (“SOI”) today in a case pending in the Eastern District of Pennsylvania that challenges the City of Philadelphia’s “Event Moratorium” that prohibits issuing permits for expressive gatherings of 150 or more people on public property. The lawsuit claims that the Moratorium violates the rights of freedom of speech and freedom of assembly guaranteed by the First Amendment.
The SOI was filed in support of the plaintiff, the Philadelphia Vietnam Veterans Memorial Society (“PVV”), an organization that seeks to promote, honor, and dignify the memory of military veterans who served in Vietnam. PVV does so by sponsoring honor guards and rifle teams to attend veteran burial details and by participating in parades and other public events. PVV contends that it and other groups are adversely impacted by the City’s blanket ban on issuing permits for public gatherings.
On July 14, 2020, in response to the COVID-19 pandemic, the City of Philadelphia instituted the Event Moratorium, imposing a blanket ban on issuing permits for any public gatherings through February 2021. While the City claims that the Event Moratorium does not apply to First Amendment protected activity, nevertheless it will not issue permits for any such activity – and it simultaneously cancelled all festivals, parades, and public gatherings on City property initially involving 50 (but now 150) people.
At the same time that it has imposed the Event Moratorium, the City has explicitly allowed a group of any size to take to the streets without a permit if their stated purpose is to protest -- even if that group ignores social distancing, masking, or any other CDC guidelines. This is true even though concerns about virus transmission obviously apply with equal force to groups protesting without a permit and those parading with one. As set forth in the SOI, this disparate treatment (and double standard) is illogical, not narrowly tailored to serve a legitimate public health purpose, and unconstitutional.
“This is a case about more speech, not less,” said U.S. Attorney McSwain. “The City’s double standard – whereby is treats protests one way and any other First Amendment gathering a completely different way -- is illogical, favors particular messages, does not serve public health purposes, and is unconstitutional. The solution is not to limit protests. Rather, the solution is to eliminate the Event Moratorium and allow all speakers to express themselves in accordance with their constitutional rights.”
“The First Amendment to United States Constitution makes illegal any attempt by government to abridge the rights of the people to speak and assemble peacefully. Our Founders established these rights to enshrine in our law a very simple ideal: tyranny has no place in this free country. At a small town west of Philadelphia, at Gettysburg in 1863, President Abraham Lincoln observed that this United States of America was ‘conceived in liberty,’ and he challenged all of us ‘to be dedicated’ to a ‘new birth of freedom.’ We must and do accept President Lincoln’s challenge,” said Assistant Attorney General Eric Dreiband for the Civil Rights Division. “The Philadelphia Vietnam Veterans Memorial Society honors those brave patriots, living and dead, who fought, suffered, and died for our freedom and for the freedom of all humanity. The United States Department of Justice stands with them, and we will continue to fight for their liberty and the liberty of all people.”
The case is docketed as Philadelphia Vietnam Veterans Memorial Society v. Kenney, et al., Civil Action No. 20-cv-05418.
The Justice Department Announces Statement of Interest Filed in Lawsuit Challenging Philadelphia's Moratorium that Cancelled the Veterans Day ParadeRead the Press Release
The Justice Department announced that a Statement of Interest (SOI) was filed today in a case pending in the Eastern District of Pennsylvania that challenges the City of Philadelphia’s “Event Moratorium” that prohibits issuing permits for gatherings of 150 or more people on public property.
The lawsuit claims that the Moratorium violates the rights of freedom of speech and freedom of assembly guaranteed by the First Amendment. The City of Philadelphia imposed a ban on permits for public gatherings, which led to the cancellation of its Veterans Day parade while at the same time allowing groups of any size to take to the streets without a permit to protest.
“The First Amendment to U.S. Constitution makes illegal any attempt by government to abridge the rights of the people to speak and assemble peacefully,” said Assistant Attorney General Eric Dreiband for the Civil Rights Division. “Our Founders established these rights to enshrine in our law a very simple ideal: tyranny has no place in this free country. At a small town west of Philadelphia, at Gettysburg in 1863, President Abraham Lincoln observed that the United States of America was ‘conceived in liberty,’ and he challenged all of us ‘to be dedicated’ to a ‘new birth of freedom.’ We must and do accept President Lincoln’s challenge. The Philadelphia Vietnam Veterans Memorial Society honors those brave patriots, living and dead, who fought, suffered, and died for our freedom and for the freedom of all humanity. The U.S. Department of Justice stands with them, and we will continue to fight for their liberty and the liberty of all people.”
“This is a case about more speech, not less,” said U.S. Attorney William M. McSwain of the Eastern District of Pennsylvania. “The city’s double standard – whereby is treats protests one way and any other First Amendment gathering a completely different way – is illogical, favors particular speakers and issues, does not serve public health purposes, and is unconstitutional. The solution is not to limit protests. Rather, the solution is to eliminate the Event Moratorium and allow all speakers to express themselves in accordance with their constitutional rights.”
The SOI was filed in support of the plaintiff, the Philadelphia Vietnam Veterans Memorial Society (Vietnam Veterans), an organization that seeks to promote, honor, and dignify the memory of military veterans who served in Vietnam. Vietnam Veterans does so by sponsoring honor guards and rifle teams to attend veteran burial details and by participating in parades and other public events. Vietnam Veterans contends that it and other groups are adversely impacted by the city’s blanket ban on issuing permits for public gatherings.
On July 14, 2020, in response to the COVID-19 pandemic, the City of Philadelphia instituted the Event Moratorium, which it revised on Sept. 21. In its current form, it bans the issuing of permits for any public gathering of 150 or more people through February 2021, thus cancelling all festivals, parades, and public gatherings on city property involving 150 or more people.
At the same time, the mayor has praised those protesting social justice issues without permits and the city has waived code violations for protesters. As set forth in the SOI, this disparate treatment (and double standard) may be “viewpoint discrimination” triggering strict scrutiny under the First Amendment. In any event, the SOI concludes, under First Amendment rules on restrictions on the time, place, and manner of speech, the moratorium on permits is an improper speech restriction, since it is not narrowly tailored and does not leave open ample alternative avenues for speech.
Statement of U.S. Attorney McSwain Regarding the Protection of Philadelphia Residents’ First Amendment Rights and the Filing of a Statement of Interest in "Philadelphia Vietnam Veterans Memorial Society v. James Kenney"Read the Press Release
PHILADELPHIA – United States Attorney William M. McSwain convened a press conference today to announce the filing of a Statement of Interest in a civil lawsuit filed against Philadelphia Mayor James Kenney and his Managing Director, challenging the City’s “Event Moratorium.” U.S. Attorney McSwain addressed the Moratorium’s unconstitutional double standard and the important role that the federal government has in safeguarding all citizens’ First Amendment rights, regardless of the content of the speech at issue.
Remarks as Prepared for Delivery
Earlier today, the Philadelphia Vietnam Veterans Memorial Society (“PVV”) filed suit in federal court in Philadelphia against Mayor Kenney and his Managing Director, alleging a violation of the organization’s and others’ First Amendment rights, based on the City’s refusal to grant any permits for parades or other expressive gatherings on public property. Also today, the U.S. Department of Justice and the U.S. Attorney’s Office filed a “Statement of Interest” in the case in support of the PVV. One of our important responsibilities at the U.S. Attorney’s Office is to safeguard civil rights, including First Amendment rights. The purpose of my remarks is to explain how this Statement of Interest does exactly that.
This is a case about more speech, not less. It is also a case about Philadelphia’s double standard whereby it treats some types of speech (protests) much more favorably than others (parades and other expressive gatherings that require a permit). There is no possible public health justification for this double standard. The City’s policy of banning parades and other expressive gatherings fails as a matter of constitutional law and basic common sense. Critically, the solution to eliminating this double standard is not to discourage or limit protests – two wrongs do not make a right. Instead, the solution is to allow all speakers to express themselves in accordance with their constitutional rights. The City’s illogical and unconstitutional ban on parades and other expressive gatherings should be eliminated. Again, more speech is the answer, not less.
The United States is committed to protecting the freedoms guaranteed by the First Amendment, which lie at the heart of a free society and are, in the words of James Madison, the “effectual guardian of every other right.” In the midst of the COVID-19 pandemic, the United States has a strong interest in the development and maintenance of public health policies that protect citizens from harm while still respecting their First Amendment rights, including the peaceful exercise of freedom of speech, freedom to assemble, and freedom to petition the government on matters of public importance in a traditional public forum.
The City of Philadelphia has announced an “Event Moratorium,” imposing a blanket ban on issuing permits for any large public gathering – initially of more than 50 people, subsequently increased to 150 people. While the City has allowed unpermitted demonstrations to occur, it has banned certain types of public gatherings, such as parades, which are unquestionably protected by the First Amendment. Parades come in many shapes and sizes, with myriad messages. Some are groups not much larger than 150 people and seek to express solemn messages. And, by their nature, parades almost always necessitate street closures and other safety measures, therefore requiring coordination and planning with the City through a permitting process. To hold a parade without coordination with the City is to invite disruption, or even disaster.
The demonstrations that ensued in Philadelphia since late May have shown the enduring importance of the First Amendment and the rights to free speech and free assembly. But those rights apply to all forms of speech and assembly; it is unconstitutional for the Philadelphia municipal government to shut down certain types of speech, while allowing other types of speech to proceed unchecked. More to the point, the City allows (and even encourages) large protests, but not parades or other expressive gatherings. This raises the specter of viewpoint discrimination – that the City is favoring certain kinds of speech because of its message.
Thus, while Philadelphia officials continue to bless unpermitted protests, the City has stated that it will deny a permit to groups seeking to engage in other forms of First Amendment-protected activity. The supposed reason for the blanket permitting ban is to prevent the spread of COVID-19 by eliminating large outdoor gatherings. By contrast, for those willing to take to the streets without a permit, a group of any size can do so – even if that group ignores social distancing, masking, or any other CDC guideline. This is true even though the same concerns about virus transmission would obviously apply with equal force to both situations. The City’s disparate treatment (and double standard) is illogical, favors particular speakers and issues, does not serve public health purposes, and is unconstitutional.
Indeed, the Supreme Court has often struck down ordinances where the distinction between two types of speech or expression is unrelated (or only tangentially related) to the government’s asserted interest. This is especially so where a less blunt approach could achieve the same ends. In short, if the City’s concern is that a large parade could cause an increase in transmission of COVID-19, a blanket ban for groups over 150 is not narrowly tailored to serve that interest, especially while also allowing other large gatherings to take place without permits. Moreover, when contrasted with the City’s recent decision to allow gatherings of up to 7,500 people in certain outdoor venues (including for Eagles games), the Event Moratorium is all the more unjustified. Rather than a blanket ban, the Constitution requires a narrowly tailored approach that might, for example, allow event organizers an opportunity to demonstrate appropriate safety measures.
At this time, I am happy to take any questions you have.
Philadelphia Woman Who Stole over $2 Million in Tax Refunds and also Committed Real Estate Fraud Sentenced to 8 ½ YearsRead the Press Release
PHILADELPHIA - United States Attorney William M. McSwain announced that Vontia Jones, 39, of Philadelphia, PA, was sentenced to eight and a half years in prison, three years of supervised release, and ordered to pay $2,319,278 in restitution by United States District Judge Joel H. Slomsky for obtaining the personal identifying information of people and using that information to file more than 900 fraudulent tax returns with the IRS, netting her over $2,319,000 in fraudulent refunds. The defendant also engaged in real estate fraud by purporting to sell properties to buyers using fraudulent documents.
The defendant pleaded guilty in August 2019 to more than 30 fraud charges, including conspiracy to make false claims to the IRS; making, and aiding and abetting the making of false claims to the IRS; wire fraud; and aggravated identity theft. Jones operated a business that she identified by various names including “Jones Tax Service,” “Earned Income Credit Unit,” “EIC Unit,” and “Eelysium,” out of her home in the 1400 block of West Cayuga Street in Philadelphia for a period of roughly seven years. Together with her co-conspirators, Jones filed or directed others to file over 900 fraudulent tax returns claiming fictious self-employment income resulting in tax refund payouts by the IRS of more $2,319,000.
The conspirators solicited the personal information of individuals and their dependents under the guise of getting them “tax money,” even if they never worked. Jones designed flyers advertising her services that stated: “Don’t you deserve some income tax money too? $750 [per child] welfare social security unemployment disability even if you never had a job.” Each of the returns submitted to the IRS was submitted by the defendant or her conspirators as self-prepared, as if it had been done by the individual taxpayer whose information had been stolen.
In addition to the tax return scheme, Jones also organized and operated a scheme to file phony deeds for multiple residential properties in Philadelphia, purporting to transfer ownership of the houses in order to sell them for a profit. Th defendant would research homes on real estate websites, typically targeting those where the owner had died or moved away, and would charge several thousand dollars to sell someone else one of these houses that she “deeded up.”
“Jones’ greed impacted the lives of many hundreds of victims, and her shameful actions had severe consequences for these innocent people,” said U.S. Attorney McSwain. “Not only did she and her co-conspirators steal personal information in order steal tax return money from the government, but also she sold people’s houses right out from underneath them to other people who believed that they were buying property from her legitimately. For her actions, she will now spend the better part of a decade in prison.”
“The degree to which Vontia Jones and her co-conspirators went in order to perpetrate this scheme is astounding,” said IRS Criminal Investigation Special Agent in Charge Thomas Fattorusso. “Not only did Vontia Jones steal the identities of unwitting individuals, she also stole millions of dollars from the US government; and ultimately US taxpayers. Today, she stands a convicted felon who will spend years in federal prison.”
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service, and is being prosecuted by Assistant United States Attorney Anthony J. Wzorek.
Philadelphia Man Convicted of Narcotics, Firearms Charges at TrialRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Sunny Sok, 30, of Philadelphia, PA, was convicted at trial of firearms and narcotics offenses arising from his illegal possession of a firearm and more than 50 grams of methamphetamine.
In June 2019, Sok was charged by Indictment with possession with intent to distribute more than 50 grams of methamphetamine, possession of a firearm during a drug trafficking crime, and being a felon in possession of a firearm. In April 2019, the defendant was stopped by a Philadelphia Police officer for a traffic violation. The officer then learned that the vehicle’s registration was expired and that there was an open arrest warrant out for the vehicle’s owner for probation violations. After discovering this information, the officer asked the defendant to exit the car. When Sok opened the door, the officer observed drug paraphernalia inside. Upon a further search of the vehicle, the officer recovered 50 grams of methamphetamine, over 300 pills of counterfeit oxycodone, a digital scale, and a loaded gun.
“The crime of being a felon in possession of a firearm is a serious offense, especially when the firearm is used in furtherance of drug dealing. This trial victory is an important step in the direction of making Philadelphia safer, when the City is currently suffering from an epidemic of violent crime and insidious drug dealing,” said U.S. Attorney McSwain. “My Office is determined to get dangerous, repeat offenders off the streets and behind bars.”
“This case is a good example of our law enforcement partners working with ATF’s crime gun intelligence to remove repeat offenders from the streets of our communities,” said Matthew Varisco, Special Agent in Charge of ATF’s Philadelphia Field Division. “A federal jury has convicted this defendant of federal crimes, so he is no longer in a position to endanger anyone else.”
The case was investigated by the City of Philadelphia Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives, and is being prosecuted by Assistant United States Attorney Anita Eve.
U.S. Attorney McSwain Announces Charges Against Four Men for Arson of Philadelphia Police and Pennsylvania State Police Vehicles During Violent Civil UnrestRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Carlos Matchett, 30, of Atlantic City, NJ; Khalif Miller, 25, of Philadelphia, PA; and Anthony David Ale Smith, 29, of Philadelphia, PA, have been charged by Indictment for the arson of a Philadelphia Police Department (PPD) vehicle, and in a separate case, that Ayoub Tabri, 24, of Arlington, VA, has been charged by Indictment for the arson of a Pennsylvania State Police (PSP) vehicle. Both incidents occurred during violent civil unrest in Philadelphia on May 30, 2020.
Following peaceful protests in Philadelphia in the early afternoon of May 30, 2020 in response to the killing of George Floyd in Minneapolis, MN, civil unrest began to unfold later that afternoon that resulted in widespread looting, burglary, arson, destruction of property, and other violent acts.
On that day, PPD Civil Affairs Car C-109 was parked on the north side of City Hall near Broad and Market Streets. During the violent episodes that began in the vicinity of City Hall that afternoon, defendants Matchett, Miller, and Smith allegedly placed combustible materials into the vehicle, after a road flare placed in the vehicle started a fire. As a result of these acts, the PPD vehicle was destroyed. A grand jury charged each of the defendants with two counts of arson, and one count of obstructing law enforcement in the commission of their duties during a civil disorder.
On the same day and at roughly the same time, PSP troopers responded to the intersection of Broad and Vine Streets, a few blocks north of City Hall. PSP placed two patrol sport utility vehicles – marked as K1-7 and K1-17 – at the on-ramp for I-676 in an effort to prevent protestors from gaining access to the highway. Soon thereafter, a group of individuals began attacking the two vehicles. The windows of the vehicles were shattered and PSP equipment stored inside was stolen, including road flares, fire extinguishers, and “riot bags” containing additional PSP-issued equipment. Tabri allegedly threw a lit road flare into K1-17, igniting a fire that engulfed the SUV. A grand jury charged the defendant with two counts of arson, and one count of obstructing law enforcement in the commission of their duties during a civil disorder.
“I want to be clear that we at the U.S. Attorney’s Office support peaceful protest – indeed, it is part of our job to protect First Amendment freedoms. We take that responsibility very seriously. But violence is not speech. There is no right to riot, loot, rob, destroy or commit arson. If you engage in violent civil unrest and commit a federal crime in this District, we will come after you as hard as we can because residents deserve safe and secure neighborhoods, not mayhem.”
“The FBI remains committed to protecting the rights of individuals to peacefully exercise their First Amendment freedoms,” said Philadelphia Division Special Agent in Charge Michael J. Driscoll. “Violence and destruction of property jeopardize the rights and safety of all citizens, including peaceful demonstrators. Today’s indictments send the message that if you seek to hijack peaceful protests to pursue violent and extremist agendas, the FBI and its law enforcement partners will bring you to justice.”
“These individuals were not in the City to participate in a peaceful protest: instead, it appears they posed as protestors and allegedly set fire to a Pennsylvania State Police vehicle and a Philadelphia Police vehicle,” said Matthew Varisco, Special Agent in Charge of ATF’s Philadelphia Field Division. “Arson is an extremely violent act which presents a tremendous threat to public safety. We will continue to work with our local, state and federal partners to seek justice during these tumultuous times.”
“Thousands peacefully assembled and protested throughout Philadelphia following the killing of George Floyd in May of 2020,” said Brian A. Michael, Special Agent in Charge for HSI Philadelphia. “Today’s indictments demonstrate how law enforcement successfully works together to pursue violent opportunists who commit criminal acts that undermine the peaceful protestors’ message. HSI works closely with federal, state, and local law enforcement partners to investigate, identify and hold accountable individuals who commit malicious, destructive, unlawful acts.”
“The Pennsylvania State Police thanks all of the partnering local, state, and federal agencies that assisted with this investigation,” said Captain James Kemm, commander of the Pennsylvania State Police Troop K. “We respect the public’s right to peacefully protest, but violence and destruction of property will not be tolerated.”
If convicted, all four defendants face a mandatory minimum of seven years in prison, and a maximum possible sentence of 65 years in prison, followed by three years of supervised release, and a fine of up to $750,000.
The Matchett, Miller, and Smith case was investigated by the Federal Bureau of Investigation, Homeland Security Investigations; the Bureau of Alcohol, Tobacco, Firearms, and Explosives; the Philadelphia Police Department; and the Philadelphia Fire Marshal’s Office; with assistance from the New Jersey Office of Homeland Security and Preparedness. The Tabri case was investigated by the Federal Bureau of Investigation; the Bureau of Alcohol, Tobacco, Firearms, and Explosives; and the Pennsylvania State Police. Both cases are being prosecuted by the United States Attorney’s Office for the Eastern District of Pennsylvania.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Remarks of U.S. Attorney McSwain Regarding Violent Civil Unrest in Philadelphia and the Announcement of Criminal ChargesRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain convened a press conference today to announce federal charges against four individuals for allegedly committing arson of police vehicles during riots that occurred in Philadelphia on May 30, 2020. U.S. Attorney McSwain also addressed concerns about current civil unrest in the City.
Remarks as Prepared for DeliveryGood afternoon and thank you for joining us. I am here today to announce criminal charges against several defendants for torching police cars during the violent civil unrest that occurred in Philadelphia in late May and early June. My law enforcement colleagues and I are also here to address the current situation in the City. Before I get into more details, I want to acknowledge and thank all the law enforcement partners standing with me here today:
- Michael J. Driscoll, Special Agent in Charge from the Philadelphia Field Office of Federal Bureau of Investigation;
- Matthew Varisco, Special Agent in Charge of Philadelphia Field Division of the Division of Alcohol, Tobacco, Firearms, and Explosives;
- Brian Michael, Special Agent in Charge from the United States Department of Homeland Security, Homeland Security Investigations;
- Major Richard Ambrosio, of the Pennsylvania State Police; and
- Jared Maples, Director of the New Jersey Office of Homeland Security and Preparedness
Your presence here today is a testament to our collective resolve to protect and promote two fundamental principles of our American democracy – freedom of expression and the rule of law.
This nation is grounded in freedom of speech. At its core is every American’s right to join with fellow citizens in protest or peaceful assembly. Just as importantly, this nation is also grounded in the rule of law. It is imperative that we preserve both – and we will. The City’s residents deserve to have their voices heard, and they deserve safe and secure neighborhoods, not mayhem.
Mayhem – in the form of rioting, looting, robbery, arson, destruction of property, attacks on police officers and other forms of violence – does not bring justice. It accomplishes nothing. If you are a protestor trying to communicate a message, engaging in mayhem obscures that message. It also turns public opinion squarely against you. And most significantly, it can land you in federal prison for a long time. Criminal behavior has been and will be met with swift and decisive action by my Office. That form of justice will be served.
Which brings me to today’s charges, stemming from the rioting and destruction that ensued in Philadelphia during the violent civil unrest following George Floyd’s death. What began as peaceful protests in Philadelphia in the early afternoon of May 30 escalated into something very different. Much of the rioting was captured on video that aired across the country. Among other things, rioters smashed store fronts, looted stores, hurled objects at the police, and torched police cars.
Among those torched police cars was a Philadelphia Police Department vehicle (Car C-109) and two Pennsylvania State Police (PSP) SUVs (numbers K1-7 and K1-17). The defendants’ alleged involvement in the burning of these vehicles is the subject of today’s charges.
In the first case, my Office has filed a three-count Indictment against Ayoub Tabri, alleging several crimes, all stemming from his alleged destruction of one of the PSP SUVs (number K1-17) that was parked near the intersection of Broad and Vine Streets near the entrance to Interstate 676 on May 30. The Indictment charges Tabri with arson, attempted arson, aiding and abetting and obstruction of law enforcement during civil disorder. If convicted, he faces a mandatory minimum term of seven years in prison and a maximum term of up to 65 years in prison, followed by three years of supervised release, a $750,000 fine, and a $300 special assessment.
On May 30, PSP troopers responded to the intersection of Broad and Vine Streets, near the overpass of I-676, based on a report of a large gathering of protesters. PSP troopers responded to this area in two SUVs to prevent protestors from gaining access to I-676 and from endangering themselves or others by demonstrating on the highway and impeding motorists’ travel.
At 3:42 p.m., a group of individuals began attacking the two PSP SUVs, which were locked and contained PSP-issued rifles and other police equipment. Individuals began striking the SUVs with various objects, including skateboards, a bike lock, and other projectiles, in addition to kicking and striking the SUVs with closed fists. Eventually, the individuals shattered the windows of both SUVs and stole PSP equipment stored inside, including road flares, fire extinguishers, and “riot bags” containing additional PSP-issued equipment. After these items were stolen, an individual sprayed the rear area of K1-17, inside and out, with an unknown liquid.
PSP troopers assigned to the area reported that individuals then threw lit road flares into K1-17, igniting the fire which engulfed that SUV. Videos taken at the scene allegedly captured Tabri throwing a lit road flare into K1-17. Fire engulfed K1-17 and ultimately destroyed it.
The harm allegedly caused by Tabri extended beyond destruction of government property. One PSP trooper, who was standing near K1-17, was hit by a lit road flare and part of his uniform caught fire. Additionally, this trooper’s left hand suffered burn injuries when he reached into K1-17 to retrieve a rifle in order to prevent it from being stolen. He was treated for his injuries on the scene by EMS.
In the second case announced today, my Office has charged three individuals, Carlos Matchett, Khalif Miller and Anthony Smith, in a three-count Indictment with arson, attempted arson, aiding and abetting, and obstruction of law enforcement during a civil disorder. These charges are based upon their alleged destruction of a Philadelphia Police Department Civil Affairs vehicle (Number C-109), which was parked near Philadelphia City Hall on May 30, 2020. Specifically, Counts One and Two allege that these defendants “maliciously damaged and destroyed, attempted to damage and destroy, and aided and abetted the damaging and destruction [of the PPD car] by means of fire,” and Count Three alleges that the defendants “knowingly committed acts, and aided and abetted such acts, to obstruct, impede, and interfere with law enforcement officers lawfully engaged in the lawful performance of their official duties incident to, and during the commission of, a civil disorder.” The Indictment further alleges that these defendants’ actions created a substantial risk of injury to one or more persons, including public safety officers.
All three defendants are in federal custody. My Office will be moving for detention of each of these defendants so that they remain in federal custody until their trial.
If convicted, the defendants each face a mandatory minimum of seven years in prison and a maximum possible sentence of 65 years in prison, followed by three years of supervised release, a fine of up to $750,000, and a special assessment of $300.
A final word about Mr. Smith: as has already been reported, he is a prominent activist and one of the lead organizers of the Philadelphia Coalition for Racial Economic and Legal Justice (or Philly for REAL Justice). To state the obvious, that it not why he is now in federal prison. Mr. Smith was not “targeted” in any way by my Office. I knew nothing about Mr. Smith or his affiliations until the investigation was nearly complete and the proposed charges had been written up by dedicated and capable career federal prosecutors. We do not investigate people at the U.S. Attorney’s Office; we investigate alleged criminal behavior. A defendant’s race, ethnicity, gender, political affiliation or group membership makes no difference to me or anybody else in my Office. In our investigations and prosecutions, all we care about is whether you committed a federal crime. And if you did, you will face the consequences.
Today’s Indictments are the culmination of an incredible amount of work by the members of both case teams who began working these cases literally as these events unfolded in real time. On the Tabri Indictment, I want to acknowledge and thank the FBI; the ATF; and the Pennsylvania State Police. On the Matchett, Miller, and Smith Indictment, I want to acknowledge and thank the following law enforcement partners: the FBI; Homeland Security Investigations; the ATF; the Philadelphia Police Department; and the Philadelphia Fire Marshall’s Office – all of whom had an important hand in the investigation. I also want to acknowledge the assistance of the New Jersey Office of Homeland Security and Preparedness. And from my Office, I want to commend and thank Assistant United States Attorney Tom Perricone, Chief of the National Security Unit, who is supervising both prosecutions.
I also want to thank the leadership of the law enforcement agencies standing with me for their continued partnership with my Office. The most effective strategy for preventing and reducing crime is aggressive prosecution and strong law enforcement partnerships at every level. Our presence today demonstrates that we are united in our purpose – to keep Philadelphia safe – and united in our approach to accomplishing this goal.
Today’s federal charges are the latest in a series of cases my Office has brought stemming from the rioting and destruction that occurred during the civil unrest at the beginning of last summer. On May 30, I pledged to hold people accountable for criminal behavior during civil unrest, and we have. That is one of the main reasons why the City did not experience violent civil unrest after early June – because would-be rioters knew that the U.S. Attorney’s Office was on duty, together with our federal partners and the Philadelphia Police Department.
Unfortunately, during the past week, the City has gone backwards, with rioting and looting that began in West Philadelphia and spread to other parts of the City, in reaction to the death of Walter Wallace. Add to this the impending election on Tuesday and you have a combustible cocktail. I want to be clear that we at the U.S. Attorney’s Office support peaceful protest – indeed, it is part of our job to protect First Amendment freedoms. We take that responsibility very seriously. But violence is not speech. There is no right to riot, loot, rob, commit arson or destroy. If you engage in violent civil unrest and commit a federal crime in this District, we will come after you as hard as we can. You will go to jail. It is not worth it.
At this moment in our City’s history, we can go down one of two paths. We can go down a path of healing and respect for democracy, where we work together to improve relations between law enforcement and the community, and where we have a free, fair and peaceful election next week. Or we can go down a path of destruction – a path that further divides us. I know what path I want to go down.
At this time, I would like to introduce FBI Special Agent in Charge, Mike Driscoll. He will share his remarks, and then we will all be available for your questions. Thank you.
Notorious Human Trafficker Who Forced Victims into Prostitution Sentenced to 30 YearsRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Kashamba John, 32, of Atlanta, GA, was sentenced to 30 years in prison, 10 years of supervised release, and ordered to pay restitution in the amount of $23,299 by United States District Judge Eduardo C. Robreno for running a national sex trafficking ring, in which he and others forced vulnerable women and girls to travel and prostitute themselves in multiple states. As part of his sentence, the defendant must also register as a sex offender.
In May 2019, the defendant was convicted after trial of conspiring to commit sex trafficking; sex trafficking by fraud, force, or coercion; and transporting individuals in interstate commerce with the intent that the individuals engage in prostitution. Between July 2011 and October 2016, John ran a national sex trafficking ring, selling the bodies of women and girls in Pennsylvania, Florida, California, Georgia, North Carolina, and elsewhere. Conspiring with others, John targeted under-aged runaways, homeless women, and women battling substance abuse in order to manipulate them into prostitution for his benefit. One of John’s victims was rescued by the Pennsylvania State Police when an Uber driver, trained in recognizing sex trafficking victims through her church, flagged down a state trooper when she suspected that the passenger in her vehicle was likely a victim. Two other victims of the defendant were teenagers at the time John trafficked them by force.
“The defendant’s actions in this case were thoroughly vile and disgusting,” said U.S. Attorney McSwain. “Kashamba John preyed upon people he knew would be the most vulnerable, and therefore the easiest for him to control and manipulate into doing his bidding. Now he will spend decades in prison, where he will no longer be able to do harm to anyone else.”
“Sadly, sex trafficking is a scourge that still plagues communities all across the United States, including right here in Philadelphia. Today’s sentencing of Mr. John sends a strong message that this form of violent modern day sex slavery will not be tolerated,” said Brian A. Michael, Special Agent in Charge for HSI Philadelphia. “HSI Philadelphia and our law enforcement partners will continue to be at the forefront of fighting all forms of human trafficking; not only ensuring these traffickers are held responsible for their vile criminal acts, but also helping the victims reclaim their lives.”
“We won’t tolerate this type of treatment of our fellow human beings,” Attorney General Josh Shapiro said. “My office will continue to work with our federal, state and local law enforcement partners to investigate and prosecute these cases and keep communities safe from predators like John.”
The case was investigated by the Department of Homeland Security, Homeland Security Investigations, the Pennsylvania State Police, and the Pennsylvania Office of Attorney General, and is being prosecuted by Assistant United States Attorneys Melanie Babb Wilmoth and Sarah Damiani.
Two Companies in Business Together Agree to Pay $310,000 to Resolve DBE Fraud Allegations Arising from Platt Memorial Bridge Painting ProjectRead the Press Release
PHILADELPHIA, PA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Hercules-Vimas Joint Venture, LLC has agreed to pay the United States $310,000 to resolve False Claims Act allegations that it participated in a fraudulent scheme designed to take advantage of the Disadvantaged Business Enterprise (DBE) program in connection with its work on the federally-funded George C. Platt Memorial Bridge painting project.
Hercules-Vimas is a joint venture formed between the Hercules Painting Company and the Vimas Painting Company. Hercules Painting Company is based in New Castle, Pennsylvania. George Savakis, a Florida resident, is president of Hercules. Vimas Painting Company is located in Lowellville, Ohio. The president of Vimas is Bessie Xipolitas.
The DBE program is set forth by statutes and regulations to provide opportunities for businesses owned by socially and economically disadvantaged individuals to work on projects financed by the federal government. The program requires contractors to award a percentage of subcontracts on a given project to DBEs that serve a “commercially useful function.” A DBE does not serve a commercially useful function if it acts as a mere pass-through – an extra participant through which funds are passed to create the appearance that historically disadvantaged persons did the work.
That scenario is what the government alleges happened in this case. Specifically, in 2011 Hercules-Vimas was awarded a $42.7 million contract by the Pennsylvania Department of Transportation (PENNDOT) to paint the George C. Platt Memorial Bridge in Philadelphia. The contract, funded largely by the federal government, required that a percentage of work be performed by a DBE. To meet this requirement, Hercules-Vimas subcontracted with Vertech International, Inc. (Vertech), an Indian-American owned company certified as a DBE in Pennsylvania, to supply materials.
According to the government’s investigation, this arrangement was a sham. While Hercules-Vimas represented to PENNDOT that Vertech served as the supplier, Hercules-Vimas actually worked directly with a large, non-disadvantaged business to deliver paint and materials for the project, while Vertech merely created invoices designed to conceal the fraud in exchange for a nominal fee. In 2016, the owner of Vertech pleaded guilty to conspiracy to commit wire fraud for Vertech’s role in this fraudulent scheme.
“By allegedly misrepresenting that Vertech was doing work on the project, Hercules-Vimas was able to submit the lowest bid and secure a large government contract,” said First Assistant U.S. Attorney Williams. “This took jobs away from the legitimate disadvantaged businesses the DBE program is intended to serve. As alleged, it was fraud – plain and simple – and it will not be tolerated in this district.”
“DBE fraud is harmful in two distinct ways. First, it prevents legitimate disadvantaged businesses from participating in transportation infrastructure contracts. And second, it compromises the integrity of the Department’s DBE program,” said Douglas Shoemaker, regional Special Agent-in-Charge, United States Department of Transportation Office of Inspector General. “We remain steadfast in our commitment to working with our law enforcement and prosecutorial partners to protect the taxpayers’ investment in our nation’s infrastructure from DBE fraud schemes that undermine DOT-funded programs and projects and the public trust.”
The settled civil claims are allegations only. There has been no determination of civil liability. The investigation was conducted by the United States Department of Transportation, Office of Inspector General and the United States Department of Labor, Office of Inspector General. For the United States Attorney’s Office, Assistant United States Attorneys David Degnan, Bryan Hughes, and Eric Gill handled the investigation and settlement.
Philadelphia Man Convicted at Trial of Illegally Possessing a Firearm as a Convicted FelonRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Peter Hutton, 24, of Philadelphia, PA was convicted at trial with possession of a firearm by a felon, arising from a 911 call placed on July 5, 2019, reporting that a man with a gun was seen on Locust Avenue in the Germantown section of Philadelphia.
In February 2020, Hutton was charged by Indictment with one count of possession of a firearm by a felon, stemming from the July 2019 incident and the subsequent arrest of the defendant by Philadelphia Police officers. After the emergency call was received, officers arrived at the scene and immediately saw a man, later identified as Hutton, matching the description provided over police radio. The defendant was standing next to the open rear driver’s side door of a white Toyota Camry. As the officers approached, Hutton looked in the direction of the officers and then leaned into the open door to get into the car. As the defendant did this, the officers saw Hutton reaching into his waistband for what appeared to be a black object. Officers then removed the defendant from the car and recovered a black Glock, model 19, 9mm semi-automatic pistol, loaded with 12 live rounds of ammunition, in the rear interior of the car.
“The crime of being a felon in possession of a firearm is a serious offense, particularly in a city like Philadelphia, where the problem of gun violence continues to grow every day,” said U.S. Attorney McSwain. “There is a reason convicted felons like Hutton no longer have the right to possess a potentially lethal weapon. The answer to Philadelphia’s violent crime crisis is to get criminals like Hutton off the streets, which is exactly what the U.S. Attorney’s Office is focused on as part of our anti-violence strategy.”
“Convicted felons who possess firearms are an inherent danger to the community,” said Eric Degree, acting Special Agent in Charge of ATF’s Philadelphia Field Division. “This conviction highlights the value of the collaborative effort with our local, state, and federal partners to reduce violent crime and helps bring a sense of security to our neighborhoods plagued by gun violence.”
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and is being prosecuted by Assistant United States Attorney Mary Kay Costello.
Bucks County Real Estate Investment Fraudster Sentenced to Five YearsRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Dean Rossi, 55, of Warrington, PA, was sentenced to five years in prison, four years of supervised release, and was ordered to pay $2.85 million in restitution and $1.38 million in forfeiture by United States District Judge Joel H. Slomsky, for devising and participating in schemes to defraud three financial institutions out of millions of dollars.
Rossi was convicted at trial in March 2018 on seven charges: one count of conspiracy to commit mail fraud affecting a financial institution and bank fraud; one count of mail fraud affecting a financial institution; three counts of bank fraud; and two counts of loan fraud.
From at least December 2006 until about March 2012, Rossi and his co-conspirators participated in schemes to defraud Nova Bank, First Cornerstone Bank, and Leesport Bank, which later became VIST Financial Bank, out of more than $4.15 million in connection with multiple real estate closings for small residential properties in working class neighborhoods in the Philadelphia area. In each scheme, the defendant conspired with others to obtain fraudulent mortgage loans and made misrepresentations regarding the disbursement of those funds and his income. The defendant also falsified numerous documents, including tax returns and HUD-1 settlement sheets. Although the banks were able to mitigate some of their fraud losses, the banks and their insurers still suffered losses exceeding $2.85 million. Rossi personally pocketed a total of $1.38 million.
“The scope and duration of Rossi’s fraud are simply stunning,” said U.S. Attorney McSwain. “He stole millions of dollars from bank lenders and preyed upon residential neighborhoods – and then attempted to cover his tracks with lies. That sort of white collar crime deserves significant prison time, which is what Rossi has earned.”
“Dean Rossi lied on mortgage applications starting in 2006, his lies and greed helped to contribute to the financial meltdown in 2008,” observed Damon Wood, Inspector in Charge of the Philadelphia Division of the Postal Inspection Service. “Over ten years later, after being found guilty at trial, he has finally been sentenced to five years in jail. I want to thank the Postal Inspectors and the Assistant United States Attorneys who stayed with this case for nearly a decade. The Postal Inspection Service has long history of investigating frauds schemes, and we will continue to lead and support investigations into fraud schemes that use the mail.”
The case was investigated by the United States Postal Inspection Service and is being prosecuted by Assistant United States Attorneys Mark Dubnoff and Elizabeth Ray.
United States Attorney William M. McSwain Announces Preparations to Preserve the Integrity of the 2020 General Election in the Eastern District of PennsylvaniaRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Assistant United States Attorney Richard P. Barrett will lead the efforts of the United States Attorney’s Office for the Eastern District of Pennsylvania in connection with the Justice Department’s nationwide Election Day Program for the general election on November 3, 2020. AUSA Barrett has been appointed to serve as the District Election Officer (DEO) for the Eastern District of Pennsylvania, and in that capacity is responsible for overseeing the District’s handling of complaints of election fraud and any other voting rights concerns in consultation with Justice Department Headquarters in Washington.
The Department of Justice has an important role in deterring ballot fraud and discrimination at the polls and combating these violations whenever and wherever they occur. The Department’s long-standing Election Day Program furthers these goals, and also seeks to ensure public confidence in the integrity of the election process by providing local points of contact within the Department for the public to report possible ballot fraud and voting rights violations while the polls are open through Election Day.
Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their direction. Further, federal law protects the right of voters to mark their own ballot or to be assisted by a person of their choice (where voters need assistance because of disability or illiteracy).
“Every citizen must be able to vote without interference or discrimination and to have that vote counted without it being impacted by fraud,” said U.S. Attorney McSwain. “Ensuring free and fair elections depends in large part on the cooperation of the American electorate. The Department of Justice will act promptly and aggressively to protect the integrity of the election process, but it is imperative that anyone with specific information about voter interference or election fraud report it immediately to my Office, the FBI, or the Civil Rights Division.”
Voting is the cornerstone of American democracy. The federal government must ensure that those who are entitled to the franchise exercise it if they choose, and that those who seek to corrupt it are brought to justice. U.S. Attorney McSwain stated that AUSA Barrett will be on duty in this District while the polls are open in order to respond to complaints of election fraud or voting rights concerns during the voting period that ends on November 3, 2020, and to ensure that such complaints are directed to the appropriate authorities. AUSA Barrett can be reached by the public at the following telephone numbers: (215) 861-8420 and (215) 861-8200.
In addition, the FBI will have special agents available in each field office throughout the country to receive allegations of election fraud and other election abuses on Election Day. The local FBI field office can be reached by the public at (215) 418-4000.
Finally, complaints about possible violations of the federal voting rights laws can also be made directly to the Civil Rights Division in Washington, DC by phone at 800-253-3931 or by complaint form at https://civilrights.justice.gov/.
Please note, however, in the case of a crime of violence, please call 911 immediately and before contacting federal authorities. State and local police have primary jurisdiction over polling places, and almost always have faster reaction capacity in an emergency.
Philadelphia Man Sentenced to 30 Years for Sexually Abusing and Recording the Abuse of a Four-Year-Old ChildRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that José Antonio Luna Benscome, 42, of Philadelphia, PA, was sentenced by U.S. District Court Judge C. Darnell Jones to 30 years in prison to be followed by five years of supervised release for child pornography offenses. The defendant’s sentence also requires him to register as a sex offender under Megan’s Law.
In October 2019, Luna Benscome pleaded guilty to charges of manufacturing and possessing child pornography, related to his abuse of a four-year-old child. In July 2018, the mother of the victim observed Luna Benscome holding her child’s hand and acting in a strange manner in the kitchen of her residence in Philadelphia. The mother reviewed her home surveillance system’s video, and found footage that showed Luna Benscome molesting her child on multiple occasions. The mother confronted the defendant about the sexual abuse, and he confessed to her, but then tried to convince her not to report it to the police. The defendant also confessed to Philadelphia Police Department detectives once the crime was reported. Subsequent investigation revealed that, in addition to sexually abusing the child and photographing the abuse, Luna Benscome made the child watch pornography on a number of occasions, took numerous photographs of the child naked, and had the child touch his genitals.
“Sexual exploitation of a minor of any age, let alone a preschooler, is utterly reprehensible and will be met with swift justice,” said U.S. Attorney McSwain. “Because of the quick response of the victim’s mother, the Philadelphia Police Department, and the FBI, we uncovered additional evidence of this defendant’s crimes – ensuring that he will now spend decades behind bars, where he belongs.”
“Luna Benscome subjected a four-year-old child to serial sexual abuse, documenting those depraved acts for his continued gratification,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “He’s a clear danger to children and has earned every minute behind bars to which he’s been sentenced. The FBI and our law enforcement partners are determined to take predators like this off the street, to prevent them from victimizing anyone else.”
This case is part of Project Safe Childhood (PSC), a program bringing together all levels of law enforcement and the communities they serve to reduce the sexual exploitation and abuse of children.
The case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney José Arteaga.
Unlicensed New Jersey Investment Adviser Charged with Defrauding Clients Out of More than $2 MillionRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Alexander S. Rowland, 29, of Penns Grove, NJ, was charged by Indictment with seven counts of mail fraud, 30 counts of wire fraud, one count of bank fraud, one count of securities fraud, one count of investment adviser fraud, and two counts of money laundering related to a scam in which he purported to be an investment adviser and either stole or lost victims’ money, resulting in total losses of more than $2 million.
The Indictment alleges that Rowland, a former warehouse operator, started an investment company in July 2016 that he incorporated in New Jersey, called Roaring Investments, Inc., and which he operated out of his apartment. The defendant held himself out to potential investors as a licensed investment adviser who would invest their money in stocks and cryptocurrency, and promised them a minimum rate of return of 25%, with potential returns of 50% or higher. Through these and other misrepresentations, Rowland was able to dupe his victims into investing almost $3 million in Roaring Investments. Eventually, the defendant was able to move his company from his apartment in New Jersey into office space in Philadelphia.
According to the Indictment, despite telling investors that he was a licensed investment adviser, in reality Rowland did not hold any licenses to sell securities or offer investment advice. Further, the defendant invested only approximately $518,000 of the almost $3 million he obtained from his clients, and those investments lost more than $100,000. The remaining client funds (almost $2.5 million) were used by Rowland in a variety of ways that were never disclosed to his clients, including spending more than $1 million on himself by: taking large cash withdrawals; paying his own personal bills; buying luxury vehicles; paying for vacations and jewelry; paying for gym memberships; and buying more than $47,000 worth of firearms.
The Indictment also alleges that Rowland was able to deceive his clients into believing that their investments were safe and profitable through a variety of fraudulent means, including: (a) operating a “Ponzi” scheme by using new client funds to make payments to earlier clients who had invested with Roaring Investments, thereby tricking those earlier clients into believing that their investments were making money; (b) creating a website, “roaringinvestments.com,” through which clients could check their account balances and on which defendant Rowland posted false account balances for his clients; and (c) emailing false account statements to clients that listed their fictitious account balances and showed non-existent profits.
Finally, the Indictment alleges that the defendant received and ignored an August 2018 cease and desist letter from the Pennsylvania Department of Banking and Securities that instructed Roaring Investments to stop selling unregistered securities and for Rowland to stop serving as an unlicensed investment adviser. Instead, Rowland continued to solicit new investments from clients. All told, due to Rowland’s alleged fraudulent conduct, Roaring Investments’ clients lost more than $2,139,000.
“Honesty, integrity, and trust all play critical roles in the relationship between a financial adviser and a client,” said U.S. Attorney McSwain. “Here, Rowland wasn’t even a legitimate advisor: he is an alleged con man who lived lavishly on his clients’ money – funds they expected him to invest responsibly. The damage done to victims of such fraud can be disastrous. I want to especially thank the U.S. Securities and Exchange Commission and the Pennsylvania Department of Banking and Securities for their substantial assistance with this case.”
Rowland faces a maximum sentence of 835 years in prison, a five-year period of supervised release, a fine of $15,345,987.58, and a $4,200 special assessment.
The case was investigated by the Federal Bureau of Investigation with assistance from the U.S. Securities and Exchange Commission and the Pennsylvania Department of Banking and Securities, and is being prosecuted by Assistant United States Attorney Michael S. Lowe.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Man Who Attempted to Rob the Trolley Car Diner at Gunpoint Sentenced to 19 YearsRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Keenan Smith, 29, of Philadelphia, PA was sentenced to nineteen years in prison and five years of supervised release by United States District Judge Eduardo C. Robreno for attempting to rob the Trolley Car Diner on Germantown Avenue in Northwest Philadelphia.
The defendant was convicted after trial in August 2019 of attempted robbery which interferes with interstate commerce (Hobbs Act robbery), and using or carrying, and discharging, a firearm during and in relation to a crime of violence. In the early morning hours of January 31, 2018, Smith snuck into the Trolley Car Diner through a side entrance before it opened for business that day, and waited outside the manager’s office with a gun. When the manager arrived, Smith pointed the gun at the manager’s head, and then a struggle ensued as the manager attempted to disarm the defendant. Ultimately, the defendant was shot in the hand, causing him to flee, but he was later arrested by the Philadelphia Police Department after seeking medical treatment for his gunshot wound at a hospital in Roxborough. Evidence presented at trial showed that Smith’s DNA was found to match DNA from blood left at the scene of the crime.
“Nobody should be put in a positon of fearing for their life when simply showing up to do their job,” said U.S. Attorney McSwain. “My Office is committed to prosecuting and punishing this type of inexcusable violence, which is all too prevalent in Philadelphia. Federal crime means federal time: here, 19 years. Keenan Smith deserves every bit of that sentence.”
“Imagine the terror of walking into a gunpoint ambush, alone with an armed stranger making demands,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “In attempting this armed robbery, Keenan Smith made clear that he’s a threat to public safety. Although Smith was the one injured during the robbery, it could have easily been his intended victim or an innocent bystander harmed. The FBI and our partners at the Philadelphia Police Department are committed to taking violent criminals off the street, to keep them from victimizing anyone else.”
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
The case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department, with assistance from the Whitemarsh Township Police Department, and is being prosecuted by Assistant United States Attorney Timothy M. Stengel.