Eastern District of Pennsylvania

PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams and Acting Assistant Attorney General Jeffrey Bossert Clark announced that Linde GmbH and its U.S. subsidiary Linde Engineering North America LLC (LENA) (together, “Linde”) have agreed to pay the United States more than $22.2 million to resolve allegations that Linde violated the False Claims Act by knowingly making false statements on customs declarations to avoid paying duties owed on the companies’ imports.

Linde GmbH is a multinational corporation headquartered in Germany that, among other things, imports materials into the United States for use in the construction of natural gas and chemical plants. LENA, based in Houston, conducted portions of Linde’s United States business and managed procurement and logistics for Linde. Between 2011 and 2017, Linde imported more than $500 million in goods into the United States.

To enter goods into the United States, an importer must declare, among other things, the country of origin of the goods, the value of the goods, whether the goods are covered by antidumping or countervailing duties, and the amount of duties owed. U.S. Customs and Border Protection (CBP) relies on these representations to determine the correct amount of any duties owed. It is the importer’s affirmative duty to use “reasonable care” to make sure that such information is accurate so that CBP can assess the proper duties.

The United States alleged that, between 2011 and 2017, Linde avoided duties owed to the United States, including in some instances antidumping and countervailing duties, by misrepresenting the nature, classification, and valuation of imported merchandise, as well as the applicability of free trade agreements.

“Trade policy is a critical part of our nation’s foreign policy,” said First Assistant U.S. Attorney Jennifer Arbittier Williams. “Anti-dumping and countervailing duties ensure that American manufacturers are protected from unfair trade practices, and valuation requirements help to ensure that importers do not have an incentive to use foreign engineers to design or inspect the equipment instead of hiring in the United States.”

“This settlement reflects our commitment to hold accountable those who evade duties owed on imported goods, including antidumping and countervailing duties that level the playing field for U.S. manufacturers,” said Acting Assistant Attorney General Jeffrey Bossert Clark for the Department of Justice’s Civil Division. “The Department of Justice will zealously pursue those who seek an unfair advantage in U.S. markets by bringing underpriced goods into this country.”  

“CBP is proud to work with the Department of Justice to enforce our trade laws. Collecting revenue on behalf of the American people is something we take very seriously,” said Brenda Smith, Executive Assistant Commissioner, CBP Office of Trade. “We are glad to have come to an equitable and productive solution.” 

Prior to the United States’ disclosure to Linde of its investigation, Linde initiated a voluntary disclosure to CBP regarding its importing practices. Since that time, Linde has cooperated with the investigation and worked to overhaul and improve its customs compliance program.

First Assistant U.S. Attorney Williams praised Linde’s work in addressing the issues in these programs: “We commend Linde for coming forward with these issues and working to ensure both that the government is made whole and that these issues will not recur. We hope this settlement will serve as a message to other importers to ensure that they have compliance processes in place that can detect problems before they grow. Importers have an obligation to scrutinize their practices and promptly report issues if they discover that they have not lived up to their obligations.” 

The settlement with Linde 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 v. Linde AG, et al., No. 17-cv-1012. As part of today’s resolution, Ms. Johnson will receive approximately $3.7 million. The qui tam complaint was filed by Stephen Hasegawa of Phillips & Cohen in San Francisco.

“We thank the relator and relator’s counsel for their contributions to this case. Without information from citizens like the relator, detecting fraud and conserving government program funds would be much more difficult,” said First Assistant U.S. Attorney Williams.

The settlement was the result of a coordinated effort among the U.S. Attorney’s Office for the Eastern District of Pennsylvania and the Commercial Litigation Branch of the Justice Department’s Civil Division, with assistance from CBP’s Office of Chief Counsel and CBP’s Regulatory Audit and Agency Advisory Services. Assistant United States Attorneys Paul W. Kaufman and Landon Y. Jones III of the Eastern District of Pennsylvania and trial attorney Jennifer Chorpening of the Civil Frauds section of the Department of Justice handled the investigation and settlement.

The claims resolved by the settlement are allegations only, and there has been no determination of liability.

PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Michael Salerno, 51, of Mount Laurel, NJ, was arrested and charged by Indictment with twenty-three counts of wire fraud and six counts of mail fraud in connection with multiple, elaborate fraud schemes.

According to the Indictment, between September 2016 and at least November 2018, the defendant operated a series of businesses, including Black Diamond Forex, L.P., BDF Trading, L.P., Advanta Capital Markets, Inc., and Advanta FX, each of which purported to be in the business of trading foreign currencies. Using a variety of misrepresentations and omissions, Salerno induced victims to pay advance fees—up-front payments of typically more than $1,000—in order to be hired by Salerno’s company. He told the victims that, upon being hired, he would make available to them a pool of $10 million which they could trade on the foreign currency market, and take a generous cut of any profits. Each of these representations was completely false.

To make his fraudulent activities appear legitimate, Salerno held himself out as a sophisticated and successful businessman. According to the Indictment, the defendant claimed to have managed a real estate empire, a portion of which he claimed to have recently sold for $10 million to fund the currency-trading venture. He also claimed that he had been a profitable currency trader. None of this was true, either. In fact, he declared bankruptcy twice, most recently in 2015, and had been evicted multiple times from rental homes for failure to pay rent. In 2005, he pleaded guilty to federal tax charges and was sentenced to 21 months in prison. He failed to disclose any of this to the aforementioned victims before taking their money. Instead, Salerno allegedly collected more than $300,000 in advance fees and used the money for his own benefit.

The defendant’s currency-trading scheme came to a halt when this Office opened a criminal investigation and the Commodity Futures Trading Commission sought and obtained an injunction against Salerno and his businesses in 2018. However, Salerno allegedly turned immediately to a second scheme. Also according to the Indictment, between May 2018 and least December 2019, Salerno operated a company called AccuOne Financial, Inc. AccuOne purported to be in the business of assisting clients in ridding themselves of unwanted automobile leases. It also purported to offer a different set of clients, whose personal credit precluded them from obtaining an automobile lease, access to automobile leases, low interest vehicle loans, and credit repair services. But Salerno failed to do as promised, instead ripping off both sets of clients. According to the Indictment, the defendant took the unwanted vehicles from the first set of clients, made few - if any - of the required lease payments, and then gave the vehicles to the second set of clients who could not obtain their own leases, in exchange for substantial monthly fees. The predictable result of this house of cards-style scheme was that the clients who wanted to get out of their leases either continued to make monthly lease payments for cars they no longer had, or suffered substantial damage to their credit. And the clients who leased cars from AccuOne often had them repossessed without warning. As for Salerno, he netted several hundred thousand dollars from this scheme alone.

“When Salerno’s foreign currency trading scheme came crashing down around him, he very quickly moved on to an alternative way of swindling people out of their money with car leases and loans,” said First Assistant U.S. Attorney Williams. “The damage done by such corrupt financial schemes can be catastrophic to innocent people’s credit and financial security. We will continue to hold those who commit crimes like the ones alleged here accountable for their misdeeds.”

If convicted, the defendant faces a maximum possible sentence of 580 years in prison, three years supervised release, a fine of $7,250,000 and full restitution.

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Christopher J. Mannion

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Chip Hackley, 49, of Hermosa Beach, CA, and George Matin, 51, of Los Angeles, CA, were each sentenced to 15 months in prison, to be followed by two years of supervised release, by United States District Court Judge Paul S. Diamond for conspiracy, wire fraud, and securities fraud. Previously, on September 16, 2020, Judge Diamond sentenced their co-conspirator, Harold Minsky, 81, of Northridge, CA, to one year and one day in prison, to be followed by the same term of supervised release.

Minsky, Matin, and Hackley conspired to manipulate the stock price and trading volume of public companies. As part of this conspiracy, Minsky and Matin attempted to manipulate the stock of two public companies:  WGE Holdings Corp. (ticker symbol WGE), a gold mining business, and Holy Grail (ticker symbol HGRL), which produced and sold hemp and Cannabidiol (“CBD”) products. Hackley joined the scheme later, participating only in the manipulation of HGRL.

The conspirators planned to manipulate the stock of these companies by establishing control over both their restricted and free trading shares and coordinating the issuance of press releases with the stock promotions in order to give the false impression of market interest in the stock. As part of this conspiracy, they also agreed to engage in prearranged stock trades and to bribe purchasers to buy the stock.

In attempting to manipulate the stock of both WGE and HGRL, Minsky and Matin intended to generate approximately $9 million in illegal proceeds for themselves and their co-conspirators, and to cause corresponding losses to the conspiracy’s victims. With respect to HGRL, Hackley intended to generate approximately $4 million in illegal proceeds.

Minsky, Matin, and Hackley were charged by separate Informations, each charging conspiracy, wire fraud, and securities fraud. Minsky pleaded guilty on May 2, 2019, Hackley on May 15, 2019, and Matin on October 10, 2019.

“Innocent individuals who try to legitimately invest and save money for the future are the ones who lose big when greedy fraudsters like Minsky, Matin and Hackley manipulate the markets with pump and dump stock schemes,” said First Assistant U.S. Attorney Williams. “Market manipulation also causes our economy to take a hit because the public cannot trust that the markets are free and fair. Thanks to the excellent work of the FBI, SEC, and prosecutors from this Office, these defendants’ days of profiting off of others’ misfortune are over.”

The case is being investigated by the Federal Bureau of Investigation, with the assistance of the Securities and Exchange Commission. It is being prosecuted by Assistant United States Attorney Patrick J. Murray.

PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Jason Muzzicato, 43, of Bangor, PA, was sentenced to five years in prison and three years of supervised release by United States District Court Judge Joseph F. Leeson, Jr., for unlawfully possessing firearms and explosives, and using an unregistered drone aircraft to drop explosive devices in order to terrorize his victim, a former girlfriend, in and around Bangor, Northampton County.

In December 2019, the defendant pleaded guilty to possession of a destructive device, possession of firearms by a person subject to a domestic violence protective order, and knowingly operating an unregistered aircraft. The charges stem from Muzzicato’s possession of homemade bombs and firearms while subject to the terms of a Protection from Abuse (“PFA”) order issued by the Northampton County Court of Common Pleas on behalf of Muzzicato’s former girlfriend, and from his unlawful operation of an unmanned aerial vehicle (drone). Muzzicato was found to be in possession of a DJI, Model Phantom 3, unmanned aerial vehicle, seven improvised explosive devices and ten firearms, including multiple AR-15 rifles and semi-automatic pistols. Under federal law, an individual who is subject to a PFA order is prohibited from possessing these firearms.  

“With this combination of homemade bombs, guns and a drone, this defendant terrorized an entire community,” said First Assistant U.S. Attorney Williams. “His blatant disregard for court orders, the law and others’ personal safety made him a true threat, and we are grateful to our law enforcement partners that Muzzicato was identified and arrested before anyone was physically hurt. Our Office will continue to work with our partners to ensure the security of our communities is not threatened by people who hide behind a remote control.”

The case was investigated by the Federal Bureau of Investigation, Allentown Resident Agency; the Bureau of Alcohol, Tobacco, Firearms, and Explosives, Allentown Field Office; the Department of Transportation, Office of Inspector General, Fort Washington Field Office; the Washington Township Police Department; the Pennsylvania State Police; and the City of Bethlehem Fire Department, and is being prosecuted by Assistant United States Attorney Kishan Nair.

PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Miguel Gonzalez Segovia, 31, of Veracruz, Mexico, was sentenced to ten years in prison, five years of supervised release by United States District Court Judge Joseph F. Leeson Jr. for trafficking drugs in the Lehigh Valley in November 2018.

In September 2019, Gonzalez Segovia pleaded guilty to the charge of possession with intent to distribute 69 kilograms cocaine, 14 kilograms of fentanyl, and 4 kilograms of acetyl fentanyl (a fentanyl analogue). According to court documents, the defendant was stopped by a Pennsylvania State Trooper while driving on Interstate 78 in Northampton County, and was evasive in answering questions and provided conflicting information about his destination and purpose for traveling through Northeastern Pennsylvania. The Trooper also observed nine large suitcases stacked inside the rented vehicle the defendant was driving.

After searching the vehicle and one of the suitcases to reveal approximately 50 pounds of substances including cocaine, fentanyl and acetyl fentanyl, Gonzalez Segovia was placed under arrest and interviewed by Pennsylvania State Police. He admitted that this was the fourth time he had driven the same drug delivery route across Pennsylvania for individuals in California, and explained that they would load drugs between furniture in moving trucks in California and drive it to the East Coast for delivery in different locations in New York, New Jersey, Pennsylvania and Maryland.

“Gonzalez Segovia and other members of this drug organization moved huge quantities of dangerous drugs through and into our community,” said First Assistant U.S. Attorney Williams. “These traffickers essentially delivered destruction to every state, city and town where these deadly drugs ultimately landed. Our office is determined to investigate and convict these criminals, and put them behind bars.”

“Segovia pleaded guilty and was responsible for trafficking 69 kilograms of cocaine and 18 kilograms of illicit fentanyl across the Lehigh Valley area.  These are substantial amounts of dangerous and potentially deadly illicit drugs,” said Jonathan A. Wilson, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Philadelphia Field Division.  “Working with our partners at the Pennsylvania State Police, Segovia will no longer be able to distribute these poisons that ruin our communities and destroy countless lives.”

The case was investigated by the Drug Enforcement Administration, Allentown Resident Office and the Pennyslvania State Police. The case is being prosecuted by Assistant United States Attorney Kelly A. Lewis Fallenstein.

PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Thomas Harris Jr., 27, of Croydon, PA was arrested and charged by Indictment with multiple firearms trafficking offenses stemming from his scheme to sell almost 40 guns to a buyer on the island of St. Lucia. Specifically, the defendant was charged with making false statements to a federal firearm licensee, dealing in firearms without a license, delivery of firearms to a common carrier without written notice, and smuggling goods from the United States.

The Indictment alleges that Harris purchased approximately 38 firearms in 12 transactions at two Bucks County, PA, gun shops between April 20, 2019, and February 15, 2020, and provided a false address as his place of residence on the required federal forms that he completed during each transaction. It is further alleged that the defendant then illegally trafficked, and attempted to traffic, the guns to St. Lucia, a sovereign island nation in the West Indies, despite his not having a license to deal in firearms nor a license to export them as required by law. He also allegedly failed to notify the shipping company he used that his shipments contained firearms, as required by law.

One of Harris’s suspected packages to St. Lucia was intercepted by federal agents at the warehouse of a local shipping company. Inside, concealed in household items such as packages of diapers, cat litter and laundry detergent, the agents found seven Glock semiautomatic pistols, one Ruger semiautomatic pistol, two AK-47 pattern pistols, two AK-47 pattern rifles, two AR-15 lower receivers, two AR-15 upper receivers, ten high capacity Glock ammunition magazines, seven additional assorted ammunition magazines, and 815 rounds of ammunition.

Harris allegedly used the alias “Lance Brown” when he presented this package to the shipping company for shipment to St. Lucia, and he allegedly falsely told a shipping company representative that the package contained household items. After the defendant left this package with the shippers, he traveled to St. Lucia himself in March 2020. He remained there until returning to the United States on July 25, 2020, when he was arrested at an airport in New York.

“As alleged in the Indictment charging him with firearms trafficking offenses, Harris has a brazen disrespect for our laws meant to regulate and monitor the sale of weapons,” said First Assistant U.S. Attorney Williams. “After sending his most recent shipment of guns overseas he also left the country for a few months, but all that did was postpone the inevitable. If you are charged in the Eastern District of Pennsylvania with a federal offense, there is no place to hide, here or abroad. We will not rest until we find you and hold you accountable.”

“Illicit international firearms trafficking is a top priority for the Office of Export Enforcement,” said P. Lee Smith, Performing the Non-exclusive Functions and Duties of the Assistant Secretary for Export Enforcement at the Department of Commerce. “We will continue to work with our law enforcement partners to arrest and prosecute individuals who violate United States export control laws that are intended to keep the most dangerous goods out of the most dangerous hands.”  

“Preventing the illegal use and trafficking of firearms is a central focus of ATF's strategy to combat violent crime and protect our communities,” said John Schmidt, acting Special Agent in Charge of ATF’s Philadelphia Field Division. “Illegally purchased firearms often end up in the hands of violent offenders and affect communities near and far, in this instance Saint Lucia in the Caribbean. Ensuring firearms traffickers are aggressively investigated and swiftly brought to justice is a top priority for the Philadelphia Field Division -- this collaborative effort between our local, state and federal partners is a prime example of such.”

“If you want to be a firearms dealer and exporter, get the proper licenses and follow the law,” said Michael J. Driscoll, Special Agent in Charge of the FBI's Philadelphia Division. "Guns illegally exported overseas are quite likely to end up in the wrong hands and be used to commit further criminal acts. The FBI is committed to working with our law enforcement partners to combat weapons trafficking, in the interests of public safety here and abroad.”

If convicted, the defendant faces a maximum possible sentence of 80 years in prison, three years of supervised release, a $3,750,000 fine, and a $1,500 special assessment.

The case was investigated by the U.S. Department of Commerce, Office of Export Enforcement, New York Field Office; the Bureau of Alcohol, Tobacco, Firearms, and Explosives; and the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Joseph A. LaBar and U.S. Department of Justice National Security Division Trial Attorney Michael E. Eaton.

 An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Erick Wandique, 26, of Allentown, Pennsylvania was sentenced to three years in prison, three years of supervised release, and was ordered to pay restitution in the amount of $87,657 and forfeiture in the same amount by United States District Court Judge Edward G. Smith for his scheme to impersonate, and steal from, his stepfather.

In March 2020, the defendant pleaded guilty to eight counts of wire fraud and one count of aggravated identity theft, after being charged with a nine-count Indictment in August 2016. The charges arose from Wandique’s electronic communications with Fidelity Investments in which he pretended to be his stepfather, Luis Flores, in order to authorize fraudulent bank transactions and debit purchases, resulting in the depletion of nearly all of Flores’ Fidelity retirement account.

From December 2014 through March 2015, Wandique went on a spending spree utilizing his stepfather’s retirement savings: withdrawing cash, making wire transfers of funds, arranging payments through the BillPay service for the account, making debit purchases at retail stores, and even taking his friends on a trip to California. After a family member confronted him about his inexplicable newfound income and spending, the defendant fled the United States by flying to Honduras, which does not have an extradition agreement with the United States. On August 25, 2019, the defendant was arrested after he attempted to reenter the United States on a flight to New Orleans, LA.

“It’s hard to imagine victimizing your own family, but Wandique took advantage of an opportunity to do just that,” said First Assistant U.S. Attorney Williams. “Here, the defendant drained his stepfather’s lifetime of savings – money earned to support himself in retirement – and when his family and the law caught on to him, Wandique fled the country. If you are charged in the Eastern District of Pennsylvania with a federal offense, we will find you and hold you accountable for your actions.”

“Mr. Wandique’s sentencing underscores the importance of vigilance against financial fraud schemes,” said Brian A. Michael, Special Agent in Charge of Homeland Security Investigations Philadelphia. “Even after Mr. Wandique fled from prosecution, Homeland Security Investigations worked closely with Interpol and international partners to ensure he was apprehended and brought to justice. Mr. Wandique will now be held accountable for swindling his family member.”

“Today’s sentencing is the culmination of years of collaboration between the Pennsylvania State Police and its federal law enforcement partners to seek justice for the victim in this case,” said Major Jeremy Richard, director of the Pennsylvania State Police Bureau of Criminal Investigation. “Despite occurring behind the anonymity of a computer, wire fraud and identity theft are serious crimes that can quickly erase a lifetime of savings from unsuspecting victims and devastated families.”

The case was investigated by the Department of Homeland Security Investigations, Customs and Border Protection, Interpol, and the Pennsylvania State Police. The case is being prosecuted by Assistant United States Attorney Christopher Diviny.

PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that neurosurgeon Sagi M. Kuznits, practice director Pnina Kuznits, and Neurosurgical Care LLC (collectively, “Kuznits”), have agreed to pay $1,017,375.03 to resolve liability under the False Claims Act for the alleged improper billing of electro-acupuncture devices called Stivax and/or P-Stim and a memory-loss device called eVox.

From February 2017 through July 2018, Kuznits billed Medicare, TRICARE, and the Federal Employees Health Benefit Program for the implantation of neuro-stimulators – a surgical procedure which usually requires an operating room and which is reimbursed by federal healthcare programs – when in fact the only procedures performed had been the non-surgical application of P-Stim and Stivax by a physician assistant.  P-Stim and Stivax are applied with an adhesive and insertion of a limited number of needles, and they do not involve surgery, anesthesia, or take place in an operating room.  Federal healthcare programs do not reimburse for devices such as P-Stim or Stivax, whether they are characterized as an electro-acupuncture device or as an implantable neuro-stimulator.  Other brand names for this device include NeuroStim, ANSiStim, E-Pulse, and NSS-2 Bridge.

In addition, Kuznits billed Medicare for a physician assistant’s application of an “eVox” device. Manufactured by Evoke Neuroscience, Inc., eVox consists of a cap with electrodes that are placed on the head and connected to a laptop by wires, purporting to measure certain “biomarkers” to assist in treatment of memory loss. Kuznits submitted claims to Medicare for payment using a combination of six reimbursable codes apparently in an effort to maximize reimbursement.  The United States alleges that Medicare does not reimburse for eVox as billed, and especially not when one diagnostic test is mis-billed under multiple codes as if it were multiple different tests.   

“Dr. Kuznits, as a surgeon, should have known better.  P-Stim is clearly not surgery and should not be billed using the surgical codes improperly pushed by marketers,” said First Assistant U.S. Attorney Williams.  “Dr. Kuznits failed to do his own independent due diligence which would have shown that he could not bill federal healthcare programs for P-Stim.  Instead, he chose to take the money based on the self-serving representations of those selling the product that Medicare would pay for it.” 

Now, in addition to this settlement, Dr. Kuznits is suing those marketers.  See Neurosurgical Care, LLC v. Doc Solutions LLC, Civil Case No. 19-5751 (E.D. Pa.).  “As this settlement shows,” continued First Assistant U.S. Attorney Williams, “if a marketer pushes a healthcare scheme like P-Stim that sounds too good to be true, it likely is – and you shouldn’t do it.”   

This is the third electro-acupuncture device settlement announced in this District as part of an ongoing investigation.  In recent months, other jurisdictions including the Southern District of Texas and the Middle District of Tennessee have also taken action to hold providers accountable.  See https://www.justice.gov/usao-sdtx/pr/pain-doctor-pays-settle-allegations-deceptive-medicare-billing; https://www.justice.gov/usao-sdtx/pr/pain-doctor-pays-settle-allegations-deceptive-medicare-billing);https://www.justice.gov/usao-mdtn/pr/united-states-and-tennessee-file-suit-against-comprehensive-pain-specialists-and); https://www.tn.gov/attorneygeneral/news/2020/6/10/pr20-27.html#:~:text=Nashville%2D%20Tennessee%20Attorney%20General%20Herbert,Tennessee%20Medicaid%20False%20Claims%20Act.

“We continue to work closely with our partners at CMS’s Center for Program Integrity, the Department of Health and Human Services Office of Inspector General, other federal healthcare programs, state partners, and sister U.S. Attorney’s Offices around the country to hold accountable any other providers who inappropriately billed this device and any product distributors or marketers who may have devised or carried out such a billing scheme,” stated First Assistant U.S. Attorney Williams. 

“Every dollar saved is critical to the sustainability of our Medicare program and the needs of our beneficiaries,” said Centers for Medicare and Medicaid Services Administrator Seema Verma. “We thank our partners at the Department of Justice and Department of Health and Human Services Office of Inspector General for working hard with us to identify, investigate, and eliminate waste, fraud and abuse in our federal healthcare programs.”

“Accurately billing for services provided to Medicare beneficiaries is required of all health care providers,” said Maureen R. Dixon, Special Agent in Charge for the U.S. Department of Health and Human Services, Office of the Inspector General. “HHS-OIG, CMS’s Center for Program Integrity, and the U.S. Attorney’s Office will continue to evaluate and pursue inaccurate billings of P-Stim and similar devices.”

The settled civil claims are allegations only.  There has been no determination of civil liability.  This case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General.  It was handled by Assistant U.S. Attorney Matthew E. K. Howatt, Civil Chief Gregory B. David, and Auditor Dawn Wiggins.

PHILADELPHIA – United States Attorney William M. McSwain announced that William Johnson, 34, of Philadelphia, PA was convicted today at trial of possession of a firearm by a convicted felon, arising from an incident in which Philadelphia police officers recovered a weapon that Johnson had tried to discard while attempting to evade capture.

In September 2019, Philadelphia Police Department Highway Patrol Officers responded to reports of a person with a gun at 15th Street and West Allegheny Avenue in North Philadelphia. Upon arrival, the officers observed the defendant walking with a person that matched the description in the report. When the officers got out of their car to investigate, Johnson took off in a full sprint while holding onto his waistband. He then cut through an empty lot and climbed a fence in an attempt to flee. An officer drove around to where Johnson would be expected to emerge on the other side of the lot. When Johnson climbed the fence that led away from the lot, he spotted yet another police officer. Johnson then jumped down from the fence and the officers observed him toss a firearm a few feet away. The officers then took Johnson into custody and secured the firearm.

“Everybody knows what is happening in Philadelphia today with the staggering violent crime rates, and everybody also knows the reason for it – a lack of enforcement at the local level. One of the ways that my Office is working to combat this chaos is by stepping in to aggressively prosecute cases in which convicted felons illegally possess firearms,” said U.S. Attorney McSwain. “This was not an easy case, and in fact resulted in a hung jury the first time we tried it back in January. But now justice has been done, thanks to the determination of the prosecution team and our law enforcement partners in this case, the FBI, the ATF, and the Philadelphia Police Department. This is the kind of commitment that is needed to keep our community safe.”

“The FBI is committed to working with our law enforcement partners to get guns out of the hands of convicted felons and off the streets,” said, Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “In order to reduce violent crime, we must stay vigilant and keep firearms away from those not permitted to possess them.”

The case was investigated by the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Robert Eckert.

PHILADELPHIA— United States Attorney William M. McSwain announced that Thomas J. Whalen, D.O., 65, of Berwyn, PA, has agreed to pay the United States $1,257,499.00 to resolve allegations under the False Claims Act that he submitted or caused the submission of false claims to federal health care plans for FDA-approved versions of Remicade, Orencia, Prolia/Xgeva, Synvisc/Synvisc One, and Boniva when he had, in fact, administered non-FDA-approved, foreign versions of these medications.

In addition, the civil settlement resolves admissions that Whalen knowingly and intentionally prescribed controlled substances outside the usual course of professional practice and without a legitimate medical purpose, in violation of the Controlled Substances Act. Whalen permanently surrendered his controlled substance registrations with the DEA, surrendered his medical license, and will be excluded from participation in federal programs.

Whalen owned and operated Rheumatology Consultants, P.C., doing business as Whalen Rheumatology Group, with locations in Havertown, PA, Exton, PA, and Wilmington, DE. As part of his practice, Whalen used medications administrated by injection and infusion to treat his patients. These medications, including Remicade Synvisc, Synvisc-One, Orencia, Prolia/Xgeva, and Boniva, are made of living cells and are expensive. Rather than purchase FDA-approved versions of these medicines from authorized distributors, Whalen devised a scheme to purchase much cheaper foreign, non-FDA-approved versions of these medications. Unbeknownst to his patients, Whalen injected or infused them with the non-FDA-approved medications and then billed health care programs as if he had used the approved medications and pocketed approximately $1.1 million in illicit gains.

Whalen also prescribed oxycodone to patients abusing illicit drugs. Whalen admitted to unlawful distribution of a controlled substance to two of his patients to whom he prescribed oxycodone, despite receiving multiple urine drug screening results for each that revealed the patients simultaneously abused cocaine and heroin.

In December 2019, Whalen also pleaded guilty before United States District Court Judge Timothy J. Savage to related criminal charges of one count of health care fraud, one count of importation contrary to law, and two counts of distributing and dispensing oxycodone outside the course of professional practice and not for a legitimate medical purpose. He was sentenced this week to one day incarceration, followed by 12 months home confinement, three years supervised release and a $25,000 fine.

“Whalen prioritized lining his own pockets over his patient’s safety,” said U.S. Attorney McSwain. “By duping his patients and health care programs alike, he stole more than $1.1 million. On top of that, he also unlawfully distributed oxycodone to patients he knew were using cocaine and heroin. These are egregious, inexcusable violations of the trust that was placed in him as a medical professional.”

Regarding the resolution of the civil suit allegations, U.S. Attorney McSwain also stated: “This settlement illustrates my Office’s dedication to ensuring that physicians who engage in submission of false claims and the illegal distribution of opioids and other controlled substances are held accountable with all of our civil enforcement tools, as well as our criminal tools. My Office’s Health Care Fraud Strike Force, Civil Division, and Forfeiture staff continue to aggressively investigate doctors who violate their duties, so that we can deter and punish illegal opioid prescribing and health care fraud.”

“Dr. Whalen administered non-FDA approved drugs, which placed patients’ health at risk” said Special Agent in Charge Maureen Dixon of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Philadelphia Office. “Such medications are not paid for by Medicare due to the risk they may pose to patient health. HHS-OIG, along with our law enforcement partners, will continue to protect the public and root out dangerous and costly fraud schemes.”

“Dr. Whalen dispensed oxycodone, a highly addictive controlled substance medication, to individuals who he knew were already abusing cocaine and heroin. He did so without first establishing a professional doctor-patient relationship with these individuals and dispensed the oxycodone to them without any legitimate medical purpose. Instead of using his professional standing to help these individuals addicted to illicit street drugs, Dr. Whalen used his medical license to harm them in the name of making money, ” said Jonathan A. Wilson, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Philadelphia Field Division. “Whalen’s crimes enabled his patients’ substance use disorder rather than treating it appropriately.”

“The opioid epidemic that continues to spread across our nation is fueled by the illegal procurement and distribution of drugs such as OxyContin,” said Norbert E. Vint, Deputy Inspector General Performing the Duties of the Inspector General, OPM OIG. “Dr. Whalen’s scheme not only defrauded the federal health insurance carriers, but also put patients at grave risk through his unlawful distribution of controlled substances for no legitimate medical purpose. This guilty plea and settlement sends a clear message to those engaged in fraudulent conduct contributing to the opioid crisis that we will hold providers accountable. I applaud the hard work of our investigative staff and our law enforcement partners.”

“U.S. consumers rely on FDA oversight to ensure that the drugs they receive are safe and effective. Rogue health care professionals who obtain foreign unapproved medicines and then dispense and administer those drugs to their patients, put the health of those patients at significant risk,” said Special Agent in Charge Mark S. McCormack, FDA Office of Criminal Investigations Metro Washington Field Office. “We will continue to pursue and bring to justice those who choose to put the public’s health at such risk.”

The U.S. Department of Health and Human Services, Office of Inspector General; the Drug Enforcement Administration; Homeland Security Investigations; the Food and Drug Administration, Office of Criminal Investigations; the Office of Personnel Management, Office of Inspector General; and the Federal Bureau of Investigation all investigated the case. Trial Attorney Debra Jaroslawicz with the Criminal Division’s Fraud Section and Assistant United States Attorney Paul J. Koob prosecuted the criminal case. Assistant United States Attorney and Deputy Chief Charlene Keller Fullmer handled the civil case.

PHILADELPHIA – United States Attorney William M. McSwain announced that Jerry Zweitzig, 71, of Hatboro, PA, was sentenced to 200 years in prison and lifetime supervised release by United States District Court Judge Wendy Beetlestone for manufacturing and attempted manufacturing of child pornography. The charges stemmed from the defendant’s sexual abuse of an infant and a young girl under ten years of age, both of whom were in the defendant’s care at the time of the abuse. Zweitzig was a pastor at the Horsham Bible Church at the time of the abuse. He was sentenced for the charges in both cases today.

In the case involving the young girl, Zweitzig pleaded guilty to five counts of manufacturing and attempted manufacturing of child pornography and one count of possession of child pornography. The charges arose from the defendant’s sexual exploitation of the girl over a period of years, his photographing and videotaping of this sexual abuse, and his collection of more than 10,000 images of child pornography involving thousands of other children on four different hard drives found in his home. According to court documents, the collection included disturbing images of prepubescent children being raped by adult males, forced oral sex on babies and young girls by adult men and women, and insertion of objects into children – many of which show children crying and clearly in pain.

In the case involving the infant, Zweitzig pleaded guilty to one count of manufacturing and one count of attempted manufacturing of child pornography. The charges were based on a video that the defendant made in 2010 that depicts an infant under six months of age being coaxed to suck on adult male genitalia. In the video, Zweitzig’s voice can be heard repeatedly saying: “that’s a good boy.”

“The level of depravity in these cases leaves me almost speechless,” said U.S. Attorney McSwain. “I will simply say this: today’s sentence ensures that Zweitzig will die in prison, which is probably a better fate than he deserves.”

“Safeguarding children from being victimized by predators is a top priority for Homeland Security Investigations,” said Brian A. Michael, Special Agent in Charge of Homeland Security Investigations Philadelphia. “Mr. Zweitzig’s behavior is deplorable, and the exploitation of children is inexcusable. HSI special agents and our law enforcement partners will relentlessly pursue child predators, in every form, and ensure those who commit these atrocious crimes are brought to justice.”

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (“CEOS”), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

The case was investigated by the Department of Homeland Security, Homeland Security Investigations, the Horsham Police Department, and the Montgomery County District Attorney’s Office. It is being prosecuted by Assistant United States Attorney Eric L. Gibson.

PHILADELPHIA – United States Attorney William M. McSwain announced that Kevin Swing, a/k/a “Tone,” 36, of West Chester, PA, was sentenced to 6 ½ years in prison and three years of supervised release by United States District Judge H. Slomsky, for his role in distributing more than 900 pills containing a dangerous fentanyl analogue, a Schedule I controlled substance.

In January 2020, Swing pleaded guilty to conspiracy to distribute a substance containing a fentanyl analogue, as well as knowingly distributing a substance containing a fentanyl analogue, for his role in a scheme to sell fentanyl disguised as prescription oxycodone. On May 11, 2018, Swing used an intermediary to sell more than 900 pills containing the narcotic cyclopropyl fentanyl, a fentanyl equivalent, to his co-defendant Ryan Menkins, for $5,600. Each pill was imprinted with “ETH 446,” which is typically found on Oxycodone Hydrochloride 30 mg pills. In other words, the fentanyl pills were intentionally mislabeled as legitimate, prescription oxycodone pills. Co-defendant Menkins is currently scheduled for trial on December 14, 2020.

“It’s bad enough when legitimate prescription medication like oxycodone is misused and abused, but when a substance as dangerous as fentanyl is made to appear to be prescription medication, it can have disastrous consequences,” said U.S. Attorney McSwain. “Fentanyl and the misuse of opioids is killing our citizens, and Kevin Swing significantly contributed to our region’s opioid epidemic. Together with our law enforcement partners, my Office will do everything possible to stop the illegal distribution of these deadly drugs.”

“Thank you to the U.S. Attorney’s office for bringing justice to the citizens of Chester County by removing the defendant and his drug peddling from our streets,” said Chester County District Attorney Deb Ryan. “We must work together to keep our residents safe.”

“Kevin Swing was peddling pills that appeared to be standard oxycodone doses, but in fact contained a drug related to fentanyl,” said Michael J. Driscoll, Special Agent in Charge of the FBI's Philadelphia Division. “Anyone buying those pills would've been expecting one thing and getting another, with potentially deadly results. Drug dealers making money off the misery of others is bad enough, let alone this dangerous bait and switch. Taking Swing off the street should send a message that the FBI and our law enforcement partners continue to fight to make our communities safer in the face of the opioid epidemic.”

The case was investigated by the Federal Bureau of Investigation, Newtown Square Resident Agency and the West Whiteland Township Police Department, and is being prosecuted by Assistant United States Attorney Matthew T. Newcomer.

PHILADELPHIA – United States Attorney William M. McSwain announced that Ralph Johnson, 54, of Kinzers, PA, former Chief of Environmental Management Services at the Corporal Michael J. Cresenz Veterans Affairs Medical Center (VAMC) in Philadelphia, PA, was charged by Indictment for soliciting and accepting bribes in connection with contracts and purchase orders at the medical center.

As the Chief of Environmental Management Services, Johnson was responsible for a range of sanitation, waste removal, linen and uniform services for the Philadelphia VAMC, and participated in the solicitation and award of contracts to vendors for those services. According to the Indictment, Johnson is charged with asking for, and receiving, thousands of dollars in cash from two Florida-based companies in return for steering purchase orders and contracts to those companies several times from about July 2018 until August 2019. He is also charged with seeking a $10,000 kickback on an $84,000 contract for tree trimming and removal awarded to one of those vendors, for which Johnson had fraudulently and grossly inflated the estimate of the work to be done and the price for that work under the contract.

“The allegations here are shameful. By giving us their best, we owe our veterans the same in return. As a senior official tasked with maintaining a healthy and safe environment for the care and treatment of our nation’s veterans, Ralph Johnson had a responsibility to do that job with honesty and integrity,” said U.S. Attorney McSwain. “Rather than being concerned about serving our veterans, Johnson was allegedly concerned with serving himself by lining his own pockets at taxpayers’ expense.”

David Spilker, Special Agent in Charge at the Veterans Affairs Office of Inspector General (OIG) stated, “VA OIG will vigorously investigate alleged instances when government employees solicit and accept bribes and kickbacks from vendors and contractors who seek to obtain business with the VA. As alleged in the indictment, Johnson’s actions breached the public’s trust, undermined the integrity of VA’s operations, and besmirched the vital work that honest hardworking VA employees do every day in support of our nation’s veterans.” 

If convicted, the defendant faces a possible sentence of 45 years imprisonment, 3 years supervised release, and up to a $750,000 fine.

The case was investigated by the United States Department of Veteran Affairs, Office of Inspector General, and is being prosecuted by Assistant United States Attorney K.T. Newton.

PHILADELPHIA, PA – On September 14, 2020, United States Attorney William M. McSwain convened a press conference to announce charges against Khalif Tuggle and John Allen Kane, both of Philadelphia.  The United States Attorney’s Office stepped in to bring federal charges in both cases after the Philadelphia District Attorney’s Office failed to handle the local criminal cases appropriately.  U.S. Attorney McSwain also spoke about the ongoing escalation of violent crime in Philadelphia and its causes.  He highlighted several local cases in which the defendants received shockingly lenient plea deals from the Philadelphia District Attorney’s Office, returned to the streets and then allegedly committed murder.  These cases highlight an undeniable pattern of cause and effect in which the application of the District Attorney’s Office’s misguided policies produce violence and tragedy.

Remarks as Prepared for Delivery

Good morning.  I am here today to announce that my Office has unsealed two criminal indictments charging two individuals, Khalif Tuggle and John Allen Kane, with committing serious federal crimes on the streets of Philadelphia.  Both cases are part of my Office’s continuing efforts to fight the tidal wave of violent crime in the City that is the unfortunate result of local criminal justice policies that coddle violent criminals.  These policies create a culture of lawlessness; they leave criminals emboldened; and they have inevitable consequences – one of which is a murder rate in Philadelphia that is the highest it has been in nearly 15 years.

The two indictments announced today are the latest efforts by my Office to serve as a counterweight to this chaos.  First, Khalif Tuggle, age 28, has been charged in a three-count indictment with carjacking, use of a firearm in furtherance of a crime of violence, and murder in the course of using a firearm, all stemming from his alleged robbery, carjacking, and brutal murder of Thomas Petersen on January 24, 2017.  Tuggle allegedly fired a shot into Mr. Petersen’s chest, dragged him out of the car, threw him on the road, robbed him, and left him for dead while Mr. Petersen was screaming in pain.  Tuggle fled the scene in Mr. Petersen’s car, and Mr. Petersen died at Temple University Hospital after two Philadelphia Police Officers rushed him there from the crime scene.  If convicted on each count, Tuggle faces a statutory maximum sentence of life imprisonment.

Second, John Allen Kane, age 53, has been charged in a one-count Indictment with possession of a firearm by a convicted felon on January 17, 2018.  Kane allegedly possessed this firearm while on probation for committing his second homicide in Philadelphia.  If convicted, Kane faces a statutory maximum term of imprisonment of 10 years.

I would like to thank our law enforcement partners whose investigative work made these indictments possible.  From the Bureau of Alcohol, Tobacco, Firearms and Explosives, which investigated both cases, I want to thank John Schmidt, Special Agent in Charge of ATF’s Philadelphia Field Division, and the law enforcement agents who investigated the cases. I also want to thank the Philadelphia Police Department for its assistance in both cases.  And thank you to Sal Astolfi, the Chief of the Violent Crime unit in my Office, and Assistant United States Attorneys Joseph Labar, Michael Miller, and Tom Zaleski, who are prosecuting these important cases. 

Both the Tuggle and the Kane cases are prime examples of how local criminal justice policies benefit violent criminals and harm crime victims.  After Mr. Petersen was murdered in cold blood on January 24, 2017, the Philadelphia Police charged Tuggle with first degree murder, firearms offenses, theft, and receipt of stolen property, and he was held without bail until trial.  As Tuggle sat in jail awaiting trial for first degree murder, he caught a big break – in January 2018, there was a change in leadership in the District Attorney’s Office in Philadelphia: the Krasner administration took over.  This new administration subsequently agreed not to prosecute Tuggle for either first or second degree murder, thus eliminating the possibility that he would serve a life sentence for killing Mr. Petersen.  Instead, the District Attorney’s Office permitted Tuggle to plead guilty to third degree murder, ostensibly because he agreed to cooperate with investigators to identify and prosecute his accomplice.

But the plea negotiations were a farce.  For one thing, the District Attorney’s Office agreed to drop the most serious charges without bothering to negotiate a “floor” for the sentence -- a minimum term of years that Tuggle would be required to serve for murdering Mr. Petersen.  And incredibly, the District Attorney’s Office agreed to the deal without knowing whether the information Tuggle supposedly would provide would prove helpful, and without ensuring that Tuggle would actually identify his accomplice as promised.

In the end, he didn’t – and his accomplice remains on the loose.  In other words, Tuggle got a huge break for nothing.  The judge sentenced Tuggle to 13.5-27 years for third degree murder, and he will be eligible for parole in the state system in approximately ten years.  That sentence is a miscarriage of justice.  It is a cruel slap in the face to Mr. Petersen’s family – including his mother, Linda, and his sister, Heather, who are with us today for this announcement.  It is something that I am determined to fix.

If convicted on the federal charges, Tuggle faces the very real possibility of life in prison with no possibility of parole.

As for John Kane, as noted in publicly filed documents, the Philadelphia Police recovered a firearm in his possession after a traffic stop and placed him under arrest.  As a convicted felon, Kane was prohibited from possessing any firearms.  But he was not just any convicted felon – at the time of the traffic stop, he was on probation for committing his second homicide in Philadelphia.  But the District Attorney’s Office saw fit to voluntarily dismiss the charges against Kane on a technicality, and he walked free.  That is, until now: Kane has been arrested on the federal charge and is in federal custody.     

Armed murderers cannot be permitted to walk the streets of Philadelphia in the name of criminal justice reform.  The staggering homicide and shooting rates in Philadelphia are proof that the District Attorney’s radical experiment has failed.  Homicides, shootings, and serious violent crime have all skyrocketed in 2020 – from already intolerable levels that existed in 2019 and 2018.  There have been 316 homicides since the beginning of the year – a 32% increase as compared to this time last year.  The violence has been pervasive and it is destroying the soul of the City.  In the last month alone, 48 people have been killed and hundreds have been shot.  And the average age of the shooting victims is getting younger.  Tragically, the vast majority of the victims are racial minorities.  I can’t say it any clearer: the District Attorney’s policies come at the expense of minority communities. 

We can draw a straight line from these policies to the carnage on the streets.  My Office has examined the circumstances underlying many of the recent murder cases in the City and the inescapable conclusion is that a great number of these murders were made possible by the District Attorney’s Office’s willingness – indeed, its eagerness – to offer sweetheart plea deals to violent defendants.  Deals that allowed those defendants to quickly get back out on the street and kill.

On this adjacent chart are 10 examples of this sad state of affairs:

• In October 2018, Michael Banks was arrested and charged with multiple counts, including a felony gun charge for possessing an unlicensed firearm.  Banks also had prior convictions, and yet in February 2019, the Philadelphia District Attorney’s Office gave him a plea deal in which the felony gun charge was dismissed, and he received only 3-9 months of incarceration for a misdemeanor gun charge and immediately went back out on the street.  Banks now stands accused of murdering a seven year-old boy in West Philadelphia last month, who was playing with a toy on his family’s porch when two groups of men began firing upon one another and shot the boy in the head.

• In November 2017, Francisco Reyes was arrested and charged with multiple drug offenses.  Despite his prior convictions – which include aggravated assault, robbery, and multiple other prior drug offenses – Reyes was given a plea deal in July 2018 in which the felony drug charge was dismissed and he received probation.  Only two days after he pleaded guilty and received probation, on July 5, 2018, Reyes allegedly murdered a 25 year-old man in Kensington.

• In September 2018, Jerome Martin was arrested and charged with possession of a firearm by a felon, which is a felony.  He had previously been convicted of felony drug dealing and possessing drug paraphernalia.  Somehow, Martin was given a plea deal in June 2019 in which he was sentenced to house arrest.  While on house arrest, in August 2019, he allegedly broke into a house and murdered a 23 year-old man, who is survived by many, including his newborn baby.

• In February 2018, Keith Garner was arrested and charged with simple assault.  Despite having multiple prior felony convictions, Garner was given a plea deal in March 2018 to probation.  In November 2018, Garner executed four people in a West Philadelphia basement, and has been convicted of all four murders.

• In March 2017, Timothy Sherfield was arrested and charged with numerous violent crimes, including two counts of aggravated assault, two counts of robbery, burglary, possession of an unlicensed firearm, and many additional misdemeanors.  In February 2018, he was given a plea deal in which the vast majority of these charges were dropped. Sherfield received a minimum sentence of less than one year.  This enabled him to be out on the streets and murder a 23 year-old man in April 2019.  The victim was inside a mini market at the time that he was gunned down in cold blood.

• In May 2017, Tariq Gant was arrested and charged with a variety of violent crimes, including aggravated assault and firearm offenses.  But in February 2018, he was given a plea deal in which the vast majority of the charges were dropped.  Gant pleaded guilty to simple assault and resisting arrest, and received probation.  In September 2018, he allegedly murdered a 19 year-old young man in Germantown.  The victim is survived by his mother, who in addition to losing this son, also tragically lost another son who was gunned down earlier this year.

• In October 2017, Jose Lugo was arrested and charged with felony drug offenses.  Despite having previously been convicted of numerous felony drug crimes and carrying a firearm without a license, he was given a plea deal in September 2018 in which he was immediately released.  Just months later, in February 2019, Lugo allegedly murdered a 24 year-old man.

• In March 2018, Byron Taylor was arrested and charged with multiple offenses, including felony possession of an unlicensed firearm.  Despite his prior convictions, he was given a plea deal in May 2019 in which the felony gun charge was dismissed and he received probation.  Almost immediately, in July 2019, Taylor allegedly shot and killed a 35 year-old man in Germantown.

• In January 2018, Rasheed Malcolm was arrested and charged with multiple offenses, including aggravated assault, simple assault, and recklessly endangering another person.  Despite his prior felony drug distribution convictions, he was given a plea deal in which all of these charges were dropped, and he was permitted to plead guilty to the summary offense of disorderly conduct.  By the end of the year, in December 2018, Malcolm allegedly murdered a 27 year-old man in the 6200 block of Market Street.

• In June 2018, Maalik Jackson-Wallace was arrested and charged with multiple offenses, including felony possession of a firearm without a license.  The District Attorney’s Office then selected him to participate in its Accelerated Rehabilitative Disposition program (ARD) – a diversion program in which defendants can avoid a conviction if they comply with certain conditions.  This diversion allowed Jackson-Wallace to walk away free.  He was then arrested with a second illegal firearm while in the program, but the District Attorney’s Office did not move for him to be taken out of ARD at that time.  In June 2019, Jackson-Wallace allegedly murdered a 26 year-old man in the Frankford section of Philadelphia.    

Each of these cases is its own separate tragedy, with terrible ramifications that extend in many directions.  And these ten cases only scratch the surface of the devastation that is being wrought by the District Attorney’s policies.  The cases are merely examples – there are many others like these, in which violent defendants who should not be on the street are committing murder or other violent crimes.  Furthermore, these are cases that have led to murder arrests.  Most homicides in the City do not even result in an arrest, so it is chilling to think of the number of unsolved murders that have likely been committed by violent criminals who do not belong on the street – and are only there because the District Attorney put them there.

As I have said before, everybody in Philadelphia deserves to live in a safe neighborhood – regardless of race or income level.  We won’t get there by treating violent criminals like they are victims, or by undermining law enforcement.  We must have the courage and the will to enforce the law – and to hold criminals accountable.  The future of our City depends upon it.  We must put the law-abiding residents of this City first.  Thank you.

PHILADELPHIA – United States Attorney William M. McSwain announced that Khalif Tuggle, 28, and John Allen Kane, 53, both of Philadelphia, PA, were arrested and charged by federal Indictment after their local cases were mishandled by the District Attorney’s Office. In a press conference outside the federal courthouse, U.S. Attorney McSwain discussed the charges against Tuggle and Kane in the context of efforts by his Office to fight the tidal wave of violent crime that has engulfed Philadelphia in 2020.

Tuggle has been charged in a three-count Indictment with carjacking, use of a firearm in furtherance of a crime of violence, and murder in the course of using a firearm, all stemming from his alleged robbery, carjacking, and brutal murder of Thomas Petersen on January 24, 2017. Tuggle allegedly fired a shot into Mr. Petersen’s chest, dragged him out of the car, threw him on the road, robbed him, and left him for dead while Mr. Petersen was screaming in pain. Tuggle fled the scene in Mr. Petersen’s car, and Mr. Petersen died at Temple University Hospital after two Philadelphia Police Officers rushed him there from the crime scene.

Kane has been charged in a one-count Indictment with possession of a firearm by a convicted felon on January 17, 2018. Kane allegedly possessed this firearm while on probation for committing his second homicide in Philadelphia.

U.S. Attorney McSwain explained thatthese cases are prime examples of how local criminal justice policies benefit violent criminals and harm crime victims. In the Tuggle case, the District Attorney’s Office agreed not to prosecute the defendant for either first or second degree murder in exchange for information on Tuggle’s accomplice that never materialized – thus eliminating the possibility that Tuggle would serve a life sentence for killing Petersen. Under his current sentence, Tuggle would be eligible for parole in approximately only ten years. If convicted of the federal charges, he faces the possibility of life imprisonment.

In the Kane case, the Philadelphia Police recovered a firearm in the defendant’s possession after a traffic stop and placed him under arrest. As a convicted felon, Kane was prohibited from possessing any firearms. But he was not just any convicted felon – at the time of the traffic stop, he was on probation for committing his second homicide in Philadelphia. But the District Attorney’s Office saw fit to voluntarily dismiss the charges against Kane on a technicality and he walked free. That is, until now: Kane has been arrested on the federal charge and is in federal custody.

“The federal cases against defendants Tuggle and Kane are the latest efforts by my Office to serve as a counterweight to the chaos in Philadelphia created by local criminal justice policies that coddle violent criminals,” said U.S. Attorney McSwain. “These policies create a culture of lawlessness; they leave criminals emboldened; and they have inevitable consequences – one of which is a murder rate in Philadelphia that is the highest it has been in nearly 15 years.”

U.S. Attorney McSwain went on to detail ten additional cases that are examples of shockingly lenient plea deals given out by the Philadelphia District Attorney’s Office where the defendant was subsequently arrested for murder.

• In October 2018, Michael Banks was arrested and charged with multiple counts, including a felony gun charge for possessing an unlicensed firearm. Banks also had prior convictions, and yet in February 2019, the Philadelphia District Attorney’s Office gave him a plea deal in which the felony gun charge was dismissed, and he received only 3-9 months of incarceration for a misdemeanor gun charge and immediately went back out on the street. Banks now stands accused of murdering a seven year-old boy in West Philadelphia last month, who was playing with a toy on his family’s porch when two groups of men began firing upon one another and shot the boy in the head.

• In November 2017, Francisco Reyes was arrested and charged with multiple drug offenses. Despite his prior convictions – which include aggravated assault, robbery, and multiple other prior drug offenses – Reyes was given a plea deal in July 2018 in which the felony drug charge was dismissed and he received probation. Only two days after he pleaded guilty and received probation, on July 5, 2018, Reyes allegedly murdered a 25 year-old man in Kensington.

• In September 2018, Jerome Martin was arrested and charged with possession of a firearm by a felon, which is a felony. He had previously been convicted of felony drug dealing and possessing drug paraphernalia. Somehow, Martin was given a plea deal in June 2019 in which he was sentenced to house arrest. While on house arrest, in August 2019, he allegedly broke into a house and murdered a 23 year-old man, who is survived by many, including his newborn baby.

• In February 2018, Keith Garner was arrested and charged with simple assault. Despite having multiple prior felony convictions, Garner was given a plea deal in March 2018 to probation. In November 2018, Garner executed four people in a West Philadelphia basement, and has been convicted of all four murders.

• In March 2017, Timothy Sherfield was arrested and charged with numerous violent crimes, including two counts of aggravated assault, two counts of robbery, burglary, possession of an unlicensed firearm, and many additional misdemeanors. In February 2018, he was given a plea deal in which the vast majority of these charges were dropped. Sherfield received a minimum sentence of less than one year. This enabled him to be out on the streets and murder a 23 year-old man in April 2019. The victim was inside a mini market at the time that he was gunned down in cold blood.

• In May 2017, Tariq Gant was arrested and charged with a variety of violent crimes, including aggravated assault and firearm offenses. But in February 2018, he was given a plea deal in which the vast majority of the charges were dropped. Gant pleaded guilty to simple assault and resisting arrest, and received probation. In September 2018, he allegedly murdered a 19 year-old young man in Germantown. The victim is survived by his mother, who in addition to losing this son, also tragically lost another son who was gunned down earlier this year.

• In October 2017, Jose Lugo was arrested and charged with felony drug offenses. Despite having previously been convicted of numerous felony drug crimes and carrying a firearm without a license, he was given a plea deal in September 2018 in which he was immediately released. Just months later, in February 2019, Lugo allegedly murdered a 24 year-old man.

• In March 2018, Byron Taylor was arrested and charged with multiple offenses, including felony possession of an unlicensed firearm. Despite his prior convictions, he was given a plea deal in May 2019 in which the felony gun charge was dismissed and he received probation. Almost immediately, in July 2019, Taylor allegedly shot and killed a 35 year-old man in Germantown.

• In January 2018, Rasheed Malcolm was arrested and charged with multiple offenses, including aggravated assault, simple assault, and recklessly endangering another person.  Despite his prior felony drug distribution convictions, he was given a plea deal in which all of these charges were dropped, and he was permitted to plead guilty to the summary offense of disorderly conduct. By the end of the year, in December 2018, Malcolm allegedly murdered a 27 year-old man in the 6200 block of Market Street.

• In June 2018, Maalik Jackson-Wallace was arrested and charged with multiple offenses, including felony possession of a firearm without a license. The District Attorney’s Office then selected him to participate in its Accelerated Rehabilitative Disposition program (ARD) – a diversion program in which defendants can avoid a conviction if they comply with certain conditions. This diversion allowed Jackson-Wallace to walk away free. He was then arrested with a second illegal firearm while in the program, but the District Attorney’s Office did not move for him to be taken out of ARD at that time. In June 2019, Jackson-Wallace allegedly murdered a 26 year-old man in the Frankford section of Philadelphia.

“Convicted felons who carry firearms pose a serious risk to public safety,” said John Schmidt, acting Special Agent in Charge of ATF’s Philadelphia Field Division. “ATF will continue to aggressively pursue these investigations and strive to be ‘no better partner’ to our local, state and federal colleagues. Thanks to the diligent work of the investigators and detectives of the Philadelphia Police Department, these individuals will be brought to justice preventing another potential violent crime or death. I would like to thank the U.S. Attorney's Office for their guidance and work prosecuting these cases.”

If convicted on each count, Tuggle faces a total maximum sentence of life imprisonment, five years of supervised release, a $750,000 fine, and a $300 special assessment; Kane faces a statutory maximum term of imprisonment of 10 years, three years of supervised release, a $250,000 fine, and a $100 special assessment.

Both cases were investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case against Tuggle is being prosecuted by Assistant United States Attorneys Joseph LaBar and Michael Miller, and the case against Kane is being prosecuted by Assistant United States Attorney Thomas Zaleski.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that three men, Andre Michael Felts, 32, Kevin Michael Francis, 60, and Ryan Keel, 39, all of Philadelphia, PA, were charged by Indictment for their roles in a sex trafficking operation that exploited numerous minor children from 2016 through 2017. Felts was detained pending trial this afternoon, joining his co-defendants, who are also in federal custody. All three defendants were charged with one count of conspiracy to sex traffic a minor, while Felts and Francis were also each charged with four counts of sex trafficking a minor.

The Indictment alleges that Felts ran a prostitution ring that recruited and enticed young girls, including one who was only fifteen years old, to engage in commercial sex acts; harbored the victims at various residences for that purpose; transported and provided the victims to males who purchased the commercial sex acts; and collected a portion of the proceeds. Further, Keel and Felts allegedly had explicit discussions via Facebook Messenger about the commercial sex acts occurring at the residences. At least one of the victims was also a victim of physical violence during the operation of the trafficking ring: according to public filings, Felts pulled her from a vehicle and repeatedly stomped on her.

“The allegations against these three men are vile and disturbing. I am gratified that the defendants are all now off the streets and in custody pending trial on these charges,” said U.S. Attorney McSwain. “Working with our federal partners, we will do all that we can to keep criminals who sell the bodies of children for their own profit securely behind bars so they can do no more harm.”

“To advertise underage girls for sex, to willfully pimp them out for profit, is heinous,” said Michael J. Driscoll, Special Agent in Charge of the FBI's Philadelphia Division. “Those who so victimize vulnerable kids do untold physical and emotional harm. Make no mistake, the Philadelphia Child Exploitation Task Force is working each and every day to lock up sex traffickers and other predators preying on innocent children.”

This investigation is a part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and 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, each defendant faces a maximum possible sentence of lifetime imprisonment.

The case was investigated by the Federal Bureau of Investigation with assistance from the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Sara Solow and Trial Attorney Jessica Urban of the Department of Justice Criminal Division’s Child Exploitation and Obscenity Section (CEOS).

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that Aleksandar Kavaja, 27, of the Balkan country Montenegro, pleaded guilty before United States District Court Judge Harvey Bartle III to charges of conspiracy to possess with intent to distribute 5 kilograms or more of cocaine on a vessel subject to the jurisdiction of the United States.

In 2019, Kavaja, a crew member who worked on board the shipping vessel MSC Gayane as the ship’s electrician, conspired with others to engage in bulk cocaine smuggling. On multiple occasions during the MSC Gayane’s voyage at sea, crew members, including Kavaja, helped load huge quantities of cocaine onto the ship from speedboats that approached under cover of darkness, traveling at high speeds. Crew members used the Gayane’s crane to hoist cargo nets full of packaged cocaine onto the vessel and then stashed the drugs in various shipping containers.

On June 17, 2019, federal, state, and local law enforcement agents boarded the MSC Gayane when it arrived at Packer Marine Terminal in the Port of Philadelphia and seized approximately 20 tons of cocaine on the ship -- with a street value of over $1 billion. This was one of the largest drug seizures in U.S. history.

“This momentous drug bust sent a clear message to criminals around the world that our city is not a safe harbor for their deadly drug trafficking,” said U.S. Attorney McSwain. “Prosecutors in my Office, in conjunction with our partner agencies, have been working non-stop for over a year to pursue justice in this case. And now another member of the conspiracy has been convicted and held accountable.”

“Protecting the Homeland against transnational crime is a top priority of Homeland Security Investigations,” said Brian A. Michael, Special Agent in Charge of Homeland Security Investigations Philadelphia. “Mr. Kavaja’s guilty plea is yet another example of HSI, our law enforcement partners, and the U.S. Attorney’s Office for the Eastern District of Pennsylvania working hand in hand to safeguard our community against transnational drug smuggling.”

“Mr. Kavaja’s guilty plea is the logical result from his participation in what remains a record cocaine seizure for CBP,” said Casey Durst, CBP’s Director of Field Operations in Baltimore. “Successful prosecutions reinforce the notion that suspects caught smuggling illegal drugs through our communities face severe, life-changing consequences.”

The defendant faces a maximum possible sentence of lifetime imprisonment.

The case is being investigated by United States Homeland Security Investigations and the United States Customs and Border Protection, together with a multi-agency team of federal, state, and local partners.

PHILADELPHIA – United States Attorney William M. McSwain announced that Vanessa O’Rourke, 32, formerly of Harleysville, PA, and last known to be residing in Queensland, Australia, was charged by Indictment with wire fraud in connection with falsely stating that she had cancer in order to solicit donations, including on gofundme.com. The Indictment was previously under seal and was unsealed earlier today.

The Indictment alleges that from approximately October 2015 through July 2016, O’Rourke falsely represented to others that she had a terminal form of brain cancer known as “Glioblastoma.” The defendant also allegedly lied about needing to raise money to travel to Australia to receive experimental cancer treatments. Based on these and other allegedly false representations, more than 140 people donated a total of $11,740 to O’Rourke’s fundraising campaign through gofundme.com, a legitimate online fundraising platform. The Indictment also alleges that while O’Rourke did travel to Australia, she did not receive any cancer treatment while she was there and instead used the donated money for personal expenses, including a variety of leisure activities.

“The allegations in this case are nauseating,” said U.S. Attorney McSwain. “O’Rourke is charged with preying upon the kindness and generosity of good people who wished to help those in need. As alleged, there was no need here – only lies, greed and callous manipulation.”

“Misleading people about a significant medical diagnosis in order to take advantage of their kind hearts and open wallets is reprehensible,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “As alleged, Vanessa O’Rourke scammed friends and family alike, convincing them to donate money toward her supposed medical care. Instead, those funds supported her lifestyle and leisure. When someone commits such financial fraud, the FBI and our law enforcement partners will work to hold them accountable.”

The case was investigated by the Federal Bureau of Investigation and the Towamencin Township Police Department, and is being prosecuted by Assistant United States Attorney Kevin Jayne.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

Three Philadelphia men were charged, by a federal grand jury, in an indictment unsealed today in the Eastern District of Pennsylvania for their roles in a sex trafficking operation that exploited numerous minors from 2016 through 2017.

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 Michel J. Driscoll of the FBI’s Philadelphia Field Division made the announcement.

Andre Michael Felts, aka “Dre” and “Plug,” 32, and Kevin Michael Francis, aka “Kev,” 60, were each charged with one count of conspiracy to sex traffic a minor and four counts of sex trafficking a minor.  Ryan Keel, 39, was charged with conspiracy to sex traffic a minor.

The indictment alleges that Felts ran a prostitution ring that recruited and enticed young females, including minors, to engage in commercial sex acts; harbored the victims at various residences for that purpose; transported and provided the victims to males who purchased the commercial sex acts; and collected a portion of the proceeds.

The charges and allegations contained in an indictment are merely accusations.  The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

Trial Attorney Jessica Urban of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Sara Solow of the Eastern District of Pennsylvania are prosecuting the case.  The FBI’s Philadelphia Field Division is investigating the case and received significant assistance from the Philadelphia Police Department. 

This investigation was a part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice.  Led by U.S. Attorneys’ Offices and 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 year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

PHILADELPHIA – United States Attorney William M. McSwain announced that Specialty Disposal Services, Inc., a controlled substance disposal company with its principal place of business in New Jersey, will pay $137,500 and enter into an administrative memorandum of agreement with the Drug Enforcement Administration to resolve allegations that the company negligently failed to complete required records regarding the disposal of certain controlled substances.

Specialty Disposal Services (SDS) is registered with the DEA as a reverse distributor. The settlement announced today resolves allegations that SDS negligently failed to make and keep records required by the Controlled Substances Act for reverse distributors arising from SDS’s transportation of controlled substances to a third-party facility in Morrisville, PA. In particular, the settlement resolves allegations that SDS negligently failed to properly complete the DEA form requiring verification that SDS’s employees witnessed the destruction of the controlled substances, which ultimately led to some of those controlled substances being subject to diversion by employees of the third-party facility. There are no allegations, however, that SDS was aware of or involved in the diversion. The settlement resolves liability for SDS’s record-keeping from January 9, 2017 through September 30, 2018.

In addition to the $137,500 civil penalty, SDS entered into an administrative agreement with the DEA, in which it agreed to various compliance and monitoring measures such as ensuring its compliance with these regulatory obligations. SDS and the third-party facility cooperated with the government’s investigation.

“The accountability and record-keeping requirements imposed by the DEA for companies that handle controlled substances are critical in preventing diversion,” said U.S. Attorney McSwain. “This civil settlement acknowledges the important responsibilities that all controlled substance disposal companies have to comply with those requirements and to do their part to prevent controlled substances from falling into the wrong hands.”

“Reverse distributors like Specialty Disposal Services play an important role in the closed distribution system of pharmaceutical controlled substances,” said Jonathan A. Wilson, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Philadelphia Field Division. “As such, their observation and documentation of the proper disposal of these same substances are essential to their responsibilities under the Controlled Substances Act.”

The civil investigation was conducted by the Philadelphia Field Division of the Drug Enforcement Administration. For the United States Attorney’s Office, Assistant United States Attorney Anthony D. Scicchitano handled the investigation and settlement.

The claims resolved by the settlement are allegations only; there has been no determination of liability and no admission of any facts.

PHILADELPHIA – United States Attorney William M. McSwain announced that Melissa Madera, 27, of Reading, PA pleaded guilty before United States District Court Judge Joseph F. Leeson, Jr. to multiple child exploitation and pornography offenses.

In August 2019, the defendant was charged by Indictment with two counts of sex trafficking minors, and one count each of distribution, receipt, and possession of child pornography. The charges stem from Madera’s trafficking of two children, 15-year-old and 17-year-old girls, from about August until October 2017. Madera forced the girls to engage in commercial sex for her own financial gain, and also plied the minors with drugs like Ecstasy and cocaine to ensure their compliance. Sometimes the girls would not make it to school the following day because they had been given so many drugs the previous night.

Madera also obtained a sexually explicit image of one of the girls and used it in a commercial sex trafficking website, advertising the minor for commercial sex acts using locations like the Quality Inn in Wyomissing, PA, and the Days Inn, Kleins’ Motel and Roadway Inn, all in Reading, PA. The defendant would rent two rooms at the hotel: one room was for the commercial sex acts and Madera would stay in the other after meeting the sex buyers and charging a fee of $200 per hour. After the 15-year-old’s mother reported her missing to the Reading Police Department in October 2017, Madera confronted the girl and assaulted her, stating “This is what you get for being a rat.”

“Sex trafficking is a serious problem in the Eastern District of Pennsylvania and we are committed to rooting it out,” said U.S. Attorney McSwain. “Here, Madera advertised children like objects to be sold online and gave them drugs so that they weren’t in their right minds. This is a parent’s worst nightmare.”

“Predators come in many different forms,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “Make no mistake, Melissa Madera fits that bill. She has now admitted to selling minors for sex, drugging them to maintain control of their minds and bodies. Such despicable treatment does serious lasting harm. The FBI is committed to finding and freeing trafficking victims and holding their tormentors accountable.”

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Sherri A. Stephan.

PHILADELPHIA – United States Attorney William M. McSwain announced that Keystone Health Plan East, Inc. and QCC Insurance Company, Inc. (collectively referred to as “KHPE/QCC”), on behalf of parent company Independence Blue Cross, LLC (“IBC”), operator of Medicare Advantage plans, have agreed to pay a total of $2,250,000 plus interest to resolve False Claims Act allegations of incorrectly calculating anticipated plan costs, resulting in inflated Medicare Advantage plan bids to the Centers for Medicare and Medicaid Services (“CMS”).

IBC operates a number of Medicare Advantage plans for Medicare beneficiaries, and is reimbursed by CMS, which pays IBC’s subsidiaries KHPE/QCC. Medicare Advantage plans are also sometimes called “Part C” or “MA Plans,” and include bundled coverage for Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance), and usually Medicare prescription drugs (Part D). KHPE/QCC submits annual bids that include anticipated costs for each Medicare Advantage plan to be offered the following year. The government alleges that KHPE/QCC incorrectly calculated its actual prior costs in the financial plan bids submitted to CMS for contract years 2009 and 2010. The incorrect and inflated prior cost data resulted in higher base amounts in KHPE/QCC’s Medicare Advantage plan bids, causing CMS to pay inflated reimbursement to KHPE/QCC. The United States contends that these claims were false in light of defendant’s conduct.

This settlement resolved a lawsuit filed under the False Claims Act in the U.S. District Court for the Eastern District of Pennsylvania by an employee of IBC. Under the qui tam (or whistleblower) provisions of the False Claims Act, private citizens are permitted to bring lawsuits on behalf of the United States and obtain a portion of the government’s recovery. The False Claims Act also permits the government to intervene and take over the lawsuit, which occurred in this case. The whistleblower in this case, Mr. Eric Johnson, will receive $499,438.05 as his share of the recovery.

“Investigating credible allegations of fraud against federal healthcare programs saves taxpayer dollars, especially in complex Medicare Advantage Part C cases such as this, when the alleged conduct has potential implications for Medicare beneficiaries and drives up the cost of Medicare Advantage plans,” said U.S. Attorney McSwain. “Medicare Advantage plan operators must know the CMS contracting rules, and the proper presentation of claims costs required by those programs, and abide by them.”

“Today’s settlement represents significant teamwork and shows our commitment to investigating all potential allegations of fraud against the Medicare Part C Programs, no matter how complex,” said Maureen R. Dixon, Special Agent in Charge of the Office of the Inspector General, Department of Health and Human Services. “We will continue to partner with the United States Attorney’s Office to evaluate allegations brought under the False Claims Act to ensure the integrity of Medicare programs.”

The government’s pursuit of these matters illustrates its emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services (“HHS”), at 1-800‑HHS‑TIPS (1-800-447-8477).

This matter was investigated by the U.S. Attorney’s Office for the Eastern District of Pennsylvania, in conjunction with the U.S. Department of Health and Human Services Office of Inspector General. The lawsuit is captioned United States ex rel. Eric Johnson v. Independence Blue Cross, Civ. Action No. 10-CV-1520 (E.D. Pa.). Assistant U.S. Attorneys Viveca D. Parker and Eric D. Gill handled the case in the Eastern District of Pennsylvania, with assistance from auditor Dawn Wiggins.

The claims resolved by this settlement are allegations only and there has been no determination of liability.

PHILADELPHIA – United States Attorney William M. McSwain announced that Justin O’Brien, 33, of Philadelphia, PA, was sentenced to 10 years and 10 months in prison, three years of supervised release, and ordered to pay $7,244 in restitution by United States District Court Judge Nitza I. Alejandro-Quinones for armed bank robbery.

In December 2019, O’Brien pleaded guilty to committing an armed bank robbery on March 12, 2019, taking $1,260 from an employee of Firstrust Bank on Lancaster Avenue in Bryn Mawr, PA. The defendant also admitted to committing an assault by the use of a dangerous weapon – namely, a facsimile firearm (pellet gun).

As part of the plea agreement, O’Brien also acknowledged his guilt for five other bank robberies, and agreed that the Court could sentence him as if he had been convicted of these crimes: 1) the October 29, 2018 bank robbery of the Tompkins VIST Bank on Verree Road in Philadelphia, resulting in a loss of approximately $1,880; 2) the November 9, 2018 bank robbery of the M&T Bank on Frankford Avenue in Philadelphia, resulting in a loss of approximately $451; 3) the March 1, 2019 armed bank robbery of the Firstrust Bank on Krewstown Road in Philadelphia, resulting in a loss of approximately $975; 4) the March 8, 2019 armed bank robbery of the Tompkins VIST Bank on West Lancaster Avenue in Radnor Township, resulting in a loss of approximately $600; and 5) the March 18, 2019 bank robbery of the PNC Bank on Market Street in Philadelphia, resulting in a loss of approximately $2,078.

“O’Brien’s bank robbery spree terrorized innocent employees and showed a contempt for the law,” U.S. Attorney McSwain. “But federal crime means federal time, and now O’Brien has earned a long stint behind bars. My Office’s anti-violence public awareness campaign warns against the serious consequences of committing violent crime in the Eastern District of Pennsylvania. You can learn more about this campaign on our District website.”

“Thanks to the hard work of the Philadelphia FBI and its local partners, Justin O’Brien will no longer be in a position to terrorize the community,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “While today’s sentence cannot undo the harm O’Brien caused his victims, it sends a message that if you commit a violent crime, the FBI and our law enforcement partners will work tirelessly to bring you to justice.”

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, the Lower Merion Township Police Department, the Philadelphia Police Department, and the Radnor Township Police Department. It is being prosecuted by Assistant United States Attorney Thomas M. Zaleski.

PHILADELPHIA – United States Attorney William M. McSwain announced that Antoine Clark, 31, of Philadelphia, PA, was sentenced to 25 years in prison, 10 years of supervised release, and ordered to pay a $1,700 fine by United States District Court Judge Gerald J. Pappert for multiple narcotics offenses related to his role in leading an almost around-the-clock drug delivery service for several years in South Philadelphia.

Clark and his codefendants, Gerald Spruell, 33, and Daniel Robinson, 37, were convicted after more than two weeks at trial of charges that included conspiracy to distribute controlled substances, and distribution or possession with intent to distribute crack cocaine and heroin.

Between 2014 and 2016, the defendant and his co-conspirators, including Spruell, Robinson, and several others who pleaded guilty to similar charges before trial, were known as the “Friends” and the “7th Street” drug trafficking group. Members of the group delivered crack cocaine and heroin to customers along the 7th Street corridor in South Philadelphia using a shared drug phone to take orders and communicate with customers; they would pass the phone off in shifts to keep their operation going almost 24 hours per day. During the course of the investigation, FBI agents intercepted phone calls and text messages from the phone, which documented the defendants’ illicit activities.

“Drug trafficking is an insidious, dangerous activity that ruins neighborhoods,” said U.S. Attorney McSwain. “Antoine Clark was an expert at it, and now he will pay the price -- to the tune of 25 years. That is the sort of just punishment that awaits drug dealers in federal court. My Office is determined to protect communities ravaged by the drug trade by investigating and destroying drug trafficking organizations like the 7th Street organization.”

“The FBI is committed to keeping communities safe from predators like Antoine Clark,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division.  “Today’s sentence sends the message to drug organizations and gang members that if you traffick in illegal drugs, we will hunt you down and bring you to justice.”

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorneys Matthew Newcomer and Jason Grenell.

PHILADELPHIA – United States Attorney William M. McSwain announced that Lamar Tindall, 45, of Philadelphia, PA, was sentenced to 12 years in prison, three years of supervised release, and was ordered to pay $2,955 in restitution by United States District Court Judge Joshua D. Wolson for robbing three separate BB&T Banks over a period of ten days in May 2019.

In January 2020, Tindall pleaded guilty to three counts of bank robbery, arising from his robberies of BB&T Banks in Philadelphia on May 14, 2019; Feasterville on May 17, 2019; and King of Prussia on May 23, 2019. During each robbery, Tindall handed a threatening note to a teller in order to receive money. For example, during the robbery on May 14, Tindall handed the frightened teller a note that read, “all 50’s and 100’s or ill shoot.” Tindall made off with a total of $3,650 as a result of these robberies. Philadelphia Police Department officers later arrested Tindall, who confessed to his crimes.

Tindall has a long rap sheet, which includes convictions for drug distribution offenses in 1999 and 2010, and a conviction for robbery of property of the United States in 2002. Because of his criminal history, the Court found Tindall to be a “Career Offender” under the U.S. Sentencing Guidelines.

“Robbing any type of business – whether it’s a bank, a corner store, or anything in between – is a serious federal offense that can carry stiff penalties, as Tindall can now attest,” said U.S. Attorney McSwain. “And even the threat of having and using a firearm during a robbery, regardless of whether or not you actually have one, will multiply the penalty. I want people to know that committing a violent crime in the Eastern District of Pennsylvania carries a tremendous risk of a long prison sentence, which is the point of our anti-violence public awareness campaign. You can learn more about this campaign on our District website.”

“Serial bank robbers like Lamar Tindall terrorize our communities,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division.  “I would like to thank our law enforcement partners who assisted in bringing Mr. Tindall to justice and making our community safer.”

The case was investigated by the Federal Bureau of Investigation, with assistance from the Abington Township Police Department, the Conshohocken Police Department, the Lower Southampton Township Police Department, the Philadelphia Police Department, and the Upper Merion Township Police Department. The case is being prosecuted by Assistant United States Attorneys Lauren R. Baer and Kevin Jayne.

PHILADELPHIA – United States Attorney William M. McSwain announced that Jennifer D’Hulster, 37, of Coatesville, PA; Zachary Gathercole, 30, of Sadsburyville, PA; Ashley Harrington, 30, of West Chester, PA; and Anthony Schweitzer, 20, also of Coatesville, PA, were charged by Complaint with fraudulently obtaining and attempting to obtain unemployment benefits related to COVID-19 emergency relief funds to which they were not entitled. Defendant D’Hulster was arrested and taken into custody this morning; the other three defendants were already in custody. All four defendants made their initial appearances in federal court today.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was signed into law. The CARES Act created the Pandemic Unemployment Assistance  (PUA) program, which provides unemployment benefits to individuals not eligible for regular unemployment compensation or extended unemployment benefits, including individuals, families, and businesses affected by the COVID-19 pandemic. Eligibility to receive weekly PUA benefits was predicated on the applicant’s unemployment for reasons related to the pandemic; however, the applicant must also have been able to work each day and, if offered a job, the applicant must have been able to accept it. Once the applicant was approved to receive benefits, the applicant was required to submit weekly certifications that indicated that he or she: was ready, willing and able to work each day; was seeking full time employment; did not refuse any job offers or referrals; and, had reported any employment during the week and the gross pay or other payments received.

The Complaint alleges that D’Hulster and Harrington assisted individuals incarcerated at Chester County Prison and other correctional institutions in fraudulent efforts to obtain Pandemic Unemployment Assistance (PUA) benefits. Harrington enabled Gathercole, who was incarcerated at Chester County Prison prior to the onset of the pandemic, to receive approximately $12,865. D’Hulster and Gathercole enabled another unidentified inmate to receive approximately $11,410 and attempted to obtain PUA benefits for another inmate. Schweitzer did not actually receive any PUA benefits, but attempted to several times. The inmates were not eligible to receive PUA benefits because they did not meet the eligibility requirements -- namely, they were not able to report to a job each day because of their incarceration.

“Sadly, fraudsters consider a national public health crisis as an opportunity to cash in,” said U.S. Attorney McSwain. “That callous attitude rips off honest taxpayers who fund relief programs and also makes it much more difficult to provide funds to those who deserve and need them. My Office will do everything in its power to ensure that coronavirus fraud scams are stopped and punished.”

“Unemployment insurance fraud has risen sharply during the COVID-19 pandemic, and investigating these types of schemes remains a priority for the Office of Inspector General. We will continue to work with our law enforcement partners to aggressively pursue allegations of criminal conduct against the Unemployment Insurance program,” said Derek Pickle, Acting Special Agent-in-Charge, Philadelphia Region, U.S. Department of Labor Office of Inspector General.

“At the end of March, 2020, the United States Government invested billions of dollars in helping its citizens through the pandemic,” said Postal Inspector in Charge Damon Wood.  “From the beginning, Postal Inspectors in Philadelphia, and across the country, have worked to do our part in ensuring that those investments in the American public do not fall into the hands of fraudsters and con artists.  I hope that the charges announced today serve as a deterrence to those who think that stealing or obtaining funds fraudulently from the most vulnerable amongst us, pays; it doesn’t.  As always, I want to thank the other agencies that assisted in this investigation and the United States Attorney’s Office which supported the investigation and will see the prosecution through.”

If convicted of the conspiracy and fraud in connection with emergency benefits charges, D’Hulster, Gathercole, Harrington, and Schweitzer each face up to 60 years’ imprisonment, a $2,000,000 fine, and five years of supervised release following any imprisonment.­ 

This case was investigated by the United States Department of Labor – Office of Inspector General, the United States Postal Inspection Service, and the Pennsylvania Department of Labor and Industry, assisted by Chester County Prison. The case is being prosecuted by Assistant United States Attorney Anita Eve.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form. 

Assistant Attorney General for National Security John C. Demers and U.S. Attorney for the Eastern District of Pennsylvania William M. McSwain announced that the following defendants were indicted on charges of conspiracy, violating the International Emergency Economic Powers Act (IEEPA), and money laundering conspiracy based on their attempt to transact in sanctioned Iranian petroleum:

• Nicholas Hovan, 34, of New York, NY;
• Zhenyu Wang, aka “Bill Wang,” 39, of Dallas, TX;
• Robert Thwaites, 30, of Dallas, TX; and
• Daniel Ray Lane, 39, of McKinney, TX.

“The defendants in this case allegedly conspired to sell Iranian petroleum to a Chinese refinery in order to enrich themselves at the expense of the US Iran sanctions regime,” said Assistant Attorney General Demers.  “The defendants devised a scheme to use front companies, bribes, and false contractual documents in order to conceal their brazenly illicit activity.  We will continue to leverage all of our tools to detect and prevent individuals such as these from engaging in actions that would have harmed the national security of this nation.”

“It doesn’t get much lower than attempting to get rich by flouting the United States’ national security interests,” said U.S. Attorney McSwain. “The defendants here allegedly jeopardized the safety and security of the United States by scheming to get in bed with Iran and China.  This type of conspiracy deserves the full condemnation of my office and it has it.”

The indictment alleges that from May 2019 to February 2020, the defendants conspired in Philadelphia and elsewhere to arrange for the purchase of petroleum from the Islamic Republic of Iran, in violation of United States economic sanctions imposed on Iran, for sale to a refinery in the People’s Republic of China.  They also allegedly conspired to launder the proceeds of the sale through shell entities and offshore financial accounts to disguise the nature of the transaction.  The defendants are charged with conspiring to purchase sanctioned Iranian petroleum, to sell the petroleum to a Chinese refinery, to conceal the origin of the petroleum (including by bribing a Chinese official), and to obtain Antigua passports to open Swiss bank accounts through which the proceeds would be laundered.

In February 2020, the defendants were arrested pursuant to a criminal complaint.  As previously reported, the defendants planned two shipments of oil per month going forward, all for an expected profit of roughly $28 million-per-month.

If convicted, the defendants face a maximum possible sentence of 45 years’ imprisonment, a $1.75 million fine, a three-year term of supervised release, and a $300 special assessment.

The case was investigated by the FBI and is being prosecuted by First Assistant U.S. Attorney Jennifer Arbittier Williams and Assistant U.S. Attorney Michael J. Rinaldi and in partnership with Trial Attorney David Recker of the Department of Justice’s National Security Division, Counterintelligence and Export Control Section.

An indictment, information, or criminal complaint is an accusation.  A defendant is presumed innocent unless and until proven guilty

PHILADELPHIA – United States Attorney William M. McSwain and Assistant Attorney General for National Security John C. Demers announced that the following defendants were indicted on charges of conspiracy, violating the International Emergency Economic Powers Act (“IEEPA”), and conspiracy to commit money laundering based on their attempt to transact in sanctioned Iranian petroleum:

• Nicholas Hovan, age 34, of New York, NY;
• Zhenyu Wang, a/k/a “Bill Wang,” age 39, of Dallas, TX;
• Robert Thwaites, age 30, of Dallas, TX; and
• Daniel Ray Lane, age 39, of McKinney, TX.

The Indictment alleges that from May 2019 to February 2020, the defendants conspired in Philadelphia and elsewhere to arrange for the purchase of petroleum from the Islamic Republic of Iran, in violation of United States economic sanctions imposed on Iran, for sale to a refinery in the People’s Republic of China. They also allegedly conspired to launder the proceeds of the sale through shell entities and offshore financial accounts to disguise the nature of the transaction. More specifically, the defendants are charged with conspiring to purchase sanctioned Iranian petroleum, to sell the petroleum to a Chinese refinery, to conceal the origin of the petroleum (including by bribing a Chinese official), and to obtain Antigua passports to open Swiss bank accounts through which the proceeds would be laundered.

In February 2020, the defendants were arrested pursuant to a criminal complaint. As previously reported, the defendants planned two shipments of oil per month going forward, all for an expected profit of roughly $28 million-per-month.

“It doesn’t get much lower than attempting to get rich by flouting the United States’ national security interests,” said U.S. Attorney McSwain. “The defendants here allegedly jeopardized the safety and security of the United States by scheming to get in bed with Iran and China. This type of conspiracy deserves the full condemnation of my Office -- and it has it.”

“The defendants in this case allegedly conspired to sell Iranian petroleum to a Chinese refinery in order to enrich themselves at the expense of the US Iran sanctions regime,” said Assistant Attorney General for National Security John C. Demers.  “The defendants devised a scheme to use front companies, bribes, and false contractual documents in order to conceal their brazenly illicit activity.  We will continue to leverage all of our tools to detect and prevent individuals such as these from engaging in actions that would have harmed the national security of this nation.”

If convicted, each defendant faces a maximum possible sentence of 45 years in prison, a $1.75 million fine, a three year term of supervised release, and a $300 special assessment.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by First Assistant U.S. Attorney Jennifer Arbittier Williams and Assistant U.S. Attorney Michael J. Rinaldi, in partnership with Trial Attorney David Recker of the Department of Justice’s National Security Division, Counterintelligence and Export Control Section.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that Leonardo Dan Almonte-Fernandez, 39, of Philadelphia, PA, was charged by Indictment with one count of malicious damage of a building by means of fire affecting interstate commerce, one count of the use of fire to commit another felony, and three counts of wire fraud.

According to court documents, on April 25, 2020, Almonte-Fernandez allegedly set fire to his business, Chevere Mini Market, at 1443 E. Luzerne Street in Philadelphia. The defendant, who rented the basement, first, and second floors of the building, was behind on his lease payments and had recently been cited by the Philadelphia Department of Public Health for underage tobacco sales. Following the fire, he allegedly submitted fraudulent claims to State Farm Fire and Casualty Company seeking $200,000 in insurance proceeds for damages resulting from the fire, for which he claimed no involvement.

“As alleged in the Indictment, Almonte-Fernandez has a brazen disrespect for the law – and for the safety of his neighbors in this densely-populated residential area,” said U.S. Attorney McSwain. “He put other people’s homes and lives at risk, and then attempted to steal insurance money. Arson is a despicable crime. Together with our federal and local partners, we are committed to doing everything possible to punish and prevent it.”

“Arson is a dangerous crime and a very real threat to our community,” said John Schmidt, acting Special Agent in Charge of ATF’s Philadelphia Field Division. “We routinely work with our partners from the Philadelphia Police Department and Fire Marshal’s Office to build these complex and violent arson cases. Rest assured, ATF along with our law enforcement partners who round out our Arson and Explosives Task Force is dedicated to seeking justice against those who use fire as a weapon.”

“The Philadelphia Fire Marshals Office remains committed to investigating acts of arson throughout the City. We are grateful to the US Attorney’s Office and all of our partners for their ongoing help and support,” said Deputy Chief Fire Marshal Dennis J. Merrigan.

If convicted, the defendant faces a maximum possible sentence of 100 years’ imprisonment, a 10-year mandatory minimum term of imprisonment, up to three years’ supervised release, a $1.25 million fine, and a $500 special assessment.

The case was investigated by the Bureau of Alcohol, Tobacco, Fire Arms and Explosives Arson and Explosives Task Force, the Philadelphia Fire Marshal’s Office and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Sarah Damiani.

An indictment, information or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that Kenneth Saunders, 34, of Philadelphia, PA, was sentenced to over six years in prison (80 months), and three years of supervised release by United States District Court Judge John M. Younge for illegally possessing a firearm as a felon. Saunders was also on Pennsylvania state parole at the time of the offense.

The defendant pleaded guilty in March 2020 to one count of possession of a firearm by a convicted felon. During his plea hearing, Saunders admitted that he carried a firearm with an obliterated serial number and fled from Philadelphia police officers while carrying the gun on July 18, 2019. During that foot chase in the Logan neighborhood, Saunders grabbed the firearm from his waistband and pointed it at the pursuing officers before falling to the ground, after which police recovered the weapon.

According to court documents, Saunders was previously convicted of numerous felony offenses in the Philadelphia County Court of Common Pleas, including violations of the Uniform Firearms Act in 2005 and 2011 and possession with intent to distribute a controlled substance in 2010. Further, in 2004, the defendant was arrested for carrying a firearm without a license and endangering the welfare of a child. In that case, Saunders not only illegally possessed a gun, but also shot his two-year-old daughter with it. After pleading guilty, the defendant was sentenced to two to five years in Pennsylvania state prison.

“The crime of being a felon in possession of a firearm is a serious offense, particularly in a city like Philadelphia, where gun violence is running rampant,” said U.S. Attorney McSwain. “Saunders has been living a life of crime for the better part of twenty years now, and has repeatedly demonstrated his disrespect for the law. The answer to Philadelphia’s violent crime crisis is to get criminals like Sanders off of the streets, which is exactly what the U.S. Attorney’s Office is focused on.”

“As a convicted felon in possession of a firearm, Kenneth Saunders presented a real danger to the community and to law enforcement officers alike,” said John Schmidt, acting Special Agent in Charge of ATF’s Philadelphia Field Division. “Despite being prohibited from possessing a firearm, he was armed when encountered by law enforcement. The federal prosecution of this crime demonstrates ATF’s dedication to working alongside our local, state and federal partners, in this case the Philadelphia Police Department and the U.S. Attorney’s Office, to ensure violent individuals like Saunders are deprived of the ability to terrorize our community.” 

“It is going to take an aligned and sustained collaborative effort with all of our law enforcement partners in order to combat the crisis of violence in our neighborhoods,” said Philadelphia Police Commissioner Danielle Outlaw. “Individuals like Mr. Saunders need to know that illegally carrying weapons on our streets will have serious and consistent consequences. I would like to thank our federal partners for helping us work towards our common goal of making our communities safer places to live and work.”

The case was investigated by the Bureau of Alcohol, Tobacco, Fire Arms and Explosives and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Kelly Harrell.

PHILADELPHIA – United States Attorney William M. McSwain announced that Dorothy Recarde, 68, of Kirkwood, PA, was sentenced to one year in prison, one year of supervised release and ordered to pay a $25,000 fine by United States District Judge Paul S. Diamond for filing false and fraudulent liens worth $15,000,000 against an employee of the Internal Revenue Service.

In December 2019, the defendant pleaded guilty to corruptly endeavoring to obstruct or impede the due administration of the Internal Revenue Service. After an IRS revenue officer initiated levy actions to satisfy an outstanding federal tax obligation of approximately $24,000 incurred by Recarde’s company, Summerbeam Woodworking, Recarde retaliated by filing two fraudulent liens in Chester County against the officer.

According to court documents, Recarde initially responded to repeated attempts by the revenue officer to collect the outstanding tax obligation by mailing notarized letters to the IRS that espoused sovereign citizen ideology, an anti-government movement that, among other things, denies the government’s authority to impose taxes. She further claimed that correspondence she had mailed to IRS officials and the United States Treasury had gone unanswered, thus nullifying her outstanding debts. Bogus and illegal liens, such as those filed by the defendant, are a common tactic used by supporters of the sovereign citizen movement against perceived opponents or enemies.

“The sovereign citizen movement is nonsense and will be treated as such,” said U.S. Attorney McSwain. “And if you use it as an excuse to harass and retaliate against an IRS agent, you’re going to jail. Then you’ll have plenty of free time to think about the consequences of flouting the law.”

“TIGTA’s statutory mission includes investigating individuals who interfere with Federal tax administration,” said J. Russell George, Treasury Inspector General for Tax Administration.  “Attempts to intimidate or retaliate against Internal Revenue Service employees engaged in the performance of their official duties will not be tolerated.  We appreciate the efforts of the U.S. Attorney’s Office in this investigation.”

The case was investigated by the Treasury Inspector General for Tax Administration (TIGTA), and is being prosecuted by Assistant United States Attorney Frank R. Costello, Jr.

PHILADELPHIA – United States Attorney William M. McSwain announced that Sean Donald Premock, 47, of Ft. Lauderdale, Florida, was sentenced today to ten years in prison and three years of supervised release by United States District Judge Paul S. Diamond for numerous fraud offenses. The defendant was also ordered to forfeit $797,021 in proceeds and pay $1,061,532 in restitution.

The defendant, a former licensed stockbroker and investment adviser, pleaded guilty in May 2017 to nine counts of mail fraud, nine counts of wire fraud, one count of securities fraud, and one count of investment adviser fraud. As part of his guilty plea, Premock admitted that he had lost all of his professional licenses between March 2012 and August 2013, and had been permanently barred from serving as an investment advisor. The defendant’s fraud that led to his conviction in this case began while he was still licensed and continued even after he lost his licenses.

Premock began defrauding his clients in at least 2009, while still employed at a securities firm in Florida. When it became apparent that he was going to lose his licenses, Premock set up his own investing companies, including the aptly-named Mocktrading Investments, LLC and Mock Trading Group, which the defendant used to defraud his clients -- most of whom were elderly and inexperienced investors and some of whom were his own family members. Premock continued to hold himself out as a licensed stockbroker and investment adviser even after losing his licenses, and convinced many of his clients to trust him with their life savings. The defendant promised to manage his clients’ money and invest it in, among other things, stocks, bonds, “hedge funds,” “tractions,” and annuities. Premock told his clients that their funds would be safe, and promised to place them in low risk investments.

In reality, Premock invested only about half of the funds he received from clients and spent the rest on himself. Furthermore, the investments he did make were failures and he lost virtually all of his clients’ money. To hide his fraud, the defendant lied to his clients about their investments and mailed them false account statements. Later, Premock even began calling himself “Ethan” to make it harder for anyone to discover his true identity. In total, Premock’s clients lost more than $1,000,000 during the course of his fraud.

“Honesty, integrity, and trust all play a critical role in the relationship between a financial advisor and a client. Any advisor who deliberately betrays his clients’ trust for his own financial gain turns the system on its head,” said U.S. Attorney McSwain. “The damage done by such corrupt financial advisors can be catastrophic; here, some of Sean Premock’s victims lost their life savings. Today’s sentence reflects the gravity of that betrayal.”

“Getting fired for bad behavior and losing his professional licenses proved a mere career speedbump for Sean Premock,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “His next venture: flat-out fraud. He set about reeling in unsuspecting investors, lied about his plans for their money, and created a phony paper trail to cover up his crimes. Most of his victims were elderly. Maybe that’s why he thought he could get away with it. The FBI is proud to have proved him wrong.”

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Michael S. Lowe.

PHILADELPHIA – United States Attorney William M. McSwain and Principal Deputy Assistant Attorney General of the Tax Division Richard E. Zuckerman, announced that Nvahbulai “Kosh” Quisiah, 44, of Philadelphia, PA was sentenced to five years in prison, three years of supervised release and ordered to pay $215,941 in restitution by United States District Court Judge Nitza I. Quiñones Alejandro for multiple fraud and tax offenses.

In February 2020, the defendant was found guilty after a jury trial on charges of preparing false tax returns, aggravated identity theft, wire fraud and engaging in a conspiracy to defraud the United States.

According to evidence presented at trial, Quisiah was the owner and operator of First Premier Tax Service (also d/b/a Kosh & Associates), a Philadelphia-based tax preparation business on Woodland Avenue. From 2010 through 2017, the defendant prepared tax returns for clients that fraudulently inflated itemized deductions, claimed fictitious Schedule C businesses, and claimed false dependents for tax years 2009 through 2016. This resulted in inflated tax refunds for his clients to which the clients were not entitled. Quisiah also bought and sold the personal identifying information of children in order to falsely claim the children as dependents on tax returns.

“Today’s sentence is an appropriate reminder to tax preparers that attempting to defraud the federal government will result in serious consequences,” said U.S. Attorney McSwain. “And here, the defendant’s actions will have ramifications for years to come because he stole the identities of children as part of his fraud. My Office will continue to work with our federal partners here and in Washington D.C. to prioritize the investigation and prosecution of tax crimes.”

 “As today’s sentencing makes clear, corrupt tax preparers who falsify tax returns, and particularly those who exploit stolen minors’ identities to do so, will not go unpunished,” said Principal Deputy Assistant Attorney General Richard E. Zuckerman.

“When return preparers put honest taxpayers and unsuspecting individuals at risk for a quick dollar, they can count on IRS-CI being on their tail,” said Don Fort, Chief, IRS Criminal Investigation. “Our special agents use their investigative and financial expertise to detect and hold accountable abusive tax return preparers like Quisiah, who falsely told taxpayers they were eligible for inflated tax refunds that they were not entitled to receive.”

The case was investigated by the Internal Revenue Service’s Criminal Investigation Division and is being prosecuted by Assistant United States Attorney Anthony Wzorek and Department of Justice Tax Division Attorney Ann M. Cherry.

A Philadelphia, Pa, tax return preparer was sentenced to 60 months in prison today for conspiring to defraud the United States, preparing false client tax returns, wire fraud, and identity theft, 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.

“As today’s sentencing makes clear, corrupt tax preparers who falsify tax returns, and particularly those who exploit stolen minors’ identities to do so, will not go unpunished,” said Principal Deputy Assistant Attorney General Richard E. Zuckerman.

“Today’s sentence is an appropriate reminder to tax preparers that attempting to defraud the federal government will result in serious consequences,” said U.S. Attorney McSwain. “And here, the defendant’s actions will have ramifications for years to come because he stole the identities of children as part of his fraud. My office will continue to work with our federal partners here and in Washington D.C. to prioritize the investigation and prosecution of tax crimes.”

According to the evidence presented at trial, Nvahbulai Quisiah owned and operated First Premier Tax Service, a tax return preparation business in Philadelphia. From 2010 through 2017, Quisiah falsified clients’ tax returns by claiming false dependents based on stolen minors’ identities, as well as false itemized deductions and business losses in order to increase the refunds paid by the IRS.

In February 2020, a federal jury found Quisiah guilty on all counts.

In addition to the term of imprisonment, U.S. District Judge Nitza I. Quiñones Alejandro ordered Quisiah to serve three years of supervised release and to pay $215,941 in restitution to the United States.

Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney McSwain thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorney Ann M. Cherry of the Tax Division and Assistant U.S. Attorney Anthony Wzorek, who prosecuted the case. 

PHILADELPHIA – United States Attorney William M. McSwain announced that Maurice Neal, 31, of Philadelphia, PA was sentenced to 25 years in prison and lifetime supervised release by United States District Court Judge Timothy J. Savage for producing child pornography.

In November 2019, the defendant pleaded guilty to one count of manufacturing child pornography, stemming from his sexual abuse of a 12-year-old child (Minor #1) as she slept, and recording the abuse on his cell phone. He covered the victim’s face with a cloth to avoid her eyes from looking at him, and stopped only because he thought another child sleeping nearby was stirring. The sexual assault of this child was the second in a series of assaults of children that Neal committed. At the time that he documented his sexual abuse of Minor #1, Neal already had an active arrest warrant issued by the Philadelphia Police Department for his sexual molestation of a different child (Minor #2), who was only six-years-old. And after sexually abusing Minor #1 and Minor #2, Neal then began molesting two additional young girls: another six-year-old (Minor #3) and a nine-year-old (Minor #4).

Neal was charged and pleaded guilty to these sexual offenses (assaulting Minors #1-4) in the Commonwealth of Pennsylvania, and was sentenced to 25 to 50 years in state prison for these crimes. While he was incarcerated, the video of his abuse of Minor #1 was discovered, and the defendant was then charged with the federal offense of manufacturing child pornography.

“Maurice Neal left a trail of young, vulnerable victims in his wake,” said U.S. Attorney McSwain. “In a few short months, he took advantage of every opportunity to prey upon children in homes in which he was staying, horrifically abusing four little girls within his grasp and causing incalculable damage. Working with our law enforcement partners, we will hold defendants like Maurice Neal accountable and pursue justice for the victims.”

“Put simply, Maurice Neal is a predator,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “He sexually violated multiple children, documenting some of that abuse. It’s vital that he stay locked away where he can’t hurt any more kids. The FBI and our partners at the Philadelphia Police Department won’t ever stop fighting to protect children from being so horrifically exploited.”  

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 in partnership with the Philadelphia Police Department and Philadelphia District Attorney’s Office, and is being prosecuted by Assistant United States Attorney Priya DeSouza and Special Assistant United States Attorney Megan Curran.

PHILADELPHIA – United States Attorney William M. McSwain announced that Phoenixville Hospital and Phoenixville Hospital Co., LLC (“Phoenixville Hospital”) has agreed to pay $100,000 to resolve alleged violations of the False Claims Act by causing the submission of altered forms to the Pennsylvania Department of Human Services, which administers Medicaid in Pennsylvania. Additionally, Firstsource Solutions, Ltd., Firstsource Solutions USA, LLC, and its predecessor Medassist, Inc. (collectively “Firstsource Solutions”), a revenue cycle management services provider operating in Pennsylvania, has agreed to pay $225,000 for processing the alleged false claims on Phoenixville Hospital’s behalf.

Phoenixville Hospital, a community healthcare provider, delivers comprehensive medical services, including emergency room care and inpatient admissions. Phoenixville Hospital accepts patients whose hospital stays are paid for by the Medicaid program. The United States contends that Phoenixville Hospital caused the submission of false claims to Medicaid for inpatient treatment and/or emergency room visits billed by Phoenixville Hospital. On certain occasions, Phoenixville Hospital allegedly caused to be altered one of the standard Pennsylvania Department of Public Welfare General Assistance Forms, the Employability Assessment Form (PA Form 1663), to exclude the option for the medical provider to certify that the self-pay patient was “Employable.” The United States contends that, in some cases, the patient was therefore not disabled and not entitled to Medicaid coverage for the treatment being billed by the hospital. The United States further contends that Phoenixville Hospital caused to be submitted such forms from January 2008 through February 2012 and that some of these claims for Medicaid beneficiaries were false in light of Phoenixville Hospital’s conduct.

Firstsource Solutions provides revenue cycle management services to hospitals, assisting with the submissions for determination of eligibility of self-pay (uninsured) patients to the Medicaid program. The government alleges that from August 2009 through February 2012, Firstsource Solutions knowingly submitted or caused the submission of false claims to Medicaid for inpatient treatment and/or emergency room visits billed by the client, Phoenixville Hospital.

The allegations that are the subject of today’s settlement were originally alleged in two cases filed under the whistleblower, or qui tam, provision of the False Claims Act. The Act permits private parties to sue for fraud on behalf of the United States and to share in any recovery. The Act also permits the government to intervene in such actions, as the government previously did in the two whistleblower cases. The whistleblowers in these cases will receive a total of approximately $60,000 of the settlement.

“My Office will continue to investigate credible allegations of fraud against federal healthcare programs, especially when the alleged conduct has potential implications for patient treatment,” said U.S. Attorney McSwain. “Hospitals that treat Medicaid patients and the entities that process Medicaid claims must know the billing and payment rules required by those programs, and abide by them. We would also like to thank the citizens and their lawyers who initially brought this case to our attention.”

“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 government’s pursuit of these matters illustrates its emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 1-800‑HHS‑TIPS (1-800-447-8477).

This case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General. For the U.S. Attorney’s Office, the investigation and settlement were handled by Assistant U.S. Attorneys Viveca D. Parker and Scott W. Reid, with assistance from auditor George Niedzwicki. The lawsuits are captioned United States ex rel. Daniel Dimarzio v. Firstsource Solutions, LTD, Firstsource Solutions USA, LLC, and Medassist, Inc., Civil Action No. 12-1464 and United States ex rel. Susan Wilson v. Phoenixville Hospital, et al., Civil Action No. 15-596.

The claims resolved by this settlement are allegations only and there has been no determination of liability.

PHILADELPHIA – United States Attorney William M. McSwain announced that Gaafar Muhammed Ebrahim Al-Wazer, 25, of Altoona, PA, was charged by Indictment with three counts of making false statements to Task Force Officers with the Federal Bureau of Investigation’s Philadelphia Joint Terrorism Task Force. The defendant was previously arrested at his home in Altoona on November 7, 2019, pursuant to a Criminal Complaint, and has been detained since then, following a finding by U.S. Magistrate Judge Marilyn Heffley that he presented a risk of flight and danger to the community.

According to the Indictment and Criminal Complaint, FBI counterterrorism investigators questioned Al-Wazer, a Yemeni citizen, on May 17, 2016 about his affiliation with the Houthi movement, known formally as Ansar Allah. Ansar Allah is the armed rebel group that toppled Yemen’s government and has fought in an ongoing civil war there for years. Al-Wazer allegedly denied to the FBI that he was aligned with the Houthi movement, whose motto is “Allah is the greatest of all, Death to America, Death to Israel, Curse upon the Jews, Victory to Islam,” and further denied that he had ever fired a weapon or participated in military or militia training.

To the contrary, however, the court documents allege that a search of Al-Wazer’s Facebook account revealed numerous postings and photographs in which he extolled and praised Ansar Allah, its objectives and its fighters who were killed in battle against the Yemeni government and its Saudi and U.S.-backed forces. In these postings, Al-Wazer was armed with automatic weapons (including a rocket-propelled grenade launcher). Al-Wazer’s Facebook account allegedly included a posting of a photograph of him and others bearing automatic assault rifles and pledging that they would stay on the path of jihad and wishing death to the United States and Israel and victory to Islam. In another posting, Al-Wazer again bears a machine gun in a photograph, which is accompanied by a pledge to Ansar Allah to the death.

“Just as when Al-Wazer was arrested and detained in November 2019, today’s Indictment demonstrates that lying to counter-terrorism officers in the course of their official duties is a crime,” said U.S. Attorney McSwain. “Al-Wazer was welcomed into our country for the educational opportunities available here, and he is entitled to hold and express his political and religious beliefs as freely as anyone else in this country -- no matter how vile and disgusting they are. But what he cannot do is lie to federal officers when directly questioned about his activities and beliefs. I want to thank our partners in the FBI’s Joint Terrorism Task Force for their continued vigilance in this case.” 

“People have the right to their own beliefs — the FBI isn’t the ‘thought police,’ nor do we want to be,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “But lying to federal agents about your ideology and your actions is illegal, for good reason. If the people we interview feel they can deceive us with impunity, false information will hobble vital investigations. We can’t allow the mission of our Joint Terrorism Task Force to be derailed like that. The stakes are just too high.”

"Let the indictment of Al-Wazer serve as an example that lying to federal officers is a federal offense, and those who do so will be held accountable to the fullest extent of the law," said Brian A. Michael, Special Agent in Charge of Homeland Security Investigations (HSI) Philadelphia. “HSI and our law enforcement partners are committed to pursue justice against those who seek to harm our country and our citizens.”

If convicted, the defendant faces a maximum possible sentence of five years’ imprisonment, three years of supervised release, a $250,000 fine, a $100 special assessment, per count.

The case was investigated by the Federal Bureau of Investigation’s Philadelphia Joint Terrorism Task Force, and is being prosecuted by Assistant United States Attorney Nelson S.T. Thayer, Jr.

An indictment, information or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that Jason C. Weigand, 50, of Denver, PA has been charged by Indictment with mail fraud, wire fraud, and interstate transportation of stolen securities, while on bail for separate, similar offenses.

The Indictment announced today alleges that Weigand helped a former client of his, identified in court documents as “AH,” recover on life insurance policies when her husband died. Weigand later convinced AH to provide him with at least $239,000, which he told her that he would invest on her behalf. However, according to the Indictment, Weigand did not invest the client’s money in appropriate investments as he promised, but instead used the money for his own personal and business purposes, including payments to his personal line of credit, his Visa credit card, and his Lincoln MKZ and Chevy Suburban car loans.

In October 2017, Weigand was charged in a separate federal Indictment with allegedly misusing funds belonging to his clients. He was arrested on those charges and released subject to conditions including that he not commit any “Federal, State, or local crime during the period of release.” He allegedly violated those conditions by committing some of the offenses alleged in the current Indictment. Further, during the relevant time period, Weigand did not even possess a license to act as an investment advisor.

According to the Indictment, Weigand was a registered investment advisor in Pennsylvania between 2009 and 2014, and in New Jersey between 2011 and 2014. He voluntarily surrendered his licenses as an investment advisor in both states in 2014. In the case of his Pennsylvania license, Weigand terminated it on April 10, 2014—the same day that he was questioned by investigators from the Pennsylvania Department of Banking and Securities about his investment advisor activities.

“Weigand is alleged to be a serial fraudster with no respect for the law,” said U.S. Attorney McSwain. “Rather than serving his clients, he served himself. Prosecuting financial and securities fraud -- and thereby safeguarding innocent investors -- has been and will continue to be a top priority of my Office.”  

“Jason Weigand was first arrested in 2017 by Postal Inspectors from the Philadelphia Division for stealing money from his investment advisory clients,” said Postal Inspector in Charge, Damon Wood. “Since 2017, while preparing to defend himself on those charges, Mr. Weigand went back to his old ways, stealing money from his investment clients. I applaud the diligence of the investigators and prosecutors in this case to not only prepare for trial but to follow up on allegations of new crimes. The Postal Inspection Service has long prided itself as being a leader in investigating investments frauds. From snake oil salesmen in the 19th century to modern day Wall Street frauds, if the United States Mail is used, Postal Inspectors will work tirelessly to bring the perpetrators to justice.”

If convicted, the defendant faces a maximum possible sentence of 120 years imprisonment, $1,500,000 fine, 3 years supervised release, $600 special assessment.

The case was investigated by the United States Postal Inspection Service, and is being prosecuted by Assistant United States Attorneys Katherine Driscoll and Paul Shapiro.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA and LAS VEGAS – United States Attorney for the Eastern District of Pennsylvania, William M. McSwain, and United States Attorney for the District of Nevada, Nicholas A. Trutanich, jointly announced that Catholic Charities of Southern Nevada (Catholic Charities) has agreed to pay $206,368.35 to resolve claims arising from its administration of community service grants funded through the Corporation for National and Community Service (CNCS).

From 2003 until 2018, Catholic Charities administered multiple grants in CNCS’s Senior Corps program. These grants included the Foster Grandparent Program, which places seniors in school and community settings to serve youth with exceptional needs, and the Senior Companion Program, which places seniors in community and residential settings to assist other seniors who have difficulty with tasks of daily living. These programs provide small hourly stipends to the volunteers performing these services.

The settlement resolves claims that in 2014 and 2015, Catholic Charities’ employees who oversaw the Foster Grandparent and Senior Companion programs falsified records for the stipend recipients. They also directed recipients to falsify records, leading to CNCS grant funds being used to pay stipends for hours that were never actually worked, were in violation of program requirements, or were inflated.

When Catholic Charities executive management discovered the fraudulent actions of its employees, it voluntarily disclosed them through the CNCS-OIG hotline. It terminated the employees who had perpetrated the fraud and cooperated fully in the United States’ investigation of its administration of these grants. In 2018, Catholic Charities relinquished the grants entirely.

“Every federal grantee, including community service organizations, is required to honestly and openly report the service that its volunteers perform. Every dollar spent on an hour that was not actually served is one that is not available to support other community service efforts,” said U.S. Attorney McSwain. “Strict compliance with grant requirements ensures that federal funds reach those who need it most.” 

“Each day, Catholic Charities of Southern Nevada feeds the hungry, provides shelter for the homeless, and supports families and seniors in need of assistance. The federal government relies on its non-profit partners to help ensure that federal grant funds are being used to assist their communities,” said U.S. Attorney Trutanich. “Today’s settlement is a reminder that everyone receiving federal grant funds must adhere to grant compliance requirements and self-report misuse of federal grant funds, as Catholic Charities of Southern Nevada did here. “

“Catholic Charities acted responsibly upon discovering fraud, promptly reported the misconduct, cooperated actively with the investigation and willingly made the taxpayers whole,” said CNCS’s Inspector General Deborah J. Jeffrey. “As a result, Catholic Charities was appropriately spared substantial penalties and fines. We thank our partners at the U.S. Attorney’s Offices in the Eastern District of Pennsylvania and Nevada for protecting the integrity of CNCS.”

United States Attorneys McSwain and Trutanich also praised Catholic Charities’ work in addressing the issues in these programs: “We commend Catholic Charities of Southern Nevada for promptly reporting these issues when they were discovered and for working with the Department of Justice and the Corporation for National and Community Service to make the government whole. We hope this settlement will serve as a message to other senior managers to be vigilant in overseeing government-funded programs and to ensure that their employees do not attempt to conceal any non-compliance. All organizations accepting federal funds should take their responsibility to the American taxpayers seriously to come forward promptly and cooperate fully if they discover that they have not lived up to their promises.”

This investigation was conducted jointly by the United States Attorney’s Offices for the Eastern District of Pennsylvania and District of Nevada with the Corporation for National and Community Service Office of Inspector General. Assistant United States Attorneys Paul W. Kaufman and Veronica Finkelstein of the Eastern District of Pennsylvania and Troy Flake of the District of Nevada handled the investigation and settlement. This case was initiated as a part of the U.S. Attorney’s Office for the Eastern District of Pennsylvania’s Affirmative Civil Enforcement Strike Force focus on grant fraud.

The claims resolved by the settlement are allegations only; there has been no determination of liability.

PHILADELPHIA – United States Attorney William M. McSwain announced that Timothy Stanley Wilkins, 41, of Bethlehem, PA was arrested last night in Miami, Florida. Wilkins was a fugitive from justice on federal drug trafficking and firearms offenses. After being charged, Wilkins fled the country and was apprehended by federal agents at Miami International Airport, while attempting to re-enter the United States.

On March 11, 2020, Wilkins was charged in a three-count Indictment with possession with intent to distribute fentanyl and cocaine, possession of a firearm in furtherance of a drug trafficking crime, and being a felon in possession of a firearm. He is scheduled to have his initial appearance today in the Southern District of Florida and then will be extradited to the Eastern District of Pennsylvania.

“As alleged in the Indictment, charging him with firearms and drug offenses, Wilkins has a brazen disrespect for the law,” said U.S. Attorney McSwain. “In response to the charges, he fled the country, but all that did was postpone the inevitable. If you are charged in the Eastern District of Pennsylvania with a federal offense, there is no place to hide, here or abroad. We will not rest until we find you and hold you accountable.”

“I would like to take an opportunity to recognize the cooperation among our law enforcement agencies responsible for getting a dangerous drug dealer off the streets,” said Northampton County District Attorney Terence P. Houck. “It is important for people to know that together, we will investigate, arrest and convict these law breakers by exhausting all federal and state efforts in the pursuit of this cause.”

“Timothy Wilkins fled to evade prosecution on state charges brought against him,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “Now he’s in the federal system, indicted on these drug and gun charges and safely in custody. The FBI and our partners at the Bethlehem Police Department will continue to work together to protect our community from those engaged in illegal and dangerous activity.”

If convicted, the defendant faces a maximum possible sentence of life imprisonment, a mandatory minimum 15 years imprisonment, 8 years supervised release, a $1,500,000 fine, and a $300 special assessment.

The case was investigated by the Federal Bureau of Investigation, Allentown Resident Agency, the City of Bethlehem Police Department, and the Northampton County District Attorney’s Office. The case is being prosecuted by Assistant United States Attorney Kelly A. Lewis Fallenstein.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that Marqueal Bonds, 22, of Chicago, Illinois, was sentenced today to 22 years in prison and lifetime supervised release by United States District Court Judge Harvey Bartle, III, for engaging in a child exploitation enterprise. Bonds was also ordered to pay a total of $33,221 in restitution to various victims.

In March 2020, Bonds pleaded guilty in the middle of trial to charges of engaging in a child exploitation enterprise and conspiracy to advertise child pornography. Using Discord, an online communications application that allows users to share files and communicate via chat messages, Bonds and his co-conspirators connected in private chat rooms to discuss how to find children and exploit them to produce child pornography. Bonds and his co-conspirators would also share child pornography on Discord, which included sexual depictions of children as young as toddlers. After discovering evidence of child pornography on Discord’s servers, federal agents executed a search warrant at Bonds’ house, and the defendant confessed to his involvement in this enterprise.

“Bonds and others like him will be held accountable by my Office no matter which dark corners of the Internet they are lurking in,” said U.S. Attorney McSwain. “Bonds and his co-conspirators trolled the Internet on legitimate sites like Snapchat, Periscope, and Live.me for vulnerable victims, tricked these children into believing they were chatting with boys or girls their own ages, and then obtained video and naked photos of them to share on Discord. Today’s lengthy sentence ensures that Bonds is out of business and serves as a warning to anybody who would consider exploiting children via the Internet.”

“Marqueal Bonds manipulated underage girls into providing explicit images of themselves,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “He and his co-conspirators teamed up to sexually exploit children across the country and share the vile results. These are predators who harmed young girls without a second thought. Locking them up ensures they won’t be victimizing anyone else.”

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. 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.projectsafechildhood.gov.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant U. S. Attorney Kevin Jayne and Trial Attorney Kaylynn Foulon, of the U.S. Department of Justice’s Child Exploitation and Obscenity Section.

PHILADELPHIA – United States Attorney William M. McSwain announced that Francisco Cruz-Pica, a/k/a “Javi,” 38, of Allentown, PA was sentenced to 10 years in prison, eight years of supervised release and ordered to pay a $1,200 fine by United States District Judge Jeffrey Schmehl for trafficking drugs and illegally possessing firearms, including a machine gun.

In January 2020, Cruz-Pica pleaded guilty to an 11-count Indictment charging drug trafficking and multiple firearms offenses, including distribution of heroin within 1,000 feet of a public school, maintaining a drug house, being a felon in possession of a firearm, possession of a machine gun, and possession of a firearm in furtherance of a drug trafficking crime. He committed these offenses while on supervised release for a previous felony firearms conviction in the District of Puerto Rico, and is a notorious drug dealer known to authorities operating in and around Allentown.

“This defendant clearly has no respect for the law or for the Allentown community,” said U.S. Attorney McSwain. “Not only did he illegally possess multiple firearms and deal drugs near a school – a place that is supposed to be a safe haven for children – but he did so while on supervised release for a previous felony conviction. My Office is committed to working with our local law enforcement partners, like District Attorney Martin and the Allentown Police Department, to protect the Allentown community by investigating and convicting criminals like Cruz-Pica, and put them behind bars.”

“I commend the Allentown Resident Office of the FBI and the Allentown Police Department on their investigation, which has enabled an effective prosecution by the U. S. Attorney and has resulted in a dangerous criminal being taken off the streets of our community,” said Lehigh County District Attorney Jim Martin.

“Cruz-Pica illegally armed himself to the teeth as he flooded the streets of Allentown with drugs,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “All while on supervised release imposed for an earlier gun crime. Today’s sentence, obtained through the efforts of the FBI and our partners on the Lehigh Valley Safe Streets Task Force, ensures this repeat offender and threat to public safety remains behind bars for some time.”

The case was investigated by the Federal Bureau of Investigation, Allentown Resident Agency, the City of Allentown Police Department, and the Lehigh County District Attorney’s Office. The case is being prosecuted by Assistant United States Attorney Kelly A. Lewis Fallenstein.

PHILADELPHIA – United States Attorney William M. McSwain announced that Jason Gerner, 46, of Shamung, New Jersey, was sentenced to 36 months imprisonment and three years of supervised release by United States District Court Judge Wendy Beetlestone for his role in multiple healthcare fraud schemes as a co-founder of the drug and alcohol rehabilitation facility Liberation Way, which had locations in Yardley, Bala Cynwyd and Fort Washington, Pennsylvania. As part of his sentence, he was also ordered to pay restitution in the amount of $9,338,607 and ordered to forfeit $444,983.

In August 2019, the defendant pleaded guilty to charges of conspiracy to commit health care fraud and conspiracy to commit money laundering for his role as a founder and operating partner of Liberation Way. An investigation into the operations and management of the facility exposed an array of schemes, including: fraudulently purchasing premium insurance policies on behalf of prospective patients so that Liberation Way could bill for expensive “treatments” that it never provided; using pre-signed medical orders for tests and treatments for patients who were not actually seen or examined by the only doctor employed by Liberation Way; paying a different doctor to sign urine-testing orders for patients who were never seen or examined; shipping those urine samples for testing to laboratories in Florida in order to submit claims that were excessive and medically unnecessary, in order to maximize billing to insurance companies; receiving kickbacks for the insurance payments made to the laboratories for these overly frequent and expensive tests; and conspiring to hide the proceeds of the illegal urine-testing kickback scheme through a series of financial transactions involving payments to various shell companies disguised as consulting payments.

“My Office will not tolerate health care fraud in any form, especially the kind that takes advantage of at-risk patients and exploits their addictions,” said U.S. Attorney McSwain. “Those who think that they can game our health care system -- which is already strained under the weight of an ongoing opioid epidemic -- and prey upon vulnerable people will face the consequences. Gerner will rightly spend years in prison and pay millions of dollars as the result of his criminal conduct.”

 “The employees of Liberation Way looked at the opioid epidemic devastating Pennsylvania and saw an opportunity to make a buck off the backs of vulnerable people. Pennsylvanians with substance abuse disorder, who deserved care from Liberation Way, were harmed instead,” said Attorney General Josh Shapiro. “I’m proud of the work we’ve done with our partners in the U.S. Attorney’s Office to hold these scam artists accountable and get justice for the people of Pennsylvania.”

“Gerner and his colleagues operated Liberation Way under the guise of helping addicts get healthy,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “In reality, the only things that benefitted were these fraudsters’ bank balances. Their elaborate, years-long swindle of the health care system victimized vulnerable patients for profit. The FBI is gratified all involved are being held accountable.”

“The U.S. Department of Labor, Employee Benefits Security Administration (EBSA), works closely with our federal and state law enforcement colleagues to bring to justice those who would, by their criminal activities, tamper with the hard–earned health benefits due the American worker,” said Employee Benefits Security Administration Philadelphia Regional Director Michael Schloss.

The case was investigated by the Federal Bureau of Investigation, the Department of Health and Human Services, the Office of Personnel Management, and the Department of Labor Employee Benefits Security Administration, in conjunction with the Pennsylvania Attorney General’s Office, and is being prosecuted by Assistant United States Attorney Nancy Beam Winter and Special Assistant United States Attorneys Robert Labar and Kristy Christ.

PHILADELPHIA – United States Attorney William M. McSwain announced that James Hardcastle, 42, of Bensalem, PA, was sentenced to 20 years in prison, 20 years of supervised release, and ordered to pay $75,000 in fines by United States District Judge Gerald J. Pappert for multiple child exploitation offenses stemming from his conduct at an over-night basketball tournament in Wildwood, New Jersey and at his home in Bensalem.

In June 2016, Hardcastle transported three minor boys, ages 15, 16 and 16, as their coach to Wildwood, New Jersey to participate in a basketball tournament, and shared a motel room with them in which there was no shower curtain. The defendant installed a USB drive containing a hidden camera in a power outlet in the bathroom and surreptitiously filmed each of the minors taking showers. Previously, in June and July 2015, the defendant also attempted to videotape two minors in a bathroom using a hidden camera while the minors were visiting his home in Bensalem. The defendant pleaded guilty in December 2019 to three counts of transporting minors with the intent to engage in criminal sexual activity and two counts of attempted production of child pornography.

“This defendant took advantage of his position of trust as a youth basketball coach to exploit children for his own satisfaction,” U.S. Attorney McSwain said. “This is heinous and reprehensible behavior that deserves the serious punishment that was meted out today. My Office will continue to prioritize the protection of children from such predation.”

“The boys James Hardcastle victimized will never forget their trusted coach’s betrayal,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “He used his relationship with them for his own gratification, setting them up for his illicit secret recordings. The FBI will never stand by when we learn of the sexual exploitation of children. Such predators need to be taken off the street so they can’t harm anyone else.”

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and 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 the Federal Bureau of Investigation with assistance from the Philadelphia Police Department Special Victims Unit and the Bensalem Police Department, and is being prosecuted by Assistant United States Attorney Michelle L. Morgan.

PHILADELPHIA – United States Attorney William M. McSwain convened a press conference today outside the Byrne United States Courthouse after the sentencing hearing for Jovaun Patterson, the man convicted of shooting a Philadelphia shop owner with a military-style assault rifle during an attempted robbery.  During his remarks, U.S. Attorney McSwain addressed the escalating violent crime crisis in Philadelphia, the anti-law enforcement bias pushed by certain groups, and the devastating impact that both continue to have on minority communities in the City. 

Remarks as Prepared for Delivery

Jovaun Patterson has been sentenced to over 14 years in federal prison for shooting and attempting to rob Philadelphia shop owner, Mike Poeng.  Mr. Patterson has been held accountable for his violent criminal behavior and will now serve an appropriate sentence.  This was only possible because the U.S. Attorney’s Office stepped in and charged Mr. Patterson after the local authorities had bent over backwards to give him a break, negotiating an overly lenient sentence that sent a message that violent crime has little consequences.

That sad state of affairs – where the mishandling of Mr. Patterson’s original case necessitated federal involvement – is symbolic of a larger catastrophe that is playing out before our eyes in Philadelphia.  Homicides, shootings, and serious violent crime have all skyrocketed in 2020 – from already intolerable levels that existed in 2019 and 2018.  Almost all the victims are racial minorities, the vast majority of whom are Black.  This past weekend alone, at least 25 people were shot.  So far this year, over 100 children have been shot, a 68% increase as compared to last year.  Again, almost all of these child victims are racial minorities, the vast majority of whom are Black.  And we all know about Zamar Jones, the 7 year-old boy who was murdered earlier this month while playing on his front porch in West Philadelphia.

This is . . . infuriating.  There is nothing more important than the safety of children.  But where is the sense of outrage, where is the anger, where is the sense of urgency among City leaders?  This slaughter in our streets has largely been met with indifference, a sense of inevitability, even a shrug of the shoulders.  Or as the District Attorney frequently puts it: “poverty equals bullets.”

“Poverty equals bullets.”  That condescending statement is a slap in the face to every law-abiding, low-income resident in the City.  There are scores of low-income people in the City who respect the law, never shoot anybody, love their neighbors, and work hard to improve their neighborhood.  Poverty is never an excuse for violent crime, and certainly not for murder.  There is no possible justification for walking up to somebody and shooting them.  Furthermore, poverty isn’t going away overnight.  As law enforcement leaders, we can’t put the violence problem at the doorstep of poverty and just leave it there.  That is the equivalent of abandoning the people we are sworn to protect and serve.

Instead, we must do something.  At the U.S. Attorney’s Office, we have and we are – unlike the District Attorney’s Office.  With our anti-violence public messaging campaign that we launched last month, the law-abiding citizens of Philadelphia know where the U.S. Attorney’s Office stands – with them and with our law enforcement partners.  The campaign also puts potential criminals on notice that if they commit a crime with a gun and we have federal jurisdiction, we will prosecute them to the fullest extent of the law.  We will come after them with everything that we have.  We are spreading that message of deterrence through billboards, bus shelter advertisements, posters, the Internet, social media, videos, radio, and TV.  It’s a message that is sorely needed in the City, and one that I believe will make neighborhoods safer and save lives.

And this is not just messaging.  It is backed up by federal resources and results.  The U.S. Attorney’s Office prosecuted 53% more violent crime cases in the Eastern District of Pennsylvania this past fiscal year than we prosecuted the year before.  In Philadelphia’s most dangerous neighborhoods – what are designated as Project Safe Neighborhood (or PSN) target districts – we charged 72% more violent crime and weapons cases than the year before.  And, where necessary, we have provided federal oversight in cases like today’s Patterson sentencing.  Still, we know that in order to meet today’s challenges, we must do even more.  

But the federal authorities cannot do it alone.  We need City leaders to speak with one voice in condemning violence – not making excuses for it and not treating violent defendants like they are somehow the victims in all of this.  And most importantly, the rhetoric should be backed up by aggressive local prosecution that holds criminals accountable and therefore makes neighborhoods safer.         

City leaders also should speak with one voice in rejecting the extreme anti-law enforcement bias that is currently being peddled by certain irresponsible fringe groups.  This bias – especially if it is not forcefully condemned by City leaders – puts the police on their heels and puts violent criminals on their toes, ready to stride forward confidently.  One year ago, I stood in this spot and decried the culture of disrespect for law enforcement in the City – a culture that celebrated chants like “F*** the police” and “No good cops in a racist system.”  Today, the bile and vitriol coming from some elements of the mob makes those chants sound quaint by comparison.   

The vast majority of Philadelphia police officers do their jobs faithfully and honorably – and by putting on the uniform and doing the dangerous work inherent in their mission, they show that they value the lives of others more than they value their own.  They, like all responsible citizens, abhor police brutality and are in favor of accountability for police.  We can and should work towards better relations between the police and the community without indulging infantile notions that the police as a whole make communities more dangerous.  Obviously, they do just the opposite.  So to those of you out there who say that we should “abolish the police,” or “defund the police,” or “abolish prisons,” or one of my favorites, that “communities should be left to police themselves,” I have a message for you: your ideas are absurd and deserve nothing but scorn.  Moreover, those ideas would cause great harm to the most vulnerable members of our society.  Victims of violent crime, like Mike Poeng, are the ones who suffer the consequences of these foolish notions.  As is often the case, the policies demanded by the self-righteous mob would come at the expense of minority communities.   

Everybody in our City deserves to live in a safe neighborhood – regardless of race or income level.  It is time for City leaders to step forward and do everything that they can to make that a reality.  We won’t get there by treating violent criminals like they are victims, or by undermining law enforcement, or by grasping for excuses – like conveniently blaming the pandemic.  It’s true that the virus isn’t making things any easier, but violence is contagious, too.  It can easily spread across a City or even beyond.  We must confront it and stop it and put the good people of this City first.  Thank you.      

PHILADELPHIA – United States Attorney William M. McSwain announced that Jovaun Patterson, 31, of Philadelphia, PA was sentenced to 171 months in prison (14 years and three months) and 5 years of supervised release by United States District Judge Mitchell S. Goldberg for the attempted robbery of a convenience store in West Philadelphia in 2018.

In December 2019, Patterson pleaded guilty to charges of attempted Hobbs Act robbery, and using, carrying and discharging a firearm during and in relation to a crime of violence. These charges stem from the defendant’s attempted armed robbery on May 5, 2018, of the KCJ, Inc. convenience store, during which Patterson shot the store owner, Li “Mike “ Poeng, with an assault rifle. Mr. Poeng is a refugee from Cambodia who became a U.S. citizen in 1998. As a result of the shooting, Mr. Poeng is confined to a wheelchair. The Philadelphia District Attorney’s Office originally charged Patterson with multiple crimes, including attempted murder and aggravated assault, but then dropped the attempted murder charges and agreed to an overly lenient plea deal of only 3 ½ to 10 years imprisonment. The U.S. Attorney’s Office then stepped in to correct this injustice. 

“Violent crime is a severe problem in Philadelphia, as shootings and homicides have sharply increased in 2020 from already intolerable levels. Confronting this crime wave is a top priority of my Office,” said U.S. Attorney McSwain. “It is important for potential criminals to know that committing a violent crime will result in grave consequences. It is also important for the general public to know that we are fighting hard to protect Philadelphia neighborhoods and to seek justice for victims. Taking Jovaun Patterson off the streets for an appropriate amount of time is part of that fight. I want to thank Mike Poeng for his courage throughout this case. Sadly, we can never make him completely whole, but today’s sentence is part of his healing process and will also help to deter future violence.”

“Today an extremely violent offender has been sentenced to a lengthy prison term,” said John Schmidt, acting Special Agent in Charge of ATF’s Philadelphia Field Division.  “The outcome is the result of ATF’s collaborative effort with the Philadelphia Police Department to combat gun violence.  Along with our other local, state and federal partners, we are committed to investigating gun crimes in Philadelphia and working with the US Attorney’s Office to prosecute those who violate the gun laws.”

Committing a violent crime in the Eastern District of Pennsylvania carries a tremendous risk of a long prison sentence, which is the message of the Office’s new anti-violence public awareness campaign. You can learn more about this campaign on the District website.

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 (ATF) and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Salvatore L. Astolfi.

PHILADELPHIA – United States Attorney William M. McSwain announced that James Millette, 33, of Reading, PA, was sentenced to 235 months (over 19 years) in prison and lifetime supervised release by United States District Judge Joseph F. Leeson, Jr., for multiple child pornography charges. The defendant was also ordered to pay a total of $66,000 in restitution to the various victims depicted in these images.

In February 2020, Millette pleaded guilty to charges of possession and receipt of child pornography. The charges stem from the defendant’s February 7, 2019 arrest at his apartment, during which he was found to be in possession of an enormous collection of child pornography, including images depicting prepubescent minors. In total, more than 200,000 images and videos depicting child pornography were recovered from various electronic devices found in the defendant’s possession.

“The amount of child pornography seized in this case is stunning,” said U.S. Attorney McSwain. “Millette is a depraved hoarder of these illegal images – every one of which was made at the expense of an innocent child, whose life will never be the same. Protecting children by prosecuting criminals like Millette is a top priority of my Office.”

“James Millette couldn’t get enough of these abhorrent images of young children being sexually abused,” said Michael J. Driscoll, Special Agent in Charge of the FBI's Philadelphia Division. “Consumers of child pornography like him perpetuate the exploitation of child victims, something the FBI simply won’t abide. May this lengthy prison sentence be a warning to others involved with such repulsive material. Our Child Exploitation Task Force could soon be knocking at your door.”      

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and 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 the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Matthew Newcomer.

PHILADELPHIA – United States Attorney William M. McSwain announced that Joseph LaForte, 49, of Haverford, PA, was arrested and charged by Indictment with possession of a firearm and ammunition by a convicted felon.

The Indictment alleges that on July 28, 2020, the defendant, a twice-convicted felon, knowingly possessed seven firearms in his home: two shotguns, four loaded handguns, and a loaded rifle.

After the defendant was arrested on August 7, 2020, the Government moved for his detention on the grounds that he was both a risk of flight and a danger to the community. The Government cited, among other things, death threats that LaForte had allegedly made to the customers of his business, Par Funding, a cash advance company based in Philadelphia. After his appearance in federal court yesterday, United States Magistrate Judge Marilyn Heffley detained the defendant until his trial.

“We’re pleased that the Court recognized that no conditions of release would be sufficient here,” said U.S. Attorney McSwain. “Joseph LaForte is where he belongs – in prison – and will now face the consequences of his alleged criminal behavior.”

“Joseph LaForte is a previously convicted felon who continues to demonstrate that he is a threat to the community,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. "This indictment is just another example of his disregard for the law.”

If convicted, the defendant faces a maximum possible sentence of ten years of imprisonment, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.

The case is being investigated by the Federal Bureau of Investigation, the Federal Deposit Insurance Corporation – Office of Inspector General, and the Internal Revenue Service, with assistance from the Lower Merion Township Police and the Pennsylvania State Police Bureau of Criminal Investigations, and is being prosecuted by Assistant United States Attorneys Jonathan Ortiz and Patrick J. Murray.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that Artavius Horne, a/k/a “Lo”, 36, of Philadelphia, PA was sentenced to 45 years in prison and 10 years of supervised release by United States District Court Judge Gerald J. Pappert for sex trafficking three children for years.

In September 2019, Horne was convicted at trial of three counts of sex trafficking minors by force, fraud or coercion. During the week-long trial, the government proved that the defendant organized, operated and led a sex trafficking venture based in and around Northeast Philadelphia between 2013 and 2015, and in 2018. As part of the scheme, the defendant recruited, enticed and maintained three minor children, one of whom was as young as 13 years old, to engage in commercial sexual encounters. Horne created Internet advertisements for each of the victims on the website Backpage.com, and he transported them across state lines to New Jersey, New York, Washington D.C., and Maryland for the purpose of engaging in commercial sex acts. He also kept the victims in apartments throughout Philadelphia, known as “trap houses,” where they were made to engage in commercial sex for the benefit of the defendant. In 2017, Horne was convicted of similar offenses in Bucks County, PA.

“Horne committed these heinous acts while on parole for doing the exact same thing,” said U.S. Attorney McSwain. “He has no regard for the law -- or even basic human decency -- as evidenced by his willingness to sell the bodies of children for sex to benefit himself. He deserves every minute of the 45 years that he received today.”

“Artavius Horne made his living by sexually exploiting children, advertising underage girls for sex with strangers,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “He even transported them to other cities and states, determined to keep the money coming in at their expense. Know that the FBI and our law enforcement partners are working every day to put traffickers like Horne behind bars and ensure some justice for their victims. We ask anyone with knowledge of child or adult sex trafficking to let us know about it, so we can help. Call 1-800-CALL-FBI or go online to tips.fbi.gov. Tipsters can remain anonymous, if they like.” 

The case was investigated by the Federal Bureau of Investigation, and it is being prosecuted by Assistant United States Attorney Melanie Babb Wilmoth.

PHILADELPHIA, PA – United States Attorney William M. McSwain announced today that Patrick Shaknitz, 29, of Croydon, PA, has been arrested and charged by Complaint with one count each of distribution and attempted distribution of child pornography. These charges arise out of the defendant’s alleged distribution of images and videos of child pornography to others, including undercover federal agents, over the Internet.

According to the Complaint, beginning in November 2019, undercover federal agents exchanged private messages with a user identified as “intoeverything1991,” who distributed images and videos containing child pornography. One such video depicts an adult female in a dark blue face mask molesting a minor child. During chats with the agents, the same user described in explicit detail how he abused other children. Subpoenas issued for “intoeverything1991” revealed an IP address and other identifying information allegedly belonging to Shaknitz.

“As alleged in the Complaint, Shaknitz is a depraved abuser of children who multiplied the impact of that abuse by sharing images of it over the Internet,” said U.S. Attorney McSwain. “These children will have to deal with the impact of this 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 responsible for stealing their innocence.”

“The distribution of child pornography results in the continued sexual exploitation of innocent children,” said Michael J. Driscoll, Special Agent in Charge of the FBI's Philadelphia Division. “That’s what pushes the FBI to keep investigating these disturbing but important cases. Protecting kids is paramount and we’ll never give up that fight.”

If convicted, Shaknitz faces a statutory maximum sentence of 20 years’ incarceration with a 5-year mandatory minimum sentence of imprisonment, a lifetime of supervised release, and a $250,000 fine.

The case is being investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Kathryn Deal.

An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.