Eastern District of Pennsylvania
Press releases recorded for this federal judicial district.
Husband and Wife Charged with BriberyRead the Press Release
PHILADELPHIA – A federal indictment was unsealed today charging Nazik Modawi and her husband Abboud Wali with conspiracy and bribery, announced Acting United States Attorney Louis D. Lappen.
According to allegations contained in the indictment, the defendants made two bribe payments in November through December 2016 to Southeastern Pennsylvania Transportation Authority (SEPTA) employees for the purpose of expediting their application for a certification from SEPTA’s disadvantaged business enterprise (DBE) program. SEPTA employees immediately reported the cash payments to authorities.
The charge of conspiracy carry a maximum sentence of 5 years in prison and a $250,000 fine; charges of bribery concerning agencies receiving federal funds carry a maximum sentence of 10 years in prison and a $250,000 fine.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
The case was investigated by the Federal Bureau of Investigation and the United States Department of Transportation, Office of Inspector General, with assistance from the SEPTA Inspector General. It is being prosecuted by Assistant United States Attorney Denise S. Wolf of the U.S. Attorney’s Office for the Eastern District of Pennsylvania.
Folcroft Man Sentenced to 20 Years for Internet Child ExploitationRead the Press Release
Jeffrey Keagle, 49 of, Folcroft, PA was sentenced yesterday to 20 years in federal prison for his conviction for distribution, receipt, and possession of a collection of more than 75,000 images and videos of children being sexually assaulted and abused, announced Acting United States Attorney Louis D. Lappen.
This was Keagle’s first arrest. In addition to the 20 year term of incarceration, District Court Judge Eduardo Robreno also imposed a 20 year term of supervised release, $45,000 in restitution payments to the victims, $400 in special assessments, and forfeiture of all of Keagle’s computer and electronic equipment used in these offenses.
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 Delaware County District Attorney’s Office Criminal Investigation Division and the Federal Bureau of Investigation, and was prosecuted by Assistant United States Attorney Michelle Rotella.
Philadelphia Police Sergeant Charged with BriberyRead the Press Release
PHILADELPHIA – A federal indictment was unsealed yesterday charging Philadelphia Police Sergeant Brian Smith with two counts of bribery and two counts of making material false statements to the FBI, announced Acting United States Attorney Louis D. Lappen.
According to allegations contained in the indictment, the defendant accepted weekly bribe payments over the course of approximately 11 months in return for providing confidential law enforcement information on accident locations to certain tow truck drivers, in violation of the Police Department’s rotational tow policy. The policy was instituted in 2008 as a public safety and consumer protection measure, following a series of highly-publicized violent encounters between tow truck operators competing for highly lucrative towing work.
The charges of bribery concerning agencies receiving federal funds carry a maximum sentence of 10 years in prison and a $250,000 fine; the charges of making false statements carry a maximum sentence of 5 years in prison and a $250,000 fine.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
The case is being prosecuted by Assistant United States Attorney Michelle L. Morgan of the U.S. Attorney’s Office for the Eastern District of Pennsylvania. The case is being investigated by the Federal Bureau of Investigation with assistance from the Philadelphia Police Department Internal Affairs Division.
Philadelphia Man Charged with Hobbs Act RobberyRead the Press Release
Koren Jones, a/k/a “Kuron Jones”, 25, of Philadelphia, Pennsylvania was charged today by Indictment[1] with two counts of Hobbs Act robbery, one count of attempted Hobbs Act robbery, and three counts of using, carrying, and brandishing a firearm during a crime of violence, announced Acting United States Attorney Louis D. Lappen. The indictment specifically charges that the defendant Koren Jones committed a gun-point robbery of A & A grocery store, located at 2000 North Gratz Street, on November 4, 2016 and German grocery store, located at 2267 North 16th Street, on November 5, 2016. During the commission of robbery of the A & A grocery store, a customer was shot in the leg. During the commission of the robbery of the German grocery store, a shot was fired at the employee victim, but no injuries were sustained. Jones is also charged with attempted robbery of Fontain deli, located at 2027 North 16th street, on November 5, 2016. Additionally, Jones is charged with using and carrying a firearm during the robberies and attempted robbery charged in the indictment.
If convicted of all counts, Jones faces a maximum sentence of life imprisonment, with a mandatory 60-year minimum sentence, consecutive to any other sentence imposed, a $1,500,000 fine, and a $600 special assessment.
The case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department. The case is being prosecuted by Assistant United States Attorney Katherine Driscoll.
[1] An Indictment or Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Pagans Associate Sentenced to 15 years in Prison for Prescription Pill MillRead the Press Release
PHILADELPHIA – Today, a federal judge sentenced Joseph Mehl, a/k/a “Joseph Montanero” to 180 months in prison for his role in a prescription pill mill that trafficked oxycodone and other dangerous and addictive opioids. In addition, the Honorable Nitza I. Quiñones Alejandro, United States District Judge, ordered the defendant to serve three years of supervised release upon release from prison, and pay a special assessment of $100, as well as entering a judgment of forfeiture.
On July 14, 2015, a grand jury in Philadelphia charged Mehl, along William O’Brien, a former doctor of osteopathic medicine, and members of the Pagans Motorcycle Club (“Pagans”), an outlaw biker gang known for violence and drug dealing, with conspiring to distribute controlled substances. Mehl was a long-time associate of the Pagans. Together with the Pagans, O’Brien operated a “pill mill” out of his medical offices. O’Brien wrote fraudulent prescriptions for oxycodone and other drugs, while the Pagans and their associates recruited “pseudo-patients” to buy the fraudulent prescriptions. O’Brien charged $250 cash for the first appointment to obtain prescriptions for controlled substances and $200 cash for each subsequent visit. Oxycodone (30 mg) was in high demand by drug dealers who could sell each pill on the street for as much as $25 to $30. O’Brien sold prescriptions for these dangerous and addictive drugs to hundreds of “pseudo-patients.” After filling the prescriptions, the Pagans resold the pills on the street. The investigation showed that from March 2012 to January 2015, more than 700,000 pills containing oxycodone and other Schedule II controlled substances were distributed by members of the conspiracy.
On October 5, 2016, O’Brien, who was convicted by a jury in summer 2016, was sentenced to 30 years in prison. Pagans members Joseph Mitchell and Patrick Treacy were sentenced to 9 nine years’ and 20 years’ imprisonment, respectively, for their roles in the conspiracy.
The case was investigated by the Federal Bureau of Investigation, the Food and Drug Administration Office of Criminal Investigations, and the Department of Health and Human Services Office of the Inspector General. It is being prosecuted by Assistant United States Attorneys Mary Beth Leahy and David E. Troyer.
Elkins Park Man Charged with Possession of Child PornographyRead the Press Release
Matthew McAlpin, 41, of Elkins Park, Pennsylvania was charged today by Information with one count of possession of child pornography, announced Acting United States Attorney Louis D. Lappen.
It is alleged that on December 10, 2015, McAlpin possessed over five thousand images or videos of child pornography, or visual depictions of minors engaged in sexually explicit conduct, and that his collection included depictions involving the sexual victimization of minors under the age of 12 years.
If convicted the defendant faces a maximum possible sentence of 20 years imprisonment, a term of supervised release, $250,000 fine, mandatory restitution, forfeiture, a $100 special assessment, and a $5,000 additional special assessment under the Justice for Victims of Trafficking Act.
The case was investigated by Homeland Security Investigations, Abington Township Police Department, and the Montgomery County Detective Bureau. It is being prosecuted by Assistant United States Attorney Priya T. De Souza.
Allegations Against Philadelphia Retail Food Store of Selling Improperly Labeled Chicken Held Under Insanitary ConditionsRead the Press Release
PHILADELPHIA, PA – Since the United States of America’s filing of a civil complaint in federal district court on February 15, 2017 against Philadelphia retail store J & B Poultry Market, Inc., and its president Johnny Wong, the parties have entered into a Consent Decree to resolve allegations that the defendants sold improperly labeled chickens stored under insanitary conditions, in violation of the Poultry Products Inspection Act. Acting United States Attorney Louis D. Lappen today announced the resolution.
The Poultry Products Inspection Act prohibits companies and individuals from selling “misbranded” or “adulterated” poultry. The Complaint alleges that United States Department of Agriculture (“USDA”) inspections of the retail store established that chickens stored by the defendants were misbranded because they lacked safe handling instructions and other information required by law, and were adulterated because they were held under unacceptable conditions, including in the back of a pick-up truck outside, and at ambient temperatures in the store as high as 80 degrees.
The Consent Decree, which is not final until accepted by the United States District Court, resolves the allegations in the Complaint, prohibits defendants from committing future violations of the Act, and calls for monetary penalties, and other appropriate relief, in the event of future violations.
“This resolution furthers the Department of Justice’s and the USDA’s goal of educating individuals and companies on safe food handling practices, and ensuring compliance with those practices,” said Acting United States Attorney Louis D. Lappen.
The case was handled by Assistant United States Attorney Stacey L. B. Smith. The matter was investigated by the United States Food and Drug Administration, with legal assistance provided by Lauren Axley, USDA Attorney Advisor.
Ambler Man Charged with Defrauding FHARead the Press Release
Eugene Peter Kenworthy, Jr., age 50, of Ambler, PA, was charged today by Indictment with wire fraud, false statements for the purpose of influencing the Federal Housing Administration, aggravated identity theft, and failure to file a tax return, announced Acting United States Attorney Louis Lappen.
If convicted the defendant faces a maximum possible sentence is 166 years’ imprisonment, five years of supervised release, a $5,050,000 fine, and a $1,000 special assessment
The case was investigated by the United States Department of Housing and Urban Development - Office of Inspector General and the Internal Revenue Service - Criminal Investigation, and is being prosecuted by Assistant United States Attorney Karen L. Grigsby.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Houston Pair Charged with Intent to Distribute MethamphetamineRead the Press Release
Norma Ibarra-Gonzalez, age 48, of Houston, Texas, and Marta Ibarra-Castillo, age 36, of Houston, Texas, were charged today by Indictment with possession with intent to distribute 500 grams or more of methamphetamine on July 2, 2017. The case involves the seizure of approximately 13 pounds of methamphetamine announced Acting United States Attorney Louis D. Lappen.
If convicted the defendants face a mandatory minimum sentence of at least 10 years in prison and a maximum of life in prison, a special assessment of $100, at least 5 years of supervised release and a potential fine.
The case was investigated by the Federal Bureau of Investigation, Immigration and Customs Enforcement, and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Jonathan B. Ortiz.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Pennsylvania Return Preparer Sentenced to Prison for Stolen Identity Refund FraudRead the Press Release
An Allentown, Pennsylvania, resident was sentenced to 12 months and one day in prison for using stolen IDs to file fraudulent tax returns, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Louis D. Lappen for the Eastern District of Pennsylvania.
According to documents filed with the court, Barbara Gonzalez, 32, worked as a return preparer at MJ & Associates, a business located in Allentown that provided tax preparation, check cashing and other services. Gonzalez conspired with others to obtain IDs of Puerto Rico residents and used them to file tax returns with the Internal Revenue Service (IRS) fraudulently seeking approximately $635,594 in refunds. She directed the IRS to deposit the refunds onto pre-paid debit cards and to mail them to addresses she and her co-conspirators controlled. The fraudulently obtained refund checks were cashed by other co-conspirators, including Jessenia Cordero, who operated MJ & Associates. Cordero was recently sentenced to 42 months in prison.
In addition to the term of prison imposed, U.S. District Judge Edward G. Smith ordered Gonzalez to serve three years of supervised release and to pay $319,610.39 in restitution to the IRS.
Acting Deputy Assistant Attorney General Goldberg and Acting U.S. Attorney Lappen commended special agents of IRS Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney David Ignall and Trial Attorney Matthew J. Kluge of the Tax Division, who prosecuted the case.
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
Pennsylvania Return Preparer Sentenced to Prison for Stolen Identity Refund FraudRead the Press Release
An Allentown, Pennsylvania, resident was sentenced to 12 months and one day in prison for using stolen IDs to file fraudulent tax returns, announced Acting U.S. Attorney Louis D. Lappen for the Eastern District of Pennsylvania and Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.
According to documents filed with the court, Barbara Gonzalez, 32, worked as a return preparer at MJ & Associates, a business located in Allentown that provided tax preparation, check cashing and other services. Gonzalez conspired with others to obtain IDs of Puerto Rico residents and used them to file tax returns with the Internal Revenue Service (IRS) fraudulently seeking approximately $635,594 in refunds. She directed the IRS to deposit the refunds onto pre-paid debit cards and to mail them to addresses she and her co-conspirators controlled. The fraudulently obtained refund checks were cashed by other co-conspirators, including Jessenia Cordero, who operated MJ & Associates. Cordero was recently sentenced to 42 months in prison.
In addition to the term of prison imposed, U.S. District Judge Edward G. Smith ordered Gonzalez to serve three years of supervised release and to pay $319,610.39 in restitution to the IRS.
Acting U.S. Attorney Lappen and Acting Deputy Assistant Attorney General Goldberg commended special agents of IRS Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney David Ignall and Trial Attorney Matthew J. Kluge of the Tax Division, who prosecuted the case.
Norristown Man Charged with Illegal Reentry After DeportationRead the Press Release
Rigoberto Roque-Vazquez, of Norristown, PA, was charged today by Indictment with illegal reentry after deportation, announced Acting United States Attorney Louis D. Lappen. The indictment alleges that on or about July 13, 2017, Roque-Vazquez, an alien, and native and citizen of Guatemala, was found in the United States after having been deported from the United States on or about June 11, 2013, March 21, 2014, and October 2, 2015.
If convicted the defendant faces a maximum possible sentence of two years.
The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Sean P. McDonnell.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Mask-Wearing Robber Sentenced to 87 Months in PrisonRead the Press Release
PHILADELPHIA – Charles Sampson, 61, of Chester, PA, was sentenced today to 87 months in prison attempting to rob a postal employee with a dangerous weapon at the Chester Post Office post offices. Sampson pleaded guilty on March 6, 2017. In addition to the prison term, U.S. District Court Judge Mitchell S. Goldberg ordered three years of supervised release and a $100 special assessment.
On November 30, 2016, Sampson entered the United States Post office in Chester, PA, wearing a mask and carrying a long golf style umbrella which was open to conceal his identity. Sampson was carrying a silver firearm or a facsimile firearm which he pointed at the postal clerk and demanded cash. Surveillance video in the area captured Sampson leaving the scene, without the mask and carrying the umbrella. Based on the video, Postal Inspectors created a reward flyer which was distributed to local media and local area residents. In response, law enforcement received several tips which led Postal Inspectors to Sampson.
The case was investigated by the United States Postal Inspection Service and the Chester Police Department. It was prosecuted by Assistant United States Attorney Jessica Natali.
Former QVC Director Charged in Million-Dollar Fraud Scheme Involving Hollywood PR Agency and NYC Production CompanyRead the Press Release
PHILADELPHIA – James D. Falkowski, a/k/a “Jamie Falkowski,” 42, of Buffalo, New York, was charged by indictment1, unsealed today, with eleven counts of wire fraud, eleven counts of mail fraud, and one count of conspiracy, announced Acting United States Attorney Louis D. Lappen.
According to the indictment, Falkowski – while working as a QVC Director responsible for enhancing QVC’s brand and reputation in the entertainment and fashion industries – engaged in a multi-layered fraud scheme that enabled him to live a luxury lifestyle through fraud. Falkowski allegedly used a variety of methods to fraudulently obtain from QVC over $1,000,000 worth of money, goods and services, all without QVC’s knowledge or approval. Specifically, the indictment alleges that Falkowski fraudulently caused QVC to pay for: hundreds of thousands of dollars of his personal expenses, including Falkowski’s first-class travel, luxury hotel and resort stays, spa treatments, upscale restaurants, luxury clothing, luxury accessories, and botox treatment; approximately $200,000 in private luxury chauffeur rides for himself and his friends and associates; approximately $70,000 in payments to his personal vendors and creditors, including over $28,000 in payments to a custom furniture maker for two tables for Falkowski’s Philadelphia apartment; and approximately $59,500 in pre-paid American Express, Tom Ford, and Barney’s New York gift cards that he used for himself. Falkowski also entered into fraudulent kickback arrangements with two separate QVC vendors, who collectively paid Falkowski approximately $240,000 as his cut of the kickback arrangement. Allegedly, Falkowski fraudulently abused QVC’s product requisition process to shower his friends and associates with at least tens of thousands of dollars’ worth of QVC products, all at QVC’s expense.
The indictment alleges that Falkowski caused QVC to hire Los Angeles-based PR firm “The Steinberg Group,” d/b/a “dOMAIN” (“TSG”), to serve as QVC’s outside PR agency. After QVC hired TSG, Falkowski allegedly used TSG to “launder” hundreds of thousands of dollars of his personal expenses. Falkowski did this by causing TSG to reimburse him directly for his personal expenses, but after paying Falkowski in the dollar amounts he commanded, TSG subsequently obtained reimbursement from QVC by issuing fraudulent invoices to QVC often written at Falkowski’s direction and, in certain instances, written by Falkowski himself. Those fraudulent invoices, by design, did not reveal to QVC the true nature of Falkowski’s expenses. Falkowski also caused TSG to reimburse him for expenses that he also submitted directly to QVC for reimbursement, thus causing QVC to unknowingly repay him multiple times for the same expenses. And, in some instances, Falkowski allegedly created entirely fake invoices and bills for submission to QVC to hide the true costs of his expenses from QVC. Falkowski also allegedly used a second QVC vendor, “SPEC Entertainment,” d/b/a “CS Global” (“SPEC”), to fraudulently alter invoices that SPEC submitted to QVC to hide the true costs of Falkowski’s expenses – including by reducing the cost of Falkowski’s luxury hotel charges on invoices submitted to QVC by tens of thousands of dollars, and by artificially inflating an event invoice to cover Falkowski’s personal vacation to the Turks and Caicos Islands.
Separately, the indictment alleges that Falkowski entered into fraudulent kickback arrangements with TSG and SPEC – both of which Falkowski caused QVC to hire, and both of whose relationships with QVC Falkowski controlled. Regarding TSG, Falkowski allegedly instructed TSG’s President and TSG’s General Counsel how to become a QVC “vendor representative” and earn royalties from QVC. Falkowski thereafter secretly assisted TSG leadership in negotiating against QVC – his own employer – by providing TSG with QVC’s proprietary contractual information, which enabled TSG leadership to negotiate for, and obtain, a larger royalty percentage over a longer period of time from QVC. In return, TSG leadership secretly cut Falkowski into the deal, and made him their “silent partner” – agreeing to pay Falkowski a kickback of fifty percent (50%) on all royalty payments received from QVC, as well as for funds received from a separate deal related to product sold by a QVC competitor. After Falkowski was terminated by QVC, Falkowski allegedly sent a private email to TSG’s President and TSG’s General Counsel, stating: “Let’s be clear of a few things: [. . . ] You have a better deal [at QVC] than any other rep because of me solely. [ ] we do not have any contract between us of our deal JUST [TSG President’s] word that we split things 50/50 always. This was because of the complications while I was at QVC.” TSG, which did business as “Domain Miami LLC” for its royalty deal with QVC, earned hundreds of thousands of dollars in royalties from QVC pursuant to the deal negotiated with Falkowski’s secret assistance, of which TSG kicked back approximately $160,981.73 to Falkowski as his share of their fraudulent deal.
Falkowski also allegedly entered into a similar fraudulent kickback arrangement with SPEC, pursuant to which he instructed SPEC how to serve as a QVC vendor representative, and in turn was secretly cut into the deal by SPEC as a one-third (33%) partner. SPEC earned hundreds of thousands of dollars in royalties from QVC, of which it kicked back approximately $81,571.23 to Falkowski as his share of their fraudulent deal.
If convicted of all charges, Falkowski faces a potential advisory sentencing guideline range of 108-135 months in prison, three years of supervised release, a possible fine, and a $2,300 special assessment. Restitution may also be ordered.
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney James Petkun.
1An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Chester, PA Man Charged with Illegal Reentry After DeportationRead the Press Release
Estuardo Felix, a/k/a “Estuardo Lopez-Felix,” of Chester, PA, was charged today by Indictment with illegal reentry after deportation, announced Acting United States Attorney Louis D. Lappen. The indictment alleges that on or about July 12, 2017, Felix, an alien, and native and citizen of Guatemala, was found in the United States after having been deported from the United States on or about June 21, 2012 and March 18, 2015.
If convicted the defendant faces a maximum possible sentence of ten years.
The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Jonathan B. Ortiz.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Kutztown Bus Company Agrees to Use Wheelchair Accessible Buses and Pay PenaltyRead the Press Release
PHILADELPHIA – Carl R. Bieber, Inc., d/b/a Bieber Tourways, a transportation company headquartered in Kutztown, Pennsylvania, has entered into a settlement agreement with the United States to resolve allegations that the company violated the Americans with Disabilities Act (ADA) by failing to use wheelchair-accessible buses on fixed-route service.
Under the ADA, large operators like Bieber Tourways must ensure that 100 percent of the buses in their fixed-route fleet are readily accessible to and usable by individuals with disabilities, including individuals who use wheelchairs. The settlement arises out of an investigation into whether Bieber Tourways complied with this requirement by providing accessible buses on its fixed-route services to and from Philadelphia and New York City.
During the investigation, the United States obtained documents showing that the company used a fixed-route fleet that is not 100 percent accessible, contrary to federal law. The United States determined that, in one particular month, Bieber Tourways used non-accessible buses on fixed routes nearly half the time.
To resolve the matter, Bieber Tourways has agreed to comply with its obligations under the ADA, pay a civil penalty of $20,000.00, use only wheelchair-accessible over-the-road buses for fixed-route service, and publish a notice on its Internet home page stating that all Bieber Tourways motor coaches are wheelchair-accessible on the fixed route schedule. In addition, Bieber Tourways has agreed that it will no longer publish bus schedules or signs stating that passengers with disabilities must give the company advance notice in order to receive accessible transportation on the fixed route service. Bieber Tourways has also agreed to train its employees about the ADA requirements for large, fixed-route over-the-road bus operators. Bieber Tourways must meet these requirements according to a timetable in the agreement.
The U.S. Attorney’s Office for the Eastern District of Pennsylvania is committed to investigating alleged violations of the Americans with Disabilities Act. Those interested in learning more about obligations under the Americans with Disabilities Act may access www.ada.gov, or call the Department of Justice’s toll-free information line at (800) 514-0301 or (800) 514-0383 (TDD). Information about filing a complaint, including instructions for filing a complaint online, can be found at www.ada.gov/filing_complaint.htm.
Assistant U.S. Attorney Michael S. Macko handled the matter in conjunction with the Department of Justice’s Civil Rights Division.
Bronx, NY Man faces Charges of Illict Sexual Conduct and Child PornographyRead the Press Release
Jose R. Flores, 39, of Bronx, New York, was charged today by Indictment with travel to engage in illicit sexual conduct, and the production and possession of child pornography, announced Acting United States Attorney Louis D. Lappen.
If convicted the defendant faces a maximum possible sentence of lifetime incarceration, a mandatory minimum fifteen years’ imprisonment, a mandatory minimum five years’ supervised release up to lifetime supervised release, a $1,250,000,000 fine, a $500 special assessment and an additional $25,000 Justice for Victims special assessment.
The case was investigated by Bethlehem Police Department and the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Sherri A. Stephan.
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 Attorney’s 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.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia, PA Man Charged with Illgeal Reentry After DeportationRead the Press Release
Amauris Ventura Alberto Castro, a/k/a “Amauris Castro,” a/k/a “Edison Hernandez,” of Philadelphia, PA, was charged today by Indictment with illegal reentry after deportation, announced Acting United States Attorney Louis D. Lappen. The indictment alleges that on or about June 29, 2017, Alberto Castro, an alien, and native and citizen of the Dominican Republic, was found in the United States after having been deported from the United States on or about March 18, 2014.
If convicted the defendant faces a maximum possible sentence of twenty years.
The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney M. Beth Leahy.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Lancaster Man with AK-47 Charged with Intent to Distribute HeroinRead the Press Release
Jose Enrique Gonzalez a/k/a “Jossy Gonzalez,” of Lancaster, PA, was charged today by four-count Indictment with possession with intent to distribute heroin, using and carrying a firearm in relation to a drug trafficking offense, possessing a firearm prohibited by the National Firearms Act, and possessing a firearm after sustaining a prior felony conviction, announced Acting United States Attorney Louis D. Lappen.
According to the Indictment, on June 14, 2016, in Lancaster, the defendant was found in possession of quantities of heroin, an AK-47 style rifle, multiple magazines of ammunition including a loaded 75-round drum magazine, and a silencer. If convicted, the defendant could face up to 50 years of incarceration, a lifetime of supervised release, a $1,020,000 fine, and a $400 special assessment.
The case was investigated by the Bureau of Alcohol, Tobacco, and Firearms (ATF), the Lancaster County Drug Enforcement Task Force, Lancaster County Detectives, and the Lancaster City Police Department. The case is being prosecuted by Assistant United States Attorney Sean McDonnell.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Pennsylvania Man Pleads Guilty to Identity Theft and Conspiring to File Fraudulent Tax Refund ClaimsRead the Press Release
A Pennsylvania man pleaded guilty to identity theft and conspiring to file fraudulent tax refund claims, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Louis D. Lappen for the Eastern District of Pennsylvania.
According to documents and information provided to the court, Steeve Zamor, 28, conspired with others to use stolen IDs to file returns with the Internal Revenue Service (IRS) fraudulently seeking tax refunds. Zamor also recruited other individuals to join the scheme. Despite not having a tax preparation business, Zamor opened up a bank account in the name of “Steeve Zamor Tax Services” to facilitate the crime. Zamor and his co-conspirators directed the IRS to deposit some of the fraudulently obtained refunds into this account. Zamor withdrew money from this account to provide to other co-conspirators, keeping a substantial portion of the illegal proceeds for his own use. He admitted to causing a tax loss of $366,135.53.
Zamor is scheduled to be sentenced on Nov. 14 before U.S. District Court Judge John R. Padova. He faces a statutory maximum sentence of 10 years in prison on the conspiracy charge and 15 years in prison on the identity theft charge, as well as a period of supervised release, restitution and monetary penalties.
Acting Deputy Assistant Attorney General Goldberg and Acting U.S. Attorney Lappen commended special agents of IRS Criminal Investigation and the FBI, who conducted the investigation, and Assistant U.S. Attorney David Ignall and Trial Attorney Eric B. Powers of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
Pennsylvania Man Sentenced to Prison for Using Stolen ID’s to Seek Fraudulent Tax RefundsRead the Press Release
A Philadelphia man was sentenced to eight months in prison for conspiring to defraud the United States and to aiding and abetting the filing of false claims for tax refunds, announced Acting U.S. Attorney Louis D. Lappen for the Eastern District of Pennsylvania and Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division
According to documents filed with the court, Shamback Francois, 28, engaged in a scheme to fraudulently obtain income tax refunds through the filing of false tax returns using stolen personal identifying information. At least one of Francois’s co-conspirators electronically filed the returns, which directed that the fraudulently claimed refunds be deposited into a bank account in the name of Shamback Tax Services. Francois did not have a tax preparation service, but had opened up the account in order to facilitate the crime. Francois withdrew funds from this account to pay his co-conspirators. He admitted to causing a loss of $425,841.14.
In addition to the term of prison imposed, U.S. District Judge John R. Padova of the Eastern District of Pennsylvania ordered Francois to serve three years of supervised release and to pay $425,841.14 in restitution to the Internal Revenue Service (IRS).
Acting U.S. Attorney Lappen and Acting Deputy Assistant Attorney General Goldberg commended special agents of IRS Criminal Investigation and the FBI, who conducted the investigation, and Assistant U.S. Attorney David Ignall and Trial Attorney Eric B. Powers of the Tax Division, who are prosecuting the case.
Bucks County Public Officials Face Additional ChargesRead the Press Release
John I. Waltman, 59, of Trevose, Pennsylvania, Robert P. Hoopes, 70, of Doylestown, Pennsylvania, and Bernard T. Rafferty, 62, of Langhorne, Pennsylvania were charged in a Superseding Indictment[1] with one count of conspiracy to commit money laundering, three counts of money laundering, one count of honest services wire fraud, three counts of honest services mail fraud, and Hobbs Act extortion under color of official right, announced Acting United States Attorney Louis D. Lappen.
Hoopes was also charged with one count of witness tampering. In addition, the Superseding Indictment added Kevin M. Biederman, 34, who is charged with one count of conspiracy to commit money laundering, three counts of money laundering, and one count of bank bribery.
From 2011 to December 2016, Waltman was a Magisterial District Judge in Bucks County, Pennsylvania. From February 2016 to December 2016, Hoopes was the Director of Public Safety in Lower Southampton, Pennsylvania. In this position, Hoopes had authority over all police, fire, and emergency operations in the township. Hoopes previously operated a legal practice in Doylestown, Pennsylvania. From 1998 to December 2016, Rafferty was a Deputy Constable in Bucks County. Rafferty controlled Raff’s Consulting LLC, a corporation registered with the Pennsylvania Department of State on May 30, 2011.
According to the Superseding Indictment, in November 2016, Waltman, Hoopes, and Rafferty accepted a bribe of $1,000, as well as the promise of other fees, in exchange for Waltman, Hoopes, and Rafferty to use their positions as public officials to “fix” a traffic case before Waltman in Bucks County Magisterial District Court. In January 2017, Hoopes allegedly tried to influence a witness to falsely testify before the federal grand jury regarding the disposition of this $1,000 bribe.
In addition, according to the Superseding Indictment, from June 2015 to November 2016, Waltman, Hoopes, Rafferty, and Biedmeran conspired to launder funds represented to be proceeds from health care fraud, illegal drug trafficking, and bank fraud. Moreover, from June 2016 to August 2016, Waltman, Hoopes, Rafferty, and Biederman laundered $400,000 in cash, represented to be proceeds from health care fraud and illegal drug trafficking, and took money laundering fees totaling $80,000 in cash.
Further, according to the superseding indictment, in June 2015, Biederman, who was then an employee of Philadelphia Federal Credit Union (“PFCU”), solicited and accepted a bribe of $1,600 in exchange for agreeing to influence PFCU’s approval of a loan.
“As alleged in today’s superseding indictment, we have uncovered another instance of public officials -- who should be serving the public good -- subverting justice in order to serve themselves,” said Acting United States Attorney Louis D. Lappen. “Our office is committed to investigating and prosecuting public corruption cases at every level. In addition, we will continue to hold accountable anyone who attempts to improperly influence the federal grand jury process or the testimony of witnesses.”
"They must've thought they had a pretty good thing going," said Michael Harpster, Special Agent in Charge of the FBI's Philadelphia Division. "As alleged in the indictments, these three public officials padded their income with ease, turning a tidy profit as part-time money-launderers. Ostensibly in the service of drug dealers and other crooks, they took steps to conceal the origins of piles of 'dirty money.' Add the allegations of bribery, extortion, witness-tampering -- and you've practically got a playbook of the varied ways to violate the public trust. The FBI is committed to investigating public corruption cases, and bringing corrupt officials to justice."
“The laws of the land apply to everyone, even public and banking officials. The public place a great deal of trust in these officials, and that trust is broken when they commit crimes,” said IRS Criminal Investigation Acting Special Agent in Charge Gregory Floyd. "Today's superseding indictment again emphasizes IRS, Criminal Investigation, FBI, HSI and the U.S. Attorney’s office will continue their aggressive pursuit of public and banking officials who use fraudulent methods in an attempt to corrupt our nation."
"Homeland Security Investigations is pleased to have teamed with our federal and local law enforcement partners to hold accountable public officials who betray the trust of the community they are sworn to serve by engaging in criminal behavior. The public places an enormous amount of trust in public officials and activities like those allegedly committed by the defendants in this case erodes the fabric of public trust," said Marlon V. Miller, special agent in charge of HSI Philadelphia. "HSI special agents will continue to vigorously pursue those who think the law does not apply to their criminal acts."
If convicted, Waltman and Rafferty each face a maximum possible sentence of 180 years in prison, three years of supervised release, a $2.25 million fine, and a $900 special assessment.
If convicted, Hoopes faces a maximum possible sentence of 200 years in prison, three years of supervised release, a $2.5 million fine, and a $1,000 special assessment.
If convicted, Biederman faces a maximum possible sentence of 110 years in prison, five years of supervised release, a $2 million fine, and a $500 special assessment
The case was investigated by the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigations, U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) and the Pennsylvania State Police. It is being prosecuted by Assistant United States Attorney Vineet Gauri.
[1] An Indictment, Information, or Criminal Complaint is an accusation. A defendant is presumed
innocent unless and until proven guilty.
Pub Owner Pleads Guilty to Wire Fraud in Scheme Defrauding PatronsRead the Press Release
Michael Hoffner, Sr., 52, of Voorhees, New Jersey, entered a guilty plea today before the Honorable Mitchell S. Goldberg to 40 counts of wire fraud, announced Acting United States Attorney Louis D. Lappen.
According to the superseding indictment, Hoffner owned the Brown Street Pub in Philadelphia, Pennsylvania. Hoffner admitted that on 40 occasions between September and December 2012, Hoffner used a stolen credit number to make charges at the pub to credit and debit cards issued by American Express, Navy Federal Credit Union, USAA, ACNB, and the State Employees Credit Union of Maryland. The average fraudulent charge was more than $2,000. The cardholders were not aware of and did not authorize these transactions. The proceeds of these transactions, more than $87,000, and went into an account that Hoffner controlled.
The defendant faces a maximum possible sentence of 800 years in prison, a $10,000,000 fine, and three years of supervised release. The Court has not yet set a sentencing date.
The case was investigated by the United States Secret Service, the Internal Revenue Service-Criminal Investigation Division, and the Federal Deposit Insurance Corporation Office of Inspector General, and is being prosecuted by Assistant United States Attorneys David J. Ignall and Christopher J. Mannion.Philadelphia Man Charged with Twelve Counts of Drug DisitributionRead the Press Release
Richard Bernard, 38, of Philadelphia, Pennsylvania was charged today in a 12 count Indictment with distribution of heroin, two counts of possession with intent to distribute heroin, possession with intent to distribute cocaine, possession with intent to distribute cocaine base, possession with intent to distribute oxycodone, selling counterfeit federal reserve notes, possession of counterfeit federal reserve notes, manufacturing counterfeit federal reserve notes, assaulting a federal officer, possession of a firearm possession by a convicted felon, and possession of a firearm in in furtherance of a drug trafficking crime, announced Acting United States Attorney Louis D. Lappen.
If convicted of all of the charges against him the defendant faces a maximum possible sentence of life imprisonment, at least three years of supervised release up to lifetime supervised release, and a $7,500,000 fine.
The case was investigated by the United States Drug Enforcement Administration, the United States Secret Service, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Philadelphia Police Department and is being prosecuted by Assistant United States Attorneys Linwood C. Wright, Jr. and Sarah Damiani.
Former Reading, PA Mayor Charged with Violations of Federal Public Corruption LawsRead the Press Release
PHILADELPHIA – A federal indictment1 was unsealed today charging former Mayor Vaughn Spencer, 70, of Reading, for alleged violations of federal public corruption laws, announced Acting United States Attorney Louis D. Lappen. The indictment charges Spencer with 9 counts of bribery, 1 count of honest services wire fraud and conspiracy. Rebecca Acosta, 40, of Reading, and James Hickey, 54, of Allentown, were also included on the indictment. Acosta was charged with 2 counts of bribery, 1 count of mail fraud, 1 count of wire fraud, and conspiracy. Hickey was charged with 1 count of bribery, 1 count of mail fraud, 1 count of wire fraud and conspiracy.
According to allegations contained in the indictment, Spencer was involved in illegal activities associated with his position as an elected official: today’s announcement is the culmination of a several year investigation involving the pleas of 5 other individuals. Former Reading City officials and businesspersons pursuing contracts with the city of Reading are among those who have already plead guilty. The indictment sets forth numerous overt acts committed by Vaughn Spencer in the course of the conspiracy in which his objective was to maximize his campaign contributions through unlawful means.
In one egregious example, Mayor Spencer offered a bribe through City Council President Francisco Acosta to Francisco Acosta’s wife, School Board President Rebecca Acosta, who was running for district justice. Mayor Spencer gave the bribe in order to persuade Francisco Acosta to seek repeal of a city Code of Ethics ordinance that capped at $2,600 individual campaign contributions to persons running for city office, like Spencer, who was running as an incumbent in the democratic primary.
“The mayor of Allentown and the former mayor of Reading charged in the two indictments unsealed today sold their offices to the highest bidder -- violating the trust and confidence of the citizens of their cities,” said Acting United States Attorney Louis Lappen. “Both mayors, working with other corrupt officials and businesspeople, directed lucrative contracts to companies who agreed to provide campaign contributions in exchange for work. In an astounding act of irony, former Mayor Spencer bribed the President of City Council to introduce legislation repealing a Reading anti-corruption statute. The United States Attorney’s Office will continue to aggressively investigate and prosecute public officials who operate these “pay to play” schemes.
"As alleged in these indictments, 'pay to play' was the order of the day in Allentown, and in Reading," said Michael Harpster, Special Agent in Charge of the FBI's Philadelphia Division, "with those cities' mayors manipulating the levers of power for their own ways and means. As charged, Edwin Pawlowski and Vaughn Spencer brazenly and repeatedly sold off city contracts to bankroll their political futures. This years-long investigation illuminated troubling conduct for which all of those indicted must now answer. The FBI is committed to fighting public corruption, which erodes the trust of 'we the people' and cheapens our cherished democracy."
“Internal Revenue Service Criminal Investigation (IRS-CI) is diligent in unraveling the fraudulent actions of those, such as Edwin Pawlowski and Vaughn Spencer, who scheme to defraud citizens of Allentown and Reading who placed their trust in him,” said Acting Special Agent in Charge Gregory Floyd of IRS-CI’s Philadelphia Field Office. IRS-Criminal Investigation is proud to be a member of the formidable team that is rooting out public corruption. “Today’s indictment is a reminder that there are detrimental consequences for this type of criminal behavior.”
The charge of bribery concerning programs receiving federal funds carries a maximum sentence of 10 years in prison and a $250,000 fine; the charge of honest services wire fraud carries a maximum sentence of 20 years in prison and a $250,000 fine; and the charge of conspiracy carries a maximum sentence of 5 years in prison and a $250,000 fine.
The case is being prosecuted by Assistant United States Attorneys Michelle Morgan and Anthony Wzorek of the U.S. Attorney’s Office for the Eastern District of Pennsylvania. The case is being investigated by the Federal Bureau of Investigation, Internal Revenue Service - Criminal Investigation and Pennsylvania State Police.
1An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Allentown Mayor Charged in Pay to Play SchemeRead the Press Release
PHILADELPHIA – A federal indictment1 was unsealed today charging Mayor Edwin Pawlowski, 52, of Allentown, for alleged violations of federal public corruption laws, announced Acting United States Attorney Louis D. Lappen. The indictment charges Pawlowski with 14 counts of bribery, 9 counts of mail fraud, 9 counts of wire fraud, 6 counts of honest services wire fraud, 2 counts of honest services mail fraud, 3 counts of attempted Hobbs Act extortion under color of official right, 3 counts of travel act bribery, 7 counts of making material false statements, and conspiracy. Scott Allinson, 55, of Allentown, and James Hickey, 54, of Allentown, were also included on the indictment. Allinson was charged with 1 count of bribery and conspiracy. Hickey was charged with 4 counts of wire fraud, 2 counts of mail fraud, 4 counts of honest services wire fraud, 2 counts of honest services mail fraud, and conspiracy.
According to allegations contained in the indictment, Pawlowski was potentially involved in illegal activities associated with his position as a Mayor of Allentown. Today’s announcement is the culmination of a several year investigation involving the pleas of 10 others. Among those who have plead are former Allentown City Officials and businesspersons seeking contracts with the city of Allentown.
The indictment alleges that Pawlowski accepted the bribes on numerous separate occasions. According to the indictment, Pawlowski allegedly accepted over $150,000 in campaign contributions in exchange for the use of his official position. Among the most notable of the explicit quid pro quo examples is a three million dollar contract awarded to an engineering firm.
“The mayor of Allentown and the former mayor of Reading charged in the two indictments unsealed today sold their offices to the highest bidder -- violating the trust and confidence of the citizens of their cities,” said Acting United States Attorney Louis Lappen. “Both mayors, working with other corrupt officials and businesspeople, directed lucrative contracts to companies who agreed to provide campaign contributions in exchange for work. In an astounding act of irony, former Mayor Spencer bribed the President of City Council to introduce legislation repealing a Reading anti-corruption statute. The United States Attorney’s Office will continue to aggressively investigate and prosecute public officials who operate these “pay to play” schemes.
"As alleged in these indictments, 'pay to play' was the order of the day in Allentown, and in Reading," said Michael Harpster, Special Agent in Charge of the FBI's Philadelphia Division, "with those cities' mayors manipulating the levers of power for their own ways and means. As charged, Edwin Pawlowski and Vaughn Spencer brazenly and repeatedly sold off city contracts to bankroll their political futures. This years-long investigation illuminated troubling conduct for which all of those indicted must now answer. The FBI is committed to fighting public corruption, which erodes the trust of 'we the people' and cheapens our cherished democracy."
“Internal Revenue Service Criminal Investigation (IRS-CI) is diligent in unraveling the fraudulent actions of those, such as Edwin Pawlowski and Vaughn Spencer, who scheme to defraud citizens of Allentown and Reading who placed their trust in him,” said Acting Special Agent in Charge Gregory Floyd of IRS-CI’s Philadelphia Field Office. IRS-Criminal Investigation is proud to be a member of the formidable team that is rooting out public corruption. “Today’s indictment is a reminder that there are detrimental consequences for this type of criminal behavior.”
The charge of bribery concerning programs receiving federal funds carries a maximum sentence of 10 years in prison and a $250,000 fine; the charges of mail fraud, wire fraud, honest services mail fraud, honest services wire fraud, and attempted Hobbs Act all carry an individual maximum sentence of 20 years in prison and a $250,000 fine; and the charges of conspiracy, travel act bribery and making material false statements all carry an individual maximum sentence of 5 years in prison and a $250,000 fine.
The case is being prosecuted by Assistant United States Attorney Anthony J. Wzorek of the U.S. Attorney’s Office for the Eastern District of Pennsylvania. The case is being investigated by the Federal Bureau of Investigation, Internal Revenue Service - Criminal Investigation and Pennsylvania State Police.
1An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Woman Pleads Guilty to Charges of Causing False Statements to the Federal Election CommissionRead the Press Release
A Philadelphia woman pleaded guilty to a criminal information unsealed today charging her with causing false statements to the Federal Election Commission (FEC) in connection with a 2012 congressional primary election. Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and Acting U.S. Attorney Louis D. Lappen for the Eastern District of Pennsylvania made the announcement.
According to the plea memorandum filed today, Carolyn Cavaness, 34, engaged in a falsification scheme involving payments to a candidate for the Democratic Party’s nomination for Member of the U.S. House of Representatives. According to the plea memorandum, those payments came from the campaign committee of the candidate’s political opponent for the purpose of removing the candidate from the 2012 Democratic race for Pennsylvania’s First Congressional District. Cavaness was a member of the candidate’s campaign staff.
As set forth in the criminal information and the government’s plea memorandum, Cavaness admitted that in or about February 2012, her candidate withdrew from the primary election pursuant to an agreement with his opponent, who promised to pay the candidate $90,000 from his campaign funds to be used to repay the candidate’s campaign debts. Cavaness admitted that she was aware that under the applicable law, a contribution from one authorized campaign to another could not exceed $2,000 for the primary election, and that the FEC required campaigns to file periodic reports itemizing the campaign’s contributions and expenditures during the reporting period. However, in order to conceal the fact that his opponent’s campaign committee paid his campaign debts, according to the plea memorandum, the candidate instructed Cavaness to create a company whose sole purpose would be to receive the funds from his opponent’s political campaign and repay the candidate’s campaign debts. As described in the plea memorandum, Cavaness admitted that she did so, and that the payments were then routed through two political consultants, who created false invoices to generate a paper trail intended to justify the payments from the candidate’s opponent’s campaign committee.
According to the plea memorandum, Cavaness used the money from the opponent’s campaign committee to repay the candidate’s campaign debts and for personal expenses, but failed to disclose this information to the FEC. Instead, according to the plea memorandum, Cavaness knowingly and intentionally caused the candidate’s campaign committee to file false reports with the FEC which did not disclose or reference the funds received from his opponent’s campaign committee, did not mention the companies of the political consultants through which the payments were routed and falsely listed the same debts owed by the candidate’s campaign that had been disclosed on earlier reports, despite the fact that those debts had been repaid using funds paid to the candidate by his opponent’s campaign committee.
The case is being investigated by the FBI and prosecuted by Assistant U.S. Attorney Eric Gibson and Trial Attorney Jonathan Kravis of the Criminal Division’s Public Integrity Section.
Philadelphia Woman Pleads Guilty to Charges of Causing False Statements to the Federal Election CommissionRead the Press Release
Carolyn Cavaness, age 34, of Ardmore, Pennsylvania, pled guilty to a criminal information unsealed today charging her with causing false statements to the Federal Election Commission (FEC) in connection with a 2012 congressional primary election. Acting U.S. Attorney Louis D. Lappen for the Eastern District of Pennsylvania and Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division made the announcement.
According to the plea agreement, Cavaness engaged in a falsification scheme involving payments to a candidate for the Democratic Party’s nomination for Member of the U.S. House of Representatives, identified in the information as Candidate B. According to the plea agreement, those payments came from Candidate B’s political opponent, identified in the information as Candidate A, for the purpose of removing Candidate B from the 2012 Democratic race for Pennsylvania’s First Congressional District. Cavaness was a member of Candidate B’s campaign staff.
Pursuant to the plea agreement, the defendant admitted that in or about February 2012, Candidate B withdrew from the primary election pursuant to an agreement with his opponent, Candidate A, who promised to pay Candidate B $90,000 from his campaign funds to be used to repay Candidate B’s campaign debts. Cavaness admitted that she was aware that under the applicable law, a contribution from one authorized campaign to another could not exceed $2,000 for the primary election, and that the FEC required campaigns to file periodic reports itemizing the campaign’s contributions and expenditures during the reporting period. However, in order to conceal the fact that Candidate A’s campaign committee paid Candidate B’s campaign debts, according to the plea agreement, Candidate B instructed Cavaness to create a company whose sole purpose would be to receive the funds from Candidate A’s political campaign and repay Candidate B’s campaign debts. Admissions in the plea agreements revealed that Cavaness did so, and that the payments were then routed through two political consultants, who created false invoices to generate a paper trail intended to justify the payments from Candidate A’s campaign committee.
According to the plea agreement, Cavaness used the money from Candidate A’s campaign committee to repay Candidate B’s campaign debts and for personal expenses, but failed to disclose this information to the FEC. Instead, according to the plea agreement, Cavaness knowingly and intentionally caused Candidate B’s campaign committee to file false reports with the FEC which did not disclose or reference the funds received from Candidate A’s campaign committee, did not mention the companies of the political consultants through whom the payments were routed, and falsely listed the same debts owed by Candidate B’s campaign that had been disclosed on earlier reports, despite the fact that those debts had been repaid using funds paid to Candidate B by Candidate A’s campaign committee.
The case is being investigated by the FBI and prosecuted by Assistant U.S. Attorney Eric Gibson and Trial Attorney Jonathan Kravis of the Criminal Division’s Public Integrity Section.
Undocumented Alien Charged with Identity TheftRead the Press Release
PHILADELPHIA - An indictment was filed charging Eulogio Bautista, an undocumented alien from Mexico, with producing a false identification document after he obtained a Pennsylvania driver’s license in the name of a person who is a citizen of Puerto Rico.
According to the indictment, Bautista obtained the false driver’s license using the other person’s name, date of birth, and social security number in 2009, and then renewed the false driver’s license in 2013 and 2017.
If convicted, Bautista faces a statutory maximum sentence of 15 years, a possible fine, a period of supervised release, and a $100 special assessment on each count.
The case was investigated by Department of Homeland Security and is being prosecuted by Assistant United States Attorney Laurie Magid
Lancaster Woman Sentenced to Prison for Theft of Social Security Benefit MoneyRead the Press Release
Carmen Perez, 40, of Lancaster, Pennsylvania, was sentenced today to 15 months in prison for theft of government funds, announced Acting United States Attorney Louis D. Lappen. The Honorable Edward G. Smith, United States District Judge, also ordered Perez to serve three years of supervised release after her prison term and pay full restitution of $78,768.06 to the Social Security Administration.
As the defendant admitted during her guilty plea hearing on February 28, 2017, during the commission of the charged offense, she was employed as a case manager for an organization that managed Social Security benefits for individuals who could not manage their own funds. a case manager for that organization, from March 2012 until July 2016, Perez stole Social Security benefits intended for the payment of financial obligations of 39 of her clients. Perez admitted further when she pleaded guilty, during the course of the scheme, she stole a total of approximately $78,768.06 in Social Security benefit money and used it for her own purposes.
The case was investigated by the Social Security Administration, Office of Inspector General, and is being prosecuted by Assistant United States Attorney Amanda R. Reinitz.
Mother-Daughter Duo Found Guilty of Scheme to Defraud IRSRead the Press Release
On June 19, 2017, a federal jury returned guilty verdicts against Maribel Nunez, 58, and Madeline Rosario, 25, both of Philadelphia, PA, on charges relating to a scheme to steal fraudulently issued tax refund checks for their own use. Nunez and her daughter, Rosario, were each found guilty of conspiracy to commit theft of government property and theft of government property. Both defendants face a statutory maximum sentence of 15 years. Both defendants also face a $200 special assessment fee, restitution, a fine, and a period of supervised release.
According to evidence presented at trial, between November of 2010 and June of 2014, the defendants opened, controlled, or conspired with others to access six business bank accounts for the purpose of depositing fraudulently obtained federal tax refund checks. Specifically, the defendants conspired together and with others, to commit theft of government funds by knowingly converting approximately 106 fraudulent tax refund checks totaling approximately $535,783.47 through the use of these bank accounts.
The defendants were immediately taken into federal custody.
The case was investigated by Internal Revenue Service Criminal Investigation and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Priya DeSouza.
Algerian Man Extradited for Conspiring to Provide Material Support to Terrorists Makes Initial AppearanceRead the Press Release
Ali Charaf Damache, aka “Theblackflag,” 52, of Algeria, made his initial appearance today following extradition from Spain for his involvement in conspiring to provide material support and resources to terrorists.
Acting Assistant Attorney General for National Security Dana J. Boente and Acting U.S. Attorney Louis D. Lappen of the Eastern District of Pennsylvania made the announcement.
Damache was indicted in 2011 in the Eastern District of Pennsylvania on one count of conspiracy to provide material support to terrorists and one count of attempted identity theft to facilitate an act of international terrorism.
As part of the conspiracy, Damache, his co-defendants Mohammad Hassan Khalid, Colleen R. LaRose, Jamie Paulin Ramirez, and others conspired to provide material support and resources, including logistical support, recruitment services, financial support, identification documents and personnel, to a conspiracy to kill overseas. Damache, Khalid and others devised and coordinated a violent jihad organization consisting of men and women from Europe and the U.S. divided into a planning team, a research team, an action team, a recruitment team and a finance team; some of whom would travel to South Asia for explosives training and return to Europe to wage violent jihad.
Furthermore, Damache, Khalid, LaRose and others recruited men online to wage violent jihad in South Asia and Europe. In addition, Damache, Khalid, LaRose and others allegedly recruited women who had passports and the ability to travel to and around Europe in support of violent jihad.
This case was investigated by the Joint Terrorism Task Force in the FBI's New York Field Office, in conjunction with the FBI's Philadelphia, Baltimore and Washington DC Field Offices. Authorities in Ireland and Spain also provided assistance in this matter.
The case is being prosecuted by Assistant U.S. Attorney Jennifer Arbittier Williams of the Eastern District of Pennsylvania, and Trial Attorneys Matthew F. Blue and C. Alexandria Bogle of the National Security Division’s Counterterrorism Section. The Office of International Affairs in the Justice Department's Criminal Division also provided assistance.
Algerian Man Extradited for Conspiring to Provide Material Support to Terrorists Makes Initial AppearanceRead the Press Release
PHILADELPHIA – An Algerian man made his initial appearance today following extradition from Spain for his involvement in conspiring to provide material support and resources to terrorists, announced Acting U.S. Attorney Louis D. Lappen of the Eastern District of Pennsylvania and Acting Assistant Attorney General for National Security Dana J. Boente.
ALI CHARAF DAMACHE, 52, a/k/a “Theblackflag,” was indicted in 2011 in the Eastern District of Pennsylvania on one count of conspiracy to provide material support to terrorists and one count of attempted identity theft to facilitate an act of international terrorism. Damache was arrested on unrelated charges by authorities in Ireland in March 2010.
As part of the conspiracy, Damache, his co-defendant Mohammad Hassan Khalid, Colleen R. LaRose, Jamie Paulin Ramirez, and others conspired to provide material support and resources, including logistical support, recruitment services, financial support, identification documents and personnel, to a conspiracy to kill overseas. Damache, Khalid and others devised and coordinated a violent jihad organization consisting of men and women from Europe and the United States divided into a planning team, a research team, an action team, a recruitment team and a finance team; some of whom would travel to South Asia for explosives training and return to Europe to wage violent jihad.
Furthermore, Damache, Khalid, LaRose, and others recruited men online to wage violent jihad in South Asia and Europe. In addition, Damache, Khalid, LaRose, and others allegedly recruited women who had passports and the ability to travel to and around Europe in support of violent jihad.
This case was investigated by the FBI Field Division in New York, in conjunction with the FBI's Joint Terrorism Task Force in Philadelphia, and the FBI Field Divisions in Baltimore and Washington, D.C. Authorities in Ireland and Spain also provided assistance in this matter.
The case is being prosecuted by Assistant U.S. Attorney Jennifer Arbittier Williams, in the Eastern District of Pennsylvania, and Trial Attorneys Matthew F. Blue and C. Alexandria Bogle, from the Counterterrorism Section of the Justice Department's National Security Division. The Office of International Affairs in the Justice Department's Criminal Division also provided assistance.
Norristown, PA Man Charged with Illegal Reentry After DeportationRead the Press Release
Cruz Eduardo Tinoco-Salvador, of Norristown, PA, was charged today by Indictment with illegal reentry after deportation, announced Acting United States Attorney Louis D. Lappen. The indictment alleges that on or about June 20, 2017, Tinoco-Salvador, an alien, and native and citizen of Mexico, was found in the United States after having been deported from the United States on or about April 16, 2012, January 22, 2015, and February 26, 2015.
If convicted the defendant faces a maximum possible sentence of two years.
The case was investigated by Homeland Security Investigations (“HSI”) and Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Laurie Magid.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Lancaster, PA Man Charged with Illegal Reentry After DeportationRead the Press Release
Ruben Alvarado-Diaz, of Lancaster, PA, was charged today by Indictment with illegal reentry after deportation, announced Acting United States Attorney Louis D. Lappen. The indictment alleges that on or about June 2, 2017, Alvarado-Diaz, an alien, and native and citizen of Mexico, was found in the United States after having been deported from the United States on or about June 27, 2014, June 11, 2015, and February 21, 2016.
If convicted the defendant faces a maximum possible sentence of two years.
The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Nancy Rue.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Brooklyn Man Engaging in Illicit Sexual Contact with A MinorRead the Press Release
Sandro G. Zhinin, 33, of Brooklyn, New York, was charged today by Indictment with crossing state lines to have sexual contact with a minor less than 12, travel to engage in illicit sexual conduct, and the production and possession of child pornography, announced Acting United States Attorney Louis D. Lappen.
If convicted the defendant faces a maximum possible sentence of lifetime incarceration, a mandatory minimum thirty years’ imprisonment, a mandatory minimum five years’ supervised release up to lifetime supervised release, a $2,000,000 fine, a $500 special assessment and an additional $25,000 Justice for Victims special assessment.
The case was investigated by Pennsylvania State Police and the Department of Homeland Security, and is being prosecuted by Assistant United States Attorney Sherri A. Stephan.
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 Attorney’s 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.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed
innocent unless and until proven guilty.
Avondale, PA Man Charged with Illegal Reentry After DeportationRead the Press Release
Pedro Mendez-Zavala, a/k/a “Pedro Zavala Mendez,” a/k/a “Luis Medina Bedolla,”of Avondale, Pennsylvania, was charged today by Indictment with illegal reentry after deportation, announced Acting United States Attorney Louis D. Lappen. The indictment alleges that on or about February 22, 2017, Mendez-Zavala, an alien, and native and citizen of Mexico, was found in the United States after having been deported from the United States on or about April 18, 1998, April 10, 2013, and December 21, 2014.
If convicted the defendant faces a maximum possible sentence of ten years.
The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), 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.
Former Owner of Bucks County Financial Consulting Firm Sentenced to Five Years in Prison for Bribing Foreign OfficialRead the Press Release
The former owner and president of Chestnut Consulting Group Inc. and Chestnut Consulting Group Co. (the Chestnut Group) was sentenced to 60 months imprisonment today for bribing an official at the European Bank for Reconstruction and Development (EBRD) in violation of the Foreign Corrupt Practices Act (FCPA).
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney Louis D. Lappen of the Eastern District of Pennsylvania and Special Agent in Charge Michael Harpster of the FBI’s Philadelphia Division made the announcement.
Dmitrij Harder, 45, of Huntingdon Valley, Pennsylvania, pleaded guilty on April 20, 2016, to two counts of violating the FCPA. In imposing sentence today, U.S. District Judge Paul S. Diamond also ordered Harder to forfeit $1.9 million.
Harder was the principal owner of Chestnut Consulting Group, based in Southampton, Pennsylvania. Between 2008 and 2009, the defendant paid approximately $3,500,000 in bribes to Andrej Ryjenko, an official and senior banker at the European Bank for Reconstruction and Development (EBRD), in exchange for Ryjenko referring EBRD clients to Chestnut, Harder admitted. Harder also admitted that he paid the bribes to Ryjenko through the Channel Island bank accounts of Ryjenko’s sister, Tatjana Sanderson. A British jury found both Ryjenko and Sanderson guilty of related corruption offenses in June 2017, and Ryjenko was sentenced to six years in prison.
The case was investigated by the FBI with significant assistance from U.K. law enforcement. Assistance was also provided by the Criminal Division’s Office of International Affairs. The case is being prosecuted by Assistant Chief Leo Tsao of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Michelle L. Morgan of the Eastern District of Pennsylvania.
The Fraud Section is responsible for investigating and prosecuting all FCPA matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal-fraud/foreign-corrupt-practices-act.
Newtown Man Charged with Receipt and Posession of Child PornographyRead the Press Release
John Hammond, of Norristown, PA, was charged today by Indictment with receipt and possession of child pornography, announced Acting United States Attorney Louis D. Lappen.
The Indictment alleges that from on or about April 11, 2016 through on or about April 18, 2016, Hammond received child pornography over the Internet. The Indictment further alleges that on April 19, 2016, Hammond possessed a computer, disc, and external drives that contained child pornography.
If convicted. Hammond faces a possible sentence of 40 years’ incarceration with a mandatory 5-year term of imprisonment, up to a lifetime of supervised release, a $500,000 dollar fine, restitution, forfeiture, and a $10,000 special assessment.
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 and Montgomery County Detectives. It is being prosecuted by Assistant United States Attorney Sean P. McDonnell.
Defunct Philly Hospice’s Owners/Operators to Pay Millions to Settle Civil False Claims SuitRead the Press Release
PHILADELPHIA – Acting United States Attorney Louis D. Lappen announced today that Matthew Kolodesh, Alex Pugman, Svetlana Ganetsky, and Malvina Yakobashvili have agreed to pay millions of dollars to settle False Claims Act allegations that they and their now-defunct company, Home Care Hospice, Inc. (HCH), falsely claimed and received taxpayer dollars for hospice services that were either unnecessary or never provided. Previously, a federal jury found Kolodesh guilty on, and Pugman and Ganetsky pleaded guilty to, related criminal charges.
Kolodesh was HCH’s de facto co-owner; Pugman was HCH’s Executive Director and co-owner; Ganetsky was HCH’s Development Executive; and Yakobashvili was HCH’s CEO and President. Kolodesh and Yakobashvili are husband and wife, as are Pugman and Ganetsky.
The civil settlements with Kolodesh, Pugman, and Ganetsky specifically resolve False Claims Act allegations that HCH and they, between January 2003 and September 2008: knowingly submitted false claims and records (including fabricated records) to Medicare for purported hospice care for patients who were not terminally ill and thus not eligible for the Medicare hospice benefit; and/or knowingly submitted or caused the submission of false claims and records (including fabricated records) to Medicare for crisis care services that were not necessary or not actually provided; and, as a result of this conduct, violated the False Claims Act and cost the Medicare Program millions of dollars. The settlements with these defendants, as well as Yakobashvili, also resolve federal common law allegations that all five defendants were unjustly enriched as a result of such conduct.
As part of the settlements, the United States will retain the full value of multiple financial accounts that were restrained in a related civil injunction action filed by the United States in the Eastern District of Pennsylvania. The estimated current value of those interests is approximately $8.8 million. The defendants have further agreed: (1) to make cash payments to the government ($400,000 from Pugman and Ganetsky, and $425,000 from Kolodesh and Yakobashvili); and (2) to transfer to the United States various assets, including Pugman’s and Kolodesh’s interests in condominium properties that they co-own.
Under qui tam (whistleblower) provisions of the federal False Claims Act, certain private citizens may bring civil actions on behalf of the United States and may share in any recovery. This suit was originally filed on behalf of the United States by Maureen Fox and Cathy Gonzales, former HCH employees who discovered the alleged fraud. The settlements announced today include False Claims Act whistleblower awards for Ms. Gonzales and for the Estate of Ms. Fox, who passed away after filing suit.
As the result of the United States’ related criminal investigation, 22 persons employed by or associated with HCH were criminally convicted in the Eastern District of Pennsylvania.
“The Medicare hospice benefit is intended to provide patients nearing the end of life with pain management and other palliative care to make them as comfortable as possible,” Lappen said. “Too often, however, we hear reports of companies that abuse this critical service by enrolling patients who do not qualify for the hospice benefit, do not provide claimed services, or who push patients into services they don’t need in order to get higher government reimbursements. The Department of Justice, including this office, will take swift action to protect the public welfare and taxpayer dollars and to make sure that Medicare benefits are available to those truly in need.”
"Medicare, a crucial component of our nation's health care system, draws from a finite pool of funds," said Michael Harpster, Special Agent in Charge of the FBI's Philadelphia Division. "The defendants siphoned money earmarked for dying patients' hospice care, and built their bank accounts on taxpayers' backs. The FBI will continue to investigate and hold accountable those defrauding the U.S. government."
"Today's settlement returns over $8 million to our nation's Medicare program. This money was wrongfully paid as a result of fraudulent billings and part of a massive criminal conspiracy that preyed on a program that comforts beneficiaries at the end of their lives," said Nick DiGiulio, Special Agent in Charge of the Inspector General's Office of the United Stated Department of Health and Human Services in Philadelphia. "In addition to this civil settlement, this investigation resulted in the criminal prosecution of 22 individuals for health care fraud or other charges. We will continue to work with our law enforcement partners and the dedicated federal prosecutors in the Eastern District of Pennsylvania to use every available tool to jail those who steal from federal health care programs and recoup cash and assets illegally acquired."
The case was investigated by the Office of Inspector General of the U.S. Department of Health and Human Services (HHS), and the Organized Crime Section of the Federal Bureau of Investigation. The civil case was handled at the U.S. Attorney’s Office by Assistant United States Attorneys Eric D. Gill, Gerald B. Sullivan, and Colin C. Cherico. Assistance was provided by the HHS Office of Counsel to the Inspector General and the Commercial Litigation Branch of the U.S. Department of Justice’s Civil Division.
The civil claims asserted against HCH, Kolodesh, Pugman, Ganetsky, and Yakobashvili are allegations only, and there has been no determination of civil liability. The civil qui tam suit is docketed in the Eastern District of Pennsylvania as U.S.A. et al. ex rel. Fox and Gonzales v. Home Care Hospice, Inc, et al., No. 06-cv-4679.
The Eastern District of Pennsylvania is one of 10 federal districts that formed an Elder Justice Task Force as a part of the U.S. Department of Justice’s Elder Justice Initiative. (The office announced its task force here in March 2016, and maintains a publicly accessible website here.) The task force seeks to enhance government protection of vulnerable, elderly Pennsylvanians from harm and to ensure the integrity of government health care spending.
California Payment Processing Company President and Part-Owner Sentenced to Prison for Fraud SchemeRead the Press Release
A Santa Ana, California man was sentenced today in Philadelphia, Pennsylvania for his role in processing unauthorized withdrawals of millions of dollars from consumer bank accounts, the Justice Department announced.
Neil Godfrey, 79, was sentenced to serve 15 months in prison, followed by one year of supervised release by Judge Eduardo Robreno in the Eastern District of Pennsylvania. Judge Robreno also ordered Godfrey to pay a $50,000 fine and entered a $100,000 forfeiture money judgment against the defendant. Godfrey pleaded guilty in July 2015 to a one-count Information charging him with wire fraud. The Information described how Godfrey, working as a payment processor, knowingly enabled fraudulent merchants to withdraw money from consumers’ bank accounts without the consumers’ knowledge or consent.
“Payment processors who knowingly facilitate consumer fraud commit a federal offense,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “We are committed to protecting consumers from unknown withdrawals from their bank accounts, and we will prosecute any individual who knowingly assist these fraud schemes.”
Godfrey used a Santa Ana processing company named Check Site Inc. to assist at least two fraudulent merchants. The merchants operated or worked with websites that purportedly offered subscriptions, clubs, sweepstakes or payday loans. But in many cases, the websites were a ruse to harvest consumers’ bank account information. Instead of providing consumers with payday loans or other services advertised, the merchants operating the websites used the bank information provided by the consumers to withdraw money from the consumers’ bank accounts. Using Check Site, Godfrey knowingly processed the merchants’ fraudulent withdrawals and provided the merchants with access to the banking system.
As part of the criminal case, Godfrey admitted to using payment devices called remotely created checks (RCCs) to facilitate fraud schemes. Once the fraudulent merchants had obtained consumer names and bank account information, the merchants created RCCs, which Check Site submitted through the banking system to the consumers’ banks. Unlike an ordinary check, an RCC is generally honored without the signature of the account holder. When the RCCs were processed, Check Site kept a fee and transferred the remainder of the withdrawals to the merchants.
According to charging documents, Godfrey used banks that were willing to facilitate these transactions and ignore the red flags raised by these transactions. The charges also alleged that Godfrey helped the fraudulent merchants stay off the radar of bank employees and regulators so that the fraud could continue. For example, Godfrey advised merchants how to change the names of their companies and set up the facade of a legitimate company to defeat banks’ attempts at due diligence.
In an email message quoted in the charging documents, Godfrey advised a fraudulent merchant that “the lesson we have learned is that we must trick the [bank] folk. It means you need to set up some type of website front. What we need to do is set up a legitimate website selling anything you can think of – that is what you get approved on. It is irrelevant if anything is ever sold there – just so it exists. . . . In the mean time we set up false credit card approval etcetera. It is this we use to run the transactions. Yes, there will be a lot of returns, but what we do is send through transactions over the next few weeks that don’t have high returns. They stop looking and then we can run the regular stuff. . . . [A]fter several months we junk that company and go to another company.”
Acting Assistant Attorney General Chad A. Readler thanked the Federal Trade Commission for providing Attorney Michelle Chua to serve as a Special Assistant U.S. Attorney on the case, and commended the FBI and the Federal Deposit Insurance Corporation Office of Inspector General for their thorough investigation. The case is being prosecuted by Assistant U.S. Attorney Patrick J. Murray of the Eastern District of Pennsylvania and Trial Attorney Kathleen Konopka of the Civil Division’s Consumer Protection Branch.
Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the District of Eastern District of Pennsylvania, visit its website at https://www.justice.gov/usao-edpa.
Prison Escapee Charged with Collecting Social Security Under Assumed NameRead the Press Release
William Lewis, 90, of Philadelphia, Pennsylvania, was charged by Indictment, unsealed today, with two counts of mail fraud, two counts of wire fraud, one count of theft of government funds, and one count of social security fraud, announced Acting United States Attorney Louis D. Lappen. According to the Indictment1, the defendant escaped from prison in Maryland in 1970 and has lived under an assumed name ever since. During the defendant’s time as an escapee, he collected Social Security benefits in violation of Social Security regulations. The defendant’s alleged actions resulted in a loss to the government of approximately $457,771.20.
If convicted, defendant William Lewis faces a sentence of incarceration, a period of supervised release, full restitution to the government of $457,771.20, a fine, and a special assessment.
The case was investigated by the Social Security Administration, Office of Inspector General, and is being prosecuted by Special Assistant United States Attorney Christopher E. Parisi.1 An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Man Charged with Theft of Government FundsRead the Press Release
Oliver Burke, 56, of Philadelphia, Pennsylvania, was charged by Information with one count of theft of government funds and one count of theft from an employee pension plan, announced Acting United States Attorney Louis D. Lappen. According to the Information[1], the defendant received Social Security and pension benefits intended for his mother-in-law, after his mother-in-law’s death in April 2013, until the fraud was discovered in March 2016. The defendant’s alleged actions resulted in a loss to the government of approximately $69,026.25.
If convicted, the defendant faces a maximum sentence of 15 years’ imprisonment, a 3‑year period of supervised release, restitution to the government of $69,026.25, a fine of up to $500,000, and a $200 special assessment.
The case was investigated by the Social Security Administration, Office of Inspector General, and the Department of Labor, Office of Inspector General; and is being prosecuted by Assistant United States Attorney Amanda R. Reinitz.
[1] An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Head of Nonprofit Mental Health Clinic Found Guilty of Fraud Against ClinicRead the Press Release
Philadelphia – Today, a federal jury found Renee Tartaglione, 61, of Philadelphia, PA, guilty on all counts of conspiracy, fraud, and theft from a nonprofit clinic that provided mental health services to persons eligible under Medicaid. Tartaglione defrauded the Juniata Community Mental Health Clinic (JCMHC) by misappropriating funds of the clinic. Tartaglione was also convicted of falsifying her federal income tax returns by underreporting her income for tax years 2008, 2009, 2010, and 2012.
According to the evidence presented at trial, between 2007 and 2015, Tartaglione, as President of JCMHC’s Board of Directors, defrauded and stole money from JCMHC through a series of actions designed to benefit her personally at the expense of the clinic. Tartaglione purchased the building on 3rd Street in Philadelphia that housed the clinic and then raised the rent repeatedly; causing the clinic’s rent for the 3rd Street building to increase from $4,500 per month to $25,000 per month.
Additionally, as of 2010, Tartaglione’s company, Norris Hancock LLC, acquired an interest in a building on 5th Street, and Tartaglione began to cause the clinic to spend money to fix up that building. Then, in December 2012, Tartaglione leased that building to JCMHC under a lease that called for rent of $35,000 per month for the first two years, and $75,000 per month for the next three years. The rent Tartaglione charged the nonprofit clinic at both buildings was substantially in excess of the market rent.
None of the JCMHC rent increases or the lease agreements were approved by JCMHC’s Board of Directors. Tartaglione and her co-conspirators created false and fictitious documents in an attempt to make the transactions appear legitimate.
Tartaglione’s crimes against the Juniata Mental Health Clinic are unfortunate examples of how those in control of non-profits can abuse them for their personal enrichment,” said Acting United States Attorney Louis D. Lappen. “Her fraudulent scheme did serious damage to the community she was supposed to serve -- denying mental health services to economically disadvantaged people.”
“Nonprofit work is generally understood to be personally fulfilling – not financially enriching,” said Harpster. “The defendant disagreed. She brazenly diverted, for her own use, money meant to improve mental health care for the underprivileged and underserved. While doing so, she shortchanged her community, and stole from U.S. taxpayers. The FBI will continue to investigate and hold accountable those misappropriating federal government funds.”
"IRS Criminal Investigation provides financial investigative expertise in our work with our law enforcement partners. Today's verdict demonstrates our collective efforts to enforce the law and ensure public trust," said IRS-CI Acting Special Agent In Charge Gregory Floyd. "Renee Tartaglione made a conscious decision to deceive and benefit personally at the expense of others, and she is now a convicted felon as a result. Today's guilty verdict should send a clear message to those contemplating a similar crime."
“Non-profit entities are supposed to protect our truly disadvantaged. When members of our City are in their most trying times, they turn to organizations like Juniata Community Mental Health, and other contractors of the City’s Community Behavioral Health, for honest and compassionate assistance,” said Amy Kurland, Philadelphia Inspector General. “Theft within our City’s non-profit sector is profoundly harmful because it victimizes those who have already been victimized. That is why my office will forever be committed to protecting the integrity of charitable services within Philadelphia – and we are very grateful to have partners like the USAO and FBI who are equally committed to that mission.”
This case was investigated by the FBI, IRS Criminal Investigation, and the Philadelphia Office of the Inspector General. Assistant United States Attorney Bea Witzleben and Trial Attorney Peter N. Halpern of the Criminal Division’s Public Integrity Section are prosecuting the case.
Philadelphia Man Charged with Illegal Reentry After DeportationRead the Press Release
Julio Vicente-Rios, a/k/a “Julio V. Rios,” a/k/a “Pablo Reyes-Ortiz,” of Philadelphia, PA, was charged today by Indictment with illegal reentry after deportation, announced Acting United States Attorney Louis D. Lappen. The indictment alleges that on or about December 2, 2016, Vicente-Rios, an alien, and native and citizen of Guatemala, was found in the United States after having been deported from the United States on or about February 15, 2008, and December 29, 2008.
If convicted the defendant faces a maximum possible sentence of ten years.
The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Jason P. Bologna.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Lancaster Man Charged with Illegal Reentry After DeportationRead the Press Release
Gabriel Bazan-Hernandez, of Lancaster, PA, was charged today by Indictment with illegal reentry after deportation, announced Acting United States Attorney Louis D. Lappen. The indictment alleges that on or about May 21, 2017, Bazan-Hernandez, an alien, and native and citizen of Mexico, was found in the United States after having been deported from the United States on or about October 23, 2007 and March 14, 2012.
If convicted the defendant faces a maximum possible sentence of ten years.
and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Albert S. Glenn.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Downingtown Man Charged with Illegal Reentry After DeportationRead the Press Release
Armando Martinez Nunez, of Downingtown, PA, was charged today by Indictment with illegal reentry after deportation, announced Acting United States Attorney Louis D. Lappen. The indictment alleges that on or about May 5, 2017, Martinez-Nunez, an alien, and native and citizen of Mexico, was found in the United States after having been deported from the United States on or about June 9, 2016.
If convicted the defendant faces a maximum possible sentence of twenty years.
The case was investigated by Homeland Security Investigations (“HSI”) and Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Katayoun M. Copeland.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Pennsylvania Woman Sentenced to Prison for Conspiring to File Tax Returns Using Stolen IDsRead the Press Release
An Allentown, Pennsylvania resident was sentenced to serve 42 months in prison for conspiring to file tax returns using stolen IDs, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Louis D. Lappen for the Eastern District of Pennsylvania.
According to the indictment and information presented to the court, Jessenia E. Cordero, 37, operated MJ & Associates and Express Tax Services, both located in Allentown. These businesses provided tax preparation, check cashing, and other services to customers. Cordero and her co-conspirators obtained lists of Puerto Rico residents’ names and social security numbers and used these IDs to file fraudulent tax returns seeking refunds with the Internal Revenue Service (IRS). The conspirators directed the IRS to mail the refund checks to addresses they controlled or to deposit the refunds onto pre-paid debit cards. Cordero used her businesses to cash fraudulently obtained refund checks totaling approximately $4,316,103.
In addition to the term of prison imposed, Cordero was also ordered to serve three years of supervised release and to pay $3,960,070.50 in restitution to the IRS.
Acting Deputy Assistant Attorney General Goldberg and Acting U.S. Attorney Lappen commended special agents of IRS Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney David Ignall and Trial Attorney Matthew J. Kluge of the Tax Division, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Downingtown Woman Charged with Embezzling $194K from Employer, and Obtaining $100K in College Loans for her Children Using Co-workers’ Stolen IdentityRead the Press Release
PHILADELPHIA – Kimberly O’Toole, 49, of Downingtown, Pennsylvania, was charged by Information today with four counts of wire fraud, announced Acting United States Attorney Louis D. Lappen.
According to the Information, defendant Kimberly O’Toole engaged in an embezzlement scheme in which, from 2012 to 2013, she stole approximately $194,193.39 from her employer, Miwon North America (“Miwon”). Defendant Kimberly O’Toole’s husband was the President and General Manager at Miwon; defendant Kimberly O’Toole had accounting and bookkeeping duties at the company. In that role, defendant Kimberly O’Toole opened a fraudulent bank account in the company’s name that only she knew about and controlled. O’Toole then intercepted checks paid to Miwon by its customers, and deposited those checks into the sham bank account that she controlled. Defendant Kimberly O’Toole later withdrew the funds she embezzled for her own personal use, including to make mortgage payments for her personal residence in Downingtown, Pennsylvania, and to pay her cable bill. When Miwon officials detected her fraud, defendant Kimberly O’Toole tried to cover-up the fraud by accessing the email account of a co-worker, without the co-worker’s knowledge or permission, in an effort to deceive company officials as to the truth about her embezzlement scheme.
Separately, during the same time period, defendant Kimberly O’Toole – who also had HR duties at Miwon, and thus had access to the company’s employees’ personnel files – stole the identity of a co-worker. Using that co-worker’s stolen identity, defendant Kimberly O’Toole took out three fraudulent Wells Fargo college loans on behalf of two of her children, who attended The Pennsylvania State University and North Carolina State University-Raleigh, respectively. This was done without the knowledge or consent of the victim. The total amount of the fraudulent loans obtained by defendant Kimberly O’Toole for the loans obtained using the victim’s stolen identity totaled approximately $104,500.
If convicted, the defendant faces a maximum statutory sentence of 80 years’ incarceration, a fine of up to $1,000,000, three years of supervised release, and a $400 special assessment.
The case was investigated by the FBI and the U.S. Postal Inspection Service, and is being prosecuted by Assistant U.S. Attorney James Petkun.
An information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Man Charged with Illegal Reentry After DeportationRead the Press Release
Procoro Abel Alcaide-Bringas, a/k/a “Abel Alcaide-Bringas,” of Philadelphia, PA was charged today by Indictment with illegal reentry after deportation, announced Acting United States Attorney Louis D. Lappen. The indictment alleges that on or about May 17, 2017, Alcaide-Bringas, an alien, and native and citizen of Mexico, was found in the United States after having been deported from the United States on or about March 31, 1998, December 21, 2005, and February 26, 2006.
If convicted the defendant faces a maximum possible sentence of two years.
The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Randall P. Hsia.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.