Eastern District of Pennsylvania
Press releases recorded for this federal judicial district.
Pennsylvania Man Sentenced for Possession of Explosives, Fraud and Weapons OffensesRead the Press Release
Istvan Merchenthaler, 45, of Downingtown, Pennsylvania, was sentenced today to 140 months in prison for wire fraud, aggravated identity theft, money laundering, filing false tax returns, interstate transportation of stolen property, possessing unregistered destructive devices, possessing firearms and ammunition as a fugitive and possessing an illegally manufactured firearm. These charges stemmed from two indictments in this district and one indictment, each, in the Eastern District of North Carolina and the District of Maryland. All of the cases were consolidated before U.S. District Judge Robert F. Kelly for the Eastern district of Pennsylvania who also ordered three years of supervised release, a $2,200 special assessment and more than $3.4 million in restitution.
Between May 2006 and February 2013, Merchenthaler claimed to be the founder of PhoneCard USA, a company that was purportedly a “premier distribution source” for prepaid phone cards, prepaid phones and prepaid “adult entertainment cards.” Merchenthaler, who used a number of aliases, falsely claimed that PhoneCard USA had “lucrative contracts” with major retail chain stores including Walmart, 7-Eleven and BJ’s Wholesale Club. In reality, Merchenthaler operated a “Ponzi” scheme, stealing over $3 million from over 250 investors and using much of these funds to buy expensive cars, jewelry and firearms and to perpetuate his scheme. To line his pockets with these victims’ funds, Merchenthaler used stolen identities, impersonated corporate executives, forged signatures and fabricated bogus contracts. Merchenthaler continued his scheme while he was on pretrial release in this district. He also filed false tax returns, defrauding the United States of over $400,000.
While on pretrial release, Merchenthaler also removed his electronic monitoring bracelet and fled as a fugitive. In order to evade authorities, Merchenthaler stole two vehicles from car dealerships in Pennsylvania and North Carolina and fled from the scene of a traffic stop by the Pennsylvania State Police while driving one of the stolen vehicles. The U.S. Marshals Service Fugitive Task Force and the Maryland State Police later apprehended Merchenthaler in Bel Air, Maryland.
Moreover, prior to and after jumping bail from this district, Merchenthaler amassed approximately 17 firearms and over approximately 11,580 rounds of ammunition, as well as approximately 634 improvised explosive devices (IEDs), which he stored in Pennsylvania, North Carolina and Maryland. Approximately 67 of these IEDs were comprised of PVC pipe, almost all of which contained shrapnel in the form of nails, screws, or rocks. The remaining approximately 567 IEDs were comprised of cardboard tubes in varying sizes and explosive power. All of the IEDs – PVC and cardboard – were center primed with flash powder. Merchenthaler drove these IEDs in his stolen vehicles to storage facilities in all three states. During render safe procedures at a North Carolina storage facility, several of the IEDs exploded, resulting in damage to a bomb squad robot and the storage facility.
The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigations, the U.S. Marshals Service Fugitive Task Force, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Pennsylvania State Police, the Philadelphia Police Bomb Disposal Unit, the Montgomery County Bomb Squad, the Montgomery County Sheriff’s Office, the East Whiteland Police Department, the East Whiteland Fire Department, the Malvern Fire Department, the Maryland State Police, the North Carolina State Bureau of Investigation, the Downingtown Police Department and the Chester County District Attorney’s Office. The case was prosecuted by Assistant U.S. Attorneys Vineet Gauri, Jason Kellhofer and Adam Ake in the U.S. Attorney’s Offices for the Eastern District of Pennsylvania, Eastern District of North Carolina and the District of Maryland.
New Hope Couple Sentenced for Stealing Social Security BenefitsRead the Press Release
PHILADELPHIA - Roger White, 58, and Audria White-Nunnally, 61, both of New Hope, Pennsylvania, were sentenced today for stealing the Social Security benefits of Roger White’s deceased relative. Roger White was sentenced to eight months in prison, his wife was sentenced to nine months in prison. Each was also ordered to complete three years of supervised release and to pay $68,462 in restitution.
The defendants pleaded guilty in October of 2015 to one count of conspiracy, three counts of wire fraud, and one count of theft of government funds. In addition to these charges, Audria White-Nunnally was also charged with two counts of making false statements to federal agents. The defendants admitted to stealing retirement benefits intended for a deceased relative of Roger White, after his relative’s death in December 1998. The defendants’ actions resulted in a loss to the government of approximately $68,462. The defendants also admitted that during the investigation they placed an elderly relative in the attic of their New Hope, PA home in an attempt to convince Social Security Administration employees that she was Roger White’s deceased relative.
The case was investigated by the Social Security Administration, Office of Inspector General, and was prosecuted by Special Assistant United States Attorney Christopher E. Parisi.
Kidnapper Sentenced to 15 Years in PrisonRead the Press Release
PHILADELPHIA - Basil Buie, 23, of Philadelphia, PA, was sentenced today to 15 years in prison for his role in a botched robbery and kidnapping that involved a jewelry store employee. Buie, a/k/a “Basil Tucker,” pleaded guilty on October 7, 2015 to conspiracy, kidnapping, and attempted Hobbs Act robbery. His two co-defendants - Khayree Gay and Salahudin Shaheed - also pleaded guilty.
Shaheed recruited Buie and Gay to rob National Watch and Diamond Exchange, at 101 S. 8th Street in Philadelphia to obtain luxury watches, jewelry, and money which Shaheed said could be found there. The defendants conducted surveillance of National Watch and its employees from a parking lot at 733 Chestnut Street, to identify and then, in disguise, abduct an employee from whom they would forcibly obtain keys, security codes, and the code to the company’s safe from which the robbers would steal luxury watches, jewelry, and money.
On April 4, 2015, the defendants watched an employee that Shaheed had targeted. When the employee entered the garage and approached her car, Shaheed and Buie, wearing masks, gloves, and sunglasses, confronted the victim, Shaheed assaulted her with a Taser, and they kidnapped her.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and is being prosecuted by Assistant United States Attorneys Jeanine Linehan and Maureen McCartney.
Former Prison Guard Pleads Guilty in Corruption CaseRead the Press Release
PHILADELPHIA – John Wesley Herder, 49, of Philadelphia, PA, formerly a correctional officer at Philadelphia’s Curran Fromhold Correctional Facility (CFCF), pleaded guilty today to attempted extortion under color of official right, attempted distribution of controlled substances, and making false statements within federal jurisdiction. These charges resulted from Herder’s agreement with a prison inmate to smuggle a cellular telephone and Oxycontin pills into the CFCF in exchange for a $1,000 cash payment, and Herder’s act of lying to the FBI when questioned about his contraband smuggling activities. U.S. District Court Judge Mark A. Kearney scheduled a sentencing hearing for May 16, 2016. Herder was working as a correctional officer at the CFCF in October 2013 when, in exchange for a $1,000 payment, he agreed to smuggle Oxycontin (oxycodone) pills and a cellular telephone into the prison and deliver it to Inmate #1. To obtain his payment and the contraband, Herder agreed to meet with Inmate #1’s associate (“Person #1”) outside the prison. On October 17, 2013, Herder met with Person #1 inside a car in the parking lot of a Walgreens Pharmacy in Philadelphia. During their meeting, Person #1 handed Herder 100 pills, represented to contain OxyContin (oxycodone), a Nokia cellular telephone, and $1,000.00 in cash. At the conclusion of their meeting, Herder told Person #1: “Just tell [Inmate #1] to sit tight and I got it coming to him, ok.” Herder also told Person #1 that he was willing to bring additional contraband into the prison. Between October 17, 2013 and October 29, 2013, Herder smuggled the 100 pills and cellular telephone past prison security and into the CFCF. On October 29, 2013, Herder provided Inmate #1 with all 100 pills and the cellular telephone. On June 18, 2015, federal law enforcement agents interviewed Herder and questioned him about his contraband smuggling activities, and Herder falsely stated that he did not bring contraband into CFCF. Herder faces a statutory maximum sentence of 45 years in prison, forfeiture, possible fines, supervised release, and special assessments. The case was investigated by the FBI with assistance from the Philadelphia Department of Corrections. It is being prosecuted by Assistant United States Attorney Kevin Brenner.Chester County Man Sentenced for Possession of Explosives, Fraud, and Weapons OffensesRead the Press Release
PHILADELPHIA - Istvan Merchenthaler, 45, formerly of Downingtown, Pennsylvania, was sentenced today to 140 months in prison for wire fraud, aggravated identity theft, money laundering, filing false tax returns, interstate transportation of stolen property, possessing unregistered destructive devices, possessing firearms and ammunition as a fugitive, and possessing an illegally manufactured firearm. These charges stemmed from two indictments in this District, and one indictment, each, in the Eastern District of North Carolina and the District of Maryland. All of the cases were consolidated before United States District Court Judge Robert F. Kelly who also ordered three years of supervised release, a $2,200 special assessment, and more than $3.4 million in restitution.
Between May 2006 and February 2013, Merchenthaler claimed to be the founder of PhoneCard USA, a company that was purportedly a “premier distribution source” for prepaid phone cards, prepaid phones, and prepaid “adult entertainment cards.” Merchenthaler, who used a number of aliases, falsely claimed that PhoneCard USA had “lucrative contracts” with major retail chain stores including Walmart, 7-Eleven, and BJ’s Wholesale Club. In reality, Merchenthaler operated a “Ponzi” scheme, stealing over $3 million from over 250 investors and using much of these funds to buy expensive cars, jewelry, and firearms and to perpetuate his scheme. To line his pockets with these victims’ funds, Merchenthaler used stolen identities, impersonated corporate executives, forged signatures, and fabricated bogus contracts. Merchenthaler continued his scheme while he was on pretrial release in this District. He also filed false tax returns, defrauding the United States of over $400,000.
While on pretrial release, Merchenthaler also removed his electronic monitoring bracelet and fled as a fugitive. In order to evade authorities, Merchenthaler stole two (2) vehicles from car dealerships in Pennsylvania and North Carolina and fled from the scene of a traffic stop by the Pennsylvania State Police while driving one of the stolen vehicles. The United States Marshals Service Fugitive Task Force and the Maryland State Police later apprehended Merchenthaler in Bel Air, Maryland.
Moreover, prior to and after jumping bail from this District, Merchenthaler amassed approximately 17 firearms and over approximately 11,580 rounds of ammunition, as well as approximately 634 improvised explosive devices (“IEDs”), which he stored in Pennsylvania, North Carolina, and Maryland. Approximately 67 of these IEDs were comprised of PVC pipe, almost all of which contained shrapnel in the form of nails, screws, or rocks. The remaining approximately 567 IEDs were comprised of cardboard tubes in varying sizes and explosive power. All of the IEDs – PVC and cardboard – were center primed with flash powder. Merchenthaler drove these IEDs in his stolen vehicles to storage facilities in all three states. During render safe procedures at a North Carolina storage facility, several of the IEDs exploded, resulting in damage to a bomb squad robot and the storage facility.
The case was investigated by the Federal Bureau of Investigation; the Internal Revenue Service Criminal Investigations; the United States Marshals Service Fugitive Task Force; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Pennsylvania State Police; the Philadelphia Police Bomb Disposal Unit; the Montgomery County Bomb Squad; the Montgomery County Sheriff’s Office; the East Whiteland Police Department; the East Whiteland Fire Department; the Malvern Fire Department; the Maryland State Police; the North Carolina State Bureau of Investigation; the Downingtown Police Department; and the Chester County District Attorney’s Office. The case was prosecuted by Assistant United States Attorneys Vineet Gauri, Jason Kellhofer, and Adam Ake in the United States Attorney’s Offices for the Eastern District of Pennsylvania, Eastern District of North Carolina, and the District of Maryland, respectively.
Philadelphia Man Charged with Robbing Cell Phone StoresRead the Press Release
PHILADELPHIA - Samuel Robinson, 29, of Philadelphia, Pennsylvania, was charged by indictment with robbing two Metro PCS stores in Philadelphia, announced United States Attorney Zane David Memeger. Robinson is charged with two counts of Hobbs Act robbery, using, carrying, and brandishing a firearm during a crime of violence, and possession of a firearm by a convicted felon. According to the indictment, on October 28, 2015, Robinson robbed the Metro PCS store at 6443 Frankford Avenue and the store at 4229 N. Broad Street, in Philadelphia.
If convicted the defendant faces a mandatory minimum term of 32 years in prison with a maximum possible sentence of life, a possible fine, restitution, a $500 special assessment and up to five years of supervised release.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Yvonne Osirim.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Man Charged with Kidnapping People for ATM AccessRead the Press Release
PHILADELPHIA - Nathaniel Rodriguez, 40, of Philadelphia, PA was charged today by indictment with two counts of kidnapping, announced United States Attorney Zane David Memeger. According to the indictment, on November 6, 2015, Rodriguez forced K.J. to accompany him to an ATM machine and use that machine to take money from K.J.’s account. It is further alleged that on November 11, 2015, Rodriguez forced P.M.N.L. to drive him to an ATM machine and attempted to use that machine to take money from P.M.N.L.’s account.
If convicted the defendant faces a maximum possible sentence of life in prison.
The case was investigated by the Federal Bureau of Investigations and the Philadelphia Police Department. It is being prosecuted by Assistant United States Attorney Arlene Fisk.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Man Charged in Bank RobberyRead the Press Release
PHILADELPHIA - John Pistilli, 50, of Philadelphia, PA, was charged today by indictment with bank robbery, announced United States Attorney Zane David Memeger. According to the indictment, on December 23, 2015, Pistilli handed a robbery note to a teller at the TD Bank, at 2520 Grant Avenue in Philadelphia, that read “This is a robbery Put large bills in this envelope – No dye packs no transmitter we have a weapon”.
If convicted the defendant faces a maximum possible sentence of 20 years in prison, a $250,000 fine, and a $100 special assessment.
The case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department. It is being prosecuted by Assistant United States Attorney Arlene Fisk.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former Allentown City Controller Admits Role in Corruption SchemeRead the Press Release
PHILADELPHIA – Mary Ellen Koval, 64, of Allentown, PA, pleaded guilty today to conspiracy to commit honest services fraud. During the guilty plea hearing, Koval admitted the following:
Koval and Public Official #3 were public officials who represented the City of Allentown through elective offices. Until her resignation last week, Koval had been the City Controller since 2012. She was re-elected to a second four-year term in November 2015.
Public Official #3 directed other public officials to identify for him individuals and entities who had profited from their dealings with the City of Allentown or who sought favorable treatment from the City of Allentown (“the vendors”). Public Official #3 made clear to certain vendors, including Ramzi Haddad, Donor #1 and Donor #2 that providing him with campaign contributions was a necessary condition for receiving certain favorable treatment from the City of Allentown. Indeed, Public Official #3 caused, agreed to cause, and attempted to cause other public officials, including Koval, Finance Director Gary Strathearn, and Assistant City Solicitor Dale Wiles, to take official action favorable to certain actual and potential donors to Public Official #3’s political campaigns.
Upon learning of these practices, Koval should have put a stop to them. As City Controller, she had a duty to exercise independent financial oversight of all City finances, including all expenditures by Public Official #3, and as a public official she owed the public a duty of honest services. But Koval relied on Public Official #3 for political support, including campaign contributions and appointments to boards, commissions, and authorities including Allentown Parking Authority’s Board of Directors, of which she became Chair in January 2015. Rather, than root out, report, and counter Public Official #3’s criminal activity, she instead agreed to enable, aid, and participate in it.
Knowing that each of them wanted favorable treatment from the City of Allentown in return, Public Official #3 asked vendors, including Donor #1, Donor #2 and Ramzi Haddad, to raise large amounts of campaign contributions for him, which they did. Koval agreed to use her official authority to help each of these donors because Public Official #3 wanted to reward and/or incentivize their campaign contributions. For example, Public Official #3 took numerous steps to attempt to award a “no bid” city contract to Donor #1’s company, despite the concerns and objections of numerous other public officials in Allentown. Because of Public Official #3’s desire to reward and incentivize Donor #1’s contributions, Koval tried to help Donor #1 through her position as City Controller and also through her influence with the Parking Authority. In furtherance of the conspiracy with Public Official #3, Koval also used her power and authority as City Controller to help Donor #2 and Haddad. After Koval asked that Donor #2 also reward her with a campaign contribution for her participation in the conspiracy, Donor #2 obliged with a donation for Koval’s re-election effort.
Koval and other members of the conspiracy attempted to conceal the conspiracy by making materially false statements to FBI agents who were investigating the conspiracy. But within a few days of her initial interview with the FBI, Koval met with the agents in order to confess her guilt and take responsibility for her wrongdoing. She then announced her resignation from the position of Controller for “the best interests of the City of Allentown and its residents.”
After accepting the guilty plea, United States District Judge Juan R. Sanchez scheduled a sentencing hearing for April 19, 2016. Strathearn, Wiles, and Haddad all previously pleaded guilty. Strathearn and Haddad are scheduled to be sentenced on April 14, 2016. Wiles is scheduled to be sentenced on March 2, 2016. Koval, Strathearn, and Wiles each face a maximum possible sentence of 20 years in prison, a fine, three years of supervised release, and a $100 special assessment. Haddad faces a maximum possible sentence of 5 years in prison, a fine, three years of supervised release, and a $100 special assessment.
This case is being investigated by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigations, and the Pennsylvania State Police. It is being prosecuted by Assistant United States Attorneys Joe Khan and Nancy Beam Winter.
Tax Charge Filed Against Bucks County ManRead the Press Release
PHILADELPHIA – Joseph White, 46, of Newtown, PA, was charged today by Information with attempted evasion of payment of tax, announced United States Attorney Zane David Memeger. According to the information, White willfully attempted to evade the full amount of income tax he owed for calendar years 2000 through 2011 by filing false information with the IRS and diverting money from his corporations for personal expenses.
If convicted, the defendant faces a statutory maximum sentence of five years in prison, a fine, a $100 special assessment, and up to two years of supervised release.
The case was investigated by IRS Criminal Investigations and is being prosecuted by Assistant United States Attorney Floyd Miller.
An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Allentown City Controller Charged in ConspiracyRead the Press Release
PHILADELPHIA – Mary Ellen Koval, 64, of Allentown, PA, was charged today by Information with conspiracy to commit honest services fraud, announced United States Attorney Zane David Memeger.
According to the information, between January 7, 2014 and at least December 8, 2015, Koval, in her position as Allentown City Controller, conspired with Public Official #3 and others to knowingly devise a scheme to defraud the City of Allentown and its citizens of the honest services of Public Official #3 and of Koval through bribery and kickbacks. Public Official #3 and Koval requested and received campaign contributions as incentives and rewards for past, continued, and future official actions that Public Official #3, Koval, and others took, attempted to take, agreed to take, and caused, attempted to cause, and agreed to cause the City of Allentown to take.
If convicted the defendant faces a statutory maximum sentence of 20 years in prison, a fine, three years of supervised release, and a $100 special assessment.
This case is being investigated by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigations, and the Pennsylvania State Police. It is being prosecuted by Assistant United States Attorneys Joe Khan and Nancy Beam Winter.
An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Judge Sentences Defendant for Violation of the Computer Fraud and Abuse ActRead the Press Release
Yijia Zhang, a permanent resident of the United States, and a citizen of the People’s Republic of China, today was sentenced to 31 months in prison by the Hon. Legrome D. Davis, for a violation of the Computer Fraud and Abuse Act, announced United States Attorney Zane David Memeger. Zhang had worked for a financial services company and had stolen a large number of electronic documents from his employer. (The documents included some that would have told how to access the company’s computer network. The government found no evidence that the files had been passed to anyone else, nor did it find any evidence that any of the information had been used to harm the company. In addition, no customer information was taken.) To cover his tracks, in July 2010, Zhang deleted a large number of files from the server he had used to effectuate the theft, causing the server to stop working and its log files to be overwritten. The log files would have given evidence of his theft. Zhang pled guilty to the charge in October of 2015.
The sentence imposed by the Court was within the range recommended by the United States Sentencing Guidelines. In addition to the prison term, Judge Davis ordered the defendant to make restitution to his former employer of $100,000.
The case was investigated by the Federal Bureau of Investigation, and was prosecuted by Assistant United States Attorney Michael L. Levy.
Former Allentown Finance Director Admits to Rigging City Contract AwardRead the Press Release
PHILADELPHIA – Garret Strathearn, 68, of Sea Girt, NJ, pleaded guilty today to conspiracy to commit mail and wire fraud while serving as the Finance Director for the City of Allentown, PA.
Strathearn admitted that he personally and directly interfered with the awarding of a city contract, at the behest of Public Official #3 who was receiving campaign contributions from the eventual contract awardee. Strathearn and Assistant City Solicitor Dale Wiles, who previously pleaded guilty, corruptly manipulated the process for awarding the City of Allentown’s 2014 revenue collection contract with the approval of, and for the benefit of, Public Official #3. Strathearn and Wiles both falsified certain paperwork in order to create public records which gave the false impression that the contract awardee had earned the revenue collection contract on the merits. Strathearn and Wiles also made statements to FBI agents which were materially false with respect to the revenue collection contract award process for 2014.
After accepting the guilty plea, United States District Judge Juan R. Sanchez scheduled a sentencing hearing for April 14, 2016. Wiles in scheduled to be sentenced on March 2, 2016. Strathearn and Wiles each face a maximum possible sentence of 20 years in prison, a fine, three years of supervised release, and a $100 special assessment.
This case is being investigated by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigations, and the Pennsylvania State Police. It is being prosecuted by Assistant United States Attorneys Joe Khan and Nancy Beam Winter.
North Carolina Woman Charged with Interfering with Flight CrewRead the Press Release
PHILADELPHIA - Sarah Buffett, 41, of Charlotte, North Carolina, was charged yesterday by Information with assaulting another person, while in the special aircraft jurisdiction of the United States, announced United States Attorney Zane David Memeger. The charge arises from the defendant’s unruly conduct on a flight from Charlotte to London last July, which caused the flight crew to divert the plane to Philadelphia, which inconvenienced hundreds of other passengers.
If convicted the defendant faces a maximum possible sentence of one year in prison, followed by one year of supervised release, a possible fine, and a $25 statutory assessment.
The case was investigated by Homeland Security Investigations and is being prosecuted by Assistant United States Attorney Mark B. Dubnoff.
An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Convicted Felon Sentenced for Scheme to Defraud BanksRead the Press Release
PHILADELPHIA – Leonard Herrington, 42, of Philadelphia, PA, was sentenced last night to 75 months in prison for his role in a bank fraud conspiracy that also involved identity theft. On September 4, 2015, a federal jury found Herrington guilty of conspiracy to commit bank fraud, attempted bank fraud, and aggravated identity theft.
Herrington was a mid-level participant who recruited and managed other co-conspirators in the extensive identity theft and fraud ring that spanned two states and defrauded seven financial institutions. The extensive fraud ring victimized numerous people whose personal information was compromised and used without their knowledge and who were victimized financially and emotionally. Herrington and his eight co-defendants obtained or attempted to obtain at least $279,875.93, through fraudulent means, from Third Fed Bank, TD Bank, Santander Bank, PNC Bank, M&T Bank, Wells Fargo Bank and Andrews Credit Union.
In addition to the prison term, U.S. District Court Judge Wendy Beetlestone ordered, a special assessment of $300 and 4 years of supervised release. A hearing on restitution will be held at a later date.
This case was investigated by Immigration and Customs Enforcement Homeland Security Investigations, the United States Secret Service, the Burlington County (NJ) Prosecutor’s Office, the Bucks County District Attorney’s Office, the Bordentown Township (NJ) Police Department, the Burlington City (NJ) Police Department, the Burlington County (NJ) Sheriff’s Department, the Camden County (NJ) Prosecutor’s Office High Tech Crimes Unit, the Camden County (NJ) Sheriff’s Department, the Cherry Hill (NJ) Police Department, the Lehigh County Auto Theft Task Force, the Mount Holly (NJ) Police Department, the Pennsauken Township (NJ) Police Department, the Plumstead Township Police Department, the Willingboro Township (NJ) Police Department, the Winslow Township (NJ) Police Department, and the West Whteland Police Department. It is being prosecuted by Assistant United States Attorney Melanie Babb Wilmoth.
United States Settles with Aria Health Systems over Unnecessary Invasive Procedures and Improper Compensation ClaimsRead the Press Release
PHILADELPHIA – The United States and Aria Health Systems, Inc. ("Aria") today settled two False Claims Act matters which Aria self-disclosed, announced United States Attorney Zane David Memeger. Aria agreed to pay $564,700 to resolve claims that a cardiologist performed unnecessary invasive procedures on inpatients and outpatients at their Torresdale Campus between October 1, 2012 and April 15, 2013. Aria also agreed to pay $2.5 million to resolve alleged violations of the False Claims Act regarding compensation to physicians that were in excess of fair market value. The settlement resolves claims regarding compensation paid to a cardiac thoracic surgeon from 2012 to 2014 and claims regarding the purchase of a trademark name in the course of the acquisition of an orthopedic group by Aria in December 2012. Aria is a major health care provider in Northeast Philadelphia and lower Bucks County.
Aria became aware of certain complaints regarding the cardiologist in January 2013. They hired an independent review organization that reviewed the medical treatment for some of his patients. As a result of the review, the doctor agreed to cease performing invasive cardiac procedures at the end of February 2013 and agreed to terminate his employment with Aria as of April 15, 2013. After further review, Aria self-disclosed this matter to the United States in March 2014.
The False Claims Act and the Stark Act require that physicians be paid salaries that are no more than fair market value and may not include compensation for referrals of patients. Aria self-reported the cardiac thoracic surgeon contract to DOJ based on a concern that his $1.4 million annual compensation was outside fair market value. With respect to the trademark purchase, Aria paid $3.5 million dollars for the right to use the trademark in perpetuity. Aria’s own internal investigation, conducted in 2014, found that the trademark payment was inflated above fair market value based on an independent valuation.
“Patients have a right to medical treatment that is ethical and necessary and not influenced by a physician’s strategy to increase his compensation,” said Memeger. “In this case, Aria recognized a problem, reported it to the government, and voluntarily made internal changes to its operations.”
The settled civil claims are allegations only. There has been no determination of civil liability, and Aria denies any such liability. The case involving improper physician compensation and purchase of a trademark was handled by Assistant United States Attorney Thomas Johnson and Health Care Fraud Analyst Raymond Uhlhorn; the allegations concerning Aria’s unnecessary invasive procedures were handled by Assistant United States Attorney Susan Dein Bricklin and Health Care Fraud Analyst George Niedzwicki. The Office of the Inspector General of the Department of Health and Human Services assisted in both investigations.
Royersford Man Pleads Guilty to Child Pornography Involving Hidden CameraRead the Press Release
PHILADELPHIA – Kevin Rebbie, 56, of Royersford, PA, pleaded guilty today to child pornography charges that included 19 counts of manufacturing child pornography and one count of possession of child pornography.
According to court documents, in February 2015, Minor #1 found a camera hidden underneath the sink in the defendant’s bathroom. The Limerick Township Police Department was contacted and a search warrant was later executed on Rebbie’s home. Seized were a total of 80 videos, taken by Rebbie with a camera hidden in the bathroom, 19 of which captured minor boys and girls as they undressed, showered, and used the toilet. The videos were saved by Rebbie from his hidden video camera to his computer.
U.S. District Court Judge Nitza I. Quinones Alejandro scheduled a sentencing hearing for April 13, 2016. Rebbie faces a mandatory minimum sentence of 15 years in prison with a maximum sentence of 580 years’ imprisonment, a possible fine, and up to a lifetime of supervised release.
The case was investigated by the Limerick Township Police Department in conjunction with Homeland Security Investigations. It is being prosecuted by Assistant United States Attorney Michelle Rotella.
Philadelphia Man Charged as A Felon in Possession of A FirearmRead the Press Release
PHILADELPHIA - Henry West, 37, of Philadelphia, PA, was charged today by indictment with possession of a firearm by a convicted felon, announced United States Attorney Zane David Memeger. The indictment charges that West committed these offenses in Philadelphia, Pennsylvania, on or about August 29, 2015.
If convicted of all charges, West faces a maximum sentence of 10 years in prison.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and is being prosecuted by Assistant United States Attorney Salvatore L. Astolfi.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Norristown Resident Charged with Illegal Reentry After DeportationRead the Press Release
Jose Alberto Guadalupe-Ascencion, 30, of Norristown, PA, was charged today by Indictment with illegal reentry after deportation, announced United States Attorney Zane David Memeger. The indictment alleges that on or about December 3, 2015, Guadalupe-Ascencion, 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 December 3, 2010, February 2, 2012, June 6, 2012, and September 23, 2012.
If convicted the defendant faces a maximum possible sentence of 10 years.
The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Joan E. Burnes.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Judge Sentences Defendant Who Defrauded Local UniversityRead the Press Release
PHILADELPHIA - Kenneth Kapikian, 58, of Wayne, Pennsylvania, was sentenced today to 60 months in prison for defrauding the University of Pennsylvania out of $3,039,383. Kapikian pleaded guilty, June 10, 2015, to six counts of wire fraud and one count of conspiracy to commit money laundering. His co-defendant, Dennis Gagliardi, of Chester Springs, PA, pleaded guilty to four counts of wire fraud and one count of conspiracy to commit money laundering.
Kapikian and Gagliardi engaged in a scheme to fraudulently obtain monies from the University of Pennsylvania by falsely billing the University for services that the defendants never provided to the Sheraton University City Hotel. They also directed vendors of the Sheraton University City Hotel to inflate their invoices submitted to the hotel and then pay them the fraudulently inflated amounts as kickbacks.
In addition to the prison term, U.S. District Court Judge Cynthia Rufe ordered Kapikian to pay restitution in the amount of $3,039,383, a $700 special assessment, and ordered three years of supervised release. Sentencing for Gagliardi is scheduled for January 8, 2016.
The case was investigated by Homeland Security Investigations and is being prosecuted by Assistant United States Attorney Melanie Babb Wilmoth.
Owners of Lehigh Valley Companies and Their Engineer Charged in Green Energy Fraud SchemeRead the Press Release
PHILADELPHIA – David Dunham, 35, of Bethlehem, PA, and Ralph Tommaso, 46, of Warren, NJ, were charged by indictment, unsealed today, with engaging in a multi-million dollar conspiracy to defraud individuals and the United States in a green energy scam involving used cooking oil, announced United States Attorney Zane David Memeger. The defendants are charged with conspiracy, providing false statements to the government, wire fraud, tax fraud, and obstruction of an IRS audit and a U.S. Department of Agriculture examination.
From 2010 through 2012, in Wind Gap, Allentown, Bethlehem, and elsewhere, Dunham and Tommaso operated, respectively, the companies Smarter Fuel, Inc. (Smarter Fuel) and Environmental Energy Recycling Corporation, LLC (EERC), coordinating the activities of these companies, and then formally merging under the umbrella of Greenworks Holdings, LLC (Greenworks). According to the 101-count indictment, the defendants falsely claimed to have produced and sold renewable fuel for which they misappropriated approximately $50 million in payments, subsidies, and other benefits. Dunham and Tommaso allegedly defrauded government programs intended to encourage the production of renewable fuel as an alternative to traditional fossil fuel. By claiming credits for renewable fuel they never produced, and that otherwise did not qualify, Duhnam and Tommaso stole tens of millions of dollars from the United States government. It is further alleged that Dunham and Tommaso stole millions more by fraudulently claiming and generating tradable credits that they sold to unsuspecting purchasers who believed these credits satisfied their legal obligation to introduce a certain quantity of renewable fuel per year.
The defendants, through their companies, collected used cooking oil from restaurants and other food service locations, sometimes processing it to remove hard particles, water, and other waste. They then sold this cleaned cooking oil primarily to renewable fuel producers that used it as a “feedstock” ingredient in their production process.
Dunham and Tommaso did not sell their cleaned used cooking oil as a final fuel, but allegedly fraudulently claimed otherwise, applying for and receiving government subsidies for every gallon of cleaned used cooking oil that they produced, plus more. Their claims vastly exceeded their actual production. In 2010, Dunham and Tommaso allegedly claimed subsidies and other payments on more than 17.5 million gallons of product, when they produced less than six million gallons. In 2011, Dunham and Tommaso allegedly claimed subsidies and other payments of more than 18 million gallons, when they only produced about 7.5 million gallons. Of the cleaned used cooking oil they did produce, the vast majority did not qualify for credit or subsidy. The defendants’ allegedly fraudulent claims included more than one million gallons of the wastewater that was the byproduct of their processes to clean debris and pollutants from used cooking oil, the non-fuel sales of their product as a feedstock ingredient to be used by biofuel producers in buyers’ production of biofuel, and transactions that existed on paper only, where the defendants did not produce or even possess the product for which they generated subsidies.
The indictment alleges that Dunham and Tommaso provided false information and altered and forged documents and records to government and private auditors in an effort to conceal their fraud. They allegedly directed employees to alter the documentation of obviously unqualified sales and change them to show sales that qualified for subsidies and other payments.
Dunham is also charged with underreporting his taxable income for the tax years 2009 and 2010. In his filings for these years, Dunham allegedly altered the dates on sales invoices, and delayed generating invoices on other sales, in order to avoid paying taxes on these sales until a subsequent tax year. He also allegedly obstructed an IRS audit of Smarter Fuel.
“According to the indictment, these defendants exploited critical government programs that were designed to encourage the production and use of renewable fuels. Instead of producing the renewable fuel as represented, the defendants lied to the government and stole tens of millions of dollars,” said Memeger. “My office will continue to hold accountable those people who enrich themselves through government fraud and deny the taxpayers the full benefit of effective federal programs.”
“The illegal activity in this case has real consequences, including undermining a law that reduces our nation’s dependence on foreign oil and achieves important greenhouse gas reductions,” said Director Doug Parker, of EPA’s Criminal Investigation Division. “Companies and their managers should think very carefully before taking similar actions that could lead to prosecution.”
“Fulfilling individual tax obligations is a legal requirement and those who willfully evade that responsibility will be prosecuted," said Special Agent-in-Charge Akeia Conner, IRS Criminal Investigation.
In a related matter, William Barnes, a professional engineer, was charged by information, unsealed today, with two counts of conspiring to provide false statements to the U.S. Environmental Protection Agency (“EPA”). Barnes was allegedly hired to help the companies in Wind Gap and in Allentown register for the EPA’s program as renewable fuel producers and allegedly conspired with the company owners to provide false Engineering Reports to the EPA.
If convicted, Dunham and Tommaso each face a substantial prison term, supervised release, a possible fine, and potential criminal forfeiture of up to $50 million. Dunham faces a $8,700 special assessment; Tommaso faces a $8,400 special assessment. Barnes faces a statutory maximum possible sentence of ten years in prison, supervised release, a possible fine, and a $200 special assessment.
The case was investigated by the Environmental Protection Agency, IRS Criminal Investigations, Department of Agriculture–Office of Inspector General, U.S. Postal Inspector Service, and the Federal Bureau of Investigation Allentown Resident Agency. It is being prosecuted by Assistant United States Attorneys Nancy E. Potts and John Gallagher.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former Allentown Finance Director Charged with Rigging City Contract AwardRead the Press Release
PHILADELPHIA – Garret Strathearn, 68, of Sea Girt, NJ, was charged today by information with conspiracy to commit mail and wire fraud, announced United States Attorney Zane David Memeger. Until earlier this year, Strathearn was the Finance Director for the City of Allentown, PA.
The information alleges the following:
Public Official #3 was a public official who represented the City of Allentown through an elective office which vested him with authority and influence over the awarding of certain municipal contracts. Aspiring to win election to a statewide elective office, Public Official #3 sought to raise campaign contributions from parties who had profited from their dealings with the City of Allentown and who sought favorable treatment from the City of Allentown. Public Official #3 also directed certain municipal officials to give preferential treatment to certain of his past and potential political donors. Strathearn and Assistant City Solicitor Dale Wiles were among the municipal officials over whom Public Official #3 had authority.
The City of Allentown outsourced its collection of delinquent real estate taxes and municipal claims (“the revenue collection”) to a law firm with experience in collecting taxes. For several years, the contract for the City’s revenue collection contract had been serviced by Law Firm #1, whose contract had been renewed annually without Law Firm #1 being required to compete with other firms in order to keep the contract. On or about November 11, 2013, the City published a request for proposals (RFP) inviting potential contractors to bid on servicing Allentown’s revenue collection contract for 2014. According to the RFP, the City would evaluate competing proposals based on their merits and select a winner based on which one would “be most advantageous to the City.” Relying on the representations in the RFP, several competitors submitted proposals for the revenue collection contract, including Law Firm #1, Law Firm #2, and a partnership between Law Firm #3 and a revenue collection company (“the Partnership”). The “revenue committee,” which was responsible for evaluating the proposals and submitting a recommendation to the City’s Purchasing Agent, consisted of Wiles and two municipal officials who reported to Strathearn.
Consistent with the representations in the RFP, the members of the revenue committee graded each of the proposals received using pre-established criteria and memorialized these scores on preprinted government forms (“the score sheets”). The original score sheets reflected that the committee members had given the highest aggregate scores to Law Firm #2 and Law Firm #1, and that none of the committee members had concluded that the Partnership’s proposal would be the most advantageous to the City. The committee members discussed the proposal and agreed that Law Firm #2’s proposal would be the most advantageous to the City.
Dissatisfied with the amount of campaign contributions that he had received from Law Firm #1 and its affiliates, Public Official #3 believed that certain principals and affiliates of the Partnership were more promising sources of campaign contributions. Public Official #3 instructed certain subordinates, known to the United States Attorney, that he wanted the Partnership to be awarded the 2014 revenue collection contract, that he did not want to be perceived as having influenced the contracting process, and that he would consider future renewals of the Partnership’s contract based on whether the Partnership and its affiliates had given sufficient campaign contributions for the benefit of Public Official #3. Specifically, on or about January 8, 2014, Public Official #3 explained to Strathearn that awarding the 2014 revenue collection contract to the Partnership was important to Public Official #3 and his political ambitions. Strathearn agreed that he would help Public Official #3 by giving preference to the Partnership in the contracting process.
To prevent the committee from recommending Law Firm #2’s proposal to the Purchasing Agent, Strathearn intervened in order to steer the contract to the Partnership so that the Partnership and its affiliates would then provide money, including campaign contributions, to Public Official #3 and his campaign operatives. Strathearn communicated to Wiles that the contracting process was being corruptly manipulated in order to steer the 2014 revenue collection contract to the Partnership, all with the approval of, and for the benefit of, Public Official #3. Strathearn also made clear that Wiles was expected to help create the false impression that the Partnership had won the contract on the merits. Public Official #3 had authority over both Strathearn and Wiles.
Streathearn, Wiles, and Public Official #3 each took steps to advance the conspiracy and ensure that the Partnership was awarded the contract, despite the substantive findings of the revenue committee. For example, Strathearn removed from the committee the municipal official whose score for the Partnership was the lowest of the committee members and replaced her by joining the committee. Strathearn and Wiles both falsified certain paperwork in order to create public records which gave the false impression that the Partnership had earned the revenue collection contract on the merits. After the City awarded the revenue collection contract to the Partnership, Strathearn, Wiles, and Public Official #3 each obstructed justice in order to help conceal the conspiracy. For example, in 2015, all three made statements to FBI agents which were materially false with respect to the revenue collection contract award process for 2014.
For his role in the conspiracy with Strathearn (who was then identified as “Public Official #4”), Wiles previously pleaded guilty before United States District Judge Juan R. Sanchez and is scheduled for a sentencing hearing on March 2, 2016.
This case is being investigated by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigations, and the Pennsylvania State Police. It is being prosecuted by Assistant United States Attorneys Joe Khan and Nancy Beam Winter.
An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Man Charged with Possession of Child PornographyRead the Press Release
Richard Schultz, 34, of Philadelphia, PA, was charged today by information with possession of child pornography, announced United States Attorney Zane David Memeger. According to the information, on or about July 2, 2015, Schultz possessed laptop computers, an Iphone, and a computer hard drive which contained more than 600 images of child pornography.
If convicted, Schultz faces a maximum possible sentence of 20 years in prison, a minimum five year term up to a lifetime of supervised release, a possible fine, a $100 special assessment, restitution, and forfeiture.
The case was investigated by the Federal Bureau of Investigation (FBI), and is being prosecuted by Assistant United States Attorney Jeffery W. Whitt.
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, 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.
Former Philadelphia Sheriff and One Other Charged in Fraud ConspiracyRead the Press Release
PHILADELPHIA – A superseding indictment, unsealed today, charges former Philadelphia Sheriff John Green, 68, of Kissimmee, Florida, and James Davis, 65, of Wyncote, Pennsylvania, with conspiracy and four counts of honest services fraud involving the Philadelphia Sheriff’s Office (“PSO”), announced United States Attorney Zane David Memeger. Davis is also charged with two counts of filing a false tax return and three counts of willful failure to file a tax return.
The indictment alleges that as Sheriff of Philadelphia, John Green was responsible for the execution of all the duties of the PSO, including the PSO’s sale of real property subject to mortgage foreclosure and tax sales at Sheriff’s sales. James Davis was co-owner of an advertising and public relations company, Reach Communications Specialists, and a title search and settlement company, RCS Searchers, Inc. John Green and James Davis enriched each other through their abuse of the public trust placed in the Sheriff to conduct his duties honestly in the best interest of the citizens of Philadelphia and the distressed owners who lost their properties at Sheriff’s sales. Green agreed to Davis’ companies receiving contracts, business, and fees from the PSO in the sale of the real estate, which they hid from the public, in exchange for Davis providing Green extensive personal benefits, which they also hid. From 2002 through 2010, Davis and his companies developed near exclusive control of much of the work connected to the PSO court-ordered sales of properties. Davis and his companies also handled the advertising for Green’s reelection campaigns, including for Green’s 2007 reelection campaign. According to the indictment, Davis provided Green with a stream of personal benefits that included: buying and renovating a home for Green which was then sold to Green at a loss; providing more than $210,000 in hidden payments to Green’s 2007 reelection campaign; and giving more than $320,000 as gifts and interest-free loans to Green for Green’s retirement home in Florida. It is further alleged that in exchange for these benefits, no other vendors were allowed to bid and compete against Davis’ companies for the services that they provided to the PSO related to the sale of properties at Sheriff’s sales; Green expanded the amount of services provided by Davis’ companies and paid for out of the proceeds of the Sheriff’s sales; and Green allowed Davis’ companies to add and increase fees that were paid for out of the proceeds from the Sheriff’s sales. Each dollar that went to Davis and his companies from the property sales was a dollar that would never make it to the distressed property owners who were entitled to the remainder of the proceeds after the satisfaction of liens and necessary costs. Also, Davis was permitted to place friends and family members on the staff at the PSO who were assigned responsibilities connected to the Sheriff’s sales.
It is further alleged that Davis willfully filed a false U.S. income tax return for Reach Communications for tax year 2007 by falsely reporting a business loss of approximately $146,669, which he knew was not true. Davis allegedly filed a false individual 2007 U.S. income tax return, by falsely reporting a taxable income of $408,072, which Davis knew was not true. Davis is also charged with willfully failing to file tax returns for tax years 2008, 2009, and 2010.
If convicted of all charges, Davis faces a statutory maximum sentence of 94 years in prison, a $775 special assessment, a possible fine, and supervised release; and Green faces a statutory maximum sentence of 85 years, a $500 special assessment, a possible fine, and supervised release. The indictment also includes a notice of forfeiture seeking $7,000,000 and property from Davis and Green.
The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigation Division, and the Philadelphia Office of the Inspector General, and is being prosecuted by Assistant United States Attorneys Sarah Grieb and Christopher Diviny.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Woman Charged with Theft of Government FundsRead the Press Release
PHILADELPHIA - Phyllis Ransome, a/k/a “Phyllis Roberts,” 70, of Philadelphia, PA, was charged by Indictment, unsealed yesterday, with nine counts of wire fraud, one count of theft of government funds, and one count of Social Security fraud, announced United States Attorney Zane David Memeger. According to the Indictment, the defendant received Supplemental Security Income benefits under one Social Security number, while failing to disclose her receipt of widow’s benefits under a second Social Security number, from October 2009 through December 2014. The defendant’s alleged actions resulted in a loss to the government of approximately $42,108.
If convicted, the defendant faces a substantial period of incarceration, a three year period of supervised release, restitution of $42,108, a $1,100 special assessment, forfeiture, and a possible million fine.
The case was investigated by the Social Security Administration, Office of Inspector General, and is being prosecuted by Special Assistant United States Attorney Amanda R. Reinitz.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Indictment Charges Alleged Post Office RobberRead the Press Release
PHILADELPHIA - Antwoine Tomlin, 32, of Philadelphia, was charged today by indictment with committing an armed robbery, on November 19, 2015, at the United States Post Office, located at 6382 Castor Ave, Philadelphia, Pennsylvania, announced United States Attorney Zane David Memeger. Tomlin was also charged with use of a firearm in connection with that robbery.
If convicted Tomlin mandatory minimum term of 25 years in prison with a maximum possible sentence of life, supervised release, a possible fine and a $100 special assessment.
The case was investigated by the United States Postal Inspection Service and Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Paul G. Shapiro.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former Bank Manager at Fulton Bank in Lancaster Charged with FraudRead the Press Release
PHILADELPHIA – Fernando Sanchez, 42, of Lancaster, Pennsylvania, was charged yesterday by Information with three counts of wire fraud, announced United States Attorney Zane David Memeger. While employed as a bank manager at Fulton Bank in Lancaster, Sanchez fraudulently took approximately $99,105.09 from the bank account of the Manor Shopping Center Merchants Association.
According to the information, from about May 2010 until about July 2014, Sanchez took money from the Merchants Association bank account to pay his own personal expenses. He removed money from the account using dozens of cashier’s checks which he deposited in his own account in another bank, and also by making online electronic transfers of funds to pay his personal expenses.
If convicted, the defendant faces a maximum possible sentence of 60 years in prison, three years of supervised release, restitution, a $750,000 fine, and a $300 special assessment.
The case was investigated by the Secret Service and is being prosecuted by Assistant United States Attorney Laurie Magid.
An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Philadelphia Woman Admits to Tax CrimesRead the Press Release
PHILADELPHIA - Sharnise Carroll, 36, of Philadelphia, PA, pleaded guilty yesterday to seven counts of aiding and assisting in the preparation of fraudulent tax returns. A sentencing hearing is scheduled for March 30, 2016. Carroll faces up to three years in prison, up to two years of supervised release, restitution to the IRS, a $700 special assessment and a possible fine.
Between February 2009 and September 2009, Carroll prepared and electronically filed federal income tax returns for seven individuals, six of whom did not know Carroll, in which she sought First Time Home Buyer Credit on behalf of each individual. Carroll knew that none of the seven individuals qualified for the credit and one of the returns that Carroll prepared was for a minor whose identity had been stolen. Carroll received a total of $53,445 in cash payments and had the IRS directly deposit the monies into one of two bank accounts in her name.
The case was investigated by Internal Revenue Service Criminal Investigations in conjunction with the City of Philadelphia Office of Inspector General. It is being prosecuted by Assistant United States Attorney Linwood C. Wright, Jr.
Montgomery County Company Charged with Clean Water Act ViolationsRead the Press Release
PHILADELPHIA –Matthew Brozena, 58, of Telford, PA, and his company, MAB Environmental Services, Inc., were charged by indictment with conspiracy to violate the Clean Water Act and other offenses, announced United States Attorney Zane David Memeger. The indictment also charges the defendants with knowingly violating permit conditions, tampering with required monitoring devices and methods, and false reporting. Separate criminal informations have been filed charging James Wetzel, 63, of Harrisburg, PA, James Crafton, 61, of Upper Black Eddy, PA, and Stephen Fritz, 48, of in Harleysville, PA, with related environmental violations.
The indictment alleges that Brozena and his company, MAB Environmental Services, Inc., contracted to operate wastewater treatment plants for its customers BC Natural Chicken and Buckingham Valley Nursing Center, in compliance with permits issued by the Pennsylvania Department of Environmental Protection to those facilities. The permits allowed BC Natural and Buckingham to discharge from their wastewater treatment plants into nearby waters under specified conditions. The permit conditions included that the operators of the wastewater treatment plants properly operate and maintain the wastewater treatment plants. The permits also required that the operators test samples of the discharge from the plants for certain pollutants and report the samples and test results to the PADEP. The permits set limits for the amount of each pollutant that each facility was allowed to discharge. The charging documents allege that Brozena directed his employees at MAB, including Wetzel and Fritz, to discard samples when Brozena believed that the pollutants in the samples would exceed the permit limits. The charges also allege that, at Brozena’s direction, Wetzel, Crafton, Fritz, and other MAB employees falsely reported samples and test results.
“The EPA and its regulatory partners are dedicated to safeguarding public health,” said Jennifer Lynn, Assistant Special Agent in Charge of Environmental Protection Agency’s criminal enforcement program in Pennsylvania. “In order to fulfill that mission, it is essential that governments receive accurate test samples and measurements. This case demonstrates that those who would knowingly put public health at risk can expect to face prosecution.”
If convicted of all charges, MAB Environmental Services, Inc., faces probation and fines; Brozena faces a significant term of imprisonment, fines, and supervised release; Crafton and Fritz face prison terms and fines and supervised release; and Wetzel faces a maximum sentence of one year in prison, a fine, and supervised release.
The case was investigated by the U.S. Environmental Protection Agency Criminal Investigation Division, with the assistance of the Pennsylvania Department of Environmental Protection. It is being prosecuted by Assistant United States Attorney Sarah L. Grieb and Special Assistant United States Attorney Patricia Miller.
Indictments and Informations are accusations. A defendant is presumed innocent unless and until proven guilty.
Chester Residents Charged in Fraud SchemeRead the Press Release
PHILADELPHIA - Steven Hameed, 56, Darnell Young, 48, and Damond Palmer, 41, all of Chester, Pennsylvania, were charged by indictment, unsealed today, with one count of conspiracy to commit offenses against the United States, one count of bank fraud, and one count of corrupt interference with Internal Revenue laws, announced United States Attorney Zane David Memeger. Hameed also faces three counts of conversion of government property, and Young was also charged with one count of conversion of government property. Hameed and Young also face a count of creating fictitious obligations.
According to the indictment, the defendants filed false land deeds with the Delaware County Recorder of Deeds Office in an attempt to claim ownership of homes owned by the government or by banks, and then to live in the homes, or rent/sell the homes to unsuspecting persons, for their own financial gain. The indictment further charges that the defendants filed hundreds of false tax forms against police officers, judges, and other government employees in an attempt to harass and intimidate them in the course of their official duties. Hameed and Young are also charged with creating a false financial bond in an attempt to purchase property.
If convicted, the defendants face substantial periods of incarceration, three-year periods of supervised release, restitution and substantial fines.
The case was investigated by the Federal Bureau of Investigation, the U.S. Department of Housing and Urban Development – Office of Inspector General, the Treasury Inspector General for Tax Administration, the Federal Housing Finance Agency – Office of Inspector General, the Federal Deposit Insurance Corporation – Office of Inspector General, the Social Security Administration - Office of Inspector General, the Philadelphia Police Department, Delaware County Detectives, the Aston Police Department, and the Upper Darby Police Department. It is being prosecuted by Special Assistant United States Attorney Amanda R. Reinitz.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Indictment Charges Alleged Leader of Straw Purchasing SchemeRead the Press Release
PHILADELPHIA - Nakia Adams, 41, address unknown, was charged by indictment, unsealed today, with conspiracy, making false statements to a federal firearms licensee, possession of firearms by a convicted felon, and aiding and abetting, announced United States Attorney Zane David Memeger. The charges arise from Adams’ use of several individuals as “straw purchasers” to obtain firearms from federally licensed firearms dealers. Adams, as a previously convicted felon, is prohibited from purchasing firearms himself.
If convicted, the defendant faces a maximum possible statutory sentence of 90 years in prison, possible fines, a $1,200 special assessment, and three years of supervised release.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives Reading Field Office and is being prosecuted by Assistant United States Attorney Eric Boden.
An Indictment or Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former Prison Guard Admits Smuggling Contraband into Philadelphia PrisonRead the Press Release
PHILADELPHIA – Joseph Romano, 31, previously employed at The Philadelphia Industrial Correctional Center (“PICC”) and the Riverside Correctional Facility, pleaded guilty today to attempted extortion which interfered with interstate commerce and two counts of attempted distribution of controlled substances. Romano agreed to deliver OxyContin pills to a prisoner in exchange for $1,000.
To obtain the contraband and payment, Romano arranged a meeting with the inmate’s purported associate at locations in Philadelphia. During the ensuing meeting, the inmate’s purported associate handed the contraband and cash payment to Romano, and Romano subsequently smuggled the contraband past prison security and delivered it to an inmate.
U.S. District Court Judge Paul S. Diamond remanded the defendant into federal custody and scheduled a sentencing hearing for March 14, 2016. Romano faces a statutory maximum sentence of 40 years in prison, possible fines, supervised release, and a $300 special assessment.
The case was investigated by the FBI and the Philadelphia Department of Corrections with assistance from the Philadelphia Police Department’s Prison Intelligence Group. It is being prosecuted by Assistant United States Attorney Kevin Brenner.
Gun Charge Filed Against Allentown ManRead the Press Release
PHILADELPHIA – Victor Morales, 30, of Allentown, PA, was charged yesterday by indictment with possession of a firearm by a convicted felon, announced United States Attorney Zane David Memeger. According to the indictment, on June 12, 2015, Morales was in possession of a Smith & Wesson, Model SW40GVE, .40 caliber semi-automatic pistol, with a live round of .40 caliber ammunition in the chamber, and a magazine loaded with 13 live rounds of .40 caliber ammunition.
If convicted, Morales faces a maximum term of ten years in prison, up to three years of supervised release, a maximum fine of $250,000, and a $100 special assessment.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Allentown Police Department and the Lehigh County District Attorney’s Office. It is being prosecuted by Assistant United States Attorney Eric A. Boden.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Allentown Teens Charged in Armed RobberiesRead the Press Release
PHILADELPHIA - Jacob Pabon, 19, and Lytic Fauntleroy, 19, both of Allentown, PA, were charged yesterday by indictment with robbery which interferes with interstate commerce, and using and carrying a firearm during a crime of violence, announced United States Attorney Zane David Memeger. The indictment charges that on May 7, 2015, Pabon committed a gun-point robbery of Sun’s Deli, located at 1341 Union Street, in Allentown, Pennsylvania; and that on May 29, 2015, Pabon and Fauntleroy committed a gun-point robbery of Speedway, located at 1043 Lehigh Street, in Allentown, Pennsylvania. Pabon and Fauntleroy are also charged with using and carrying firearms during the robberies charged in the indictment.
If convicted of all counts, Pabon faces a mandatory minimum sentence of 32 years in prison with a maximum sentence of life, a fine, five years of supervised release, and a $400 special assessment; Fauntleroy faces a mandatory minimum sentence of seven years in prison with a maximum sentence of life, a fine, five years of supervised release, and a $200 special assessment.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Allentown Police Department and the Lehigh County District Attorney’s Office. The case has been assigned to Assistant United States Attorney Eric A. Boden.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Pub Owner Charged in Fraud SchemeRead the Press Release
PHILADELPHIA - Michael Hoffner, Sr., 50, of Voorhees, New Jersey was charged today by superseding indictment with five additional counts of wire fraud, announced United States Attorney Zane David Memeger. Hoffner was first charged in June 2015 with 23 counts of wire fraud.
Hoffner owned the Brown Street Pub in Philadelphia, Pennsylvania. According to the superseding indictment, on 28 occasions between September and December 2012, Hoffner used a stolen credit number to make charges to Visa, American Express, or Mastercard cards. The cardholders were not aware of and did not authorize these transactions. The proceeds of these transactions went into accounts that Hoffner controlled.
If convicted, the defendant faces a maximum statutory sentence of 20 years in prison on each of the wire fraud counts, a $7 million fine, and three years of supervised release.
The case was investigated by United States Secret Service and the Internal Revenue Service-Criminal Investigations. It is being prosecuted by Assistant United States Attorney David J. Ignall.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former Philadelphia Police Officer Convicted of Running Counterfeit Credit Card OperationRead the Press Release
PHILADELPHIA – A federal jury, today, returned guilty verdicts on all counts against Rahim Henderson, 38, of Philadelphia, PA, in connection with a counterfeit credit card manufacturing operation. Henderson, a former Philadelphia Police Officer, was convicted of conspiracy, wire fraud, access device fraud, and multiple counts of aggravated identity theft.
Between April 2014 and October 2014, Rahim Henderson used a credit card encoding machine – a machine used to encode a victim’s stolen credit card account information onto a different credit card’s magnetic stripe – so that, when swiped during a merchant transaction, the victim’s credit card account would be charged. Henderson manufactured the credit cards, and he and his co-conspirators used the cards to make fraudulent purchases at commercial establishments in and around the Philadelphia region. In addition to possessing a credit card encoding machine, the defendant also possessed and stored a credit card embossing machine, a credit card printing machine, computer equipment, hundreds of blank plastic credit cards, various re-encoded credit cards and gift cards, and over $67,000 in US currency in the home that he shared with his wife and co-defendant Tian Larode. The defendant obtained the stolen victim credit card account information via the internet, using his Yahoo! email account to purchase and obtain the stolen credit card account information from unidentified sellers.
U.S. District Court Judge John R. Padova scheduled a sentencing hearing for March 10, 2016. Henderson faces a mandatory minimum term of two years in prison with a maximum statutory sentence of 74 years in prison, a possible fine, a $1,200 special assessment, and three years of supervised release. Henderson’s co-conspirators, his wife Tian Larode and his sister Waliyda Henderson, pleaded guilty and are awaiting sentencing.
The case was investigated by the United States Secret Service and the Philadelphia Police Department. It is being prosecuted by Assistant United States Attorney James A. Petkun.
Charges Filed Against Eight People in Alleged Drug ConspiracyRead the Press Release
PHILADELPHIA - An indictment, unsealed today, charges eight people with conspiring to distribute heroin in the Kensington section of Philadelphia, announced United States Attorney Zane David Memeger. Charged are: Jorge Balbuena, a/k/a “Hansel,” 29, Yan Mota Soto, 25, Luis Garcia, a/k/a “Twin,” a/k/a “Mellos,” a/k/a “Domi,” 35, Jose Garcia, a/k/a “Twin,” a/k/a “Mellos,” 35, Ysidro Garcia, a/k/a “Pisa Pie,” 67, Elvin DeJesus, 26, Pedro Angel Montes-Perez, 24, and Gary Cuevas-Reyes, 27, all living in Philadelphia, PA. In addition to the conspiracy count, the defendants are charged in multiple counts of distribution of heroin, and distribution of heroin within 1,000 feet of a school or playground. Jorge Balbuena, Jose Garcia, Evlin Dejesus, Gary Cuevas-Reyes, Pedro Montes-Perez were arrested this morning. Montes-Perez is a U.S. citizen. The remaining defendants are citizens of the Dominican Republic residing in Philadelphia.
According to the indictment, the conspiracy existed from March 2014 to October 2015 and was led by Jorge Balbuena and supplied wholesale amounts of heroin, cocaine, cocaine base (“crack”), and other controlled substances to other wholesale drug distributors, and to street corner drug operations.
If convicted, each defendant faces lengthy prison terms.
The case was investigated by the Federal Bureau of Investigation, U.S. Immigration and Customs Enforcement, and the Philadelphia Police Department. It is being prosecuted by Assistant United States Attorney David. E. Troyer and Marianne Shelvey of the United States Department of Justice’s Organized Crime and Gang Section.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Roofing Company Owner Pleads Guilty to Charges in Connection with Employee's Fatal FallRead the Press Release
PHILADELPHIA - James J. McCullagh, 60, of Meadowbrook, PA, pleaded guilty today to four counts of making false statements, one count of obstruction of justice, and one count of willfully violating an Occupational Safety and Health Administration (OSHA) regulation causing death to an employee. U.S. District Court Judge Nitza I. Quinones Alejandro scheduled a sentencing hearing for March 29, 2016. The defendant faces a maximum statutory sentence of 25 years in prison, a possible fine, supervised release, and a $510 special assessment.
McCullagh, who owns James J. McCullagh Roofing, failed to provide fall protection equipment to his employees. On June 21, 2013, one of McCullagh’s employees was killed after falling approximately 45 feet from a roof bracket scaffold while performing roofing work for McCullagh. In connection with the OSHA investigation of the fatality, McCullagh attempted to cover up his failure to provide fall protection by falsely stating, on four occasions, that he had provided fall protection equipment, including safety harnesses, to his employees. McCullagh knew that he had not provided fall protection to his employees and none of his employees had safety harnesses or any other form of fall protection. McCullagh told an OSHA Compliance Safety and Health Officer that his employees had been wearing safety harnesses tied off to an anchor point when he saw them earlier in the day prior to the fall. McCullagh also directed other employees to falsely state that they had fall protection, including safety harnesses, on the day of the fall.
The case was investigated by the United States Department of Labor-Office of Inspector General Labor Racketeering and Fraud Investigations and the Occupational Safety and Health Administration, with assistance from the U.S. Department of Labor's Occupational Safety and Health Administration and Office of Inspector General. It is being prosecuted by Assistant United States Attorney Mary Kay Costello.
Philadelphia Man Charged with Stealing Dead Mother's BenefitsRead the Press Release
PHILADELPHIA - Anthony Cooper, 67, of Philadelphia, Pennsylvania, was charged by information with one count of theft of government funds, announced United States Attorney Zane David Memeger. According to the information, the defendant received retirement benefits intended for his mother, after his mother’s death in February 1991 until December 2011. The defendant’s alleged actions resulted in a loss to the government of approximately $69,528.
If convicted, the defendant faces a statutory maximum sentence of 10 years in prison, up to three years of supervised release, restitution to the government of $69,528, a fine, and a $100 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.
An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Title Company Owner Charged with Misusing FundsRead the Press Release
PHILADELPHIA - Anthony R. Angelo, 69, of Philadelphia PA was charged today by Information with wire fraud and bank fraud, announced United States Attorney Zane David Memeger.
The Information alleges that Angelo was the owner of Aracor Search & Abstract Services, Inc., a title company that provided real estate title insurance services and transactions, located in Philadelphia, Pennsylvania. Because Ararcor was in debt, Angelo caused funds from dedicated escrow accounts to be used to pay off other escrow obligations and operating costs, causing a loss of over $1 million to the victims.
If convicted the defendant faces a maximum possible sentence of 70 years in prison, a $1.5 million fine, a five-year period of supervised release and a $300 special assessment.
The case was investigated by Federal Bureau of Invesitgation and is being prosecuted by Assistant United States Attorney Daniel A. Vélez.
An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.
New York Man Charged with Bank FraudRead the Press Release
PHILADELPHIA - Stephen Jemal, 59, of Brooklyn NY, was charged today by indictment with three counts of bank fraud. These offenses arise from the defendant's obtaining a series of loans and loan modifications, extensions and renewals from Republic First Bank (Republic) totaling approximately $9.3 million, by submitting fraudulent financial documents that falsely stated that Jemal owned a stock portfolio valued, at different times, from approximately $26 million to approximately $60 million, when, in fact, his stock portfolio never contained stock worth as much as $2 million. When Republic began foreclosure proceedings after a nearly five-year relationship with Jemal, the loans were in default by an aggregate total of almost $6 million.
If convicted the defendant faces a maximum possible sentence of 90 years in prison.
The case was investigated by the FBI and is being prosecuted by Assistant United States Attorney Joel D. Goldstein.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Northampton County Man Gets 50 Years in Prison for Child ExploitationRead the Press Release
ALLENTOWN - Brent S. Galletta, 43, of Nazareth, PA, was sentenced today to 50 years in prison, followed by a lifetime of supervised release, for using a facility and means of interstate commerce to attempt to entice an individual, whom he believed was seven-years old, to engage in illegal sexual activity. The jury found Galletta guilty on September 2, 2015 of that charge plus one count of transportation of child pornography and one count of possession of child pornography. In addition to the prison term, U.S. District Court Judge Edward G. Smith ordered Galletta to pay a $10,000 fine, and a $300 special assessment.
Galletta posted several advertisements on the website Craigslist.com seeking to find “pervy dads.” Galletta was attempting to find another man who had access to young children that he could abuse sexually. Galletta communicated with at least five separate individuals attempting to find such a target. The craigslist posting was brought to the attention of Agent Justin Leri of the Office of the Pennsylvania Attorney General. Agent Leri responded to Galletta’s Craigslist post in an undercover capacity and stated he had a seven-year old daughter. Galletta communicated with Agent Leri, believing him to be a father of a seven-year-old that would allow Galletta access to the child for sexual purposes. A meeting was arranged and Galletta showed up in a parking lot in South Whitehall Township, Pennsylvania in order to meet the seven-year old and her father. When he arrived he was arrested by Agent Leri. Galletta had over two dozen images of prepubescent girls in bathing suits on his mobile phone as well as three images depicting the sexual abuse of minors that he had deleted. Galletta also sent an image of child pornography to another man through the internet.
The case was investigated by the Federal Bureau of Investigation, and the Pennsylvania Attorney General's Office. It was prosecuted by Assistant United States Attorney Sherri A. Stephan.
Michigan Woman Charged in Fraud SchemeRead the Press Release
PHILADELPHIA - Alyson Cesarz, 43, of Allen Park, Michigan, was charged by information, filed December 1, 2015, with five counts of wire fraud, announced United States Attorney Zane David Memeger. As the owner of Parklane Commercial Lending, Cesarz told clients that she would seek financing for their commercial projects in amounts ranging from fifteen million dollars to almost one billion dollars. She required the clients to pay a large, allegedly refundable deposit, of over $100,000, and for one client over $500,000. Cesarz did not obtain financing for the clients or return the refundable deposits. Four victims were defrauded of at least $1,148,000.
If convicted, the defendant faces a maximum possible sentence of 100 years of imprisonment, three years of supervised release, a fine, and a $500 special assessment.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Laurie Magid.
An information is an accusation. A defendant is presumed innocent unless and until proven guilty.
Child Pornography Charges Filed Against Montgomery County ManRead the Press Release
PHILADELPHIA - Kurt Eichert, 51, of Wyndmoor, Pennsylvania, was charged today by Indictment with one count of production of child pornography, two counts of distribution of child pornography, and one count of possession of child pornography announced United States Attorney Zane David Memeger. The indictment alleges that on or about June 2005 to on or about September 2015, Eichert produced child pornography. Eichert is alleged to have surreptitiously recorded children changing their clothes in Dorney Park in Allentown, Pennsylvania. Eichert is also charged with distributing child pornography in May 2015 and possessing images of child pornography in September 2015.
If convicted the defendant faces a mandatory minimum sentence of 15 years in prison with a maximum possible sentence of 80 years.
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 Immigration and Customs Enforcement Homeland Security Investigations (“HSI”) and the Abington Township Police Department. It is being prosecuted by Special Assistant United States Attorney Josh A. Davison.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Store Owner Sentenced to Three Years for Defrauding Government Assistance ProgramRead the Press Release
PHILADELPHIA - Saud Saleh, 30, of Philadelphia, PA, was sentenced today to three years in prison for defrauding the United States Department of Agriculture (USDA)’s Supplemental Nutrition Assistance Program (SNAP), formerly known as the food stamp program. The defendant had pleaded guilty to charges of trafficking in SNAP benefits and committing wire fraud.
The defendant owned and operated Twinz Meat Market, a retail grocery store, now defunct, that was located at 3083 Kensington Avenue in Philadelphia. At his guilty plea hearing, the defendant admitted that he knowingly trafficked in SNAP benefits, and directed his employees to traffic in SNAP benefits, by purchasing those benefits from customers of Twinz Meats, which is illegal. The defendant admitted that within a 12-month period, he was responsible for a program loss of $1,125,586.
In addition to the prison term, United States District Court Judge Gerald J. Pappert ordered restitution of $1,125,586 to USDA and three years of supervised release.
The case was investigated by the United States Department of Agriculture Office of Inspector General, and U.S. Immigration and Customs Enforcement Homeland Security Investigations. The case was prosecuted by Assistant United States Attorney Floyd J. Miller.
Philadelphia Check Cashing Agency and One Owner Charged with Money LaunderingRead the Press Release
PHILADELPHIA – Cottman Check Cashing, LP, located in Philadelphia, PA, and Steven Kessler, 50, of Cherry Hill, NJ, one of Cottman’s owners, were charged by indictment, unsealed today, with eight counts of aiding and abetting aggravated structuring of financial transactions, announced United States Attorney Zane David Memeger. Kessler was also charged with conspiring to structure financial transactions.
According to the indictment, between 2009 and 2011, Kessler conspired with a sports bookmaker, Jerold Cohen, charged elsewhere, to help the bookmaker cash 76 checks from one of his bettors, totaling approximately $670,000, without triggering a report that would have to be provided to the U.S. government. Kessler allegedly helped Cohen cash those checks at Cottman Check Cashing.
According to the indictment, Cohen obtained the 76 checks from a single bettor to settle the bettor’s losses. Cohen allegedly knew that a report would have to be filed with the government if he cashed any check over $10,000. To conceal the nature of his business and the total amount of his income, Cohen allegedly directed the bettor to write the checks in amounts just under $10,000. The bettor did as he was instructed and, because he was often in debt in an amount that far exceeded $10,000, the bettor would provide Cohen with several checks at one time, each for an amount just under $10,000. Cohen then took those checks to Cottman Check Cashing to be cashed because of his longtime friendship with Kessler. It is alleged that Cohen knew Kessler would help him by cashing the checks so as to avoid triggering a report that must be filed with the government when a cash transaction is over $10,000. Kessler’s alleged assistance included cashing the checks himself, failing to keep business records of most of the transactions, and making Cottman Check Cashing available to perform the money laundering. The indictment charges that the structured transactions were part of a pattern of illegal activity involving transactions of more than $100,000 in a 12-month period.
If convicted, Kessler faces up to 85 years in prison, three years of supervised release, a fine, a $900 special assessment, and criminal forfeiture of up to $670,175. Cottman Check Cashing faces supervised release, a fine, an $800 special assessment, and criminal forfeiture of up to $670,175.
The case was investigated by the Internal Revenue Service Criminal Investigations and the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Nancy E. Potts.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Indictment Charges Two Citizens of the Dominican Republic in A Drug ConspiracyRead the Press Release
PHILADELPHIA – Luis Manuel Gomez Rodriguez, 37, and Jose Antonio Rosario Reyes, 55, both of the Dominican Republic, with local residences in Philadelphia, Pennsylvania, are charged in a four count indictment with conspiracy to distribute 1 kilogram or more of heroin, possession with intent to distribute 1 kilogram or more of heroin, possession with intent to distribute 1 kilogram or more of heroin within 1,000 feet of the Abraham Lincoln High School in Philadelphia, and possession of a firearm in furtherance of a drug trafficking felony, announced United States Attorney Zane David Memeger. The indictment charges that Gomez Rodriguez and Rosario Reyes possessed with intent to distribute approximately 12 kilograms of heroin at a residence on Battersby Street in the Mayfair section of Philadelphia, as well as a loaded 9 mm handgun and extensive drug trafficking and packaging paraphernalia on October 22, 2015.
According to the indictment, the named defendants were members of a drug organization that received, prepared and packaged multi-kilogram quantities of heroin for street sale and distribution in Philadelphia. The organization used the premises at 7563 Battersby Street in Philadelphia, as a stash house for concealing and storing kilogram quantities of heroin, as a location to cut, prepare and package heroin for street sale in Philadelphia, as well as a place to store proceeds from drug sales and to maintain records from those sales.
The indictment charges that the organization concealed inside 7563 Battersby Street premises multi-kilogram quantities of heroin intended for cutting and packaging, placing the kilograms of heroin inside pieces of furniture containing hidden compartments. It is further charged that the organization employed multiple workers on a periodic basis to mill, prepare, cut and package heroin for street sale and maintained in the basement of the premises extensive paraphernalia, including strainers, grinders, presses, scales, a bucket, ziplock bags, glassine envelopes and two large ziplock bags containing cutting substances, all of which were for use in the cutting and packaging of heroin for street sale. The indictment further charges that, on October 22, 2015, at the time of a warrant-authorized search of the 7563 Battersby Street premises, Luis Manuel Gomez Rodriguez and Jose Antonio Rosario Reyes, both workers in the drug organization, possessed inside the residence approximately 12 kilograms of heroin, which were found concealed in compartments inside two pieces of furniture, a 9 mm Kel-Tech Luger handgun loaded with 7 live rounds of ammunition, approximately $79,286 in United States currency, and a significant amount of heroin trafficking paraphernalia and packaging material.
If convicted, Luis Manuel Gomez Rodriguez and Jose Antonio Rosario Reyes each face a maximum penalty of life imprisonment, an effective mandatory minimum sentence of 15 years’ imprisonment, lifetime supervised release, at least 5 years supervised release, a fine of $30,250,000, and a $400 special assessment.
This case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department and is being prosecuted by Assistant United States Attorney Joseph T. Labrum, III.
Philadelphia Man Indicted for Impersonating A Federal OfficerRead the Press Release
PHILADELPHIA - Michael Alvaro, 37, of Philadelphia, PA, was charged today by Indictment with impersonation of a federal officer, impersonator conducting a search, and possession of unregistered firearms, announced United States Attorney Zane David Memeger. The indictment alleges that on or about November 17, 2014, Alvaro identified himself as a federal law enforcement officer of the Drug Enforcement Agency (DEA), and assisted in the detention of another person and search of that person’s vehicle. The indictment also alleges that on May 12, 2015, Alvaro identified himself as a federal law enforcement officer of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) in order to gain access to a secured area of an Amtrak derailment. The indictment further alleges that Alvaro unlawfully possessed unregistered firearms.
If convicted the defendant faces a maximum possible sentence of 29 years in prison, possible fine, special assessment $500, up to three years of supervised release.
The case was investigated by the Federal Bureau of Investigation and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It is being prosecuted by Assistant United States Attorney Denise S. Wolf.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Former Military Contractor Sentenced to 12 Months in Prison for Paying Bribes to Army Officers during Iraq WarRead the Press Release
The former president of a defense contractor providing services to the U.S. military in Iraq was sentenced today to 12 months and one day in prison for his role in a scheme to pay more than $1.2 million in bribes to U.S. Army contracting personnel in exchange for being awarded lucrative defense contracts, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Zane David Memeger for the Eastern District of Pennsylvania.
U.S. District Judge Joel H. Slomsky in the Eastern District of Pennsylvania sentenced Justin W. Lee, 37, of Philadelphia, the former president of Lee Dynamics International (LDI), who pleaded guilty in July 2011 to one count of conspiracy to commit bribery and four substantive counts of bribery.
In connection with his guilty plea, Lee admitted that as the president of LDI and previously as an officer of American Logistics Services (ALS), a Kuwaiti company providing supplies to the U.S. military in Iraq, he paid multiple bribes in the form of cash, airline tickets, trips and hotel stays, among other things, to military contracting personnel in exchange for their agreement to take official action to award lucrative contracts to both LDI and ALS.
Lee’s father and co-defendant, George Lee, who was the CEO of both companies, was sentenced to 54 months in prison in July 2015 for one count of bribery. This marks the end of a long-running investigation, which began in 2006, that led to the conviction of seven other defendants, including several high-ranking contracting officers.
The U.S. Army Criminal Investigation Command, the Defense Criminal Investigative Service and the U.S. Department of Homeland Security – Immigration and Customs Enforcement investigated the case, and the Office of the Special Inspector General for Iraq Reconstruction, the FBI and the Internal Revenue Service previously contributed to the investigation. Trial Attorneys Richard B. Evans and John Keller of the Criminal Division’s Public Integrity Section and the U.S. Attorney’s Office of the Eastern District of Pennsylvania prosecuted the case. Mark W. Pletcher and Emily W. Allen of the U.S. Attorney’s Office of the Southern District of California previously provided substantial assistance.
Day Care Operator Sentenced for Wire Fraud and Obstructing the IRSRead the Press Release
PHILADELPHIA - Deborah Cellucci, 45, of Mullica Hill, New Jersey, was sentenced today to one year and one day in prison for sending a false levy release that hampered the Internal Revenue Service's efforts to collect taxes owed by Cellucci's day care business, announced United States Attorney Zane David Memeger.
In 2013, Cellucci fell behind on her business taxes. An IRS revenue agent worked out a payment plan with Cellucci. Also, as part of its collection efforts, the IRS sent a Notice of Levy to an agency that paid subsidies to Cellucci’s day care under the subsidized child care program. That levy directed that the $28,103.20 subsidy slated for the day care be paid to the IRS. In June 2013, Cellucci faxed a false levy release from her home in New Jersey to the agency, in Philadelphia, in charge of paying the day care subsidy funds. As a result of the false levy release, a check for $28,103.20 that the agency had written to the U.S. Treasury was canceled, and a new check in the same amount was made out to the day care. Cellucci endorsed the check, and deposited the proceeds into her business account.
In addition to the prison term, United States District Judge Berle M. Schiller also ordered the defendant to pay $28,103.20 in restitution, and to serve a three-year period of supervised release.
The case was investigated by the Treasury Inspector General for Tax Administration and was prosecuted by Assistant United States Attorney Elizabeth Abrams.