Eastern District of Pennsylvania
Press releases recorded for this federal judicial district.
Temple University Agrees to Pay $100,000 to Resolve OverbillingRead the Press Release
PHILADELPHIA- Temple University has agreed to a $100,000 settlement to resolve allegations arising from overbilling for neurology services. The settlement agreement, which was reached on February 22, 2013, was announced by United States Attorney Zane David Memeger. The overbilling to Medicaid and Medicare programs arose from services rendered at Temple University's own facilities as well as services rendered at Frankford Hospital by Temple physicians. Temple University submitted claims for medical services that were improperly coded higher than the appropriate codes that were supported by the documentation for those services. Upon review of the documentation underlying these claims, Temple University agreed that the coding was not accurate and thus, that the government paid more than it should have for the services Temple University physicians provided. Under the parties' settlement agreement, Temple University will pay $100,000.00 to the United States.
“As we continue to seek to contain healthcare costs, the United States cannot tolerate overbilling to government healthcare programs,” said Memeger. “Unfortunately, this type of fraud and waste is a serious problem facing our healthcare system. To help ensure the continued viability of these critical healthcare programs for our citizens, we must be vigilant about preventing these financial drains on the system.”
This resolution was handled by Assistant U.S. Attorneys Veronica J. Finkelstein and Susan R. Becker.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Philadelphia Woman Facing Gun ChargeRead the Press Release
Tanika Victoria Little, 34, of Philadelphia, Pennsylvania, was charged today by indictment with one count of illegally possessing a firearm with obliterated serial numbers, announced United States Attorney Zane David Memeger. The indictment alleges that on October 1, 2012, Little knowingly possessed a Glock model 19, 9mm pistol, serial #TN460US, with a forcibly removed serial number plate from the frame and scratched serial number on the slide of the firearm.
If convicted the defendant faces a maximum possible sentence of five years in prison, three years supervised release, a $250,000 fine, and a $100 special assessment.
The case was investigated by United States Secret Service, the Office of the Attorney General Commonwealth of Pennsylvania Gun Violence Task Force, and is being prosecuted by Assistant United States Attorney Anita Eve.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Philadelphia Man Charged in Three RobberiesRead the Press Release
Maurice M. Connelly, 20, of Philadelphia, PA was charged today by Indictment with three counts of robbery which interferes with interstate commerce and three counts of using, carrying, and brandishing a firearm during a crime of violence, announced United States Attorney Zane David Memeger. These charges stem from Connelly’s involvement in three separate gun-point robberies of store robberies; one on June 24, 2012, June 25, 2012, and August 27, 2012.
If convicted the defendant faces a maximum possible sentence of life imprisonment, with a mandatory minimum 57-year sentence consecutive to all other sentences, a $1,500,000 fine, 5 years supervised release, and a $600 special assessment.
The case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department and is being prosecuted by Assistant United States Attorney Jeffery W. Whitt.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Lancaster Man Charged with Enticing A MinorRead the Press Release
Richard Haines, Jr., 59, of Lancaster, PA, was charged today by indictment with enticing a minor to engage in sexually explicit conduct so that he could take pictures of the conduct and with
possession of child pornography, announced United States Attorney Zane David Memeger.
If convicted the defendant faces a maximum possible sentence of 130 years with a 15 year mandatory minimum; 5 years up to a lifetime of supervised release; $1,250,000 fine; restitution; forfeiture and $500 special assessment.The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorneys Michael L. Levy and Michelle Rotella.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Alleged Fraud Scheme Racked up $243k in Gift Cards & MerchandiseRead the Press Release
PHILADELPHIA - Diane Williams, 51, of New York, NY, was charged today by indictment with conspiracy to commit bank fraud, bank fraud, and aggravated identity theft in connection with a scheme to use stolen bank cards to buy department store gift cards, announced United States Attorney Zane David Memeger.
According to the indictment, between January 2011 and February 2012, a co-conspirator, unknown to the grand jury, obtained stolen bank cards that had been issued by Bank of America and recruited Williams as a “shopper.” The role of the shopper was to use the victims’ identification information and stolen bank cards to buy gift cards and other merchandise. Williams, working with the co-conspirator, allegedly obtained the dates of birth, addresses, Social Security numbers, bank account numbers, and other means of identification of unknowing victims. She allegedly used this information and the stolen bank cards to fraudulently buy at least $243,029.78 worth of store gift cards and merchandise from Target, Walgreens, Walmart, and other stores in Pennsylvania, New York, and New Jersey. It is further alleged that Williams and the co-conspirator obtained and possessed bank cards that had been stolen from a Pitney-Bowes distribution center in Reading, Pennsylvania. The co-conspirator allegedly paid Williams for her work by giving her cash equal to a portion of the value of the gift cards or other merchandise she purchased in each store.
If convicted, Williams faces a total statutory maximum of 47 years in prison, five years of supervised release, a fine of $2.75 million, and a $700 special assessment.
The case was investigated by the U.S. Secret Service. The case is being prosecuted by Assistant United States Attorney Laurie Magid.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Trio Charged in Armed RobberyRead the Press Release
PHILADELPHIA - Three Philadelphia men are charged with conspiracy and Hobbs Acts robbery in a superseding indictment filed yesterday, announced United States Attorney Zane David Memeger. Marcus Jones, 23, Jonte King, 22, and Maleek Brown, 22, are charged with planning and carrying out the March 14, 2012 armed robbery of the Peralta Grocery Store, located at 6935 Dicks Avenue, Philadelphia. According to the indictment, Brown acted as the getaway driver while Jones and King, brandishing firearms, robbed the store. The indictment further charges Jones and King with the March 24, 2012 armed robbery of the Golden Kingdom II Restaurant, located at 7100 Elmwood Avenue, Philadelphia. The indictment further charges Jones with the March 22, 2012 armed robbery of Aya’s Pizza, located at 7144 Elmwood Avenue, in Philadelphia.
If convicted of all charges, Jones faces a mandatory 57 years in prison up to life; King faces a mandatory 32 years in prison, up to life; Brown faces a mandatory seven years in prison up to life. Each defendant also faces possible fines, mandatory special assessments, and supervised release.
The case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department. It is being prosecuted by Assistant United States Attorney Jennifer Chun Barry.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Loan Fraudster Sentenced to 160 Months in PrisonRead the Press Release
PHILADELPHIA - Allie Speight, 58, of Philadelphia, was sentenced today to 160 months in prison for a loan fraud scheme that included aggravated identity theft, bank fraud, wire fraud, and money laundering. Speight pleaded guilty on April 16, 2012 to orchestrating a scheme to induce others to obtain loans as straw borrowers in return for receiving a percentage of the loans. Co-defendant Jerome Manker received funds from the loans for construction and rehabilitation work that he never performed.
Speight and co-defendant Maurice Thomas would act as brokers, scouting for depressed properties and enticing others to purchase the properties by obtaining loans that were far in excess of the properties' values. Speight and Thomas used a mortgage broker in Pittsburgh to prepare and submit loan applications that contained false W-2 statements and pay stubs, mostly from the fictitious company of "Allied Construction and Development, Corp.," owned by Allie Speight. The mortgage broker, John Polosky, charged elsewhere, received payments from the loan proceeds outside of the payments identified in the HUD-1 settlement sheets for the loans. Speight and Thomas received at least 10-percent of the loan proceeds that they helped to broker. In many cases, Speight and Thomas allegedly created forged letters from the straw borrowers that directed title companies to send the proceeds to Fred A. Johnson, Jr., charged elsewhere, an accountant based in West Philadelphia. Johnson then laundered the loan proceeds by disbursing the monies to various bank accounts according to Speight's and Thomas' directions. By misdirecting the funds to Johnson, the lenders were not aware that the loan monies were ultimately disbursed to individuals not entitled to receive the funds, including Speight, Thomas, and members of Speight's family. More than $3 million in loans were obtained during the course of the conspiracy.
Speight was also charged with a scheme to obtain loans from Wachovia Bank using straw borrowers. Co-defendants Jerome Manker and Andrea McCrea, a former Wachovia employee, submitted loan applications that contained false documents. Over the course of three loans, Manker and McCrae obtained from Wachovia over $300,000 in loan proceeds. In July 2007, after McCrea was no longer working for Wachoiva, McCrea bribed another Wachovia employee to push a third Manker loan using a straw borrower.
In addition to the prison term - 24 months of which is a mandatory term for the aggravated identity theft - U.S. District Court Judge Juan R. Sanchez ordered Speight to pay restitution in the amount of $2,037,700, joint and severally with his co-defendants who have already been sentenced.
Maurice Thomas was sentenced to 78 months in prison; Jerome Manker was sentenced to 51 months in prison; Andrea McCrea was sentenced to 12 months and one day in prison.The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation. It was prosecuted by Assistant United States Attorneys Daniel Velez and Christopher Diviny.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Indictment Charges Tax Preparer with Fraud SchemeRead the Press Release
PHILADELPHIA - Crystal Graham, 42, of Philadelphia, was charged today by indictment with filing false claims with the United States through federal income tax returns she prepared for clients, announced United States Attorney Zane David Memeger. According to the indictment, Graham created bogus wage statements and other false financial information which she placed on tax returns that she prepared for individuals for the purpose of obtaining tax refunds in the names of the filers. The refunds were based on the filer’s alleged entitlement to the First Time Home Buyer’s Credit and the Earned Income Tax Credit which are two tax credits that could result in a tax refund in 2008 even when the filer had little, if any, taxes withheld from income in that year.
According to the Indictment, Graham had her clients sign statements giving her the authority to deposit the clients’ refund checks into her savings account, or to have the refund checks placed on prepaid access devices. This gave Graham the ability to take a substantial portion of the fraudulent refunds before giving her clients the remainder.
If convicted, Graham faces a maximum possible statutory sentence of 55 years in prison, a fine of $2.75 million, a special assessment of $1,100, and three years of supervised release.The case was investigated by the Internal Revenue Service Criminal Investigation. It is being prosecuted by Assistant United States Attorney Floyd J. Miller.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Alleged Pharmacy Robbers IndictedRead the Press Release
Edward Schaeffer, 29, and William Webb, 50, both of Philadelphia, were charged today by Indictment with conspiracy, interference with interstate commerce by robbery, and brandishing a firearm during a crime of violence, announced United States Attorney Zane David Memeger. The indictment alleges that the defendants conspired to target approximately 19 pharmacies in order to steal prescription pharmaceuticals, including oxycontin, oxycodone, and percocet.
If convicted, the defendants face a maximum sentence of life imprisonment, five years of supervised release, a fine of up to $1.25 million, and a $500 special assessment. They face a mandatory 32 years in prison consecutive to any other sentence.This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Philadelphia Police Department, Abington Twp. Police Department and Glenolden Borough Police Department. It is being prosecuted by Assistant United States Attorney Jennifer Chun Barry.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Philadelphia Man Sentenced for Defrauding the CityRead the Press Release
PHILADELPHIA - Barry Jones, 67, of Philadelphia, was sentenced today to 21 months in prison for devising and executing a scheme to defraud the City of Philadelphia out of more than $1.2 million. Jones, who was charged with one count of mail fraud, was the president of Mara Management Services Inc. (“Mara”) when he knowingly submitted false bills in connection with a series of computer services contracts that Mara had entered into with City agencies.
Between July 2004 and June 2008, Mara had contracts to provide computer programming, maintenance, and consulting services to multiple agencies, including the City’s revenue and water departments, and Community Behavioral Health (“CBH”), a charitable corporation contracted by the City to provide mental health and substance abuse services for Philadelphia County Medicaid recipients. Mara hired subcontractors to perform much of the work on these contracts, repeatedly overstating the number of hours that these subcontractors worked on the projects in order to get inflated monthly payments from the City’s agencies and CBH.Jones also overstated the number of hours that he was working on the contracted-for projects and between 2006 and 2008, he even sought and received compensation from the City for work by a subcontractor who had stopped working on the projects in 2005. In total, Jones caused the City to make payments to Mara totaling more than $5.9 million between January 1, 2005 and June 30, 2008, in connection with Mara’s contracts with the Revenue Department, the Water Department, and CBH. Jones admitted that he kept approximately $2.7 million for himself, which greatly exceeded the amount he was entitled to receive from the City.
In addition to the prison term, U.S. District Court Judge Robert F. Kelly ordered Jones to pay restitution in the amount of $1.2 million and ordered three years of supervised release.
The case was investigated by the United States Postal Inspection Service and the City of Philadelphia’s Office of the Inspector General. It was prosecuted by Assistant United States Attorney Mark B. Dubnoff.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Bucks County Man Pleads Guilty to Gun ChargesRead the Press Release
PHILADELPHIA - David Manilla, 51, of Worcester, PA, pleaded guilty today to possession of firearms by a convicted felon. Manilla was found to be in possession of multiple firearms and ammunition when police investigated the November 2010 shooting death of a hunter. Manilla, who fired the fatal shot, was prohibited from possessing any weapons because of his conviction on aggravated assault for the 1985 beating of another man.
U.S. District Court Judge Jan E. DuBois scheduled a sentencing hearing for June 27, 2013. Manilla faces a maximum statutory sentence of 10 years in prison, a fine of up to $250,000, three years of supervised release, and a $100 special assessment.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and is being prosecuted by Assistant United States Attorney Joseph LaBar.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Serial Bank Robber Pleads GuiltyRead the Press Release
Aaron Thomas, 47, of Philadelphia pleaded guilty today to six counts of bank robbery, announced United States Attorney Zane David Memeger. Thomas pleaded guilty to robbing six banks: (1) PNC Bank located on Old York Road in Abington on August 10, 2012; (2) TD Bank located on City Avenue in Philadelphia, on August 8, 2012; (3) TD Bank located on City Avenue in Philadelphia on May 17, 2011; (4) TD Bank located on Moreland Road in Abington, on September 17, 2009; (5) TD Bank located on Grant Avenue in Philadelphia, on September 17, 2009; and (6) TD Bank located on Old York Road in Abington on July 24, 2009. Thomas was apprehended by Abington Police following the PNC Bank robbery on August 10, 2012 after a vehicle and foot pursuit through the streets of Abington and Philadelphia which resulted in two police officers being injured and several vehicles damaged. Thomas has two prior convictions for bank robbery.
Sentencing is scheduled for June 12, 2013 before the Honorable Lawrence F. Stengel.
The case was investigated by Federal Bureau of Investigation, the Abington Township Police Department, and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Robert J. Livermore.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Indictment Unsealed Against Alleged Members of Heroin Smuggling RingRead the Press Release
PHILADELPHIA - A second superseding indictment was unsealed today charging eleven people in a conspiracy that involved secreting packets of heroin inside the body, in order to smuggle the drugs into the United States from the Dominican Republic, drug charges and kidnapping. The indictment names defendants Higinio Castillo and Michael Nunez-Rodriguez as the alleged leaders of the Castillo Drug Smuggling Organization (CDSO). Members of the CDSO acted as couriers and recruited other individuals to act as couriers smuggling the drugs inside their bodies or in luggage. The CDSO paid the couriers’ travel expenses, helped them obtain U.S. Passports, and drove them to and from the U.S. airports. The indictment alleges that the CDSO operated in Philadelphia from November 2010 through March 2012 smuggling at least six kilograms of heroin into the United States during that time period.
Charged with Castillo and Nunez-Rodriguez are: Philip Osley, Yeltsin Genao, Kelvin Perez, Adrian DeJesus, Tommy Figueroa, Argenes Peralta, Carlos Ruben Cotto-Leon, Dilcy Herminia Almanzar, and Jiliana Urena, all of Philadelphia. The charges were announced today by United States Attorney Zane David Memeger and Special Agent-in-Charge John Kelleghan with U.S. Immigration and Customs Enforcement Homeland Security Investigations.The CDSO allegedly enforced its hold on couriers and prevented theft of its product through threats and intimidation. The indictment alleges that on August 24, 2011, defendants Nunez-Rodriguez, Genao and Perez drove from Camden, NJ, to Philadelphia to locate “S.R.,”a person believed to have stolen the heroin that he was tasked with smuggling. The defendants drove S.R. to a house on 19th Street in Philadelphia where Castillo and DeJesus were waiting. The five conspirators interrogated S.R. by binding his hands and feet, making threats on his life, and discharging a firearm at close range. S.R. was eventually released with no serious physical injury. The indictment further alleges that on September 5,2011, defendants Nunez-Rodriguez and Figueroa went to the homes of courier “C.D.” after C.D. did not appear at the airport the previous night as expected. Figueroa pointed a gun at the person who answered the door and forced his way into the home to search for C.D. The defendants left after not finding C.D.
According to the indictment, the couriers traveled to and from the Dominican Republic on commercial flights that landed at Philadelphia International Airport, Newark Liberty International Airport in Newark, NJ, and JFK International Airport in Brooklyn, NY.
Defendant DeJesus was taken in to custody last night; the remaining defendants have been in federal custody.
If convicted of all charges, each defendant faces a mandatory minimum sentence of 10 years in prison up to life in prison, a mandatory minimum five years of supervised release up to a lifetime of supervised release, possible fines, and mandatory special assessments. Defendants convicted of firearm charges face an additional consecutive mandatory term of seven years in prison. The government is also seeking forfeiture of all assets derived from any criminal activity.
The case was investigated by Immigration and Customs Enforcement Homeland Security Investigations with assistance from United States Customs and Border Protection, the Philadelphia Police Department, Pennsylvania State Police, and the Philadelphia District Attorney’s Office. It is being prosecuted by Assistant United States Attorney Nancy Rue.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Identity Theft Ringleader Gets 12 Year Prison SentenceRead the Press Release
PHILADELPHIA - Lawrence Fudge, 47, of Philadelphia, was sentenced today to 144 months in prison for running a fraud and identity theft ring in Philadelphia for at least six years. Fudge pleaded guilty in December 2012 to conspiracy, six counts of bank fraud, eight counts of access device fraud and 18 counts of aggravated identity theft. Through the course of the scheme, Fudge recruited bank employees and an insurance company employee to abuse the trust placed in them by their employers and pass on to him the bank account and personal information of dozens of victims. He insulated himself from the actual fraudulent transactions by recruiting others to find sources of victim information and by finding “check runners” to conduct the fraudulent transactions at the banks, to open the fraudulent retail store credit accounts and to make the purchases at the retail stores with those fraudulently-opened accounts. With others, he traveled within and outside Pennsylvania to run his fraud and identity theft scheme. In addition, Fudge admitted that he committed additional crimes of the same nature between September 1, 2011 and November 14, 2012 while he was on pretrial release on this case.
Found in Fudge’s red Toyota truck at the time of his initial arrest, on August 30, 2011, were a number of documents and other items, including driver’s licenses and documents with personal and bank account information in the names of individuals who had not previously been identified by law enforcement as victims. The intended amount of fraud and attempted fraud that is attributed to the illegal activities of Lawrence Fudge and his ring - from conducting fraudulent transactions against victims’ bank accounts and opening retail store credit accounts in victims’ names and then making purchases with those accounts - is more than $357,030.Examples of Fudge’s fraud include: in August 2011, accounts at Home Depot, Lowe’s and Target were opened using the identity of victim C.S. More than $8,000 in purchases were made with those
fraudulent accounts and more than $1,500 was fraudulently withdrawn from her Bank of America bank
account. In that same time frame, accounts at Lowe’s, Target and Sam’s Club were opened using the identity of victim M.W. with more than $15,000 in purchases made with those fraudulent accounts, and additional accounts at Best Buy and Staples attempted to be opened. Also in that same time frame, accounts at Home Depot, Lowe’s, Best Buy and Target were opened using the identity of victim P.V. with more than
$10,000 in purchases made with those fraudulent accounts.Several of the victims have detailed the emotional distress and negative impact these crimes had on their lives. They describe their fear, their feelings of violation, and the lack of safety they now feel and, indeed, may always feel. One victim, who is a widow, described how the theft of the identity of her deceased husband left her “shaken to the core,” with the realization that her husband’s insurance policy, meant to protect his family, was the means of the theft of his identity and her security.
In addition to the prison term, U.S. District Court Judge Lawrence F. Stengel ordered restitution of $311,878, a special assessment of $3,300, and 10 years of supervised release.
The case was investigated by United States Postal Inspection Service and Federal Bureau of Investigation, with the assistance of multiple local police departments. It was prosecuted by Assistant United States Attorney K.T. Newton.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Former IRS Worker, Two Others Convicted of Tax Refund SchemeRead the Press Release
PHILADELPHIA - Former Internal Revenue Service employee Patricia Fountain, 35, Larry Ishmael, 40, and Calvin Johnson, Jr., 35, all of Philadelphia, PA, were found guilty yesterday of committing a series of tax refund schemes that defrauded the U.S. Government. A federal jury found each of the three defendants guilty of multiple counts of both conspiracy and filing false claims/tax returns to the IRS. For abusing her public office, Fountain was also found guilty of extortion. Johnson, Jr. was also found guilty of filing false claims while he was on pretrial release. Collectively, the defendants’ schemes cost the IRS well over $1 million.
Each of the defendants solicited claimants whose personal information the defendants used to file false tax returns claiming the Telephone Excise Tax Refund (TETR) in 2007 and the First Time Homebuyer Credit in 2009. Fountain also claimed the TETR by filing false tax returns for herself and for Ishmael, and used one of the claimant’s information to file a false tax return in 2008. Johnson, Jr. also used claimants’ information to file false tax returns in 2012, while he was being supervised on pretrial release in this case.
For each of the schemes, which Fountain engineered using inside information from the IRS, the defendants charged claimants a cash fee. With respect to her TETR scheme, Fountain warned that she would “red flag” those claimants who did not pay her a $400 fee. She then filed amended returns for those whom she believed had not paid the fee, causing the IRS to demand payment from certain claimants who had previously received TETRs. Fountain and Ishmael pooled their cash fees for their mutual use, including an $11,299 down payment on a Mercedes Benz R350, which Fountain structured by paying $9,900 in cash and charging the rest to a credit card.
Sentencing hearings for the defendants are scheduled for Fountain and Ishmael for June 17, 2013. Johnson’s sentencing hearing is scheduled for June 18, 2013. Pending sentencing, Ishmael and Johnson are being detained in federal custody and Fountain is being supervised on home detention. Fountain faces an expected advisory sentencing guideline range of 188 to 235 months in prison; Ishmael faces an expected advisory sentencing guideline range of 78 to 97 months; Johnson, Jr., faces an expected advisory sentencing guideline range of 108 to 135 months in prison. The defendants could also be ordered to pay restitution to the IRS, and fines, in addition to the mandatory special assessments. Co-defendants Andre Bruce, Howard Chilsom, William Martin, and Calvin Johnson, Sr. previously pleaded guilty.
The case was investigated by the Treasury Inspector General for Tax Administration and IRS Criminal Investigation. It is being prosecuted by Assistant United States Attorney Joe Khan and Department of Justice, Tax Division Trial Attorney Tiwana L. Wright.UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Third Defendant in Ticket-Fixing Scheme Pleads GuiltyRead the Press Release
PHILADELPHIA - Fortunato Perri, 76, of Philadelphia, PA, pleaded guilty today to taking part in a fraud scheme involving nine other judges at Philadelphia Traffic Court. Perri pleaded guilty to conspiracy to commit wire fraud and mail fraud, one count of mail fraud, and two counts of wire fraud. He faces a possible advisory sentencing guideline range of zero to six months in prison, before variances or departures.
Perri admitted receiving free auto repairs, free towing, free videos, and free seafood from a co-defendant in exchange for “fixing” tickets. Perri would receive traffic citation numbers, the names of offenders, or the actual citations to arrange “fixing” the ticket and would convey the information to William Hird, Director of Records, charged elsewhere. Hird, in turn, allegedly conveyed the request to the assigned judge. Court authorized intercepted telephone conversations reveal that Perri prioritized assisting the co-defendant from whom he received free services.
Defendant Hird, it is alleged, was extremely loyal to Perri given that Perri helped Hird move up the ladder to a high-level administrator at Traffic Court. Recorded conversations demonstrate that Hird acceded to Perri’s requests to “fix” certain tickets. Given Hird’s position at Traffic Court and access to the judges, Hird was allegedly able to facilitate requests for ticket fixing for Perri.
As part of the scheme, tickets were “fixed” by either being dismissed, finding the ticket holder “not guilty,” or finding the ticket holder guilty of a lesser offense. In many cases, the ticket holder did not even appear in Traffic Court, yet their ticket was “fixed.” As a result, the ticketholders paid lesser or no fines and costs, and evaded the assessment of “points” on their driver’s record. This widespread “ticket-fixing” defrauded both the Commonwealth of Pennsylvania and the City of Philadelphia of funds, and allowed potentially unsafe drivers to remain on the roads.
Perri is the third defendant to plead guilty. Co-defendants H. Warren Hogeland, who was a Bucks County Senior Magisterial District Judge, and Kenneth Miller, who was a Delaware County Senior District Judge, admitted to participating in the practice of giving breaks on Philadelphia traffic citations to friends, family, the politically-connected, and business associates. They entered their guilty pleas on February 12, 2013 and will be sentenced on May 24, 2013.This case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys Denise S. Wolf and Anthony J. Wzorek.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525School Principal Charged with Possession of Child PornRead the Press Release
A one-count information was filed today against Troy Czukoski, 42, of Exton, PA, charging that on October 18, 2012, he possessed more than 150 but less than 300 images of children engaging in sexually explicit conduct, announced United States Attorney Zane David Memeger. At the time of the investigation, Czukoski was serving as Principal of the Springton Lake Middle School in the Rose Tree Media School District in Delaware County.
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.
If convicted the defendant faces a maximum possible sentence of 10 years incarceration, which includes a mandatory five year term up to a lifetime of supervised release, a $250,000 fine and a $100 special assessment.
The case was investigated by the United States Postal Inspection Service and is being prosecuted by Assistant United States Attorney Michelle Rotella.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Chester Springs Couple Charged in Tax Refund Scam Involving Stolen Hospital Patient InformationRead the Press Release
PHILADELPHIA - Rafael Henriquez Polanco, 30, and his wife, Yanira Lopez, 27, are charged by information, filed today, with a tax fraud and identity theft scheme in which they sought more than $1.7 million in fraudulent tax refunds, announced United States Attorney Zane David Memeger. Defendant Polanco is separately charged by indictment with possession with intent to distribute 500 grams or more of cocaine, and possession with intent to distribute 28 grams or more of cocaine base (“crack”). Defendant Polanco is an illegal alien from the Dominican Republic, and, prior to his arrest in 2012, he and his wife resided together in Chester Springs, Pennsylvania.
According to the Information, between January 2008 and September 2011, defendants Polanco and Lopez obtained the names, dates of birth, and social security numbers of patients of Community Hospital in Chester, Pennsylvania and Crozer-Chester Medical Center in Upland, Pennsylvania, by paying employees of the hospitals to steal confidential medical forms. Defendants Polanco and Lopez then utilized the stolen identities to file fraudulent individual income tax returns with the IRS claiming fraudulent refunds. In support of the false returns, the defendants allegedly submitted phony Forms W-2 (Wage and Tax Statement) and listed one of several return addresses in Chester, Pennsylvania, or Philadelphia, Pennsylvania, which addresses the defendants controlled. The defendants utilized some of those homes to grow marijuana. The Information further alleges that Polanco and Lopez opened several bank accounts, and paid others to open bank accounts, using false identities for the purpose of depositing the fraudulently procured tax refund checks. Lopez, a former bank teller, utilized her knowledge of bank procedures to further this aspect of the scheme. It is alleged that between February 23, 2009 and September 16, 2011, the defendants caused the United States Department of the Treasury to issue federal tax refund checks totaling $257,710.79.
It is further alleged that between October 26, 2008 and May 18, 2010, defendant Lopez
devised a scheme to fraudulently obtain unemployment benefits from the Commonwealth of Pennsylvania. In furtherance of this scheme, Lopez represented to the Commonwealth that she was unemployed, when in fact she was employed full-time at Brandywine Maintenance, Inc., in Spring City, Pennsylvania, where she worked under the alias “Leslie Serrano.”The defendants are each charged with conspiracy to defraud the government, aggravated identity theft, passport fraud, and presentation of an immigration application containing a false statement. Lopez is additionally charged with wire fraud.
If convicted, defendant Polanco faces 32 years’ imprisonment, including a mandatory two year term of imprisonment, three years supervised release, a $1,000,000 fine, a $400 special assessment, and full restitution. If convicted, defendant Lopez faces 52 years’ imprisonment, including a mandatory two year term of imprisonment, three years supervised release, a $1,250,000 fine, a $500 special assessment, and full restitution. Forfeiture of all proceeds and all property involved in defendant Lopez’s wire fraud offense also may be ordered.
The case was investigated by the U.S. Department of State Diplomatic Security Service, the Department of Labor, the Internal Revenue Service – Criminal Investigations, and Immigration and Customs Enforcement Homeland Security Investigations. It is being prosecuted by Assistant United States Attorneys Kevin Brenner and Maureen McCartney.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Indictment Names Former and Current Police Officers in Charges Related to Loan-SharkingRead the Press Release
PHILADELPHIA - One former and one active Philadelphia police officer were charged by indictment, unsealed today, with extortion in an alleged loan-sharking scheme. According to the indictment, Gary Cottrell, 46, a former 14th district police officer, made high interest loans to others, including Cheryl L. Stephens, 46, an active 18th district police officer. Cottrell, who was arrested this morning, is charged with four counts of making an extortionate extension of credit, four counts of collecting an extension of credit by extortionate means, and eight counts of obstruction; Stephens is charged with two counts of making false statements to the grand jury. The charges were announced today by United States Attorney Zane David Memeger and FBI Acting Special Agent-in-Charge John Brosnan.
The indictment alleges that during the time he worked as a police officer and for a time after he left the Philadelphia Police Department, Cottrell operated a business in which he extended credit to borrowers, typically in amounts ranging from several hundred dollars to several thousand dollars. He allegedly required each borrower to repay the amount of money he loaned to them plus interest. The interest generally was in an amount equal to $25 for every $100 borrowed and generally had to be repaid in four weeks. The interest rate on these loans was substantially greater than the legally enforceable rate of 25% per annum. The indictment further alleges that some of the individuals borrowing money from Cottrell understood that he would use force, if necessary, to collect the money he loaned them plus the interest, and Cottrell did use force and the threat of force to collect money from borrowers. At times Cottrell allegedly sent threats of force to the borrowers via text messages.
It is further alleged Stephens falsely testified that Cottrell did not charge interest on her loan from him, and did not tell her to deny paying interest when talking to law enforcement officers.
If convicted, Cottrell faces a maximum statutory sentence of 320 years in prison, three years of supervised release, a $4 million fine, and a $1,600 special assessment. Stephens faces a maximum statutory sentence of 10 years in prison, three years of supervised release, a $500,000 fine, and a $200 special assessment.
The case was investigated by the Federal Bureau of Investigation/Philadelphia Police Department Public Corruption Task Force and the Philadelphia District Attorney’s Office. It is being prosecuted by Assistant United States Attorney Anthony J. Wzorek and Special Assistant United States Attorney Vicki J. Markovitz.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Coatesville Man Faces Additional Charges Related to Alleged Ponzi SchemeRead the Press Release
PHILADELPHIA - Istvan Merchenthaler, 42, of Coatesville, PA, was charged today in a superseding indictment with seven additional counts stemming from an alleged investment fraud scheme. Merchenthaler is now charged with a total of four counts of wire fraud, two counts of aggravated identity theft, four counts of money laundering, two counts of filing false tax returns, and two counts of interstate transportation of stolen property, announced United States Attorney Zane David Memeger.
According to the superseding indictment, from at least about May 2006 to about February 2013, Merchenthaler claimed to be the founder of PhoneCard USA, a company that was purportedly a “premier distribution source” for prepaid phone cards and cell phones. In reality, Merchenthaler operated a “Ponzi” scheme, stealing over $2 million from over 200 investors and using much of these funds for his own benefit and to perpetuate his scheme.
Merchenthaler, who used a number of aliases, approached investors and persuaded them to make investments in PhoneCard USA. In his marketing materials, Merchenthaler claimed that these investments would finance the “exponential growth” of PhoneCard USA and would provide investors with “generous returns” on their investments.
In addition, Merchenthaler falsely claimed that PhoneCard USA had “lucrative contracts” with major retail chain stores “covering territories that span the east coast.” In these materials, and in his communications to investors, Merchenthaler falsely claimed PhoneCard USA had contracts with these major retail chain stores, including Walmart, 7-Eleven, and BJ’s Wholesale Club. In reality, Merchenthaler had no such contracts with these major retail chain stores. Further, Merchenthaler falsely claimed to have friendships with executives at Walmart and 7-Eleven.
According to the superseding indictment, Merchenthaler stole two cars from dealerships while on pretrial release. Merchenthaler is now in federal custody.
If convicted, the defendant faces a maximum possible sentence of 170 years of imprisonment, a $3.5 million fine, 3 years of supervised release, and an $1,400 special assessment. Merchenthaler also faces a mandatory minimum of two years imprisonment.
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation Division. It is being prosecuted by Assistant United States Attorney Vineet Gauri.Click here to view the indictment
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Phoenixville Man Charged with Theft of Government FundsRead the Press Release
Lawrence Nicoletti, 60, of Phoenixville, Pennsylvania, was charged today by information with one count of theft of government funds, in connection with his alleged scheme to collect retirement benefits intended for his father-in-law, after his father-in-law’s death, announced United States Attorney Zane David Memeger. According to the Information, the defendant’s father-in-law was a United States Postal Service worker who received Social Security Administration Retirement and Survivor’s Insurance benefits, as well as Office of Personnel Management Civil Service Retirement System benefits. The information alleges that Nicoletti’s father-in-law died in December 2005 but the defendant took the retirement benefits intended for his father-in-law until the fraud was discovered in the summer of 2012. This resulted in a loss to the government of approximately $188,564.70.
If convicted, the defendant faces a maximum possible sentence of 10 years imprisonment; 3 years of supervised release; a $250,000 fine; restitution of $188,564.70; and a $100 special assessment.The case was investigated by the Social Security Administration, Office of Inspector General, and the Office of Personnel Management, Office of Inspector General. It is being prosecuted by Special Assistant United States Attorney Amanda R. Reinitz.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Philadelphia Woman Charged with Theft of Government FundsRead the Press Release
Sophia Beltz, 54, of Philadelphia, PA was charged today by information with one count of theft of government funds, in connection with her alleged scheme to collect Social Security Administration Retirement Insurance Benefits intended for her father, after her father’s death, announced United States Attorney Zane David Memeger. According to the information, the defendant received the retirement benefits intended for her father, who died in February 1997, until her fraud was discovered in August 2012. The information alleges that her conduct resulted in a loss to the government of approximately $172,133.
If convicted, the defendant faces a maximum possible sentence of 10 years imprisonment; 3 years of supervised release; a $250,000 fine; restitution of $172,133; 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 Amanda R. Reinitz.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Trio Charged in Counterfeiting SchemeRead the Press Release
Malik Burton, 21, Kyle Gumbs, 20, and Rayvaughan White, 21, all of Freeport, NY, were charged today by indictment with a counterfeiting scheme in which they allegedly passed counterfeit $100 bills at shopping centers and other retail establishments in Bucks County, announced United States Attorney Zane David Memeger. They are each charged with one count of conspiracy and one count of possessing and passing counterfeit currency. According to the indictment, on November 15, 2012, the defendants passed and attempted to pass approximately $5,700 in counterfeit currency at the Neshaminy Mall in Bensalem, among other locations.
If convicted, each defendant faces a maximum possible sentence of 25 years imprisonment, a fine of $500,000, a three-year term of supervised release, and a $200 mandatory special assessment.
The case was investigated by United States Secret Service and the East Lampeter Township Police Department and is being prosecuted by Assistant United States Attorney Joel D. Goldstein.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Judge Hands Down Long Prison Term for Illegal Oxycodone DistributionRead the Press Release
PHILADELPHIA - William Andrews, 52, of Philadelphia, was sentenced today to 145 months in prison for a drug distribution conspiracy involving approximately 7,000 pills of a mixture and substance containing a detectable amount of oxycodone. Andrews obtained oxycodone pills from various sources, including a licensed physician who issued prescriptions authorizing Andrews to obtain oxycodone pills from licensed pharmacies. Andrews then supplied oxycodone pills to his alleged co-conspirator, Joseph Fareri, for the purpose of selling the pills to customers, typically charging $20 for a 30 milligram pill. Andrews also sold oxycodone pills to customers.
In addition to the prison term, U.S. District Court Judge Mitchell S. Goldberg ordered six years of supervised release. Andrews pleaded guilty on April 11, 2013 to the conspiracy, to a charge of distribution, and a charge of distribution within 1,000 feet of a protected area. His co-defendant, Joseph Fareri, was sentenced on February 4, 2013 to 86 months in prison; co-defendant John Marshall is awaiting trial.
The case was investigated by the Federal Bureau of Investigation and the Pennsylvania State Attorney General’s Office. It is being prosecuted by Assistant United States Attorneys David Troyer and Frank Labor and Special Assistant United States Attorneys Erik Olson and Heather Castellino of the Pennsylvania State Attorney General’s Office.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Montgomery County Pastor and Mortgage Broker Convicted of Mortgage FraudRead the Press Release
PHILADELPHIA - Michael Wilkerson, 47, of Pottstown, PA, and Denise Haines, 43, of Birdsboro, PA, were convicted today of engaging in a scheme to defraud JP Morgan Chase’s predecessor, Chase Manhattan Bank, by fraudulently obtaining home loans valued at more than $6 million for properties located in Schwenksville and Glenmoore, Montgomery County, PA.
Michael Wilkerson, pastor of New Millennium Life Restoration Fellowship, with locations in Phoenixville and Spring City, recruited several of his congregants, and the congregants’ families and friends, to participate in a number of real estate transactions. If they had good credit and acted as “straw purchasers” - meaning they would sign loan documents as the purchaser of a house and attend the property settlement - Michael Wilkerson would pay them $15,000. Wilkerson paid the recruits another $5,000 if they referred other straw purchasers to him. Wilkerson recruited at least six individuals who agreed to be straw purchasers of homes. Denise Haines, a mortgage broker with American Group Mortgage Corporation, submitted fraudulent loan applications in the transactions to Chase Manhattan Bank. These fraudulent loan applications falsely represented the appraised value of the homes, the identification of the “straws,” the source of funds, the borrower’s income and assets, and their intent to take possession of the homes as their primary residence. Based on the representations made in the loan documents, Haines knew she could get Chase Manhattan Bank to approve the loans with little verification of the information on the loan applications.
Wilkerson’s wife Joyce, who pleaded guilty, assisted in the scheme by writing out the checks to the “straws,” and also pretended to be a co-purchaser of each of the homes at the time of settlement. Lee Garell, a real estate broker who pleaded guilty, prepared the sales paperwork for each of the homes that was sold to the “straws” and, along with Michael Wilkerson, dictated the fraudulent terms set out in the settlement sheets.
When the loans were funded at the time of settlement, the defendants manipulated the documents prepared at settlement and, later, forwarded the settlement documents to Chase Manhattan Bank to make it appear to the bank that the “straws” brought considerable cash to the closings. In fact, all of the money involved at the settlement actually came from Chase Manhattan Bank. The defendants shared in the profits from the fraudulent sales.
After settlement on the homes, Michael Wilkerson took possession of all of the homes, rented at least two of them and lived in another. He paid the mortgages with the proceeds from the fraudulent mortgage transactions and with rental income for approximately six months, then told the “straw” purchasers that they had to pay the mortgages. This last act led to the loans falling into default and then foreclosure, resulting in a loss of approximately $3 million.
U.S. District Court Judge Mitchell S. Goldberg scheduled a sentencing hearing for June 3, 2013 for Michael Wilkerson and for June 17, 2013 for Denise Haines. Each face a maximum possible sentence of 180 years in prison, five years supervised release, a fine of up to $6 million, and a $600 special assessment. Sentencing hearings are scheduled for Garrell and Joyce Wilkerson on April 30, 2013 and May 6, 2013, respectively.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Anita Eve.
President Obama established the Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Member of Philadelphia La Cosa Nostra Sentenced to 55 Months in Prison for Racketeering ConspiracyRead the Press Release
PHILADELPHIA – Louis Fazzini, 46, of Caldwell, N.J., was sentenced today to
55 months in prison for his participation in a racketeering conspiracy involving illegal gambling and theft from an employee benefit plan. U.S. District Court Judge Eduardo C. Robreno also ordered Fazzini to serve three years of supervised release following his prison term.
On Oct. 5, 2012, Fazzini pleaded guilty to conspiring to conduct and participate in the affairs of the Philadelphia La Cosa Nostra (LCN) Family through a pattern of racketeering activity. At the time of the plea colloquy, he admitted that, as a “made” member of the North Jersey crew of the Philadelphia LCN Family, he operated a sports bookmaking business and devised a fraudulent scheme to obtain health benefits through a “no show” job controlled by the LCN in furtherance of the racketeering conspiracy. As a “no show” employee, he would perform no work or productive services, while still receiving health benefits.The case was investigated by the FBI, the Internal Revenue Service Criminal Investigation, the Pennsylvania State Police, the New Jersey State Police, the Philadelphia Police Department, the Department of Labor Office of Inspector General’s Office of Labor Racketeering and Fraud Investigations, and the Department of Labor Employee Benefits Security Administration. Additional assistance was provided by the New Jersey Department of Corrections.
The case is being prosecuted by Trial Attorney John S. Han of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Frank A. Labor III and Suzanne B. Ercole of the Eastern District of Pennsylvania. Valuable prosecutorial assistance was provided by the Pennsylvania Office of the Attorney General.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Charges Allege Trio Engaged in Home Buyer Credit ScamRead the Press Release
PHILADELPHIA - Darlene Johnson, 49, Sheryl McPhail, 49, and Tracey Hill, 49, all of Philadelphia, were charged today in a four count information alleging that they engaged in a scheme to defraud the Internal Revenue Service with false claims of First Time Home Buyer Credits (FTHBCs), announced United States Attorney Zane David Memeger. The defendants are each charged with one count of conspiracy to submit false claims to a government agency and submitting a false claim to a government agency.
According to the information, Johnson prepared tax returns for individuals whose names and identifying information she received from McPhail and Hill. In those returns, Johnson submitted false claims to the government, on behalf of clients, totaling approximately $390,680.65 and received FTHBCs totaling approximately $367,180.65. Johnson paid McPhail and Hill out of the proceeds from the returns where the FTHBC was fraudulently received. Johnson is charged with two additional counts of submitting a false claim to a government agency.
If convicted, Johnson faces a maximum possible sentence of 25 years imprisonment, a fine of up to $1 million, three years of supervised release, and a $400 special assessment. McPhail and Hill each face a maximum possible sentence of 15 years imprisonment, a fine of up to $500,000, three years supervised release, and a $200 special assessment.
The case was investigated by the Internal Revenue Service Criminal Investigations in conjunction with the Philadelphia Office of Inspector General. It is being prosecuted by Assistant United States Attorney Linwood C. Wright, Jr.
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UNITED STATES ATTORNEY'S OFFICE Contact: PATTY HARTMAN
EASTERN DISTRICT, PENNSYLVANIA Media Contact
615 Chestnut Street, Suite 1250 215-861-8525
Philadelphia, PA 19106COPIES OF NEWS MEMOS AND RELATED DOCUMENTS CAN ALSO BE FOUND AT
HTTP://www.justice.gov/usao/paeUNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Virginia Man Charged with Stealing Social Security NumberRead the Press Release
PHILADELPHIA - Ronnie Lee Durham, a/k/a “Ronnie Lee Johnson,” and “R.P.J.,” 50, of Alexandria, Virginia and formerly of Feasterville, PA is charged by Indictment, unsealed yesterday, with stealing and using the social security number of another person, announced United States Attorney Zane David Memeger. Durham is charged with four counts of Social Security Fraud and one count of Aggravated Identity Theft. He was arrested in Virginia.
According to the indictment, the defendant used the Social Security number and date of birth of an individual residing in another state to open bank accounts, obtain a debit card, and obtain employment. In March 2011, Durham, using the name Ronnie Lee Johnson, went to work for a company in Langhorne, PA, where he had access to client files. Between March and April of 2011, Durham allegedly accessed the identifying information of “RJP,” who resided in Mississippi, and rented an apartment in Feasterville, PA, using RJP’s date of birth and social security number. It is further alleged that Durham opened bank and credit card accounts using RJP’s information and also secured a job with a New Jersey company using that information.
If convicted, the defendant faces a maximum possible sentence of 22 years imprisonment, a three-year period of supervised release, a $1.25 million fine, and a $500 special assessment.The case was investigated by the Social Security Administration, Office of Inspector General, the Diplomatic Security Service, and the Lower Southampton Police Department. It is being prosecuted by Special Assistant United States Attorney Amanda R. Reinitz.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525New Jersey Man Admits to Scamming NunsRead the Press Release
PHILADELPHIA - Adriano Sotomayor, 54, of Margate, New Jersey, pleaded guilty, late today, to 17 counts of wire fraud in connection with a scheme to defraud members of the Dominican Sisters of the Rosary of Fatima (“Sisters of Fatima”), and others, between May 2009 and February 2012. Sotomayor was captured by the FBI Fugitive Squad in Las Vegas, Nevada, on February 27, 2012. He went on the run November 16, 2011, one day after he was indicted.
The defendant launched his scheme by causing an elderly nun to believe that she had been named in a will as the beneficiary of an estate estimated at approximately $2.1 million. In order to lure the elderly nun into this scheme, the defendant caused his victim to believe that the man who notified her about the will was a Catholic priest from New Jersey, and the testator was one of his parishioners. Sotomayor fraudulently induced the elderly nun to begin sending money to him in Atlantic City, New Jersey, by telling her that she needed to pay taxes, processing fees, and various legal fees associated with the fictitious will. He went on to target other victims in Levittown and Philadelphia who initially sent money to him on the elderly nun’s behalf. Sotomayor caused at least 50 victims to send a total of at least $1.3 million from Pennsylvania and elsewhere to him in New Jersey over a two year period. The defendant received wire transfers at the Trump Plaza Hotel and Casino, the Showboat Hotel and Casino, and Bally’s Park Place, among other places.
U.S. District Court Judge Eduardo C. Robreno scheduled a sentencing hearing for June 12, 2013. Sotomayor faces a possible advisory sentencing guideline range of 70 to 188 months in prison.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Karen M. Klotz.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Former Member of Board of Directors Charged in Scheme Contributing to Closure of Local Federal Credit UnionRead the Press Release
PHILADELPHIA – Miqueas Santana, 43, was charged today by information with embezzlement and money laundering in a case that contributed to the closure of the Borinquen Federal Credit Union (BFCU), announced United States Attorney Zane David Memeger. According to the information, Between July 2009 and June 2011, Santana, with the permission and approval of the former manager of BFCU, withdrew money from his BFCU bank accounts without depositing sufficient money into the accounts to cover the withdrawals, resulting in deficit account balances in his five personal and business savings and checking accounts of more than $500,000. Santana used this money to purchase multiple pieces of real estate throughout Philadelphia.
BFCU was a federal credit union in Philadelphia. In June 2011, the National Credit Union Association took over the operation of the BFCU, but within two weeks, closed the credit union and liquidated its assets. Its former manager, Ignacio Morales, has previously been convicted of multiple counts relating to embezzlement from BFCU and conspiracy to defraud the government regarding the cashing of fraudulent tax refund checks. Morales is currently serving a 7 ½ year sentence for his crimes.
If convicted of all charges,Santanafaces a maximum sentence of 40 years imprisonment, 5 years supervised release, a $1,250,000 fine (or a $1,000,000 fine plus twice the value of the criminally derived property) and a $200 special assessment.
This case was investigated by the United States Postal Inspection Service, the Internal Revenue Service, and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Arlene D. Fisk.
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An Indictment or an Information is an accusation. A defendant is presumed innocent unless and until proven guilty.UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Two Philadelphia Men Charged in Bank Fraud ConspiracyRead the Press Release
Eric Young, 39, and Calvin Johnson, 41, both of Philadelphia, Pennsylvania, were charged today by Indictment with one count of conspiracy to commit bank fraud and one count of bank fraud, announced United States Attorney Zane David Memeger.
According to the indictment, Young and Johnson ran a scheme in which they hired individuals to open bank accounts, made phony deposits, and made withdraws from the accounts knowing there were insufficient funds. The indictment alleges that the defendants defrauded the banks of more than $100,000 between December 2011 and August 2012.
If convicted on all counts, Young and Johnson each face a maximum possible sentence of 35 years imprisonment, a five-year period of supervised release, a fine of up to $1.25 million, a $200 special assessment, and full restitution.
The case was investigated by the Bensalem Police Department and the United States Secret Service. It is being prosecuted by Assistant United States Attorney Patrick J. Murray.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525New York Man Charged with Sex Trafficking of Young FemalesRead the Press Release
PHILADELPHIA - Justin Williams, a/k/a “New York Ice”, a/k/a “Pimp Juice”, 38, of NY, NY, is charged by indictment, unsealed today, with the sex trafficking of minors, announced United States Attorney Zane David Memeger. According to the indictment, between November 2011 and January 2012, Williams recruited young females to work as prostitutes in his business, created Internet advertisements in which he advertised various females as available for purchase for purposes of prostitution, and engaged in acts of physical violence to force the victims to remain in his business. The advertisements that Williams created featured pictures of the victims, either scantily clad, or topless with their hands covering their breasts, the price, and a phone number to call to arrange a meeting with a female. Williams allegedly forced the victims to engage in sex acts with clients.
If convicted, the defendant faces a 15-year mandatory minimum and maximum life sentence in prison, supervised release and a fine of up to $500,000.
The case was investigated by the FBI and is being prosecuted by Michelle Morgan.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Tax Preparer Charged with Falsifying Returns to Increase Client RefundsRead the Press Release
PHILADELPHIA - Shawn Sisco, 48, of Philadelphia, PA, was charged today by Indictment with preparing false income tax returns for her clients, announced United States Attorney Zane David Memeger. According to the indictment, Sisco, who owned Sisco Accounting, a home-based tax preparation business, falsified the itemized deductions on her clients’ returns in order to obtain refunds in amounts larger than the filers would have otherwise received if Sisco had truthfully prepared the tax returns. According to the indictment, the bogus expense deductions included: medical and dental expenses; charitable contributions; mortgage interest; cell phone expenses; property tax expenses; clothing and shoe expenses; laundry expenses; and maintenance expense.
If convicted the defendant faces a maximum possible sentence of 93 years of imprisonment, a fine of $7.750 million, a special assessment of $3,100 and 1 year of supervised after she is released from prison.
The case was investigated by Internal Revenue Service Criminal Investigation and is being prosecuted by Assistant United States Attorney Floyd J. Miller.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Yeadon Man Charged in Multi-Million Dollar Mortgage Fraud SchemeRead the Press Release
Eric Ponder, 43, of Yeadon, Pennsylvania, was charged today by Information with participating in a mortgage fraud conspiracy involving more than 100 Philadelphia properties and more than $20 million in fraudulent loan proceeds, announced United States Attorney Zane David Memeger. Ponder is charged with conspiracy to commit loan and wire fraud, loan fraud, and wire fraud. He allegedly received approximately $1 million through his participation in this mortgage fraud scheme.
The information alleges a massive mortgage fraud conspiracy that operated between May 2004 and February 2009, primarily in the West Philadelphia section of the city of Philadelphia. Ponder, who held himself out as a real estate developer, is alleged to have helped cause the submission of numerous fraudulent loan applications that resulted in mortgages being unwittingly issued by various banks by, among other things, knowingly making false statements on loan applications in his own name and helping secure mortgages in the names of others by recruiting “straw buyers” whose identity and fraudulent information was used to obtain the loans. Ponder is also alleged to have submitted false invoices for construction work never performed on the properties in order to justify payments to him from the settlement proceeds of loans in the names of the straw buyers. According to the information, co-conspirator Willie G. Manley, charged elsewhere, was an accountant who created false income documents, such as W-2 forms, paystubs, and Form 1040 income tax returns, which were submitted to lenders. The conspiracy also included grossly inflated appraisals, false title insurance policies, false receipts for home repairs that were never performed, and straw buyers who knowingly allowed their names and identities to be used to purchase the properties and defraud the banks.
The information alleges that a Philadelphia-based property settlement company, “KREW Settlement Services,” was at the center of the conspiracy. Most of the mortgages were unpaid and most of the properties fell into foreclosure.
If convicted, Ponder the defendant faces a maximum possible sentence 55 years in prison, five years of supervised release, a fine of $1.5 million or twice the gross gain resulting from the offense, and a $300 special assessment.The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigation, and the Department of Housing and Urban Development’s Office of Inspector General. It is being prosecuted by Assistant United States Attorney Michael S. Lowe.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Straw Buyer Gets Maximum SentenceRead the Press Release
PHILADELPHIA - Kevin Michael McGinty, 25, of Philadelphia, was sentenced yesterday to the statutory maximum sentence of 60 months in prison for the illegal straw purchase of firearms. McGinty made a false statement when he certified that he was the actual buyer of five firearms from Delia’s Gun Shop, 6104 Torresdale Avenue, Philadelphia, Pennsylvania. The purchases were made on February 10, 2012.
In addition to the prison term, U.S. District Court Judge Berle M Schiller ordered a $1,000 fine and three years of supervised release.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Philadelphia Police Department. It was prosecuted by Assistant United States Attorney Jennifer Chun Barry.UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Former Treasurer of A City Council Campaign Pleads Guilty to Fraud ChargeRead the Press Release
PHILADELPHIA - Former Philadelphia city employee John D. McDaniel, 39, of Philadelphia, pleaded guilty today to one count of wire fraud for allegedly stealing $100,000 from a campaign/political committee. A sentencing hearing is scheduled for May 14, 2013. McDaniel, the former Treasurer of the campaign/political committee for a Philadelphia City Councilperson, was recently fired from his city-paid airport job after the city Board of Ethics identified numerous reporting irregularities by McDaniel in the campaign’s required city filings.Between 2010 and 2011, McDaniel used several methods to routinely and, at times, without authorization, withdraw funds from the committee account, which funds he then used for his own purposes and other purposes. At times, McDaniel wrote and cashed checks to himself, and wrote checks to Progressive Agenda, a political action committee which he controlled, from which he then took stolen funds. McDaniel concealed the theft by filing false and incomplete campaign finance reports.
McDaniel faces a statutory maximum sentence of 30 years imprisonment, 5 years supervised release, a $250,000 fine, and a $100 special assessment.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Paul L. Gray.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Mortgage Broker and Loan Officer Sentenced for Multi-Million Dollar Fraud SchemeRead the Press Release
PHILADELPHIA - Dennis Nicholas, 62, Bernadette Nicholas, 64, both of Newtown Square, PA, and Kevin McAllister, 59, of Drexel Hill, PA, were sentenced today for engaging in schemes to defraud Wilmington Trust Federal Savings Bank and Malvern Federal Savings Bank that involved properties valued at more than $35.5 million. Dennis Nicholas was sentenced to 72 months in prison; Bernadette Nicholas was sentenced to 42 months in prison; McAllister was sentenced to 20 months in prison
In addition to the prison terms, U.S. District Court Judge Legrome D. Davis ordered Bernadette Nicholas and Kevin McAllister to jointly pay restitution to Wilmington Trust in the amount of $2.5 million; ordered Bernadette Nicholas to pay restitution to Malvern Federal Savings in the amount of $2.5 million; and ordered Dennis Nicholas to pay restitution to Malvern Federal Savings in the amount of $2,755,909.27.
Bernadette Nicholas was a mortgage broker who intentionally misrepresented material facts to Wilmington Trust about borrowers’ income and assets, the potential rental income and accurate appraisals of properties. She falsified borrowers’ tax returns and documents relating to the true source and amount of the down payments being made by borrowers, and forged borrowers’ signatures on loan documents.
Kevin McAllister was a loan officer with Wilmington Trust working in conjunction with Nicholas to approve mortgage loans for borrowers who did not meet Wilmington Trust’s criteria for income, assets, and credit scores, in return for bribes and kickbacks from Nicholas. As a result, Nicholas and McAllister caused the approval of loans totaling more than $30 million.
Bernadette Nicholas received a mortgage broker’s commission equivalent to approximately two to three percent of the total amount of a funded loan at the time of loan settlement. During the years 2004, 2005, and 2006, Bernadette Nicholas received approximately $1.2 million as the result of the loans funded by Wilmington Trust. She deposited the money into accounts maintained by Dennis Nicholas who then paid Kevin McAllister equivalent to approximately one percent of the amount of the funded loan, which was a kickback/bribe for getting the questionable loan approved and funded. McAllister made $379,075 in kickbacks. None of the defendants reported the income on their taxes.
Dennis Nicholas was convicted at trial on July 19, 2012 of bank fraud, bank bribery, loan application fraud, and filing false and fraudulent income tax returns. Bernadette Nicholas pleaded guilty to those same charges on October 31, 2011. McAllister pleaded guilty on October 31, 2011 to bank fraud, bank bribery, loan application fraud, and tax evasion.
Another defendant, Wayne Rosen, who was charged in a scheme with Bernadette Nicholas to defraud Malvern Federal, will be sentenced February 25, 2013. Nicholas brokered the sale of an apartment building between Rosen and mortgage clients and sought a $1.6 million loan from Malvern Federal for her clients. Nicholas altered the borrowers’ income tax returns prior to submitting them to Malvern Federal and falsely represented the borrowers’ income, the amount of the borrowers’ down payment, and the details of a subordination agreement between Rosen and the borrowers on the borrowers’ loan application and supporting documents. At settlement on the apartment building, Dennis Nicholas, Bernadette Nicholas and Rosen falsely represented to Malvern Federal that the borrower had made a down payment. Bernadette Nicholas and Rosen applied for a $3.5 million loan to refinance an existing loan that they had on a medical building. In order to influence Malvern Federal’s actions, Bernadette Nicholas, Dennis Nicholas and Rosen prepared and caused to be prepared fraudulent leases which misrepresented the potential rental flow income of their medical building and caused these leases to be submitted to Malvern Federal.
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service. It is being prosecuted by Assistant United States Attorney Anita Eve.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Guatemalan Citizen Charged with Illegal ReentryRead the Press Release
Deiby Ovalle-Pinto, 29, of Guatemala, was charged today by Indictment with illegal re-entry after deportation, announced United States Attorney Zane David Memeger. The indictment alleges that on or about February 6, 2013, Ovalle-Pinto, an alien, and native and citizen of Guatemala, was found in the United States after having been deported from the United States on or about June 19, 2003.
If convicted the defendant faces a maximum possible sentence of 20 years imprisonment, not more than three years supervised release, a $250,000 fine and a $100 special assessment.
The case was investigated by the Enforcement and Removal Operations of Immigration and Customs Enforcement of the United States Department of Homeland Security and is being prosecuted by Assistant United States Attorney Linwood C. Wright, Jr.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Convicted Felon Gets 78 Months for Gun ChargeRead the Press Release
PHILADELPHIA - Marquan Greggs, 22, of Philadelphia, was sentenced yesterday to 78 months for a charge of possession of a firearm by a convicted felon. Greggs was arrested after a police chase on March 1, 2011, during which he threw a stolen firearm with 10 rounds of ammunition into the street in the 800 block of E. Hilton Street, Philadelphia. Greggs was on parole at the time for two drug trafficking convictions. Greggs pleaded guilty to the charge on April 24, 2012.
In addition to the prison term, U.S. District Court Judge Juan R. Sanchez ordered a $1,000 fine, three years of supervised release, and a $100 special assessment.
This case was investigated by the Philadelphia Police Department and the Bureau of Alcohol, Tobacco, Firearms & Explosives. It was prosecuted by Assistant United States Attorney Ewald Zittlau.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Two Philadelphia Traffic Court Judges Plead Guilty in Ticket-fixing SchemeRead the Press Release
PHILADELPHIA - H. Warren Hogeland, 75, of Richboro, PA, and Kenneth Miller, 76, of Brookhaven, PA, pleaded guilty today to taking part in a fraud scheme involving seven other judges at Philadelphia Traffic Court. Hogeland was a Bucks County Senior Magisterial District Judge; Miller was a Delaware County Senior District Judge. Both accepted assignments with Traffic Court when their services were requested. The two defendants admitted to participating in the practice of giving breaks on traffic citations to friends, family, the politically-connected, and business associates. Specifically, Hogeland presided over a ticket issued to Miller’s son and declared Miller’s son “not guilty” without him having to make an appearance. Additionally, Miller arranged for a ticket, received by “J.B.,” to be declared “not guilty.” Both defendants pleaded guilty to mail fraud; Hogeland also pleaded guilty to conspiracy.
As part of the scheme, tickets were “fixed” by either being dismissed, finding the ticket holder “not guilty,” or finding the ticket holder guilty of a lesser offense. In many cases, the ticket holder did not even appear in Traffic Court, yet their ticket was “fixed.” As a result, the ticketholders paid lesser or no fines and costs, and evaded the assessment of “points” on their driver’s record. This widespread “ticket-fixing” defrauded both the Commonwealth of Pennsylvania and the City of Philadelphia of funds, and allowed potentially unsafe drivers to remain on the roads.U.S. District Court Judge Robert F. Kelly scheduled sentencing hearings for both Hogeland and Miller on May 24, 2013. Each defendant faces a possible advisory sentencing guideline range of zero to six months in prison, before variances or departures.
This case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys Denise S. Wolf and Anthony J. Wzorek.UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Canadian Drug Dealer Pleads Guilty to Drug Trafficking and Money LaunderingRead the Press Release
Dung Ngoc Nguyen, 53, of Mississauga, Ontario, Canada, pleaded guilty today to drug trafficking and money laundering charges before the Honorable Lawrence F. Stengel. Sentencing is scheduled for May 8, 2013.
During the summer of 2006, special agents with the Department of Homeland Security were investigating two Philadelphia-based drug traffickers, John Q. Le and his then-girlfriend, Hanh Duong. Le was one of the largest drug dealers on the east coast with a network of customers stretching from New Jersey to Florida. Le imported large quantities of marijuana from various drug trafficking organizations in Canada. Nguyen worked for one of these Canadian organizations as a broker. Nguyen took drug purchase orders from Le and Duong, made arrangements for the marijuana to be smuggled into the United States, and made arrangements for the drug proceeds to be smuggled back to Canada. During the duration of the conspiracy, Nguyen admitted that she arranged to smuggle between 700 and 1,000 kilograms of marijuana into the United States. The drugs were usually delivered, via courier, directly to Le's house in West Chester, PA.
The case was investigated by Immigration and Customs Enforcement Homeland Security Investigations and was prosecuted by Assistant United States Attorneys David E. Fritchey and Robert J. Livermore.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Former Charter School Head Sentenced for FraudRead the Press Release
PHILADELPHIA - Masai Skief, 32, of Philadelphia, PA, was sentenced today to 36 months in prison for abusing his leadership positions at a Philadelphia charter school in order to enrich himself. Skief pleaded guilty to two counts of wire fraud in August 2013. He was the chief executive officer of Harambee Institute of Science and Technology Charter School (“Harambee Charter School”) and the president and chief administrative officer of a related non-profit organization, Harambee Institute, Inc. (“Harambee Institute”). In addition to the prison term, U.S. District Court Judge Paul S. Diamond ordered Skief to pay restitution in the amount of $88,000, a $200 special assessment, and ordered three years of supervised release, during which time Skief is not permitted to work in an administrative capacity at any school or in any capacity at Harambee Institute and Charter School.
Harambee Charter School, a non-profit corporation, was established to educate children from kindergarten to eighth grade. Harambee Institute was a separate non-profit established to provide students with educational services and vocational training. For its students, Harambee Charter School created a scholarship fund intended to benefit those who intended to attend a “historically black institution of higher education in the United States.”
Skief engaged in a scheme to improperly obtain the funds of both the scholarship fund and Harambee Institute. First, Skief improperly withdrew $9,000 from the scholarship fund in order to purchase a house for himself in Philadelphia. Then, through his control of the bank accounts of Harambee Institute, Skief converted for his own personal use approximately $79,000 from Harambee Institute. He did this primarily through a series of improper cash withdrawals from the bank accounts of Harambee Institute.
Skief also made substantial efforts to conceal his illegal activities, both during and after the fraud. In particular, he attempted to disguise a significant portion of his improper cash withdrawals from the accounts of Harambee Institute as labor costs for Harambee Institute, when there were no such labor costs associated with the improper withdrawals. Skief directed an accountant to create IRS forms to reflect this false information. Skief also directed others to lie for him to federal agents and to a federal grand jury about the use of the funds that the defendant had unlawfully converted. Finally, even after agreeing to plead guilty, Skief continued to steal from Harambee Institute, taking over $12,000 in additional funds, some of which he stole while awaiting sentencing.
“This is an example of our commitment to investigating allegations of significant fraud and abuse involving education funds – taxpayer dollars that are intended for the educational development of children,” said Steven Anderson, Special Agent in Charge of the U.S. Department of Education Office of Inspector General. “Mr. Skief knowingly and willfully abused his position of trust for personal gain and did so at the expense of the children he promised to serve. Deservedly, he will now be held accountable for cheating these children, their families, and taxpayers.”
The case was investigated by the Federal Bureau of Investigation and the United States Department of Education Office of Inspector General. It was prosecuted by First Assistant United States Attorney Louis D. Lappen and Assistant United States Attorney Joseph J. Khan.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Judge Sentences Canadian Man for "Grandson" SchemeRead the Press Release
PHILADELPHIA - Anthony Oluwole Ojo, 44, of Ontario, Canada, was sentenced yesterday to 45 months in prison for running a scam in which he pretended to be a relative of his victims and in need of help. Ojo, and/or others working with him, would telephone his victims, most of whom were elderly, from Canada, and would claim to be the victim's grandson. The victims were told their grandson had been arrested and needed money to pay legal expenses. Ojo, and/or those working in concert with him, would instruct the victim to wire funds, using Western Union, MoneyGram or a similar service, to a fictitious name provided by Ojo. The victim would do so at which point Ojo, using a false means of identification in the fictitious name provided to the victim, would receive the wired funds. If the victim complied, Ojo would then contact the victim again to obtain more money. In one instance, an elderly victim was tricked into wiring money on numerous occasions resulting in a loss to her of $106,400. As a result of the scheme, Ojo defrauded more than 120 victims of at least $643,503.97, in total. Ojo pleaded guilty to three counts of wire fraud on May 14, 2012.
In addition to the prison term, U.S. District Court Judge Joel H. Slomsky ordered Ojo to pay restitution of $643,503.97. Ojo also faces possible deportation.
The case was investigated by the United States Secret Service and is being prosecuted by Assistant United States Attorney Linwood C. Wright.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Delaware Man Sentenced to 35 Years in Sex Travelling CaseRead the Press Release
PHILADELPHIA - John Angell, 41, of Smyrna, DE, was sentenced today to 35 years in prison for his conviction on 11 counts of traveling to have sex with a minor and 1 counts of aggravated sexual abuse of a child under the age of 12. Between June 2001 and June 2007, Angell, while working as a driver for the father of Minor 1, would drive the victim between the father’s house in the Eastern District of Pennsylvania and the mother’s house in the state of New York. On several occasions during that time period, Angell sexually assaulted Minor 1 while stopped at various rest areas.
In addition to the prison term, U.S. District Court Judge William H. Yohn, Jr. ordered 15 of supervised release, and ordered Angell to pay a $2,200 special assessment and a $1,000 fine.
The case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant United States Attorney Michelle Morgan.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Charges Allege $311 Million Global Hedge Fund Fraud SchemeRead the Press Release
PHILADELPHIA - An indictment was filed and an information unsealed today charging two business associates in the hedge fund management industry with defrauding institutional investors and causing collective losses of more than $311 million, announced United States Attorney Zane David Memeger. Helmut Kiener, 53, of Aschaffenburg, Germany, is charged by indictment with four counts of wire fraud, two counts of bank fraud, and three counts of money laundering, based on allegations that he devised and directed various investment fraud schemes in concert with his partner John C. Tausche. Tausche, 61, of Blowing Rock, North Carolina, is charged by information with one count of bank fraud and one count of money laundering, based on his alleged involvement in the scheme.
Kiener, a German national, controlled several hedge funds - including K1 Global Limited and K1 Invest - which he marketed to international investors. Tausche, a U.S. citizen, controlled several offshore hedge funds collectively called the Oceanus Funds. According to the charges, between March 2005 and December 2008, Kiener allegedly devised a scheme to defraud Bear Stearns entities by representing to Bear Stearns that, under Kiener’s management, Bear Stearns investment funds would be diversified and independently managed. However, the indictment alleges that Kiener actually funneled Bear Stearns money from K1 through the Oceanus Funds and back to K1, so as to give the false impression that the funds were growing in size and were viable investments. Kiener and Tausche, it is alleged, knowingly and intentionally fostered the false appearance that the K1 Funds were increasing in value, in order to induce Bear Stearns to continue to invest in the K1 Funds. Both defendants allegedly provided false and misleading information to Bear Stearns in response to inquiries regarding the K1 and Oceanus Funds, repeatedly and falsely representing that the funds were diversified and independently managed. The indictment alleges that, as a result of the scheme, Kiener earned sales agent fees all while Bear Stearns invested and lost approximately $82 million.
The information filed against Tausche alleges a similar scheme against Barclays Bank, involving the K1 Funds and the Oceanus Funds. The information alleges that this scheme caused losses to Barclays Bank of $137 million.
It is further alleged that starting in 2007, Barclays Bank, Bear Stearns, and BNP Paribas (“BNPP”) invested with Kiener in two offshore funds named Consistent Return Ltd. and Mezzanine Financing Ltd. Kiener represented that both Consistent Return Ltd. and Mezzanine Financing Ltd. were legitimate investment funds, and the indictment alleges that the three institutional investors together invested more than $100 million in these funds. However, the indictment alleges that Kiener actually directed a third party to create these offshore funds, and that Kiener then used the funds for his own purposes including, but not limited to, the purchase of: oceanfront real estate in Delray Beach, Florida valued at over $21 million; a Bombardier executive jet; a Bell helicopter; luxury cars such as a Bentley, a Mercedes and a Maybach; two luxury watercraft; and over $8 million in upgrades to his real estate.
If convicted of all charges, Kiener faces a maximum possible statutory sentence of 200 years in prison, restitution, and a maximum possible fine of $7.936 million; Tausche faces a maximum possible statutory sentence of 40 years in prison, restitution, and a maximum possible fine of $1.974 million.
The case was investigated by the Foreign Corruption Investigation Group, Homeland Security Investigations - Miami Field Office, the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigations, and the German police force Kriminalpolizeiinspektion Unterfranken, with assistance from Barclays Bank, BNP Paribas, and Bear Stearns/J.P. Morgan Chase Bank. The Office of International Affairs in the Justice Department’s Criminal Division also provided valuable assistance in this matter. It is being prosecuted by Assistant United States Attorneys Jennifer Arbittier Williams and Suzanne Ercole.
View: Indictment | Information
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Boyertown Man Charged with Armed Bank RobberyRead the Press Release
Marcus Akiem Ricketts, 35, of Boyertown, Pennsylvania was charged today by
indictment with armed bank robbery and using and carrying a firearm during a crime of violence, announced United States Attorney Zane David Memeger. These charges stem from the July 2, 2012, armed robbery of the Manufacturers and Traders Trust Company (“M&T Bank”), formerly located at 760 North Pottstown Pike, in Exton, Pennsylvania of approximately $27,906.
If convicted, Ricketts faces a 7-year mandatory minimum term of imprisonment, five years of supervised release, a $500,000 fine, and a $200 special assessment.This case was investigated by the Federal Bureau of Investigations, the Uwchlan Township Police Department, the Upper Uwchlan Township Police Department, the West Whiteland Township Police Department, the Chester County Sheriff’s Department, the Chester County Detectives, and the Chester County District Attorney’s Office, and is being prosecuted by Assistant United States Attorney Jeffery W. Whitt.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Philadelphia Teen Charged with String of Armed HoldupsRead the Press Release
Abdullah Sirleaf, 19, of Philadelphia, PA, was charged today by indictment with robbery and gun charges for holdups at six different business, in Philadelphia and Lansdowne, PA, in June and July of 2013, announced United States Attorney Zane David Memeger. Sirleaf is charged with the armed robberies of: Metro Self Storage, 2240 Island Ave., Philadelphia, on June 15, 2013; Gulla’s Auto Tag & Insurance, at 6301 Buist Avenue, Philadelphia, on June 17, 2013; the Sunoco gas station/convenience store, 2500 Island Avenue, Philadelphia, on June 21, 2013; Kerrs Building Materials, Inc., 1528 Washington Avenue, Philadelphia, on June 22, 2013; the 7-Eleven store, 1337 S. 58th Street, Philadelphia, on June 28, 2013; and the Papa John’s Pizza, 7 N. Lansdowne Avenue, Lansdowne, PA, on July 3, 2013.
If convicted of all charges,thedefendant faces a mandatory minimum term of 107 years in prison with a maximum of life. He would also face up to five years of supervised release, a possible fine, a $1,100 special assessment, and restitution.This case was investigated by the Federal Bureau of Investigation, Philadelphia Police Department, Lansdowne Police Department, the Philadelphia District Attorney=s Office, and the Delaware County District Attorney’s Office. It is being prosecuted by Assistant United States Attorney Ewald Zittlau.
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An Indictment or an Information is an accusation. A defendant is presumed innocent unless and until proven guilty.UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Indictment Charges Former Prison Guard with SmugglingRead the Press Release
PHILADELPHIA - Dion Reid, 35, of Philadelphia, PA, was charged today by indictment with two counts of honest services fraud and two counts of possession with intent to distribute a controlled substance, announced United States Attorney Zane David Memeger. The indictment alleges that Reid, a former corrections officers employed by the Philadelphia Prison System, conspired and agreed with a prisoner inside the prison to smuggle in marijuana, Xanax pills, tobacco, and cellular telephones.
If convicted the defendant faces a maximum possible sentence of 50 years imprisonment, three years supervised release, a $1 million fine, and a $400 special assessment.
The case was investigated by the Federal Bureau of Investigation, the Philadelphia Police Department, and the City Office of Inspector General. It is being prosecuted by Assistant United States Attorney David L. Axelrod.
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UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Oxycodone Dealer Sentenced to 86 Months in PrisonRead the Press Release
PHILADELPHIA - Joseph Fareri, 52, of Philadelphia, PA, was sentenced today to 86 months in prison and six years of supervised release for his role in a drug conspiracy. Fareri was charged, with co-defendants William Andrews and John Marshall, with conspiracy to distribute oxycodone and distributing oxycodone within 1,000 feet of a school. The indictment alleged that the defendants intentionally distributed approximately 7,000 pills. Fareri pleaded guilty and admitted to distributing 691 pills. Andrews pleaded guilty and will be sentenced February 28, 2013. Marshall is awaiting trial.
Andrews obtained oxycodone pills from various sources, including a licensed physician who issued prescriptions to defendant Andrews authorizing the defendant to obtain oxycodone pills from licensed pharmacies. Andrews then supplied oxycodone pills to Fareri, an admitted member of the Pagan’s Outlaw Motorcycle Club, for the purpose of selling the pills to customers, typically charging $20 for a 30 milligram pill. Andrews also sold oxycodone pills to customers. When Andrews was not available to make deliveries of oxycodone pills, defendant Marshall allegedly made the deliveries to Andrews’ customers.
The case was investigated by the Federal Bureau of Investigation and the Pennsylvania State Attorney General’s Office. It is being prosecuted by Assistant United States Attorneys David Troyer and Frank Labor and Special Assistant United States Attorneys Erik Olson and Heather Castellino of the Pennsylvania State Attorney General’s Office.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Philadelphia Traffic Court Judges Indicted for FraudRead the Press Release
PHILADELPHIA - An indictment and three separate informations, unsealed today, charge nine elected judges along with three other individuals in a fraud conspiracy that allegedly involved frequent and pervasive “ticket-fixing” at the Philadelphia Traffic Court. The defendants participated in a widespread culture of giving breaks on traffic citations to friends, family, the politically-connected, and business associates. The defendants include:
• Michael J. Sullivan (sitting Judge, Traffic Court)
• Michael Lowry (sitting Judge, Traffic Court)
• Robert Mulgrew (former Judge, Traffic Court)
• Willie Singletary (former Judge, Traffic Court)
• Thomasine Tynes (former Judge, Traffic Court)
• Mark A. Bruno (Chester County Magisterial District)
• H. Warren Hogeland (Bucks County Senior Magisterial District Judge)
• Kenneth Miller (Delaware County Senior District Judge)
• Fortunato N. Perri, Sr. (Senior Judge, Traffic Court)
• William Hird (former Director of Records, Traffic Court)
• Henry P. Alfano (local businessman)
• Robert Moy (local businessman)The 77-count indictment was announced by United States Attorney Zane David Memeger and Acting Special Agent-in-Charge John Brosnan.
According to the indictment, Philadelphia ward leaders, local politicians and associates of the Democratic City Committee regularly contacted defendants seeking preferential treatment on specific tickets. Additionally, defendants were regularly contacted by family, friends and associates seeking a “break” on tickets. These defendants accepted these requests and either gave the preferential treatment directly or communicated the request to another judge to whom the case was assigned.
Tickets were “fixed” by either being dismissed, finding the ticket holder “not guilty,” or finding the ticket holder guilty of a lesser offense. In many cases, the ticket holder did not even appear in Traffic Court, yet their ticket was “fixed.” As a result, these ticketholders paid lesser or no fines and costs, and evaded the assessment of “points” on their driver’s record. This widespread “ticket-fixing” defrauded both the Commonwealth of Pennsylvania and the City of Philadelphia of funds, and allowed potentially unsafe drivers to remain on the roads.
The defendants allegedly used their personal assistants and courtroom staff to communicate requests to “fix tickets” to other judges. The indictment further alleges that the conspiracy also involved a cover-up which consisted of shredding paperwork, speaking in code, and trusting only certain individuals to carry out the fraud scheme.
Three judges - defendants Lowry, Mulgrew, and Tynes - are each charged with committing perjury before the federal grand jury. One judge - defendant Singletary - and defendant Hird are charged with lying to the FBI when they were approached and asked questions about ticket fixing at Traffic Court.
Defendant Henry P. Alfano regularly gave defendant Fortunato N. Perri, Sr. free auto repairs, free towing, free videos, and free seafood in exchange for “fixing” tickets. According to the indictment, Alfano would give Perri traffic citation numbers, the names of offenders, or the actual citations to arrange “fixing” the ticket. Perri conveyed the information to William Hird.
Hird, in turn, conveyed the request to the assigned judge. Court authorized intercepted telephone conversations reveal that Perri prioritized assisting Alfano and Alfano made sure to take care of Perri.. Perri told Alfano “when you call, I move, brother, believe me. I move everybody.” After multiple free repairs on his cars and family members’ cars, Perri allegedly told Alfano their relationship was “becoming like a one way street. I like a two way street.” To which Alfano responded “if I need something, you’re going to do it.”Defendant Hird, it is alleged, was extremely loyal to Perri given that Perri helped Hird move up the ladder to a high-level administrator at Traffic Court. Recorded conversations demonstrate that Hird acceded to Perri’s requests to “fix” certain tickets. Given Hird’s position at Traffic Court and access to the judges, Hird was allegedly able to facilitate requests for ticket fixing, not only for Perri, but also for various Philadelphia ward leaders.
Defendant Michael J. Sullivan, in addition to requests from ward leaders, also assisted friends and customers of his bar, the Fireside Tavern. According to the indictment, Sullivan directed associates who wanted their tickets “fixed” to leave them at his tavern where they were placed in a box behind the bar. Defendant Sullivan would assure his associates that the ticket would be “fixed.” In one recorded call, Sullivan told a ticket holder, “I know you’re broke” and “it don’t matter which judge would be hearing the case, because “you’re good,” meaning the “fix” was conveyed.
Defendant Willie Singletary and Thomasine Tynes allegedly “fixed” tickets on behalf of defendant Robert Moy, who owned “Number One Translations,” a business located in Philadelphia. Moy, it is alleged, would guarantee paying customers favorable results on their Traffic Court citations based on his relationship with both Singletary and Tynes. According to the indictment, Moy even advertised in a local newspaper that he “Tackles the traffic ticket, and guarantees no points or fewer points.” Ticket holders took their citations to defendant Moy, paid Moy hundreds of dollars in cash, were instructed not to appear in Traffic Court, and ultimately were found not guilty by either Tynes or Singletary.
In addition to the conspiracy charging a longstanding and widespread practice of fixing tickets, the indictment specifically lists 50 separate citations as being “fixed.” These tickets involved driving at unsafe speeds, driving an unregistered vehicle, texting while driving, operating an ATV on the highway, running a red light, making a prohibited u-turn, careless driving, not using a child safety restraint, and towing a vehicle without a towing agreement, among others. Yet, these ticket holders unjustly incurred no penalties for their vehicle code violations.
“Our judicial system requires that the finder of fact determine guilt or innocence impartially,” said Memeger. “Ignoring this basic rule of justice, the judges in this case allegedly routinely "fixed" traffic tickets by giving preferential treatment to people with whom they were politically and socially connected. In addition to depriving the City of Philadelphia and the Commonwealth of Pennsylvania of funds rightfully owed by traffic violators, their allegedly corrupt conduct also undermined the confidence that law abiding citizens have in the Philadelphia Court System. Those who seek to game the system by refusing to follow the rules need to be held accountable by the rule of law they swore to uphold.”“The citizens of Philadelphia expect and deserve public officials who perform their duties free of deceit, favoritism, bias, self-enrichment, concealment and conflict of interest,” said Brosnan. “Everyone is entitled to the same treatment in Traffic Court, regardless of their personal relationships, regardless of political considerations, and regardless of the personal preferences of court officials.”
The moneys that would have been received from adjudicated citations would have been equally divided between the City of Philadelphia and the Commonwealth of Pennsylvania and used to fund, for example, the City of Philadelphia’s general fund; the Philadelphia Parking Authority; the First Judicial District’s procurement department; the funds lost to the Commonwealth of Pennsylvania would have paid for Emergency Medical Services training; MCARE, which helps compensate people injured by medical malpractice; and the Access to Justice Fund, which provides money for legal aid for low income people and victims of domestic violence.
This case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys Denise Wolf and Anthony Wzorek.
Indictment.pdf | Hogeland Information.pdf | Perri Information.pdf | Miller Information.pdf | Charges.pdf |Defendants.pdf
UNITED STATES ATTORNEY'S OFFICE Contact:
EASTERN DISTRICT, PENNSYLVANIA PATTY HARTMAN
Suite 1250, 615 Chestnut Street Media Contact
Philadelphia, PA 19106 215-861-8525
COPIES OF NEWS MEMOS AND RELATED DOCUMENTS CAN ALSO BE FOUND AT
http://www.usdoj.gov/usao/paeUNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525