Eastern District of Texas

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  PLANO, Texas – Infosys Corporation, an Indian company involved in consulting, technology, and outsourcing, has agreed to a civil settlement of allegations of systemic visa fraud and abuse of immigration processes by paying a record settlement amount and agreeing to enhanced corporate compliance measures, announced U.S. Attorney John M. Bales.  The $34 million payment made by Infosys as a result of these allegations represents the largest payment ever levied in an immigration case.

        Infosys is located in thirty countries including the United States, and in 17 cities in the United States, including a location in Plano, Texas.  The Plano location is responsible for handling the immigration practices and procedures for the United States operations of Infosys.  Infosys brings foreign nationals into the United States in order to perform work and fulfill contracts with its customers under two visa classification programs relevant to this matter, H-1B and B-1.

        According to court documents, the government alleged instances of Infosys circumventing the requirements, limitations, and governmental oversight of the H-1B visa program by knowingly and unlawfully using B-1 visa holders to perform skilled labor in order to fill positions in the United States for employment that would otherwise be performed by United States citizens or require legitimate H-1B visa holders.  The government also alleges that Infosys did so in order to increase profits, minimize costs of securing visas, increase flexibility of employee movement, obtain an unfair advantage over competitors, and avoid tax liabilities.  Specific allegations include the following:

·       Infosys used B-1 visa holders to perform jobs that involved skilled labor that were instead required to be performed by United States citizens or required legitimate H-1B visa holders.

·       Infosys submitted “invitation letters” to U.S. Consular Officials that contained false statements regarding the true purpose of a B-1 visa holder’s travel in order to deceive U.S. Consular Officials and secure entry of the visa holder into the United States.  These letters often stated that the purpose of travel was for “meetings” or “discussions” when the true purpose was to engage in activities not authorized under a B-1 visa.

·       Infosys directed B-1 visa holders to deceive U.S. Consular Officials, including specific instructions to avoid certain terminology, to secure entry of the visa holder into the United States.  Infosys created a “Do’s and Don’ts” memorandum that it provided to foreign nationals entering the United States on a B-1 visa that included the following directions: “Do not mention activities like implementation, design & testing, consulting, etc., which sound like work”; “Also do not use words like, work, activity, etc., in the invitation letter”; and “Please do not mention anything about contract rates.”

·       Infosys told its foreign nationals to inform U.S. Consular Officials that their destination in the United States was the same as that provided in the Labor Condition Application, notwithstanding the fact that Infosys knew that the destinations had changed.

·        Infosys wrote and revised contracts with clients in order to conceal the fact that Infosys was providing B-1 visa holders to perform jobs that involved skilled or unskilled labor that were otherwise required to be performed by United States citizens or required legitimate H-1B visa holders.

·       Infosys concealed the fact that B-1 visa holders were performing jobs that involved skilled or unskilled labor that were otherwise required to be performed by United States citizens or required legitimate H-1B visa holders by billing clients for the use of off-shore resources when, in fact, work was being performed by B-1 visa holders in the United States.

·       Infosys failed to maintain I-9 records for many of its foreign nationals in the United States in 2010 and 2011 as required by law, including a widespread failure to update and re-verify the employment authorization status of a large percentage of its foreign national employees.

        The settlement agreement requires Infosys to make a payment to the United States of $34 million.  The agreement was largely predicated on Infosys’s cooperation with the United States during the investigation and on compliance measures taken by Infosys in the areas of B-1 and H-1B visas and I-9 documentation, both prior to and during the course of the investigation.  The settlement agreement requires additional auditing for I-9 forms; a reporting requirement for B-1 usage; an agreement to continue to use only detailed invitation letters, and the continued use of corporate disciplinary processes for employees that violate the immigration laws of the United States.

        “We will not tolerate actions that mislead the United States and circumvent lawful immigration processes, whether undertaken by a single individual or one of the largest corporations in the world,” said U.S. Attorney Bales.  “The H-1B and B-1 visa programs are designed and intended to protect the American worker; and we will vigorously enforce the requirements of those programs.”

David M. Marwell, Special Agent in Charge of Homeland Security Investigations in Dallas, concurred:  “This settlement against Infosys is the largest immigration fine on record.  The investigation indicated that Infosys manipulated the visa process and circumvented the requirements, limitations, and governmental oversight of the visa programs.  The investigation also showed that more than 80 percent of Infosys’s I-9 forms for 2010 and 2011 contained substantive violations.  Ultimately, these actions by Infosys cost American jobs and simultaneously financially hurt companies that sought to follow the laws of this nation.  Companies that misuse the visa process can expect to be scrutinized and held accountable.”

        The investigation and settlement also earned the praise of George M. Nutwell III, Special Agent-in-Charge of the Houston Field Office, Diplomatic Security Service, U.S. Department of State, who said that “the Infosys investigation illustrates the unique role that DSS plays in investigating complex visa fraud cases that reach far beyond U.S. borders.  DSS collaborates with our law enforcement partners and is committed to investigating and bringing to justice those who violate the law.”

        This case was investigated and the settlement negotiated by Assistant U.S. Attorneys Shamoil T. Shipchandler, Alan R. Jackson, and J. Kevin McClendon, and special agents and attorneys from the Department of State, Diplomatic Security Service, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), and U.S. Citizenship and Immigration Services.

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 TYLER, Texas – A 63-year-old Tyler, Texas eco-tourism guide has been sentenced for smuggling live snakes into the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

William Lamar pleaded guilty on June 18, 2013, to importing wildlife taken in violation of foreign law and was sentenced to three years of probation today by U.S. District Judge Michael H. Schneider. 

                According to information presented in court, on Aug. 29, 2012, Lamar imported seven live snakes that he had purchased at a market in Lima, Peru.  Lamar smuggled the snakes in his jacket on flights from Lima to Miami, Florida and then to Dallas/Ft. Worth International Airport.  The next day, after TSA agents refused to let him board a commuter plane to Tyler with the snakes, Lamar traveled aboard a ground transport shuttle from DFW to his home in Tyler.  Game Wardens went to Lamar’s residence and seized the snakes.

                Peruvian law prohibits the exportation of wild live animals coming from the forest or jungle region unless the exporter has a properly issued ministerial order authorizing the export for either scientific investigation or for cultural diffusion.  Lamar admitted that he knew that Peruvian law prohibited the unauthorized exportation of wildlife in a jacket without proper authorization.

                This case was investigated by the U.S. Fish and Wildlife Service, the Texas Parks and Wildlife Service, the Transportation Security Administration, and the Dallas Fort Worth International Airport Department of Public Safety.  This case was prosecuted by Assistant U.S. Attorney Jim Noble.

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  BEAUMONT, Texas – A 32-year-old Vidor, Texas man was sentenced today for his role in a March 2011 murder committed in furtherance of the SWS criminal enterprise in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Kenny Don Stanley pleaded guilty on June 25, 2013, to murder in aid of racketeering and was  sentenced to life in federal prison today by U.S. District Judge Marcia Crone. 

According to information presented in court, on Mar. 14, 2011, Stanley, along with Tanner Lynn Bourque, a/k/a “Two Shoes,” a/k/a “Hitman” (33), Kristopher Leigh Guidry, a/k/a “Hollywood” (28), and Vicki Stark-Fitts (49), used a firearm to murder James Lee Sedtal, a/k/a “Lil Bit,” in Liberty County, Texas.  The defendants murdered Sedtal on behalf of SWS, after Sedtal assaulted an Aryan Brotherhood of Texas (ABT) associate.  ABT was poised to retaliate against SWS, and Bourque, Guidry, Stanley, and Stark-Fitts sought to maintain and increase their position within SWS by murdering Sedtal. 

According to court documents, the SWS is a race-based organization operating inside and outside of jails and prisons in Texas and elsewhere.  SWS was founded during the 1990s by inmates within the Texas Department of Criminal Justice. SWS is also known as “Solid Wood Soldiers” and “Separate White State.” Although the founders established SWS for protection of white inmates and advancement of white supremacy and white separatism, SWS expanded its objectives to include illegal activities for profit, including trafficking methamphetamine and firearms.  SWS protects its power, territory, and profits through intimidation and violence, including assaults, robbery, and murder. 

From September 2010 to January 2011, SWS members manufactured “shake and bake” methamphetamine for distribution in the Orange County area of Texas.  In February 2011, Bourque, Guidry and other SWS members became closely associated with Stark-Fitts, who supplied them with crystal methamphetamine and firearms. Crystal methamphetamine is a purer form of methamphetamine that is imported from Mexico.  According to information presented in court, on Mar. 14, 2011, Stanley, Bourque, Guidrey and Stark-Fitts murdered James Lee Sedtal, a/k/a Lil Bit, in connection with the methamphetamine conspiracy.

  Guidry, Bourque, and Stark-Fitts pleaded guilty this summer for their respective roles in the murder.  Judge Crone sentenced Guidry to life in prison on October 4, 2013.  Bourque and Stark-Fitts are awaiting sentencing.  Bourque faces life in prison, and Stark-Fitts faces from 360 months to life in prison.
This case is being prosecuted as part of the Project Safe Neighborhoods Time Machine Initiative. Time Machine is aimed at reducing gun and gang violence, deterring illegal possession of guns, ammunition and body armor, and improving the safety of residents in the Eastern District of Texas. Participants in the initiative include community members and organizations as well as federal, state and local law enforcement agencies.
The case is being investigated by the ATF, FBI, U.S. Marshals Service, U.S. Secret Service, U.S. Bureau of Prisons, DEA, Texas Rangers, Department of Public Safety CID, Texas Department of Criminal Justice OIG, Orange County Sheriff’s Office, Hardin County Sheriff’s Office, Jasper County Sheriff’s Office, Tyler County Sheriff’s Office, Jefferson County Sheriff’s Office, and Beaumont Police Department, and is being prosecuted by Assistant U.S. Attorney John B. Ross. 

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 BEAUMONT, Texas – A 40-year-old Jasper, Texas, man has been sentenced to federal prison for child pornography violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
 
Tracy Jay Chappell pleaded guilty on July 11, 2013 to possession of child pornography and was sentenced to 60 months in federal prison today by U.S. District Judge Marcia Crone.

According to information presented in court, on Apr. 4, 2011, Chappell was identified through his IP (Internet Protocol) address during an undercover operation targeting child pornography distribution.  The IP address had files available for any computer user connected to the internet to access using publicly available file sharing software.  A federal search warrant was later executed at Chappell’s residence on County Road 136 in Jasper.  During the search, a personal computer was seized that contained approximately 1,200 files depicting child pornography.  Chappell was indicted by a federal grand jury on Feb. 6, 2013
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by Homeland Security Investigation’s Immigration and Customs Enforcement and the Beaumont Police Department and prosecuted by Assistant U.S. Attorney Randall L. Fluke. 

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  BEAUMONT, Texas – The former president of Port Arthur Chemical and Environmental Services, LLC (PACES) has been sentenced for occupational safety crimes which resulted in the death of an employee, announced John M. Bales, U.S. Attorney for the Eastern District of Texas, and Robert G. Dreher, Acting Assistant Attorney General of the Justice Department’s Environment and Natural Resources Division
Matthew Lawrence Bowman, 41, of Houston, pleaded guilty on May 9, 2013, to violating the Occupational Safety and Health Act (OSH Act) and making a false statement and was sentenced to 12 months in federal prison today by U.S. District Judge Marcia Crone.  Bowman was also ordered to pay fines in the amount of $5,000.  

Bowman admitted to not properly protecting PACES employees from exposure to hydrogen sulfide, a poisonous gas resulting in the death of truck driver Joey Sutter on Dec. 18, 2008.  In addition, Bowman admitted to directing employees to falsify transportation documents to conceal that the wastewater was coming from PACES after a disposal facility put a moratorium on all shipments from PACES after it received loads containing hydrogen sulfide. 

“The government’s prosecution of Matthew Bowman is now complete.  While Mr. Bowman is being held accountable for his criminal conduct, and that is appropriate, there is no amount of time in prison; no amount of criminal fine that can be levied that will compensate for the loss of life at PACES.  We extend our deepest condolences and well wishes to the friends and family of Mr. Sutter, who died pitilessly and needlessly because of the criminally negligent actions of Matthew Bowman,” said U.S. Attorney John M. Bales.  “The agents and prosecutors conducted an outstanding investigation and prosecution.”

“Today’s sentence is a just punishment for Bowman’s actions, which placed workers at unacceptable risk and had fatal consequences,” said Robert G. Dreher, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.  “The Justice Department and the U.S. Attorney’s Offices will continue to work with our law enforcement partners to vigorously investigate and prosecute those who violate the laws enacted to ensure the safety of workers handling hazardous materials and to prevent the kind of tragedies that occurred in this case.”

“The sentencing today is a clear signal of the U.S. Department of Transportation’s (USDOT), and its Office of Inspector General’s (OIG) commitment to protecting the public from illegally transported hazardous materials,” said Max Smith, regional Special Agent-in-Charge, USDOT OIG.  “Working with our law enforcement and prosecutorial colleagues we will continue our vigorous efforts to prosecute to the fullest extent of the law those who would seek to disregard the Nation’s transportation laws and endanger the public.”

 “Environmental violations are serious crimes, and in a worst-case scenario, they can kill people,” said Ivan Vikin, special Agent in Charge of EPA’s criminal enforcement program in Texas.  “In this case, a senior manger’s actions led directly to the death of one of his employees.  This is why we have laws regarding the safe and legal handling of hazardous materials.  Enforcement of these laws must be consistent and uncompromising.”

"When a worker loses his or her life on the job, it has a ripple effect on their families, friends, community and the workplace. Matt Bowman and PACES knowingly violated workplace safety standards that led to Joey Sutter's death," said OSHA's Deputy Regional Administrator Eric Harbin in Dallas. "OSHA standards are in place to protect workers and employers will be held accountable when they fail to follow these standards."
According to information presented in court, Bowman was president and owner of PACES, located in Port Arthur, Texas, and CES Environmental Services (CES) located in Houston.  PACES was in operation from November 2008 to November 2010, and was in the business of producing and selling caustic materials to paper mills.  The production of caustic materials involved hydrogen sulfide, a poisonous gas.  According to the National Institute for Occupational Safety and Health, hydrogen sulfide is an acute toxic substance that is the leading cause of sudden death in the workplace.  Employers are required by OSHA to implement engineering and safety controls to prevent employees from exposure above harmful limits of hydrogen sulfide.  
Bowman was responsible for approving and directing PACES production operations, the disposal of hydrogen sulfide wastewater, and ensuring implementation of employee safety precautions. In some cases, Bowman personally handled the investigation of work-related employee injuries, directed the transportation of PACES wastewater, and determined what safety equipment could be purchased or maintained.  In the cases at issue, hazardous materials were transported illegally with false documents and without the required placards.  Most importantly, the workers were not properly protected from exposure to hazardous gases.  The exposure resulted in the deaths of two employees, Joey Sutter and Charles Sittig, who were truck drivers, at the PACES facility on Dec. 18, 2008 and Apr. 14, 2009.  Placarding is critical to ensure the safety of first responders in the event of an accident or other highway incident.  Bowman and PACES were indicted by a federal grand jury on July 18, 2012. 
This case was investigated by EPA Criminal Investigation Division; the U.S. Department of Transportation Office of Inspector General; the Texas Commission on Environmental Quality - Environmental Crimes Unit, part of the Texas Environmental Enforcement Task Force; the Texas Parks & Wildlife Department - Environmental Crimes Unit; the Houston Police Department - Major Offenders, Environmental Investigations Unit; the Travis County, Texas - District Attorney’s Office; the Harris County, Texas, District Attorney’s Office - Environmental Crimes Division; the Houston Fire Department; OSHA; the U.S. Coast Guard; the Port Arthur Police Department; and the Port Arthur Fire Department.

  The case was prosecuted by the U.S. Attorney’s Office for the Eastern District of Texas and the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division.

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 TYLER, Texas – A 37-year-old Texarkana, Texas man has been sentenced to federal prison for drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Sonya Lamarcus Hopkins pleaded guilty on June 6, 2013 to possession with intent to distribute and distribution of methamphetamine and was sentenced to 87 months in federal prison today by U.S. District Judge Michael H. Schneider.

            According to information presented in court, on Feb. 28, 2012, Hopkins arranged by telephone to distribute 7 grams of methamphetamine to another individual.  The transaction was carried out by another person on behalf of Hopkins in Texarkana, Texas.  Hopkins was indicted by a federal grand jury on Sep. 12, 2012 and charged with drug trafficking violations. 

            This case was investigated by the Bi-State Narcotics Task Force, Texarkana Police Department, Bowie County Sheriff’s Office, and the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Mary Ann Cozby.

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 PLANO, Texas – A 27-year-old McKinney, Texas man has been sentenced to federal prison for a firearms violation in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

            Quincy Reshawn Gilstrap pleaded guilty on Aug. 21, 2012, to charges of being a Felon in Possession of a Firearm and was sentenced to 262 months in federal prison on Oct. 24, 2013, by U.S. District Judge Richard A. Schell. 

            According to information presented in court, in December 2011, Gilstrap was arrested by Plano Police for a drug offense and evading arrest and found in possession of a firearm.   Further investigation revealed Gilstrap had been previously convicted in Collin County, Texas for evading arrest in 2004, manufacture/delivery of a controlled substance in 2008 and robbery in 2008.  Convicted felons are prohibited by federal law from owning or possessing firearms or ammunition.  A federal grand jury returned an indictment in March 2012 charging Gilstrap with being a felon in possession of a firearm. 

This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Plano Police Department and prosecuted by Assistant U.S. Attorney Tracey M. Batson.

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 TYLER, Texas – A 39-year-old Tyler, Texas, man has been sentenced to federal prison for child pornography violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
 
Mark Anthony Hicks pleaded guilty on June 4, 2013 to possession of child pornography and was sentenced to 24 months in federal prison today by U.S. District Judge Leonard E. Davis.

According to information presented in court, on Feb. 28, 2013, federal and local law enforcement agents executed a search warrant at Hicks’ residence in Tyler, Texas.  A computer hard drive was seized during the search and found to contain more than 100 images and nearly 30 videos of child pornography.  Hicks was indicted by a federal grand jury on Mar. 27, 2013 and charged with child pornography violations.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by United States Secret Service and the Longview Police Department and prosecuted by Assistant U.S. Attorney L. Frank Coan, Jr. 

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 TYLER, Texas – A 43-year-old Henderson, Texas, man has been sentenced to federal prison for child pornography violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
 
James Brent Malone, a former Henderson high school English teacher, pleaded guilty on June 11, 2013 to possession of child pornography and was sentenced to 121 months in federal prison today by U.S. District Judge Leonard E. Davis.

According to information presented in court, on Jan. 10, 2013, federal and local law enforcement agents executed a search warrant at Malone’s residence in Henderson, Texas.  A laptop computer and two DVDs were seized during the search and found to contain more than 1,200 images and 40 videos of child pornography.  Some of the material included prepubescent children under the age of 12 engaged in sexually explicit conduct.  Malone was indicted by a federal grand jury on Mar. 27, 2013 and charged with child pornography violations.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

                This case was investigated by United States Secret Service and the Longview Police Department and prosecuted by Assistant U.S. Attorney Gregg A. Marchessault.

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 BEAUMONT, Texas – A 38-year-old Lufkin, Texas, man has pleaded guilty to violating state and federal wildlife laws, announced U.S. Attorney John M. Bales today.

Michael Wayne Scoggin pleaded guilty to killing an animal protected as an endangered species today before U.S. Magistrate Judge Keith F. Giblin.

            According to information presented in court, on Apr. 8, 2011, Scoggin shot and killed a 13-foot American alligator, weighing approximately 800 pounds, with a .22 caliber rifle.  Scoggin shot the alligator from a canoe he and his girlfriend were traveling in on the Neches River in Trinity County, Texas.  Scoggin then tied the alligator alongside the canoe and towed it down river to an area where he and a friend were able to load it on to his truck for transport.  In the following days, pictures of Scoggin and others with the dead alligator appeared posted at a local Academy Sporting Goods store and on the internet.  Scoggin took the alligator to a Grapeland, Texas taxidermy shop and paid $1,542.53 to have the alligator skull and hide tanned and preserved.  The skull, hide and rifle were recovered by federal and state law enforcement officers in March 2012. 

            It is a violation of Texas law to kill an alligator in Trinity County at any time other than from September 10th to September 30th.  Further it is a violation of Texas law to shoot an alligator from a boat in public water.  The Endangered Species Act prohibits the taking of any threatened species of fish or wildlife in violation of any federal or state regulation pertaining to such species. Alligators are listed as a threatened species pursuant to the Endangered Species Act. 

Scoggin faces up to one year in federal prison and a $100,000.00 fine.  A sentencing date has not been set. 

This case was investigated by the U.S. Fish and Wildlife Service, Office of Law Enforcement, Houston, and the Texas Parks and Wildlife Department, Criminal Investigations Division, and prosecuted by Assistant U.S. Attorney Joseph R. Batte.

           The mission of the U.S. Fish and Wildlife Service is working with others to conserve, protect, and enhance fish, wildlife, plants, and their habitats for the continuing benefit of the American people. It is both a leader and trusted partner in fish and wildlife conservation, known for its scientific excellence, stewardship of lands and natural resources, dedicated professionals, and commitment to public service. For more information on its work and the people who make it happen, visit www.fws.gov . Connect with its Facebook page at www.facebook.com/usfws , follow its tweets at www.twitter.com/usfwshq  and download photos from its Flickr page at http://www.flickr.com/photos/usfwshq .

 

 

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 SHERMAN, Texas – U.S. Attorney John M. Bales announced the hiring of a federal prosecutor assigned to the Sherman office of the United States Attorney for the Eastern District of Texas. 

Assistant U.S. Attorney William Tatum was administered the Oath of Office by U.S. Attorney Bales, today before a small crowd of friends, family, and government officials at the U.S. Attorney’s Office in Sherman.

                Tatum is a graduate of Texas A&M University and St. Mary’s University School of Law.   Tatum began his career in 2002 as an Assistant District Attorney with the Smith County D.A.’s Office before taking a position as an Assistant Attorney General in the Texas Attorney General’s white collar crime and public integrity section.  Tatum is no stranger to a federal prosecutor’s office as he has served the last couple years as an Assistant U.S. Attorney in the Western District of Texas’ Midland office.

                Tatum joins the Sherman office where he will prosecute a wide range of federal crimes including drug trafficking, white collar crime, immigration matters, violent crimes and child pornography.     

                The Eastern District of Texas is comprised of 43 counties stretching from the Gulf of Mexico to the Oklahoma/Texas border.  There are 6 staffed offices located in Beaumont, Lufkin, Tyler, Texarkana, Plano and Sherman with a total of 52 federal prosecutors.

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 MARSHALL, Texas – Three Marshall, Texas men have been sentenced to federal prison by U.S. District Judge Rodney Gilstrap for drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today. 

                Santiago Carbajal Abelardo, 26, pleaded guilty on May 3, 2013, to possession with intent to distribute and distribution of methamphetamine and was sentenced to 90 months in federal prison on Sep. 24, 2013.

Jehovani Abelardo, 21, pleaded guilty on May 3, 2013, to possession with intent to distribute and distribution of methamphetamine and was sentenced to 90 months in federal prison on Sep. 24, 2013.

 Santos Acuna, 24, pleaded guilty on May 3, 2013, to possession with intent to distribute and distribution of cocaine and was sentenced to 11 months in federal prison on Sep. 24, 2013.

According to information presented in court, from November 2009 to October 2012, the defendants conspired to manufacture and distribute methamphetamine and cocaine in East Texas.  Santiago Abelardo admitted to distributing over 35 grams of methamphetamine and possessing a firearm during the conspiracy.  Jehovani Abelardo admitted to assisting in the distribution of over 20 grams of methamphetamine as well as attempting to bride a police officer during the conspiracy.  Acuna admitted to distributing over 50 grams of cocaine during the conspiracy.  A federal grand jury returned an indictment on Nov. 7, 2012, charging these defendants and two others with federal drug trafficking violations. 

This case was investigated by the Federal Bureau of Investigation, the Marshall Police Department and the Harrison County District Attorney’s Office and prosecuted by Assistant U.S. Attorney Allen Hurst.

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 TYLER, Texas – A 42-year-old Tyler, Texas man has pleaded guilty to mail fraud violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales. 
             
Muhammad Sarfraz Ashraf pleaded guilty to an Information charging him with conspiracy to commit mail fraud on Sep. 19, 2013 before U.S. Magistrate Judge John D. Love.

According to information presented in court, from Nov. 2010 to June 2011, Ashraf, who owned and operated an automobile repair and maintenance shop in Tyler, conspired with others to cause the Smith County Tax Assessor-Collector’s Office to mail false certificate of title application packages to the Texas Department of Motor Vehicles.  The conspiracy was devised in order to obtain fraudulent vehicle titles and unlawfully avoid payment of sales taxes.  Specifically, Ashraf would omit the sales price on applications and indicate that the specific transfer was a gift.  Ashraf also falsified dates so as to make it appear transactions occurred prior to a change in Texas law regarding when transfers were considered gifts for tax purposes. 

Ashraf faces up to 5 years in federal prison and restitution.  A sentencing date has not been set.

This case is being investigated by the Federal Bureau of Investigation and the Smith County Sheriff’s Office with assistance from the Smith County District Attorney’s Office.  This case is being prosecuted by Assistant U.S. Attorney L. Frank Coan, Jr.

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 BEAUMONT, Texas – Three Vidor, Texas residents have pleaded guilty to racketeering charges related to their association with a “white’s only” criminal enterprise that engaged in methamphetamine distribution and murder in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Juanette Marie Cunningham, a/k/a Netty, 46, Michael Taylor Word, 45, and Erica Nicole Parrott, 27, pleaded guilty to conspiracy to distribute methamphetamine on Sep. 18, 2013, before U.S. Magistrate Judge Zack Hawthorn.

Five other defendants, Craig Pipps, a/k/a Lone Wolf, 40, of Vidor, Mikell Allen Cunningham, a/k/a Mikey, 28, of Vidor, Ricky Allen Nichols, 54, of Vidor, Cassi Diane Hetzel, 37, of Silsbee, Texas and Mack Langston Warner, 33, of Silsbee, pleaded guilty to the same charge earlier this week. 

The eight were named along with four others in a seven-count superseding indictment that was returned by a federal grand jury on Aug. 7, 2013.  According to the indictment, Pipps, Kenny Don Stanley, 25, of Vidor, Tanner Lynn Bourque, a/k/a Two Shoes, a/k/a Hitman, 33, of Vidor, Kristopher Leigh Guidry, a/k/a Hollywood, 28, of Vidor, and Vicki Stark-Fitts, 49, of Hull, Texas, participated in the operation and management of the “SWS” gang. 

According to the indictment, the SWS is a race-based organization operating inside and outside of jails and prisons in Texas and elsewhere.  SWS was founded during the 1990s by inmates within the Texas Department of Criminal Justice. SWS is also known as “Solid Wood Soldiers” and “Separate White State.” Although the founders established SWS for protection of white inmates and advancement of white supremacy and white separatism, SWS expanded its objectives to include illegal activities for profit, including trafficking methamphetamine and firearms.  SWS protects its power, territory, and profits through intimidation and violence, including assaults, robbery, and murder. 

According to information presented in court, Pipps used his position as president of SWS to encourage SWS members and associates to enrich SWS through criminal activity including the distribution of methamphetamine.  In August 2010, Pipps and Guidry agreed that Guidry, Bourque and other SWS members would raise money for Pipps and SWS through criminal activities including the sale of methamphetamine.  The stated goal of the conspiracy was to raise $30,000 so that Pipps and SWS could purchase real property for a “separatist community.” Under the agreement, Pipps was to receive control of the funds upon his impending release from federal prison.

From September 2010 to January 2011, members manufactured “shake and bake” methamphetamine for distribution in the Orange County area of Texas.  In February 2011, Bourque, Guidry and other SWS members became closely associated with Stark-Fitts, who supplied them with crystal methamphetamine and firearms. Crystal methamphetamine is a purer form of methamphetamine that is imported from Mexico.  According to information presented in court, on Mar. 14, 2011, Stanley, Bourque, Guidrey and Stark-Fitts murdered James Lee Sedtal, a/k/a Lil Bit, in connection with the methamphetamine conspiracy.

The eight defendants pleading guilty this week face up to 40 years in federal prison.  Earlier this summer, Stanley, Bourque, and Guidry pleaded guilty to murder in aid of racketeering.  In connection with their guilty pleas, Bourque, Guidry, and Stanley admitted that they sought to maintain and increase their position within SWS by murdering Sedtal.  Bourque, Guidry, and Stanley face a punishment of life imprisonment.  Stark-Fitts pleaded guilty to a racketeering violation and faces up to life in federal prison.  Sentencing dates have not been set. 

This case is being prosecuted as part of the Project Safe Neighborhoods Time Machine Initiative. Time Machine is aimed at reducing gun and gang violence, deterring illegal possession of guns, ammunition and body armor, and improving the safety of residents in the Eastern District of Texas. Participants in the initiative include community members and organizations as well as federal, state and local law enforcement agencies.

The case is being investigated by the ATF, FBI, U.S. Marshals Service, U.S. Secret Service, U.S. Bureau of Prisons, DEA, Texas Rangers, Department of Public Safety CID, Texas Department of Criminal Justice OIG, Orange County Sheriff’s Office, Hardin County Sheriff’s Office, Jasper County Sheriff’s Office, Tyler County Sheriff’s Office, Jefferson County Sheriff’s Office, and Beaumont Police Department, and is being prosecuted by Assistant U.S. Attorney John B. Ross. 

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 PLANO, Texas – A 57-year-old Quinlan, Texas man has been sentenced for environmental violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

William “Bill” Lafon Musgrove pleaded guilty on Aug. 7, 2013, to negligent release of an extremely hazardous substance and was sentenced to 36 months of probation today by U.S. Magistrate Judge Don D. Bush.  Musgrove was also fined $10,000.

                According to information presented in court, in June of 2011, Musgrove was the vice president of and operations manager of Industrial Precious Metals Recovery Incorporated (IPMR), in Royse City, Texas.  During that time, he allowed their metal recovery process to release approximately ten pounds of Nitrogen Oxides, or “NOx” within a 24 hour time period into the ambient air at ground level through an open doorway, instead of utilizing the company’s air scrubber which was broken at the time.  Musgrove admitted that he should have known that releasing NOx in that manner would place people in imminent danger of death or serious bodily injury.  Fortunately, no actual injuries occurred. 

             Federal environmental regulations characterize Nitrogen Oxides as an “extremely hazardous substance.”  At the time, the IPMR facility in Royse City was adjacent to other commercial facilities with employees that were present during the NOx emissions.  The facility has since closed.     

This case was investigated by the U.S. Environmental Protection Agency, Criminal Investigations Division, Region VI, Dallas, Texas, and the Texas Commission on Environmental Quality (TCEQ) Environmental Crimes Unit and prosecuted by Assistant U.S. Attorney Jim Noble.         

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 PLANO, Texas – A Colorado corporation has agreed to settle allegations of trade secret theft in the Eastern District of Texas, announced U.S. Attorney John M. Bales.

ADA-ES, Inc., and ADA Environmental Solutions, LLC, (collectively, “ADA”), entered into a non-prosecution agreement with the U.S. Attorney’s Office accepting responsibility for their actions, pledging to continue a culture of corporate compliance, and continuing to make payments to the victim corporation from whom confidential information had been acquired.

                Between approximately 2000 and 2006, ADA and another corporation agreed to jointly develop, test, and market a product known as activated carbon in North America; activated carbon was, and is, used to remove mercury emissions from waste gas created through the manufacturing process of certain industrial products.  According to the non-prosecution agreement, ADA inappropriately maintained the confidential information that it had been provided by its partner corporation.

                The agreement between ADA and the U.S. Attorney’s Office requires ADA to provide training programs and compliance checks designed to ensure that proper safeguards are in place to protect confidential information, and provide periodic progress reports to the U.S. Attorney’s Office.  On its own, and prior to the government’s investigation, ADA employed general counsel to oversee these efforts.  The agreement also requires that ADA abide by the terms of a settlement agreement between it and the partner corporation, which required a $40.5 million payment to the partner corporation as well as a running royalty on ADA’s sale of activated carbon until 2018.

                “Information is akin to currency in the modern world.  Like individuals, corporations that acquire protected information have a duty to guard its confidentiality,” said U.S. Attorney Bales.  “We intend to be vigilant to ensure that the acquisition and use of such information is handled appropriately.”

                This case was investigated by the Federal Bureau of Investigation and negotiated by Assistant U.S. Attorneys Shamoil T. Shipchandler and J. Kevin McClendon. 

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 TEXARKANA, Texas – A 49-year-old Cove, Arkansas man has been sentenced to federal prison for bank robbery in the Eastern District of Texas, announced U.S. Attorney John M. Bales. 
               
                Joe Elva Whisenant pleaded guilty on June 20, 2013, to two bank robberies and was sentenced to 77 months in federal prison today by U.S. District Judge Michael Schneider.  Whisenant was also ordered to pay restitution of $23,153.
 
                According to information presented in court, on July 24, 2012, Whisenant entered the lobby of the Wells Fargo Bank branch in Texarkana, Texas, and placed a black zippered bag on the counter in front of the teller and handed the teller a note demanding money.  Whisenant then fled the bank with approximately $738.  A short time later, he was arrested while driving a moped.  A federal grand jury returned an indictment on Aug. 1, 2012, charging Whisenant with bank robbery.

                After Whisenant was arrested for the Wells Fargo robbery in Texas, law enforcement officers were able to obtain evidence connecting Whisenant to the Nov. 28, 2011, robbery of the Bancorp South Bank branch in Texarkana, Arkansas.  Whisenant robbed the Arkansas bank of $23,153.  A federal grand in the Western District of Arkansas returned an indictment on Jan. 13, 2013, charging Whisenant in that bank robbery.  On Feb. 28, 2013, the case was transferred to the jurisdiction of the Eastern District of Texas.

                These cases were investigated by the FBI, the Texarkana, Texas, Police Department, the Bowie County Sheriff’s Office, and the Texarkana, Arkansas, Police Department.  These cases were prosecuted by Assistant U.S. Attorneys Allen Hurst and Jonathan D. Ross.

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 TYLER, Texas – Two North Texas men have pleaded guilty to federal firearms violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today. 

Colten David Barrow, 22, of Quinlan, Texas, and Craig Marcus Cooper, 42, of Farmersville, Texas, each pleaded guilty today before U.S. Magistrate Judge John D. Love.  Barrow pleaded guilty to attempting to sell a machinegun and Cooper pleaded guilty to being a felon in possession of a machinegun.

According to information presented in court, on Jan. 31, 2012, Barrow and Cooper traveled together to Duke’s Truck Stop on Highway 64 in Van Zandt County, Texas to meet an individual interested in buying the machinegun.  The defendants intended to sell the firearm to the individual for $10,000.  However, the buyer was actually an undercover federal agent.  The defendants were detained and the 9 mm, fully automatic machine gun with an attached silencer was seized.  Further investigation revealed Cooper was a felon having been previously convicted of felony criminal mischief in Collin County, Texas in 2011.   Federal law prohibits convicted felons from owning or possessing firearms or ammunition.  A federal grand jury returned an indictment on Mar. 27, 2013, charging the defendants with firearms violations. 

            Barrow and Cooper each face up to 10 years in federal prison at sentencing.  A sentencing date has not been set.  A third defendant is awaiting trial.
This case is being prosecuted as part of the Project Safe Neighborhoods Initiative. Project Safe Neighborhoods is aimed at reducing gun and gang violence, deterring illegal possession of guns, ammunition and body armor, and improving the safety of residents in the Eastern District of Texas. Participants in the initiative include community members and organizations as well as federal, state and local law enforcement agencies.

This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and prosecuted by Assistant U.S. Attorney Jim Noble.

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 PLANO, Texas – The federal government provided nearly $1 million in forfeiture proceeds to local police departments for their assistance in dismantling a wide-scale Internet-based pharmacy, announced Eastern District of Texas U.S. Attorney John M. Bales today.

                U.S. Attorney Bales presented checks totaling $897,352.26 to the following agencies at a ceremony on Sep. 10, 2013, at the U.S. Attorney’s Office:

Rowlett Police Department                         $597,142.74
Duncanville Police Department    139,702.37
Mesquite Police Department                       102,786.40
Irving Police Department                                  25,118.07
Dallas Police Department                                 22,454.05
Texas Joint Counterdrug Task Force            10,148.63

The Alton Bay, New Hampshire Police Department also received $27,812.74 in forfeiture proceeds from this case. 

The forfeiture funds are the result of the investigation and conviction of New Yorker David Allen Vogel.  In the summer of 2010, Vogel was convicted by a jury in the Eastern District of Texas of conspiracy to distribute a controlled substance, conspiracy to commit money laundering, and two counts of money laundering.  On Jan. 7, 2011, Vogel was sentenced to 240 months in federal prison and ordered to pay a money judgment in the amount of $24,743,000 and forfeiture of $4,376,471.39, which had already been seized from six separate bank accounts.  These funds represent the final distribution of equitable sharing funds in this case.  In addition to the funds noted above, these agencies have already received significant additional forfeiture funds in this case.

Vogel, the owner and operator of Madison Pain Clinic, conspired with others to operate an Internet-based pharmacy through which they distributed millions of hydrocodone pills and other controlled substances without a valid prescription.  Vogel used proceeds from the illegal enterprise to purchase a multi-million dollar condominium in Trump Towers in New York City and rare coins, including a $36,000 penny.  Vogel’s co-defendants were also convicted and received federal prison sentences.

This case was investigated by the U.S. Drug Enforcement Administration and the Internal Revenue Service – Criminal Investigation and prosecuted by Assistant U. S. Attorneys Stevan Buys, Maureen Smith and Kevin Collins. 

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 SHERMAN, Texas – A 44-year-old Chinese national living in Plano, Texas has been sentenced for customs violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Shichen Wang pleaded guilty on Feb. 14, 2013 to the misdemeanor offense of negligent attempted transportation of wildlife sold in violation of law and was given an 11 month probated sentence on Sep. 10, 2013, by U.S. Magistrate Judge Amos L. Mazzant. 

                According to information presented in court, on April 19, 2011, Wang attempted to ship two elephant ivory carvings, daffodil flowers and a cylinder brush pot, in two separate packages that were addressed to two different locations in the Republic of China.  Both of the packages were falsely labeled to describe their contents as “wood carvings” which is a violation of federal laws that protect specified species of wildlife.  The packages were intercepted by wildlife inspectors who were inspecting International Express Mail packages that were consigned for export from the United States.  Wang was also fined $3,000 and must forfeit the seized carvings to the government.

"One of the primary objectives of the U.S. Fish and Wildlife Service is to combat the international smuggling of wildlife from the U. S.,” said Southwest Region’s Special Agent in Charge Nicholas Chavez.  “This seizure was a great example of a multi-agency interdiction effort by the U.S. Fish and Wildlife Service, Office of Law Enforcement and the U. S. Customs and Border Protection.”

This case was investigated by the U.S. Fish and Wildlife Service, Office of Law Enforcement, Fort Worth, and Rosemont, Illinois Office along with the U.S. Customs and Border Protection, Rosemont, Illinois Office and prosecuted by Assistant U.S. Attorney Jim Noble.

The mission of the U.S. Fish and Wildlife Service is working with others to conserve, protect, and enhance fish, wildlife, plants, and their habitats for the continuing benefit of the American people. It is both a leader and trusted partner in fish and wildlife conservation, known for its scientific excellence, stewardship of lands and natural resources, dedicated professionals, and commitment to public service. For more information on its work and the people who make it happen, visit www.fws.gov . Connect with its Facebook page at www.facebook.com/usfws , follow its tweets at www.twitter.com/usfwshq , and download photos from its Flickr page at http://www.flickr.com/photos/usfwshq .

 

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 TYLER, Texas – A 57-year-old Shreveport, LA, man has been sentenced to pay over $14,000.00 in restitution and serve 48 hours of community service as conditions of a two year probated sentence for federal wildlife violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Stephen Anderson Sipes Jr. pleaded guilty on June 10, 2013, to negligent transportation of wildlife and was sentenced today by U.S. Magistrate Judge John D. Love.

According to information presented in court, Sipes had an ownership interest in a high-fence ranch in Sanderson, Texas. On Jan. 14, 2010, Sipes transported and possessed 14 live, illegally imported whitetail deer valued at over $350.00 each from Carthage, Missouri to the ranch in Sanderson, which is prohibited by Texas law.  The fair market value of the illegally imported whitetail deer was approximately $5,650.00. 

Sipes must pay $14,016.49 in restitution to the Texas Parks and Wildlife Foundation to compensate the agency for costs incurred in protecting the native deer from the threat of disease carried by the Missouri whitetails.   

                This case was investigated by the Special Operations Unit of the Texas Parks and Wildlife and U.S. Fish and Wildlife Service and prosecuted by Assistant U.S. Attorney Jim Noble.

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 BEAUMONT, Texas – A 38-year-old Beaumont woman has been sentenced to federal prison for bank fraud violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Jeanie Marie Smith Henges pleaded guilty on Nov. 20, 2012 to seven counts of bank fraud and was sentenced to 24 months in federal prison today by U.S. District Judge Marcia Crone.

                According to information presented in court, in March 2011, April 2011, April 2010, May 2010, March 2010, February 2010, and November 2008, Henges devised a scheme to fraudulently obtained funds from the following federally insured financial institutions:  Anahuac National Bank, Eastex Federal Credit Union (FCU), Community Bank, MidSouth Bank, Education First FCU, Mobile Oil FCU and Wachovia Bank.  Henges executed the scheme by presenting one or more fraudulent checks for deposit.  According to the seven-count Information, the intended losses amount to approximately $72,419, and the actual losses amount to approximately $32,445. 

                Henges was also fined $4,000.  A hearing has been set for Sep. 21, 2013 to determine restitution.

            This case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Randall L. Fluke.

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 BEAUMONT, Texas – A 30-year-old Lufkin, Texas man has been sentenced to federal prison for robbing a post office in the Eastern District of Texas, announced U.S. Attorney John M. Bales. 
               
                Keith DeWayne Bailey pleaded guilty on June 19, 2013, to post office robbery and was sentenced to 33 months in federal prison today by U.S. District Judge Ron Clark. 
 
                According to information presented in court, on Oct. 1, 2012, Bailey entered the United States Post Office in Woodville, Texas and handed a note to a postal employee indicating he had a concealed weapon, he was robbing the post office, and demanding the money in the register.  The postal employee went to the back of the post office and gave the note to her supervisor.  When the postal employee returned to the front of the post office, Bailey had already left the building.  The postal employee called 911 and gave a detailed description of the suspect.  Less than 10 minutes later, a law enforcement officer responding to the scene observed a suspect matching the description a few blocks from the post office.  Bailey was arrested without incident and admitted to attempting to rob the post office.

                A federal grand jury returned an indictment on Oct. 3, 2012 charging Bailey with federal violations.

This case was investigated by the U.S. Postal Inspection Service and the Woodville Police Department and prosecuted by Assistant U.S. Attorney Joseph R. Batte.

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 LUFKIN – Harold’s House is hosting the East Texas Child Abuse Conference on Sept. 12-13, 2013 at Courtyard by Marriott. This is the first conference of its kind in East Texas, bringing together federal, state and local officials across all fields of investigation, prosecution and victim advocacy to share resources, best practices and training on crimes involving the physical or sexual abuse or neglect of children.

                “We are excited to offer this great opportunity to our partners in law enforcement, the court system and child services,” said Laura Squiers, Executive Director. “We all want the best outcomes for children suffering abuse. This conference will help us achieve that goal by putting new information and resources in the hands of those working on the front lines and behind the scenes to protect children suffering abuse.”

                Since its beginning 10 years ago, Harold’s House has served thousands of children suffering abuse. As a Children’s Advocacy Center, its goal is to lessen the trauma of children suffering abuse through a team approach to child-centered case response. The Center also works to empower the community to end abuse through prevention training and at-risk parenting classes offered free of charge.

                The East Texas Child Abuse Conference features speakers from the U.S. Attorney’s Office, U.S. Marshal’s Office, Office of the Attorney General, Angelina County District Attorney’s Office, Lufkin Police Department, Child Protective Services, the City of Lufkin, Harold’s House and the TLL Temple Foundation SANE Program.

                The conference features plenary sessions including case reviews and training and program presentations, plus resource information and networking opportunities. Topics include: cybercrime, connecting to resources, CACs, SANEs, Project Safe Childhood, CPS, child pornography and exploitation, family care, case studies, multidisciplinary teams, helping children heal, Darkness to Light’s Prevent Now! and sex offender fugitive investigation and failure to identify as a sex offender.

The event is open to members of law enforcement, court officials, social workers, counselors, child advocates and family crisis workers, and offers TCLEOSE/CEU credits through Angelina College. Registration is required for the event and seating is limited. Contact Harold’s House at (936) 634-1999 to register by phone or request a registration form. Follow updates at: www.facebook.com/haroldhouse.org.

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 MARSHALL, Texas – A 29-year-old Sinaloa, Mexico man currently residing in Marshall, Texas, has been sentenced to federal prison for drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Joeli Higuera Fernandez pleaded guilty on May 3, 2013, to conspiracy to possess with intent to distribute and distribution of methamphetamine and was sentenced to 70 months in federal prison on Aug. 28, 2013, by U.S. District Judge Rodney Gilstrap.  Fernandez was also ordered to submit to forfeiture of $15,000 in currency.

                According to information presented in court, from March 2010 to October 2012, Fernandez was involved in a conspiracy to possess and distribute methamphetamine in the Eastern District of Texas.  Fernandez admitted to distributing 101.7 grams of actual methamphetamine during this time.  A federal grand jury returned an indictment on Nov. 7, 2012, charging Fernandez and three others with drug trafficking violations. 

              This case was investigated by the Federal Bureau of Investigation, the Marshall Police Department and the Harrison County District Attorney’s Office and prosecuted by Assistant U.S. Attorney Allen Hurst.

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 MARSHALL, Texas – A couple from Mexico currently residing in Marshall, Texas, have been sentenced to federal prison for drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Julia Flores Saucedo, 33, of Guerrero, Mexico, pleaded guilty on Jan. 20, 2013, to possession with intent to distribute and distribution of methamphetamine and was sentenced to 46 months in federal prison on Aug. 28, 2013, by U.S. District Judge Rodney Gilstrap. 

Her common-law husband, Oscar Diaz-Mendoza, 35, of Guerrero, Mexico, pleaded guilty on Feb. 28, 2013, to possession with intent to distribute and distribution of methamphetamine and was sentenced to 46 months in federal prison on Aug. 28, 2013, Judge Gilstrap. 

                According to information presented in court, from July 2011 to October 2012, the couple was involved in a conspiracy to possess and distribute methamphetamine in the Eastern District of Texas.  Saucedo admitted to distributing 14.7 grams of methamphetamine on Aug. 24, 2011, in Marshall, Texas.  Diaz-Mendoza admitted to distributing 15 grams of methamphetamine on Aug. 4, 2011, in Karnack, Texas. 

                A federal grand jury returned an indictment on Oct. 3, 2012, charging the couple and Melecio Nunez-Duque with drug trafficking violations.  Nunez-Duque pleaded guilty on Aug. 6, 2013, to distributing 59.6 grams of methamphetamine and is awaiting sentencing.  

               This case was investigated by the Federal Bureau of Investigation, the Marshall Police Department and the Harrison County District Attorney’s Office and prosecuted by Assistant U.S. Attorney Allen Hurst.

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 TYLER, Texas – A 40-year-old Mineola, Texas man has pleaded guilty to drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Larry James Hooks, Jr., pleaded guilty to possession with intent to distribute methamphetamine today before U.S. Magistrate Judge K. Nicole Mitchell. 

                According to information presented in court, on July 19, 2012, Hooks conspired with others to acquire and distribute methamphetamine in the Eastern District of Texas and elsewhere.  Hooks admitted to being responsible for assisting in the distribution of more than 34.8 grams of pure methamphetamine.  A federal grand jury returned an indictment on Mar. 27, 2013, charging Hooks and two others with drug trafficking violations. 

                Hooks faces a minimum of five years in federal prison at sentencing.  A sentencing date has not been set.

                This case was investigated by the Drug Enforcement Administration and the Canton Police Department and prosecuted by Assistant U.S. Attorney Bill Baldwin.

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 TYLER, Texas – A 45-year-old Yantis, Texas woman has been sentenced to federal prison for firearms violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today. 

Lucretia Beth Brown pleaded guilty on Feb. 14, 2013, to conspiracy to deal firearms without recording the without keeping records and was sentenced to 24 months in federal prison today by U.S. District Judge Leonard Davis. 

Co-defendant Andrea Jaine Burns London, 51, of Yantis, pleaded guilty on Apr. 9, 2013, to the same charges and is awaiting sentencing.

Brown and London were indicted on July 11, 2012, and charged with gun trafficking violations.  Federal agents executed search warrants at their home and business in November 2011.   A warrant was issued for their arrest, but it was soon discovered that the pair had left the United States for the Philippines in February 2012.  Assistance was requested from the International Investigations Branch and a lead was sent to the Diplomatic Security Service in Manila.  On Oct. 9, 2012, Philippine Immigration Agents arrested London and Brown in Cebu without incident.  Both subjects were transported to Manila to begin the deportation process.  On Nov. 8, 2012, London and Brown were escorted by Philippine Immigration Agents from Manila to Los Angeles where they were taken into custody by the Pacific Southwest Regional Fugitive Task Force.   

According to information presented in court, from January 2011 to July 2011, London and Brown transported guns from the inventory of Lake Fork Gunslinger & Outdoors in Emory, Texas, to gun shows in Oklahoma, Missouri, and Arkansas, and then sold the guns without properly recording the name, age, and place of residence of the buyers.  Brown was also ordered to forfeit approximately 140 firearms from the dealership’s inventory.
This case is being prosecuted as part of the Project Safe Neighborhoods Initiative. Project Safe Neighborhoods is aimed at reducing gun and gang violence, deterring illegal possession of guns, ammunition and body armor, and improving the safety of residents in the Eastern District of Texas. Participants in the initiative include community members and organizations as well as federal, state and local law enforcement agencies.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the U.S. Marshals Service and prosecuted by Assistant U.S. Attorney Jim Noble.

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 PLANO, Texas – Six individuals have been indicted in connection with a bank fraud scheme operating in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

An 11-count indictment was returned by a federal grand jury on Aug. 15, 2013, charging six individuals in the scheme.  The indictment specifically charges one count of conspiracy to commit bank fraud and 10 counts of aggravated identity theft.  Those named in the indictment include:

Craig Dwayne Tobias, 33, of Fort Lauderdale, Florida; Keevan Iszeal Coney, 22, of Fort Lauderdale; Makeisha Ann Williams, 36, of Garland, Texas; Antonio Perez Barfield, 29, of Fort Pierce, Florida; Atamian Rajuan Johnson, 31, of Rivera Beach, Florida; and
Misty Dawn Hendrix, 37, of Seagoville, Texas

According to the indictment, the defendants are alleged to have devised a scheme in which they stole bank checks, bank cards, and personal identification cards from locations such as daycare facilities, gyms, and public parks throughout the Metroplex area and elsewhere.  The thefts were typically from motor vehicles and were made via forcible entry.  The stolen bank cards were usually used within minutes of the theft, often at gas stations, convenience stores, or retail stores.  The bank checks were cashed at banks in Denton, Irving, Bedford, Grapevine, Mesquite, Garland, and Dallas using drive thru teller lanes and rented vehicles. 

Hendrix and Williams appeared before U.S. Magistrate Judge Don Bush for an initial appearance on Aug. 26, 2013.  Tobias, Johnson and Coney appeared before Judge Bush on Aug. 27, 2013.  Barfield remains at large.

If convicted of the conspiracy charge, the defendants face up to 30 years in federal prison.  They face an additional two years in federal prison for each of the aggravated identity theft charges.

This case is being investigated by the Federal Bureau of Investigation and the Plano Police Department with assistance from various agencies throughout the area.  This case is being prosecuted by Assistant U.S. Attorney Chris Eason.

A grand jury indictment is not evidence of guilt and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law

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 BEAUMONT, Texas – A 49-year-old Cameron, LA, man has pleaded guilty to bank robbery in the Eastern District of Texas, announced U.S. Attorney John M. Bales. 
             
Allen Keith Miller pleaded guilty to bank robbery today before U.S. Magistrate Judge Keith Giblin.

According to information presented in court, on June 25, 2013, Miller entered the Capital One Bank branch office located on 16th Street in Orange, Texas, wearing a blonde wig, baseball cap, long-sleeve shirt, tan pants and a black knee brace.  Miller approached a bank teller and presented a hand-written note advising that the bank was being robbed.  Miller also advised that he was armed although a weapon was not displayed.  Media outlets broadcast footage of the bank robbery and Miller was identified by citizens.  Miller was stopped by law enforcement officers in Louisiana, at which time items from the robbery, including the wig, baseball cap, clothing, and knee brace, were located in Miller’s vehicle. Miller was indicted by a federal grand jury on July 11, 2013 and charged with bank robbery.   

Miller faces up to 20 years in federal prison.  A sentencing date has not been set.

This case is being investigated by the Federal Bureau of Investigation and the Orange Police Department and prosecuted by Assistant U.S. Attorney John Craft.

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 TYLER, Texas - A 37-year-old Wills Point, Texas man has been sentenced to federal prison for firearms violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

                Michael Jack Callaway pleaded guilty on Nov. 20, 2012, to possession of an unregistered firearm and was sentenced to 120 months in federal prison today by U.S. District Judge Leonard Davis.  Callaway was also ordered to forfeit the shotgun and seven additional firearms to the government.

According to information presented in court, on Aug. 22, 2012, law enforcement officers found a short barrel shotgun among several rifles, pistols, and shotguns, as well as several hundreds of rounds of ammunition, when they ran a search warrant at Callaway’s residence on County Road 2144 in Wills Point, Texas.
This case was prosecuted as part of the Project Safe Neighborhoods Initiative. Project Safe Neighborhoods is aimed at reducing gun and gang violence, deterring illegal possession of guns, ammunition and body armor, and improving the safety of residents in the Eastern District of Texas. Participants in the initiative include community members and organizations as well as federal, state and local law enforcement agencies.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Van Zandt County Drug Task Force and prosecuted by Assistant U.S. Attorney Jim Noble.

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 TYLER, Texas – A 51-year-old Fruitvale, Texas man has pleaded guilty to drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Billie Earl Johnson pleaded guilty to conspiracy to possess with intent to distribute and distribution of methamphetamine today before U.S. Magistrate Judge K. Nicole Mitchell. 

                According to information presented in court, up until December 2010, Johnson conspired with others to acquire and distribute methamphetamine in the Eastern District of Texas and elsewhere.  Johnson admitted to being responsible for assisting in the distribution of more than 50 grams of methamphetamine.  He also admitted to possessing a firearm during his drug trafficking activities.  A federal grand jury returned an indictment on Nov. 7, 2012, charging Johnson and two others with drug trafficking violations. 

                Johnson faces a minimum of 10 years in federal prison at sentencing.  A sentencing date has not been set.

                This case was investigated by the Drug Enforcement Administration and the Mineola Police Department and prosecuted by Assistant U.S. Attorney Bill Baldwin.

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 TYLER, Texas – A 45-year-old Kilgore, Texas man has pleaded guilty to drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Paul Bryan Jones pleaded guilty to possession with intent to distribute methamphetamine on Aug. 26, 2013, before U.S. Magistrate Judge John D. Love. 

                According to information presented in court, on Sep. 18, 2011, Jones possessed methamphetamine with the intent to distribute it in the Eastern District of Texas.  On that same day, law enforcement officers seized 17.26 grams of pure methamphetamine at Jones’ residence.  A federal grand jury returned an indictment on Feb. 27, 2013, charging Jones and three others with drug trafficking violations. 

                Jones faces a minimum of five years in federal prison at sentencing.  A sentencing date has not been set.

                This case was investigated by the Drug Enforcement Administration, the Gregg County CODE Unit, the Overton Police Department and the Texas Department of Public Safety and prosecuted by Assistant U.S. Attorney Bill Baldwin.

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 SHERMAN, Texas – A Dallas-area husband and wife have been sentenced to federal prison for drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

                Jose Torres Mijares, 61, pleaded guilty on June 27, 2012, to conspiracy to distribute cocaine and was sentenced 327 months in federal prison on Aug. 12, 2013, by U.S. District Judge Marcia Crone.  His wife, 47-year-old Leticia Norma Munoz, pleaded guilty on Apr. 10, 2012, to conspiracy to distribute cocaine and was sentenced to 235 months in federal prison on Aug. 12, 2013 by Judge Crone.

                The court also ordered the forfeiture of firearms and over $300,000 which had been seized during a search of the couple’s residence. 

Another man, Jose Luis Perez, 47, of Dallas, pleaded guilty on Nov. 11, 2012, to conspiracy to distribute cocaine and was sentenced to 16 months in federal prison.

                According to information presented in court, Mijares and Munoz owned and operated the El Palacio Bar, the El Jimador Bar, the Circle 33 Bar, and Ladies Bar and Night Club in Dallas.  They were arrested on Nov. 14, 2011, and accused of using these businesses to distribute large quantities of cocaine. 

                This case is the result of an Organized Crime Drug Enforcement Task Force (OCDETF) joint investigation.  The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply. 

This case was investigated by the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation, Texas Department of Public Safety, Plano Police Department, Denton Police Department, Collin County District Attorney’s Office and prosecuted by the U.S. Attorney’s Office for the Eastern District of Texas

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 PLANO, Texas – U.S. Attorney John M. Bales announced today that 17 alleged members of a Colombian drug trafficking organization have been indicted by a federal grand jury in the Eastern District of Texas. 

The indictment, which was returned by a federal grand jury on Feb. 27, 2013, and unsealed on Aug. 5, 2013, charges the 17 defendants with drug trafficking crimes, including conspiracy to possess with intent to manufacture and distribute cocaine, conspiracy to import cocaine and to manufacture and distribute cocaine knowing it will be unlawfully imported into the United States, and conspiracy to possess with intent to distribute cocaine while on board a vessel subject to the jurisdiction of the United States.  According to the indictment, the defendants are alleged to be members of a drug trafficking organization responsible for sending cocaine from Colombia and Mexico to the United States.   

The Colombian National Police (CNP) began executing arrest warrants on Aug. 23, 2013 in Colombia.  Of the 17 defendants, 10 are now safely in custody.  If convicted, they face up to life in federal prison.

"Four years ago, we purposed to look differently at the drug prosecutions in our office and to better use our time and resources by working smarter with what we hope will result in maximum results,” said U.S. Attorney Bales.  "The obvious step was to look at the root of the drug crime problem.  Invariably, the leads always came back to Mexico and to Colombia.  Happily, we have discovered extraordinary partnerships with the Colombian National Police who are outstanding and very brave law enforcement officers.  This investigation is the second significant case where we have utilized American laws to address criminality in Colombia that is affecting the United States.  Late last year, our prosecutors completed the successful prosecution of 25 Colombian nationals who had conspired to import cocaine into the United States.  These cases are challenging, but essential if we are to effectively enforce the drug laws of the United States.  I commend the extraordinary work of the many agents and officers, both here in Texas and in Colombia, who are working on this case and we look forward to the extradition of the arrested defendants."

“The DEA’s commitment to ensure the safety of our citizens is a global effort,” said DEA Acting Special Agent in Charge Daniel R. Salter of the Dallas Field Division.  “This investigation is a perfect example of the DEA’s outstanding partnership with the Government of Colombia and the Colombia National Police.  The DEA’s resolve remains steadfast and we will continue to pursue and bring to justice those that are determined to bring illicit drugs into our great nation.” 

                This case is the result of an ongoing Organized Crime Drug Enforcement Task Force (OCDETF) joint investigation.  The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply. 

The case is being investigated by the U.S. Drug Enforcement Administration Enforcement Group 1, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, HSI-ICE, and the Colombian National Police.  This case is being prosecuted by Assistant U.S. Attorney Ernest Gonzalez.  Provisional arrest warrants, the legal instruments which triggered the enforcement actions and arrests in Colombia, were prepared with the assistance of the DOJ Criminal Division's Office of International Affairs in Washington D.C. 

An indictment is not evidence of guilt.  All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

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 TYLER, Texas – A 24-year-old Houston, Texas woman has pleaded guilty to drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Lindsay Mason pleaded guilty to possession with intent to distribute methamphetamine today before U.S. Magistrate Judge John D. Love. 

            According to information presented in court, on June 29, 2011, Mason agreed with others to acquire and distribute methamphetamine in the Eastern District of Texas and elsewhere.  Mason was personally responsible for assisting in the possession of 49.3 grams of pure methamphetamine.  A federal grand jury returned an indictment on Feb. 27, 2013, charging Mason and three others with drug trafficking violations. 

            Mason faces a minimum of five years in federal prison at sentencing.  A sentencing date has not been set.

           This case was investigated by the Drug Enforcement Administration, the Gregg county CODE Unit, the Overton Police Department and the Texas Department of Public Safety and prosecuted by Assistant U.S. Attorney Bill Baldwin.

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“Whites Only” Enterprise Dealt Methamphetamine and Murder

 BEAUMONT, Texas – A 49-year-old Hull, Texas, woman has pleaded guilty to racketeering charges related to her association with a “white’s only” criminal enterprise that engaged in methamphetamine distribution and murder in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Vicki Stark-Fitts pleaded guilty to participating in a pattern of racketeering activity that included conspiracy to distribute methamphetamine and murder today before U.S. Magistrate Judge Keith Giblin.

  Kenny Don Stanley, 25, of Vidor, Texas, Tanner Lynn Bourque, a/k/a “Two Shoes,” a/k/a “Hitman,” 33, of Port Arthur, Texas, and Kristopher Leigh Guidry, a/k/a “Hollywood,” 28, each pleaded guilty to murder in aid of the racketeering activity earlier this summer.   

The four were charged in a seven-count superseding indictment that was returned by a federal grand jury on Aug. 7, 2013.  The indictment is the latest in a series of Eastern District prosecutions targeting members and associates of the SWS and the Aryan Brotherhood of Texas (ABT).

According to the indictment, the SWS is a race-based organization operating inside and outside of jails and prisons in Texas and elsewhere.  SWS was founded during the 1990s by inmates within the Texas Department of Criminal Justice. SWS is also known as “Solid Wood Soldiers” and “Separate White State.” Although the founders established SWS for protection of white inmates and advancement of white supremacy and white separatism, SWS expanded its objectives to include illegal activities for profit, including trafficking methamphetamine and firearms.  SWS protects its power, territory, and profits through intimidation and violence, including assaults, robbery, and murder.  From September 2010 to January 2011, Bourque, Guidry and other SWS members manufactured “shake and bake” methamphetamine for distribution in the Orange County area of Texas.  In February 2011, Bourque, Guidry and other SWS members became closely associated with Stark-Fitts, who supplied them with crystal methamphetamine and firearms. Crystal methamphetamine is a purer form of methamphetamine that is imported from Mexico.

According to information presented in court, on Mar. 11, 2011, while SWS member James Lee Sedtal, a/k/a “Lil Bit,” was delivering methamphetamine in Orange County, Sedtal used one of Stark-Fitts’s guns to shoot and wound an ABT associate.  ABT is a criminal gang operating in the Orange County area of Texas and elsewhere that wielded supremacy over SWS in Orange County.  During the early morning hours of Mar. 14, 2011, Stanley shot and killed Sedtal at Stark-Fitts’s residence in Liberty County, Texas. Bourque had ordered Stanley to kill Sedtal to prevent ABT from retaliating against SWS for Sedtal’s shooting of the ABT associate. Later that morning, Bourque, Stark-Fitts, Guidry, and Stanley drove to a deserted logging trail in Hardin County where they disposed of Sedtal’s body.  Sedtal’s body was recovered on March 23, 2011, after a man phoned 911 to report his discovery of human remains inside a burned car.

Stanley, Bourque, Guidry each pleaded guilty to violating 18 U.S.C. 1959(a)(1), murder in aid of racketeering.  In connection with their pleas, Bourque, Guidry, and Stanley admitted that they sought to maintain and increase their position within SWS by murdering Sedtal.  Bourque, Guidry, and Stanley face a punishment of life imprisonment.  Stark-Fitts pleaded guilty to a violation of 18 U.S.C. 1962(c), RICO, and faces up to life imprisonment.  The indictment charged all twelve defendants with conspiracy to distribute methamphetamine in violation of 21 U.S.C. § 846.  If convicted of conspiracy to distribute methamphetamine as charged, the remaining defendants face a punishment range of 10 years to life imprisonment. 
This case is being prosecuted as part of the Project Safe Neighborhoods Time Machine Initiative. Time Machine is aimed at reducing gun and gang violence, deterring illegal possession of guns, ammunition and body armor, and improving the safety of residents in the Eastern District of Texas. Participants in the initiative include community members and organizations as well as federal, state and local law enforcement agencies.

The case is being investigated by the ATF, FBI, U.S. Marshals Service, U.S. Secret Service, U.S. Bureau of Prisons, DEA, Texas Rangers, Department of Public Safety CID, Texas Department of Criminal Justice OIG, Orange County Sheriff’s Office, Hardin County Sheriff’s Office, Jasper County Sheriff’s Office, Tyler County Sheriff’s Office, Jefferson County Sheriff’s Office, and Beaumont Police Department, and is being prosecuted by Assistant U.S. Attorney John B. Ross.

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 MARSHALL, Texas – A 23-year-old Gilmer, Texas woman has pleaded guilty to drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Lindsey Noel Rawls pleaded guilty to possession with intent to distribute heroin today before U.S. Magistrate Judge Roy S. Payne. 

            According to information presented in court, on Feb. 7, 2013, Rawls possessed approximately 37 grams of a mixture containing heroin and 15 capsules, also containing a heroin substance.  Rawls admitted to traveling with co-defendant William Griffin to Dallas to acquire the heroin.  A federal grand jury returned an indictment on Mar. 27, 2013, charging nine individuals with drug trafficking violations. 

            Rawls faces up to 20 years in federal prison at sentencing.  A sentencing date has not been set.

            This case was investigated by the Drug Enforcement Administration and the Gilmer Police Department and prosecuted by Assistant U.S. Attorney Mary Ann Cozby.

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      MARSHALL, Texas – A 55-year-old Gilmer, Texas man has been sentenced to federal prison for drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Paul Allen Wigington pleaded guilty on July 12, 2013 to possession with intent to distribute and distribution of heroin and was sentenced to six months in federal prison on Aug. 20, 2013 by U.S. District Judge Rodney Gilstrap. 

            According to information presented in court, on Aug. 23, 2012, Wigington distributed approximately 2.2 grams of a mixture containing heroin to another person in exchange for $500.  Wigington admitted to purchasing the heroin from co-defendant, Cynthia Blaylock, at her Upshur County home.  A federal grand jury returned an indictment on Mar. 27, 2013, charging Wigington and eight others with drug trafficking violations. 

            This case was investigated by the Drug Enforcement Administration and the Gilmer Police Department and prosecuted by Assistant U.S. Attorney Mary Ann Cozby.

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     SHERMAN, Texas – Two Collin County, Texas men have pleaded guilty to federal charges in connection with a combination foreclosure rescue and drug distribution scheme in the Eastern District of Texas, announced U.S. Attorney John M. Bales. 
                 
Jarrod Williams, 34, and Julius Williams, 43, both of McKinney, Texas, pleaded guilty to conspiracy to commit mail and wire fraud today before U.S. Magistrate Judge Amos L. Mazzant. 

According to information presented in court, from February 2007 to June 2012, Jarrod Williams, Julius Williams, and co-defendant, Charles Williams, controlled and operated Applied Investment Strategies, Inc. (AIS), which marketed itself as a foreclosure rescue service offering assistance to homeowners at risk of foreclosure.  However, once a homeowner detained AIS, the defendants fraudulently used the customer’s personal identification information to prepare and send false military orders to banks and lending institutions in order to claim relief from foreclosure under the Servicemember’s Civil Relief Act.  AIS would then lease out the home and collect rental payments for AIS’ benefit.  The scheme involved approximately 38 homes throughout North Texas and also extended to interfering in the repossession of automobiles.  After at least one of the fraudulently-acquired properties was vacated, Charles Williams, Christopher Carter and Sean Harrell turned it into a marijuana grow operation that housed approximately 1,300 marijuana plants that were intended for distribution.  A federal grand jury returned an indictment on July 11, 2012, charging the defendants with federal violations.

Jarrod Williams and Julius Williams both face up to five years in federal prison at sentencing.  Charles Williams, 38, of McKinney, pleaded guilty on Dec. 18, 2012, to conspiracy to commit mail and wire fraud and conspiracy to possess with intent to distribute marijuana.  He faces up to 20 years on the fraud charges and between 10 years and life on the drug charge.  Sean Harrell, 37, of Dallas, pleaded guilty on Aug. 7, 2013, to conspiracy to possess with intent to distribute marijuana and faces from 10 years to life at sentencing.  Sentencing dates have not been set. 

Christopher Carter, 33, of Leicester, England, was sentenced to 41 months in federal prison on Apr. 12, 2013, for conspiracy to distribute marijuana.

This case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Shamoil T. Shipchandler.

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 TEXARKANA, Texas – A 44-year-old Texarkana, Texas man has pleaded guilty to federal drug trafficking and firearms violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Keith Glenn Harris pleaded guilty to possession with intent to distribute methamphetamine and possession of a firearm during a drug trafficking crime today before U.S. Magistrate Judge Caroline M. Craven.

            According to information presented in court, on July 21, 2012, Harris possessed approximately 1,610 grams of actual methamphetamine and a handgun in his vehicle.  He was being paid to travel to Dallas and transport the methamphetamine to Texarkana for distribution.  A federal grand jury returned an indictment on Oct. 3, 2012, charging Harris with federal violations.

            Harris faces a minimum of 10 years in federal prison at sentencing.  A sentencing date has not been set. 

            This case is being investigated by the Federal Bureau of Investigation and the Texas Department of Public Safety and prosecuted by Assistant U.S. Attorney Mary Ann Cozby.

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       LUFKIN, Texas – Houston-based Planned Parenthood Gulf Coast has paid $4.3 million to resolve civil allegations under the False Claims Act in the Eastern District of Texas, announced U.S. Attorney John M. Bales.

The government alleges that between 2003 and 2009, Planned Parenthood Gulf Coast billed and was paid by government programs, Texas Medicaid, Title XX, and the Women’s Health Program, for certain items and services related to birth control counseling, STD testing and contraceptives when such items and services were either not medically necessary, not medically indicated or not actually provided.  Title XX is funded by the federal government while Texas Medicaid and the Women’s Health Program are funded jointly by the federal government and the State of Texas.

Of the $4.3 million settlement, the federal government will receive $3,594,604 and the State of Texas will receive $705,396.  The settlement resolves a False Claims Act lawsuit filed in the Eastern District of Texas by Karen Reynolds, a former employee of Planned Parenthood Gulf Coast.  The whistleblower or qui tam provisions of the False Claims Act permit the relator to obtain a portion of the proceeds obtained by the government.  As part of today’s resolution, Reynolds will receive $1,247,000.

“We are very pleased to settle this matter for an amount of money that addresses what was, in the Government’s view, an abuse of programs that are extremely important to the well-being of many American women,” said U.S. Attorney Bales.  “We will remain ever vigilant to protect the interests of American taxpayers and the integrity of the Medicare and Medicaid health programs.  I am particularly grateful to the whistleblower for bringing the matter to our attention.”

The claims settled by this agreement are allegations only; there has been no determination of liability.

This case was investigated by the Texas Attorney General’s Civil Medicaid Fraud Division and prosecuted by Assistant U.S. Attorney Kevin McClendon.

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           PLANO, Texas – The federal government provided nearly $5 million in proceeds to the Plano Police Department after their joint efforts dismantled a major internet gambling operation, announced U.S. Attorney John M. Bales and IRS Criminal Investigation Acting Special Agent in Charge Madie Branch today.

            The Plano Police Department was presented a check in the amount of $4,753,841.40 at an asset sharing ceremony today at the Plano Police Department.  The check presentation was made by U.S. Attorney Bales and Acting SAC Branch. 

The Plano Police Department began an investigation in 2006 in which an undercover police detective developed a betting relationship with a bookmaker.  The bookmaker was part of a larger organization operating an offshore sports book that utilized toll free telephone numbers and the Internet as a means of accepting sports wagers from bettors located throughout the United States.  Further investigation revealed the illegal gambling organization originated in North Texas and had operated the offshore Internet sports book utilizing a corporate identity, global Internet Corporation (GIC), incorporated in Willemstad Curacao Netherlands Antilles, since September 2002.

The investigation identified 18 individuals who conspired to illegally accept wagers on college and professional sporting events through approximately 25 Internet websites hosted in Curacao, Netherlands Antilles.  The defendants provided bettors with a personal login code and password to facilitate the placement of wagers through the websites and to disguise their identities.  Bettors were then directed to specific websites or to toll free numbers operated by the websites where the bettors placed wagers on sporting events. 

On March 3 and 4, 2011, law enforcement officers executed 32 federal search warrants at residences, offices and safe-deposit boxes belonging to defendants.  During the course of the investigation, 47 seizure warrants were also served seizing numerous bank and investment accounts, automobiles, businesses, and real properties. The investigation disclosed that this illegal Internet wagering organization generated in excess of $5.4 billion in gross wagers resulting in approximately $200 million in illegal earnings to the defendants from January 2007 to February 2011.

All 18 defendants have pleaded guilty to various criminal violations including money laundering, illegal gambling, structuring and tax violations related to income derived from their illegal gambling enterprise.  To date, in excess of $10 million has been forfeited to the U.S. Government.  In addition to forfeiture of money and assets and court ordered fines, the defendants were sentenced as follows:

Albert Sydney Reed, Jr., 57, of Southlake, Texas, was convicted of prohibition of illegal gambling business and sentenced to 12 months and 1 day in federal prison.

Curtis Wayne Higgins, 45, of Proper, Texas, was convicted of engaging in monetary transactions in property derived from illegal gambling and sentenced to 5 years of probation.

David Mullins, 48, of Coppell, Texas, was convicted of engaging in monetary transactions in property derived from illegal gambling and sentenced to 5 years of probation.

Dean Hartley Maddox, 69, of Houston, was convicted of willful failure to file a tax return and sentenced to 18 months of probation.

Carl Francis, 71, of Dallas, was convicted of prohibition of illegal gambling business and was sentenced to 3 years of probation, 6 months home confinement and 200 hours of community service.

Andrew Harris McElroy, 44, of Dallas, was convicted of engaging in monetary transactions in property derived from illegal gambling and sentenced to 3 years of probation.

Steven Arnold Bell, 58, of Arlington, Texas, was convicted of prohibition of illegal gambling business and sentenced to 2 years of probation and 6 months home detention.

Neil Marcus Gerson, 51, of Frisco, Texas, was convicted of prohibition of illegal gambling business and sentenced to 2 years of probation.

Robert Primm, 71, of Fort Worth, was convicted of a violation of willful failure to file a tax return and sentenced to 6 months of probation.

Charles Albert Brawner, 66, of McKinney, Texas, was convicted of engaging in monetary transactions in property derived from illegal gambling and sentenced to 5 years of probation. 

Adam John Brady, 36, of Irving, Texas, was convicted of prohibition of illegal gambling business and sentenced to 2 years of probation.

William Craig Robertson, 42, of Rockwall, Texas, was convicted of prohibition of illegal gambling business and sentenced to 3 years of probation.

Thomas Applegate, 45, of Carrollton, Texas pleaded guilty to prohibition of illegal gambling business and is awaiting sentencing.

William Michael Christopher, 56, of Fort Worth, pleaded guilty to prohibition of illegal gambling business and is awaiting sentencing.

Larry Dean Coralli, 78, of Addison, Texas, pleaded guilty to prohibition of illegal gambling business and is awaiting sentencing.

Brent Lee Coralli, 48, of Plano, Texas, pleaded guilty to prohibition of illegal gambling business and is awaiting sentencing.

Robert Roy Hodges, 71, of Dallas, pleaded guilty to prohibition of illegal gambling business and is awaiting sentencing.

Gregg Richard Merkow, 49, of Plano, Texas, pleaded guilty to prohibition of illegal gambling business and is awaiting sentencing.

“Taking away the assets from these illegal organizations hits criminals where it hurts the most – it deprives them of their profits,” said Madie Branch, Acting Special Agent in Charge of IRS Criminal Investigation. “Today, we are transferring those seized profits from the criminals and giving them back to the communities.”

This case was prosecuted by Assistant U. S. Attorney Milton A. Stover and the investigation was led by the Internal Revenue Service Criminal Investigation and Plano Police Department.  Additional agencies that assisted in the investigation and will be receiving proceeds at a later date include: Dallas Police Department, Denton County District Attorney’s Office, Flower Mound Police Department, Fort Worth Police Department, Arlington Police Department, Midlothian Police Department, Desoto Police Department, and Southlake Police Department.

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“Gar Guy” admits that he transported alligator killed in violation of state and federal law

         BEAUMONT, Texas – A 49-year-old Kennard, Texas, hunting and fishing guide has pleaded guilty to transporting an alligator that he knew had been shot in violation of state and federal wildlife laws, announced U.S. Attorney John M. Bales today.

Steve Barclay, 49, pleaded guilty on Aug. 13, 2013, before U.S. Magistrate Keith F. Giblin to the felony offense of transporting wildlife taken in violation of federal law. Barclay admitted that on May 8th, 16th, and 20th of 2008 he witnessed John A. McCall, a client for whom he was providing guide services, shoot and kill a total of three alligators even though Barclay knew that Texas law limits hunters to one alligator per hunter per season.  Barclay admitted that he transported the alligator killed on May 20th in Leon County to Sportsman’s Memory taxidermy shop in Grapeland, Texas. 

            The Endangered Species Act prohibits the taking of any threatened species of fish or wildlife in violation of any federal or state regulation pertaining to such species. Alligators are listed as a threatened species pursuant to the Endangered Species Act.  The Lacy Act prohibits the transport, receipt, or acquisition of any wildlife taken, possessed, or transported in violation of any law, treaty, or regulation of the United States.     

Although Barclay is facing up to 5 years in federal prison and a $250,000.00 fine, his plea agreement with the government, subject to approval by the court, calls for a $5,000 fine and three years’ probation. 

This case was investigated by the U.S. Fish and Wildlife Service, Office of Law Enforcement, Houston, and the Texas Parks and Wildlife Department, Criminal Investigations Division, and prosecuted by Assistant U.S. Attorney Jim Noble.

           The mission of the U.S. Fish and Wildlife Service is working with others to conserve, protect, and enhance fish, wildlife, plants, and their habitats for the continuing benefit of the American people. It is both a leader and trusted partner in fish and wildlife conservation, known for its scientific excellence, stewardship of lands and natural resources, dedicated professionals, and commitment to public service. For more information on its work and the people who make it happen, visit www.fws.gov. Connect with its Facebook page at www.facebook.com/usfws, follow its tweets at www.twitter.com/usfwshq, watch its YouTube Channel at https://www.youtube.com/usfws and download photos from its Flickr page at http://www.flickr.com/photos/usfwshq.

 

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       TYLER, Texas – Two East Texas women were sentenced to federal prison today for drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Stacie Serenko, 29, of Tyler, Texas pleaded guilty on Feb. 7, 2013 to possession with intent to distribute methamphetamine and was sentenced to 70 months in federal prison today by U.S. District Judge Leonard E. Davis.

Jennifer Northcutt, 42, of Mineola, Texas, pleaded guilty on Feb. 5, 2013, to possession with intent to distribute methamphetamine and was sentenced to 60 months in federal prison today by Judge Davis.

                According to information presented in court, on Aug. 21, 2010, Serenko and Northcutt both found in possession of methamphetamine which they intended to distribute to others.   Serenko admitted to being in possession of more than 5 grams of methamphetamine.  Northcutt admitted to possessing at least 17 grams of methamphetamine and a firearm.

                Another defendant, Billie Earl Johnson, is set for trial on Oct. 8, 2013.   

                This case is being investigated by the U.S. Drug enforcement Administration and the Mineola Police Department and prosecuted by Assistant U.S. Attorney Bill Baldwin.

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          SHERMAN, Texas – A 58-year-old Prosper, Texas business owner has been sentenced to prison for federal violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

Ricky Prince pleaded guilty on Sep. 6, 2012, to bank fraud and money laundering and was sentenced to a total of 36 months in federal prison on Aug. 13, 2013, by U.S. District Judge Marcia A. Crone.  Prince was also ordered to pay restitution in the amount of $1,461,807.27.  .

                According to information presented in court, from March 2007 to August 2010, Prince owned and operated North Texas Muscle Cars, Inc., specializing in antique automobile sales, in McKinney, Texas.  During this time, Prince submitted materially false personal finance statements and income tax returns to financial institutions to secure credit for himself and North Texas Muscle Cars, Inc.  To further the scheme, Prince included antique automobiles such as a 1963 Chevrolet Corvette, a 1974 Pantera Detomasoy, a 1967 Chevrolet Chevelle and a 1938 Ford Custom Street Rod, that were never purchased.  As a result of the fraudulent activity, the financial institutions incurred actual losses totaling approximately $1,347,472. 

                Prince was ordered to report to prison on Sep. 27, 2013 to begin serving his sentence.

                This case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation and prosecuted by Assistant U.S. Attorney Randall Blake.

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        WASHINGTON – An Eastern District of Texas prosecution team was one of 154 members of the Department of Justice recognized by Attorney General Eric Holder and Executive Office for U.S. Attorneys (EOUSA) Director H. Marshall Jarrett with a 2013 Director’s Award.

On Aug.15, 2013, U.S. Attorney John M. Bales recognized Deputy Criminal Chief/Assistant U.S. Attorney in Charge of the Plano Office Shamoil T. Shipchandler, Assistant U.S. Attorney Christopher A. Eason, and former Assistant U.S. Attorney Richard J. Johnson in a ceremony at the U.S. Attorney’s Office in Plano. 

In personalized letters to the recipients, Attorney General Holder told the three lawyers, “You and your team are responsible for the successful prosecution of the largest mortgage fraud scheme in the Eastern District of Texas to date, and one of the largest in Texas history.  Forty defendants conspired to defraud lending institutions by convincing them to approve mortgage loans for residential properties with fraudulently inflated values.  Your dedication to this case led to 37 of 40 defendants pleading guilty, successful verdicts in two trials, sentences of up to 120 months’ imprisonment, restitution orders totaling more than $100 million, and forfeitures in excess of $11 million.”

The complex mortgage fraud scheme was led by defendant John Barry, and included title attorneys, escrow officers, real estate agents, loan officers, appraisers, property flippers, and straw buyers.  The scheme involved over 114 residential properties in cities throughout Texas, including Allen, Arlington, Cedar Hill, Coppell, Corinth, Cypress, Dallas, Flower Mound, Fort Worth, Frisco, Granbury, Heath, Highland Village, Houston, Keller, Lantana, Lewisville, Little Elm, Lubbock, Magnolia, McKinney, Plano, Roanoke, Southlake, spring, the Woodlands, and Willis.  Shipchandler served as lead counsel during the investigation and early prosecution of the case and as a member of the trial team.  Johnson led the trial team for the two trials and Eason served as co-counsel and played a crucial role in streamlining the evidence in the massive case. 

“Each day the members of the U.S. Attorneys’ community go to work for the citizens of this country with one goal in mind – to do everything they can to protect the rights of all Americans,” said EOUSA Director Jarrett.  “I am continually humbled by their resiliency, dedication, and unparalleled work ethic to accomplish this noble mission. Today’s awardees exemplify what it truly means to be a patriot and it is an honor to recognize them for their extraordinary service.”

            “The Director’s Awards presented today were earned by individuals who toiled hundreds of hours, not for any notion of individual glory, but because they are driven to serve and to be instruments of justice where wrongdoing has occurred.  Just as importantly, in a case like the Barry investigation, the entire office pitched in to a significant degree making it possible for the individual Assistant United States Attorney’s to be successful.  I am so proud of Shamoil, Chris and Jay who represent the finest principles in prosecution; they are fair, persistent and highly skilled,” said U.S. Attorney Bales.

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            BEAUMONT, Texas – A former investigator for the Texas Health and Human Services Commission was sentenced to federal prison for theft violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
 
            Melva Darlene Blakemore, 62, of Diboll, Texas, pleaded guilty on March 26, 2013 to theft of federal funds and was sentenced to 12 months in federal prison today by U.S. District Judge Marcia Crone.  Blakemore was also ordered to pay $27,208 in restitution.
 
            According to information presented in court, while employed as an investigator with the Texas Health and Human Services Commission, part of Blakemore’s job duties entailed her contacting individuals to advise them they could be indicted and prosecuted for receiving overpayments of benefits from federally funded programs, such as the Supplemental Nutrition Assistance Program, (also known as SNAP or the food stamp program).  Blakemore advised numerous beneficiaries that no charges would be filed against them if they agreed to repay the overpaid benefits directly to Blakemore in cash.  Blakemore utilized this scheme on multiple occasions to obtain funds from individuals who had received overpayments. 

            This case was investigated by the Nacogdoches County Sheriff’s Office, the Texas Rangers, the Texas Health and Human Services Commission – Office of Inspector General and the FBI,  and was prosecuted by Assistant U.S. Attorney Randall L. Fluke.

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            BEAUMONT, Texas – Two Southeast Texas residents and a Louisiana man have been sentenced to federal prison for child pornography violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
 
            Stacey Marie Barron, 25, of Nederland, Texas, pleaded guilty on Aug. 24, 2012 to conspiracy to produce child pornography and was sentenced to 276 months in federal prison today by U.S. District Judge Marcia Crone.
 
            Johnny Ray Baldwin, II, 28, of Lumberton, Texas pleaded guilty on Aug. 24, 2012, to conspiracy to produce child pornography and was sentenced to 108 months in federal prison today by Judge Crone.

            Charles Edward Reese, 67, of Covington, LA, pleaded guilty on May 24, 2012, to conspiracy to produce child pornography and was sentenced to 240 months in federal prison today by Judge Crone.  Reese was also ordered to pay $2,819,887.00 in restitution to the victims.  The minor victims in this case will receive restitution for their future medical needs, to be held in a special needs trust.  The trust will be funded, in part, by assets frozen and seized by the U.S. Attorney’s Office prior to Reese’s sentencing.

            According to information presented in court, on Feb. 1, 2012, federal officials conducted a search warrant at a home in Orange County, Texas after receiving information from an Internet-based image hosting website reporting that a customer had uploaded digital images from a cell phone that contained sexually explicit conduct of a young child and an adult.  An investigation revealed that although the adult in the photos was deceased, another person identified as Reese had been paying money for several years in return for digital pictures of sexually explicit conduct involving minor children.  On Mar. 12, 2012, a search warrant was executed at Reese’s home in Louisiana during which multiple child pornography images and videos were discovered.  Financial records indicate Reese paid over $700,000 between 2004 and 2012 for the production of child pornography. 

            Reese was arrested on Mar. 5, 2012 and indicted by a federal grand jury on Mar. 21, 2012. 

            Further investigation led to additional child pornography which had been produced by Barron and Baldwin for Reece from July 2009 to August 2011 using two young children.  A federal grand jury returned an indictment on June 6, 2012 charging Barron and Baldwin with child pornography violations.  
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

            This case was investigated by the FBI, Jefferson County Child Protective Services, the Garth House, Orange County Child Protective Services, and Orange County Sheriff’s Office, and was prosecuted by Executive Assistant U.S. Attorney Brit Featherston and Assistant U.S. Attorney Christopher T. Tortorice.

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            SHERMAN – A pharmacist has pleaded guilty in Philadelphia, Pennsylvania to charges originating in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.

            Eric Vern Fox, 45, a pharmacist living in Berwyn, Pennsylvania, pleaded guilty to money laundering conspiracy, in violation of federal money laundering laws, announced United States Attorney Zane David Memeger.  These charges were transferred from the Eastern District of Texas for guilty plea and sentencing.  According to the charges, from June 2002 until September 2007, Fox owned and operated two compounding pharmacies in this district:  the Medicine Shoppe, located at 578 Lancaster Avenue, Berwyn, PA, and Compounding Rx Apothecary, located at 81 Lancaster Avenue, Store #4, Malvern, PA.  The indictment alleges that from June 2002 until September 2007, Fox agreed with the owners and operators of an illegal internet pharmacy, the Madison Pain Clinic, located in Texas, to compound millions of hydrocodone pills that the Madison Pain Clinic sold to internet customers under fraudulent “prescriptions,” outside the usual course of professional practice and not for a legitimate medical purpose. 

            The money laundering charge to which Fox pleaded guilty alleges that between June 2002 and September 2007, Fox was paid by the Madison Pain Clinic for the hydrocodone pills that the clinic sold to its internet customers, and agreed to launder the proceeds of this illegal activity totaling at least $4,500,000.  The plea agreement calls for Fox to receive an agreed-upon sentence of twelve months and a day in prison, followed by three years of supervised release.  The plea agreement also requires Fox to forfeit the sum of $2,000,000 and pay an assessment of $100.  At the hearing today, the Honorable R. Barclay Surrick accepted the plea agreement, scheduling sentencing to take place on November 8, 2013. 

            The case was investigated by the Drug Enforcement Administration and the Internal Revenue  Service, Criminal Investigation Division.  It was prosecuted by Assistant United States Attorney Steven Buys in the Eastern District of Texas. In the Eastern District of Pennsylvania, the case is being prosecuted by Assistant United States Attorney Mary E. Crawley.

UNITED STATES ATTORNEY'S OFFICE       Contact:    PATTY HARTMAN
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