Northern District of Texas
Press releases recorded for this federal judicial district.
Hospital to Pay More Than $3 Million to Settle Whistleblower SuitRead the Press Release
Tarrant County’s John Peter Smith Hospital (JPS) has agreed to pay more than $3.3 million to settle allegations that it violated the False Claims Act by upcoding certain claims submitted to federal healthcare programs, Acting U.S. Attorney Prerak Shah announced today.
The settlement resolves a whistleblower suit filed in 2018 by JPS’s former Director of Compliance Erma Lee, whose complaint asserted that the hospital improperly appended billing modifiers -25, -59, and -XU to hundreds of claims in order to obtain payments to which it was not entitled.
Used properly, these billing modifiers indicate that a provider administered significant care on the same day as another medical procedure that was above and beyond the preoperative and postoperative care “bundled” into the main procedure code.
In her amended complaint, filed in September 2020, Ms. Lee alleged that she alerted hospital leadership that JPS had been improperly adding these modifiers to claims between 70 and 95 percent of the time, in essence routinely double billing for certain aspects of patients’ care. Nevertheless, she claimed, JPS failed to reimburse payors for overpayment stemming from these improperly coded claims.
“When company executives ignored this whistleblower's concerns about improper billing, she took them to the court,” said Acting U.S. Attorney Prerak Shah. “We are proud of the citizens who speak out to protect our federal healthcare programs.”
The allegations resolved by this settlement were originally filed under the qui tam provisions of the False Claims Act, which permits private persons with evidence of fraud to sue on behalf of the government and to share in any proceeds.
Under the Act, the United States may intervene in such an action or permit the whistleblower to pursue it. Although the United States elected not to intervene in the case, it investigated Ms. Lee’s allegations and worked collaboratively with the relator and her counsel in their pursuit and resolution of this case.
Ms. Lee will receive $912,635 as her statutory share of the settlement proceeds.
This matter was handled on behalf of the government by Assistant U.S. Attorney Andrew Robbins on behalf of the Office of the Inspector General for the Department of Health and Human Services.
The case is captioned United States ex rel. Lee v. Tarrant County Hospital District, case no. 4:19-CV-00412-P (N.D. Tex.). The claims settled by this agreement are allegations only and do not constitute a determination of liability.
Former Wind Farm Manager Sentenced to 3 Years in $550,000 Embezzlement SchemeRead the Press Release
A San Angelo man who embezzled more than half a million dollars from a wind farm was sentenced yesterday to more than three years in federal prison, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Arturo Salazar III, 41, a former site manager for a Vestas-American Wind Technologies wind farm, pleaded guilty to four counts of unauthorized transactions with access devices in May. He was sentenced Thursday to 37 months in federal prison by U.S. District Judge James Wesley Hendrix, who ordered him to pay $359,810 in restitution to the company.
According to court documents, Mr. Salazar admitted that he teamed up with a conspirator to create a sham business, BT Machine, with the sole purpose of creating fraudulent invoices.
From 2016 to 2019, the pair created hundreds of bogus invoices for nonexistent equipment BT Machine purportedly leased to Vestas. The conpsirator sent each invoice – complete with a BT “logo” – to Mr. Salazar at his work email address; Mr. Salazar then paid each one with his Vetas credit card. He and the other individual then split the money.
Mr. Salazar also used Vestas company credit cards to make unauthorized purchases totaling approximately $80,000. These personal purchases included products from Amazon as well as a $50,000 skid steer loader, a $18,900 universal terrain vehicle, and a $7,900 dump trailer.
From 2016 to 2019, Mr. Salazar admitted to defrauding Vestas out of more than $550,000. To avoid detection, he kept each transaction under the $2,000 limit set by his employer.
The Federal Bureau of Investigation’s Dallas Field Office, San Angelo Resident Agency conducted the investigation. Assistant U.S. Attorney Ann Howey prosecuted the case.
Laredo Man Sentenced to 25 Years for Brutal Assault in Dallas Parking GarageRead the Press Release
The Laredo man who brutally assaulted a woman in a downtown Dallas parking garage has been sentenced to 25 years in federal prison, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
David Cadena, 27, was charged via criminal complaint in November 2019 and indicted less than a month later. Before he was federally charged, Mr. Cadena been charged by the state with aggravated assault with a deadly weapon and aggravated robbery, but had twice bonded out of Dallas County Jail. A federal judge ordered him detained immediately after he was arrested by the feds. He pleaded guilty in April 2021 to the federal charge, carjacking resulting in bodily injury, and was sentenced Thursday by U.S. District Judge Jane J. Boyle.
According to plea papers, Mr. Cadena admitted he savagely assaulted the victim with a fire extinguisher in the parking garage of the Statler Hotel around 2:30 a.m. on Saturday, Sept. 21.
After assaulting the victim, Mr. Cadena allegedly carjacked her 2015 Toyota Corolla, drove it around the garage, and slammed it into a wall. A Statler security guard observed Mr. Cadena behind the wheel of the wrecked vehicle and removed him from the car for his own safety.
Authorities discovered the 27-year-old victim, identified in court documents as J.K., unconscious, with severe bruising and swelling to her face and head. She was transported to Baylor Hospital, where she lay in a coma for two days, and medical professionals documented nerve damage to her arms and legs as a result of the beating.
“Cadena was likely a blow short of committing capital murder,” prosecutors argued in a motion for upward variance from the sentencing guidelines, later granted by the judge. “This is not a run-of the-mill, garden-variety carjacking. Cadena’s crime is excessively violent and egregious.”
In court documents, Mr. Cadena asserted that because he was heavily intoxicated at the time of the crime, he has no recollection of the events that occurred that night. However, after reviewing the evidence, including security video and witness accounts, he agreed that he committed the offense as described.
The Federal Bureau of Investigation Dallas Field Office and Dallas Police Department conducted the investigation. Assistant U.S. Attorneys Camille Sparks and Gary Tromblay prosecuted the case.
Grand Prairie Man Convicted of Trafficking Teenage GirlRead the Press Release
A Grand Prairie man was convicted yesterday of trafficking a 16-year-old girl, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
After a two-day trial, a federal jury in Dallas on Tuesday convicted 37-year-old Howard Sandford Williams of sex trafficking of a child.
“This defendant exploited a vulnerable teenager he found online,” said Acting U.S. Attorney Prerak Shah. “Far too often, traffickers target struggling women and girls, claiming that they can help. The U.S. Attorney’s Office and HSI are committed to fighting the scourge of trafficking, and to getting justice for the victims of this horrific crime.”
According to evidence presented at trial, Mr. Williams first contacted 16-year-old Jane Doe through Tagged, a dating app, after he viewed a live video of her venting about conflict within her family.
Mr. Williams checked Jane Doe into a hotel room in Irving, where he provided her with drugs and alcohol, had sex with her, and took photographs of her. He then posted those photographs online in commercial sex advertisements. Through the advertisements, Mr. Williams arranged for adult customers to go to Jane Doe’s hotel room for commercial sex; he also drove Jane Doe to adult customers for commercial sex.
Mr. Williams now faces up to life in federal prison.
Homeland Security Investigations conducted the investigation with the assistance of the Irving Police Department. Assistant U.S. Attorneys Nicole Hammond and John de la Garza are prosecuting the case. U.S. District Judge Jane J. Boyle presided over the trial.
Cryptocurrency CEO Sentenced to Five Years in $4 Million Crypto SchemeRead the Press Release
The inventor of cryptocurrency AriseCoin was sentenced today to five years in federal prison for duping investors out of more than $4 million, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
AriseBank CEO Jared Rice, Sr. – who settled a civil action involving AriseCoin filed by the SEC’s Fort Worth regional office last year – pleaded guilty to one count of securities fraud in March 2019. He was sentenced Wednesday by U.S. District Judge Ed Kinkeade, who ordered him to pay $4,258,073 in restitution.
According to his plea papers, Mr. Rice, 33, admitted he lied to would-be investors, claiming that AriseBank – billed as the world’s “first decentralized banking platform” based on the proprietary digital currency AriseCoin – could offer consumers FDIC-insured accounts and traditional banking services, including Visa-brand credit cards, in addition to cryptocurrency services. In actuality, AriseBank had not been authorized to conduct banking in Texas, was not FDIC insured, and did not have any sort of partnership with Visa.
Even as he touted AriseBank’s nonexistent benefits, Mr. Rice quietly converted investor funds for his own personal use, spending the money on hotels, food, transportation, a family law attorney, and even a guardian ad litem – facts he failed to disclose to investors. He also failed to disclose that he’d plead guilty to state felony charges in connection with a prior internet-related business scheme.
Meanwhile, hundreds of investors bought approximately $4,250,000 in AriseCoin using digital currencies like Bitcoin, Ethereum, and Litecoin, as well as fiat currency.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorneys Mary Walters, Sid Mody, and Erica Hilliard prosecuted the case.
Former Preschool Teacher Pleads Guilty to Receipt of Child PornographyRead the Press Release
A former preschool teacher pleaded guilty today to purchasing sexually explicit images of children, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Jason Sherod Baldwin, 29, was charged via criminal complaint in July 2020 and indicted less than a month later. He pleaded guilty Tuesday to one count of receipt of child pornography.
In plea papers, Mr. Baldwin, a former teacher at Dallas’ Hockaday School, admitted that he used Kik, an encrypted messaging app popular among teenagers, to purchase links to child pornography from another Kik user. In chats, Mr. Baldwin requested “mainly preteen boy-on-boy vid[eo]s.”
According to court documents, the investigation into Mr. Baldwin began after FBI agents executed a federal search warrant at the home of a convicted sex offender in Philadelphia. A search of the offender’s phone revealed that he routinely used Kik to solicit payment for links child pornography. One of the accounts with which the offender communicated traced back to Mr. Baldwin.
On Oct. 29, Mr. Baldwin messaged the sex offender about purchasing child pornography. The offender shared a link to a “preview” folder and indicated the complete file set would cost $27. Mr. Baldwin sent the money through PayPal and received links to the files a few minutes later.
The investigation showed that Mr. Baldwin purchased child pornography from the offender several times over the ensuing months, on Nov. 11 ($13 for two videos of minor males), Dec. 8 ($10 for a video and more than 100 images), Dec. 18 ($12 for two videos), and Jan. 21 ($31 for seven videos).
In an interview with law enforcement after he was arrested, Mr. Baldwin admitted that he’d used Kik to purchase sexually explicit images of children. He said he had hundreds of sexually explicit images and videos of children stored on his cell phones, and that he had been viewing child porn for approximately eight years.
He now faces between five and 20 years in federal prison.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation with the assistance of the Bureau’s Philadelphia Field Office. Assistant U.S. Attorney Nicole Dana prosecuted the case.
Bedford Man Sentenced to 10 Years for Sexually Exploitative Images of ChildrenRead the Press Release
A Bedford man has been sentenced to 10 years in federal prison for receiving sexually explicit images of children, announced Acting U.S. Attorney Prerak Shah.
Joshua Clyde Lamb, 35, pleaded guilty in April to one count of receipt of child pornography. He was sentenced Friday by U.S. District Judge Reed C. O’Connor.
According to plea papers, Mr. Lamb admitted that he used Skype, an internet-based video teleconferencing platform, to communicate with purveyors of child pornography based in the Philippines. On one occasion, he paid $30 for a video for a 10-minute video of an adult male raping a prepubescent girl.
Homeland Security Investigations’ Dallas Field Division conducted the investigation with help from HSI’s Portland, Maine Field Division. Assistant U.S. Attorney Aisha Saleem prosecuted the case.
Amarillo Drug Trafficker Sentenced to 35+ Years in Federal PrisonRead the Press Release
An Amarillo man has been sentenced to 35 years and five months in federal prison for gun and drug crimes, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
In April, a federal jury in Amarillo convicted Jeffrey Rene Lopez, 52, of two counts of possession with intent to distribute methamphetamine, one count of possession of firearms in furtherance of drug trafficking crimes, and one count of felon in possession of firearms. He was sentenced Thursday by U.S. District Judge Matthew J. Kacsmaryk.
According to evidence presented at trial, Mr. Lopez was dealing meth out of two residences in Amarillo.
On October 19, 2020, law enforcement recorded a confidential informant calling Mr. Lopez to schedule a $1,000, two-ounce meth buy. Two days later, equipped with an audio/video recording device, the CI knocked at the door of Mr. Lopez’s residence.
Once inside, the CI watched Mr. Lopez pull out a large bag of crystal meth and scoop about an ounce into smaller plastic baggie. When the CI said the substance looked “shaky” (low quality), Mr. Lopez promised to get the second ounce from another location. Mr. Lopez retrieved additional meth from his brother’s residence and handed it off to the CI at a local laundromat.
About a month later, the CI informed law enforcement that Mr. Lopez was traveling back from California with a load of methamphetamine. DEA agents spotted him on Interstate Highway 40 near Amarillo, and called in Texas DPS troopers to place him under arrest pursuant to a warrant. When law enforcement searched his vehicle, they found two bundles of meth hidden inside a spare tire in the trunk. Agents also searched two residences in Amarillo, where they found a total of nine guns: seven pistols, an AR-15 style rifle, and a .22 rifle with an extended magazine.
In an interview a short while later, Mr. Lopez confessed to possession of both the guns and the drugs, stating that he got the meth from a source in California who had previously “ripped him off.”
Due to his prior felony convictions, Mr. Lopez was prohibited by law from possessing – including buying, borrowing, carrying, storing, or shooting – firearms. His former convictions include three counts of possession of a controlled substance for sale, two counts of transportation of a controlled substance, one count of unlawful possession of a controlled substance, two counts of felon in possession of a firearm, and obliterated firearm violation, all in California.
“This defendant smuggled drugs across state lines to distribute to Texans struggling with addiction, using firearms in furtherance of his crimes,” said Acting U.S. Attorney Prerak Shah. “Amarillo is safer today because he is behind bars. And I expect he will spend his decades in prison regretting his choices.”
“The arrest and conviction of Mr. Lopez has undoubtedly made our Amarillo safer,” said Eduardo A. Chavez, Special Agent in Charge of the DEA Dallas Field Division, which is responsible for the Amarillo area. “This is a clear example of the marriage of drugs and guns and something that the men and women of DEA Amarillo and our law enforcement partners will tirelessly work to destroy.”
The Drug Enforcement Administration’s Dallas Field Division, Amarillo Resident Office conducted the investigation with assistance from the Amarillo Police Department, the Randall County Sheriff’s Office, the Texas Department of Public Safety, and the Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division. Assistant U.S. Attorneys Jeffrey Haag and Meredith Pinkham prosecuted the case with the help of Assistant U.S. Attorney Anna Marie Bell.
Wichita Falls Man Pleads Guilty to Possessing MachinegunRead the Press Release
A Wichita Falls man pleaded guilty today to possessing devices that convert semi-automatic weapons into machineguns, announced Acting United States Attorney for the Northern District of Texas Prerak Shah.
Paul David Shaw Jr., 30, was charged via criminal complaint in May and indicted in July. He pleaded guilty on Wednesday to one count of possession of an unregistered firearm.
According to plea papers, Mr. Shaw admitted that he used Snapchat to advertise the sale of Glock “switches.” Also known as “auto sears,” switches are small, easy-install devices designed to convert semi-automatic pistols into fully automatic firearms, classified under federal law as machineguns.
A federal agent, acting in an undercover capacity, purchased two Glock switches from Mr. Shaw for $600 each. Investigators test-fired the Glock switches, and confirmed that they functioned as designed, causing the gun to fire more than one round of ammunition with a single depression of the trigger.
Law enforcement also conducted a search of a commercial building Mr. Shaw used, where they found several additional switches.
“Switches allow criminals to fire off multiple rounds with a single squeeze of a trigger,” said Acting U.S. Attorney Prerak Shah. “Unfortunately, we’re seeing an influx of switches on our streets, where they are inflicting serious harm. ATF and the U.S. Attorney’s Office are committed to keeping our communities safe by keeping these dangerous items out of the wrong hands.”
“Someone selling tools that make firearms fully automatic is one of law enforcement’s greatest fears. Automatic weapons in the hands of those aiming to cause harm is what keeps cops up at night. The fact that Mr. Shaw was selling these on social media should cause us all grave concern. I applaud the efforts of all of those involved in the arrest of this reckless individual,” stated ATF Dallas Special Agent in Charge Jeffrey C. Boshek II.
Mr. Shaw now faces a maximum of ten years in prison, as well as possible fines.
The Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division conducted the investigation with assistance from the Wichita Falls Police Department. Assistant U.S. Attorney Rob Boudreau prosecuted the case.
Man Convicted of Sex Trafficking 14-Year-Old, Adult out of Dallas HotelRead the Press Release
A Dallas man has been found guilty of sex trafficking a 14-year-old minor and an adult victim, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
After less than a half hour of deliberation, a federal jury in Dallas convicted Anthony Lennell Acy, 34, on one count of child sex trafficking and one count of sex trafficking by force, fraud, and coercion.
“Human trafficking is one of the most degrading crimes we prosecute. Like so many traffickers, this defendant preyed on vulnerable victims, lining his pockets at the expense of their dignity,” said Acting U.S. Attorney Prerak Shah. “The North Texas Trafficking Task Force is proud to stand against the exploitation of women and girls.”
“Sex trafficking has no place in our communities. HSI will vigorously pursue anyone involved in the exploitation of victims for commercial sexual acts,” said Ryan L. Spradlin, Special Agent in Charge HSI Dallas. “We will aggressively investigate these types of cases to ensure predators are identified, arrested, and face the justice deserved.”
According to evidence presented at trial, Mr. Acy trafficked at least two victims — including the 14-year-old girl, a runaway from McKinney, Texas — out of multiple hotels in Dallas and in California.
Agents with the North Texas Trafficking Task Force testified that they recovered Jane Doe 1 and Adult Victim 1 out of a Dallas hotel room and arrested Mr. Acy as he was leaving the hotel parking lot.
At trial, Jane Doe 1 testified that Mr. Acy approached her in a parking lot next to a hotel a couple weeks after she ran away from home. Jane Doe 1 stated that Mr. Acy told her that she could model for his clothing line and then drove her to a hotel, where he offered her dinner and a place to stay that night. She testified that Mr. Acy later forced her to take ecstasy pills, caused her to engage in commercial sex in Dallas and in California, and physically assaulted her multiple times.
Adult Victim 1 testified at trial that Mr. Acy first recruited her over Facebook, claiming that he wanted to be her boyfriend. Adult Victim 1 stated that, after she traveled to Dallas to visit Mr. Acy, he took her cell phone and her car keys and forced her to engage in commercial sex in order to pay back the money he claimed to have spent on her. Mr. Acy trafficked Adult Victim 1 first in Dallas and later in Austin and California. Adult Victim 1 testified that Mr. Acy forced her to earn $1,000 a day, with all proceeds turned over to him.
Both victims testified that Mr. Acy repeatedly beat them, threatened them at gunpoint and knifepoint, and threatened to kill them and their families if they called the police.
In the course of the investigation, investigators reviewed Mr. Acy’s hotel records, phone records, financial records, online advertisements, and Facebook posts that corroborated the victims’ accounts of Mr. Acy’s sex trafficking activity.
Mr. Acy now faces a minimum sentence of 15 years and up to life in federal prison.
The North Texas Trafficking Task Force, led by Homeland Security Investigations, conducted the investigation, with assistance from the Texas Department of Public Safety, the Dallas County Sheriff’s Office, the Colleyville Police Department, and the Dallas County District Attorney’s Office. Assistant U.S. Attorneys Rebekah Ricketts and John Kull are prosecuting the case. U.S. District Judge Jane J. Boyle presided over trial.
Suspect in Amarillo Explosion Charged with Possession of Destructive DeviceRead the Press Release
The man suspected of causing an explosion at his residence in Amarillo, Texas on Monday has been federally charged, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Erfan Salmanzadeh, a 32-year-old naturalized citizen of the U.S. born in Iran, was charged via criminal complaint on Friday with one count of possession of a destructive device. (He has also been charged by the state with possession of components of explosives.)
“Mr. Salmanzadeh had absolutely no business handling unregistered destructive devices. We believe this defendant is a danger to the community and must be kept behind bars,” said Acting U.S. Attorney Prerak Shah.
“The FBI is committed to protecting our communities from harm and working with our law enforcement partners to disrupt violent activity. This defendant allegedly possessed a device with the potential to cause significant damage or injury to innocent people,” said FBI Dallas Special Agent in Charge Matthew DeSarno. “We want to thank the Amarillo Police Department, Texas Department of Public Safety, and Homeland Security Investigations for their tireless assistance in this investigation.”
Following the explosion Monday afternoon, officers discovered explosive components in Mr. Salmanzadeh’s residence, his backyard, and the alleyway behind his home, law enforcement has confirmed. The incident prompted the immediate evacuation of the area; neighbors were allowed to return to their homes on Wednesday.
Though the arrest warrant against Mr. Salmanzadeh was unsealed this afternoon, the criminal complaint and affidavit remain sealed, per judicial order.
A criminal complaint is merely an allegation of criminal conduct, not evidence. Like all defendants, Mr. Salmanzadeh is presumed innocent until proven guilty in a court of law.
If convicted of the federal offense, he faces up to 10 years in prison.
The Federal Bureau of Investigation’s Dallas Field Office and the Amarillo Police Department’s Bomb Squad conducted the investigation with the assistance of the North Texas Joint Terrorism Taskforce, Homeland Security Investigations, the Texas Department of Public Safety, and the Amarillo Fire Department. Assistant U.S. Attorneys Jeffrey Haag and Josh Frausto are prosecuting the case.
UPDATE: On May 26, a federal grand jury returned a superseding indictment charging Mr. Salmanzadeh with attempted use of a weapon of mass destruction, a violation of 18 U.S.C. § 2332a(a)(2). The charge carries a potential sentence of up to life in federal prison. Mr. Salmanzadeh’s trial has been continued to Tuesday, August 9.
Lubbock Man Sentenced to 30 Years for Gun, Drug Crimes After Firing at OfficersRead the Press Release
A Lubbock man who shot at police and then led them on a 115 mile-per-hour chase in Lamesa, Texas, was sentenced today to 30 years in federal prison for gun and drug crimes, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Zachary Jay Barfield, 28, pleaded guilty in April to one count of possession with intent to distribute methamphetamine and one count of discharge of firearms in furtherance of a drug trafficking crime. He was sentenced Thursday by U.S. District Judge James Wesley Hendrix.
On Nov. 4, 2020, Lamesa police officers attempted to stop a vehicle driven by Mr. Barfield, who was then a felon on parole with an active warrant for deadly conduct by discharging a firearm.
According to plea papers, Mr. Barfield admitted that as law enforcement approached his vehicle shouting commands, he fired a gun at the officers and sped away. Travelling at more than 115 miles per hour, he headed toward County Road 8201, then turned onto an unpaved road and proceeded into a pasture, evading officers.
Shortly thereafter, law enforcement located the abandoned vehicle in a ditch in Andrews County, Texas. Inside, they found a 12 gauge shotgun, ammunition, and a fanny pack containing more than 40 grams of methamphetamine. Nearby, they located a man who stated that he was seated in the backseat of the vehicle during the chase. He allegedly admitted he had been planning to purchase $20 worth of meth from the driver – Zachary Barfield – before law enforcement pulled the car over.
Law enforcement then dispatched a Department of Public Safety helicopter and a Texas Department of Criminal Justice bloodhound tracking canine to help locate Mr. Barfield. The following day, at 2:45 a.m., they located him and his girlfriend in a field roughly 8.4 miles from the abandoned car. The pair were laying on face-down on top of two Smith & Wesson guns: a 9 mm semiautomatic pistol and a .40 caliber semiautomatic pistol.
During an interview at the local sheriff’s office, Mr. Barfield waived his right to remain silent and admitted that he was a distributor of methamphetamine, and that he discharged a firearm in order to advance his distribution scheme.
The Lamesa Police Department, the Texas Department of Public Safety, the Texas Department of Criminal Justice, the Drug Enforcement Administration’s Dallas Field Division, and the Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division conducted the investigation with the assistance of the Dawson County Sheriff’s Office. Assistant U.S. Attorney Stephen Rancourt prosecuted the case.
Gang Member Sentenced to 21+ Years for Drug CrimeRead the Press Release
A gang member who started a riot at the Lubbock County Jail last month was sentenced today to more than 21 years in federal prison for a drug crime, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Clarence Willard, Jr., 28, pleaded guilty in March to possession with intent to distribute crack cocaine. He was sentenced Thursday to 262 months in prison by U.S. District Judge James Wesley Hendrix.
According to plea papers, Mr. Willard – aka “C-Will” – admitted that when officers attempted to pull his car over on Sept. 2, 2020, he ditched the vehicle and fled on foot with a clear plastic baggie of cocaine in his hand. An officer deployed his taser and Mr. Willard fell to the ground, dropping the baggie, which contained approximately 48 grams of crack cocaine.
Law enforcement testified today that during their undercover investigation, they discovered that Mr. Willard ran a trap house in East Lubbock, selling crack cocaine for roughly $100 per gram. Officers said they found numerous videos of Mr. Willard flaunting his drug trafficking on his phone, including a video of him displaying what he stated was $200,000 cash. Mr. Willard also recorded freestyle rap videos of himself openly discussing crack cocaine trafficking.
At his sentencing hearing, prosecutors introduced evidence showing that Mr. Willard, a member of the Crips gang, started a riot in the Lubbock county jail while awaiting sentencing.
A gang intelligence Sargent with the Lubbock County Sheriff’s Office testified that other Crip members stated that they participated in the riot because Willard was the “Mayor of Eastside,” and effectively ran crack cocaine distribution in East Lubbock.
Prosecutors played surveillance video of the riot, which showed Willard starting the melee and then viciously stomping and kicking and rival gang members in the jail pod. Officers eventually deployed pepper spray to end the riot, and the placed the entire facility of approximately 1200 inmates on lockdown as a result of Willard’s conduct.
Mr. Willard’s main co-defendant, Kevaundre Boyd, was sentenced on May 20 to 210 months in federal prison for possession with intent to distribute cocaine.
The Drug Enforcement Administration’s Dallas Field Division conducted the investigation, with significant assistance from the Lubbock Police Department, the Lubbock County Sheriff’s Office, the Texas Department of Public Safety, Homeland Security Investigations, and the Texas Anti-Gang Unit. Assistant U.S. Attorney Stephen Rancourt prosecuted the case.
Texas Man Sentenced for $24 Million COVID-19 Relief Fraud SchemeRead the Press Release
A Coppell businessman was sentenced today to more than 11 years in prison for wire-fraud and money-laundering offenses in connection with his fraudulent scheme to obtain approximately $24.8 million in forgivable Paycheck Protection Program (PPP) loans, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah and Assistant Attorney General Kenneth A Polite Jr. of the Justice Department’s Criminal Division.
Dinesh Sah, 55, of Coppell, pleaded guilty on March 24. He was sentenced today by U.S. District Judge Karen Gren Scholer, who also ordered him to pay $17,284,649.79 in restitution.
According to court documents, Sah submitted 15 fraudulent applications, filed under the names of various purported businesses that he owned or controlled, to eight different lenders seeking approximately $24.8 million in PPP loans.
He claimed that these businesses had numerous employees and hundreds of thousands of dollars in payroll expenses when, in fact, no business had employees or paid wages consistent with the amounts claimed in the PPP applications.
Sah further submitted fraudulent documentation in support of his applications, including fabricated federal tax filings and bank statements for the purported businesses, and falsely listed other persons as the authorized representatives of certain of these businesses without the authority to use their identifying information on the applications.
“Congress passed the Paycheck Protection Program to help struggling businesses stay afloat, not to fund faux entrepreneurs’ luxury lifestyles,” said Acting U.S. Attorney Prerak Shah. “Even as COVID-19 devastated companies around the nation, Mr. Sah sapped millions of dollars from the relief fund that could have helped them. He exploited the pandemic for personal gain, and we are proud to hold him accountable.”
“Today’s sentence serves as a clear reminder that individuals who exploit COVID-relief programs to enrich themselves will be held accountable under the law,” said Assistant Attorney General Kenneth A. Polite Jr. “The Department of Justice and its law enforcement partners remain committed to aggressively pursuing and bringing to justice those who steal federal funds intended to help legitimate small businesses.”
Based upon his false statements and fabricated documents, Sah received over $17 million in PPP loan funds and diverted the proceeds for his personal benefit, using them to purchase multiple homes in Texas, pay off the mortgages on other homes in California, and buy a fleet of luxury cars, including a Bentley convertible, Corvette Stingray, and Porsche Macan. Sah also sent millions of dollars in PPP proceeds in international money transfers. As part of his guilty plea, Sah agreed to forfeit, among other property, eight homes, six luxury vehicles, and more than $9 million in fraudulent proceeds that the government has seized to date.
“This sentencing serves as a deterrent to all who would attempt to commit fraud against any of the COVID-19 relief programs,” said Special Agent in Charge Christopher J. Altemus Jr. of the IRS – Criminal Investigation Dallas Field Office. “These programs are here to help during a pandemic, not for fraudsters like Sah to take advantage of for their own personal gain.”
The Dallas Field Offices of the FDIC-OIG, IRS-Criminal Investigation, and U.S. Treasury Inspector General for Tax Administration investigated the case. Assistant Deputy Chief Anna G. Kaminska of the Criminal Division’s Fraud Section and Section Chief Katherine Miller of the U.S. Attorney’s Office for the Northern District of Texas prosecuted the case. Assistant U.S. Attorneys Erica Hilliard and Dimitri Rocha handled the asset-forfeiture component of the case.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1%. PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities. The PPP allows the interest and principal on the PPP loan to be forgiven if the business spends the loan proceeds on these expense items within a designated period of time after receiving the proceeds and uses at least a certain percentage of the PPP loan proceeds on payroll expenses.
The Fraud Section leads the Department of Justice’s prosecution of fraud schemes that exploit the CARES Act. In the months since the CARES Act was passed, Fraud Section attorneys have prosecuted more than 100 defendants in more than 70 criminal cases. The Fraud Section has also seized more than $65 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real-estate properties and luxury items purchased with such proceeds. More information can be found at: https://www.justice.gov/criminal-fraud/cares-act-fraud.
Anyone with general information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Texas Man Sentenced for $24 Million COVID-19 Relief Fraud SchemeRead the Press Release
A Texas man was sentenced today to more than 11 years in prison for wire-fraud and money-laundering offenses in connection with his fraudulent scheme to obtain approximately $24.8 million in forgivable Paycheck Protection Program (PPP) loans.
Dinesh Sah, 55, of Coppell, pleaded guilty on March 24, 2021. According to court documents, Sah submitted 15 fraudulent applications, filed under the names of various purported businesses that he owned or controlled, to eight different lenders seeking approximately $24.8 million in PPP loans. Sah claimed that these businesses had numerous employees and hundreds of thousands of dollars in payroll expenses when, in fact, no business had employees or paid wages consistent with the amounts claimed in the PPP applications. Sah further submitted fraudulent documentation in support of his applications, including fabricated federal tax filings and bank statements for the purported businesses, and falsely listed other persons as the authorized representatives of certain of these businesses without the authority to use their identifying information on the applications.
“Today’s sentence serves as a clear reminder that individuals who exploit COVID-relief programs to enrich themselves will be held accountable under the law,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “The Department of Justice and its law enforcement partners remain committed to aggressively pursuing and bringing to justice those who steal federal funds intended to help legitimate small businesses.”
“Congress passed the Paycheck Protection Program to help struggling businesses stay afloat, not to fund faux entrepreneurs’ luxury lifestyles,” said Acting U.S. Attorney Prerak Shah for the Northern District of Texas. “Even as COVID-19 devastated companies around the nation, Mr. Sah sapped millions of dollars from the relief fund that could have helped them. He exploited the pandemic for personal gain, and we are proud to hold him accountable.”
“This sentencing serves as a deterrent to all who would attempt to commit fraud against any of the COVID-19 relief programs,” said Special Agent in Charge Christopher J. Altemus Jr. of the IRS–Criminal Investigation Dallas Field Office. “These programs are here to help during a pandemic, not for fraudsters like Sah to take advantage of for their own personal gain.”
“The Treasury Inspector General for Tax Administration aggressively pursues those who endeavor to defraud programs afforded to the American people under the CARES Act,” said J. Russell George, the Treasury Inspector General for Tax Administration (TIGTA). “We appreciate the efforts of the Department of Justice and our law enforcement partners in this effort.”
Based upon his false statements and fabricated documents, Sah received over $17 million in PPP loan funds and diverted the proceeds for his personal benefit, using them to purchase multiple homes in Texas, pay off the mortgages on other homes in California and buy a fleet of luxury cars, including a Bentley convertible, Corvette Stingray and Porsche Macan. Sah also sent millions of dollars in PPP proceeds in international money transfers. As part of his guilty plea, Sah agreed to forfeit, among other property, eight homes, six luxury vehicles and more than $9 million in fraudulent proceeds that the government has seized to date.
In addition to the prison sentence, Sah was ordered to pay $17,284,649.79 in restitution.
The Dallas Field Offices of the FDIC-OIG, IRS-Criminal Investigation and U.S. Treasury Inspector General for Tax Administration investigated the case.
Assistant Deputy Chief Anna G. Kaminska of the Criminal Division’s Fraud Section and Section Chief Katherine Miller of the U.S. Attorney’s Office for the Northern District of Texas prosecuted the case. Assistant U.S. Attorneys Erica Hilliard and Dimitri Rocha handled the asset-forfeiture component of the case.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1%. PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities. The PPP allows the interest and principal on the PPP loan to be forgiven if the business spends the loan proceeds on these expense items within a designated period of time after receiving the proceeds and uses at least a certain percentage of the PPP loan proceeds on payroll expenses.
The Fraud Section leads the Department of Justice’s prosecution of fraud schemes that exploit the CARES Act. In the months since the CARES Act was passed, Fraud Section attorneys have prosecuted more than 100 defendants in more than 70 criminal cases. The Fraud Section has also seized more than $65 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real-estate properties and luxury items purchased with such proceeds. More information can be found at: https://www.justice.gov/criminal-fraud/cares-act-fraud.
Anyone with general information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
IRS Officer Sentenced for Obstructing Tax LawRead the Press Release
A former IRS officer was sentenced today to three years in prison for obstructing federal tax laws, announced Acting U.S. Attorney Prerak Shah.
Former Revenue Officer Sonya Vivar, 55, pleaded guilty in November to one count of corrupt endeavor to obstruct or impede the due administration of internal revenue laws. She was sentenced Thursday by U.S. District Judge Mark Pittman.
According to plea papers, Ms. Vivar admitted she attempted to conceal her personal relationship with C.J.B., the subject of an IRS investigation, from the IRS and U.S. Treasury Inspector General for Tax Administration.
At the time, C.J.B. was operating a business that was delinquent on its employment taxes.
C.J.B. had purchased the company only after Ms. Vivar was assigned to oversee collection efforts against it. Ms. Vivar was aware that C.B.J. had acquired the company and sold its assets at a profit or transferred the assets into newly formed business entities.
At Friday’s sentencing hearing, the judge found that due to the defendant’s crimes, the IRS lost the opportunity to collect more than $4 million in taxes.
IRS – Criminal Investigations conducted the investigation. Assistant U.S. Attorneys Rob Boudreau and Jay Weimer are prosecuting the case.
Accused Levelland Shooter Federally ChargedRead the Press Release
The man who allegedly shot and killed a SWAT officer during a standoff in Levelland, Texas earlier this month has been charged with assaulting a federal officer who responded to the scene, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Omar Soto-Chavira, 22, was charged via criminal complaint on Friday with one count of forcibly assaulting a federal officer engaged in the performance of official duties. Mr. Soto-Chavira has also been charged by the state with capital murder.
“The state acted swiftly to charge Mr. Soto-Chavira in the murder of Lubbock County Sheriff’s Office Sgt. Josh Bartlett. Were Mr. Soto-Chavira to post the $500,000 bond set in the state case, he would be immediately transferred to federal custody, where criminal defendants can be detained without bond, ” said Acting U.S. Attorney Prerak Shah. “We believe this defendant is a threat to the community, and needs to be kept behind bars. We mourn the loss of Sgt. Bartlett, who served with honor for nine years, and we pray for the other officers who were wounded in the standoff, including Sgt. Shawn Wilson.”
Local law enforcement has confirmed that during the almost 11-hours standoff, the defendant repeatedly opened fire at agents and officers. Lubbock County Sheriff’s Department Sgt. Josh Bartlett was shot in the neck and killed; Levelland Police Sgt. Shawn Wilson was shot in the head and rushed to the hospital, where he remains in critical condition; and two other officers were also shot and wounded.
Though the federal criminal complaint against Mr. Soto-Chavira remains sealed, the federal arrest warrant was unsealed shortly after it was filed this morning.
A complaint is merely an allegation of criminal conduct, not evidence. Like all defendants, Mr. Soto-Chavira is presumed innocent until proven guilty.
If convicted in the federal case, he faces up to 20 years in federal prison. He faces a potential death sentence if convicted on state charges.
The Levelland Police Department, Lubbock County Sheriff’s Office SWAT, and Lubbock Police Department SWAT conducted the investigation with the assistance of Homeland Security Investigations, the Federal Bureau of Investigation’s Dallas Field Office, the Bureau of Alcohol, Tobacco, Firearms, & Explosives’ Dallas Field Division, the Drug Enforcement Administration’s Dallas Field Division, the Texas Department of Public Safety, the Texas Rangers, and the Hockley County District Attorney's Office. Assistant U.S. Attorney Sean Long is prosecuting the federal case.
West Texas Man Sentenced to 30 Years for Pornographic Image of 11-Year-Old RelativeRead the Press Release
A Muleshoe, Texas man who sexually exploited an 11-year-old girl was sentenced today to 30 years in federal prison for child pornography, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
In April, after two days of trial, a federal jury found 25-year-old Felipe Mata-Benavidez guilty of production of child pornography. He was sentenced Thursday by U.S. District Judge James Wesley Hendrix.
According to evidence presented at trial, Mr. Mata-Benavidez attempted to sexually assault an 11-year-old relative at her home in Muleshoe. During the assault, the victim’s mother walked in on Mr. Mata-Benavidez attempting to have sexual intercourse with the minor.
The young girl’s mother stopped the assault and fled the residence with her daughter. A short time later, a concerned neighbor notified law enforcement after hearing about the incident.
The Muleshoe Police Department then interviewed Mr. Mata-Benavidez. He showed detectives his cell phone, which contained his messages with the young girl.
In those messages, Mr. Mata-Benavidez instructed the 11-year-old to send him explicit photographs of herself. When she refused, Mr. Mata-Benavidez bullied the girl until she conceded, texting Mr. Mata-Benavidez a lewd image. He said the child was beautiful and told her not to “share with anybody else… because it’s mine.”
The defendant then continued to ask the 11-year-old to send him more explicit images.
The Federal Bureau of Investigation’s Dallas Field Office, Lubbock Resident Agency, the Muleshoe Police Department, and Homeland Security Investigations - Lubbock Computer Forensic Analysts conducted the investigation. Assistant U.S. Attorneys Callie Woolam and Matthew McLeod prosecuted the case.
Sentence More Than Doubled for Man Who Committed Fraud While on Pretrial Release in Separate Fraud CaseRead the Press Release
A Sweetwater man who perpetrated a $12.3 million fraud while on pretrial release in a separate fraud case had almost nine years tacked onto his sentence today, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Stewart Kile Williams, 31, pleaded guilty in March to two counts of wire fraud and two counts of engaging in monetary transactions in property derived from unlawful activity (money laundering). He was sentenced Thursday by U.S. District Judge James Wesley Hendrix to 105 months in federal prison, to be served consecutive to his existing 70 month sentence, and ordered to pay roughly $7.4 million in restitution.
According to court documents, Mr. Williams committed these crimes in late 2018 and early 2019, while on pretrial release for crimes committed in the Southern District of Texas. (He was first charged by the Southern District in summer 2018 for selling non-existent cattle to a ranch in Decatur for $2.5 million. Following an indictment, he was released on bond, but would go on to have that release revoked in late 2019 after a local arrest for theft of hay bales. He eventually pleaded guilty in to four counts of wire fraud and was sentenced to 70 months in federal prison and ordered to pay more than $2 million in restitution.)
“They say insanity is doing the same thing over and over and expecting different results. Mr. Williams wasn’t insane, but he was brazen. While on pretrial release for one fraud in south Texas, he had the audacity to perpetrate a similar fraud in north Texas. If he thought federal prosecutors would content themselves with holding him accountable in only one case, he was sorely mistaken. We will not tolerate repeated maleficence,” said Acting U.S. Attorney Prerak Shah.
“Mr. Williams’ bold actions in committing additional crimes while on pretrial release for other crimes shows his complete lack of concern for our laws or his fellow citizens and this additional sentencing is deserved,” said IRS – Criminal Investigations Special Agent in Charge Christopher J. Altemus Jr., Dallas Field Office.
In plea papers, Mr. Williams admitted that while on pretrial release, he formed AZS Trenching, an unregistered sole proprietorship that provided freight transport and trenching services in the Permian Basin. In January 2019, he entered into an agreement with Navarone Capital, a privately held factoring company that purchased outstanding invoices from businesses like AZS.
At first, everything was above-board – Mr. Williams sent Navarone invoices for work AZS performed for pipeline company M.G. Dyess, Navarone wired advance payment to his bank account, and when M.G. Dyess paid Mr. Williams, he mailed the checks to Navarone.
Two months later, however, Mr. Williams asked Navarone to factor invoices provided for work he said AZS purportedly performed for pipeline company HIS. In fact, AZS had never serviced HIS.
In order to convince Navarone that the bogus HIS invoices were legitimate, Mr. Williams assumed the identity of an HIS construction manager. He obtained a temporary cell phone with an area code that matched HIS’s, and then, posing as the HIS employee, called Navarone to assure them that AZS was indeed performing the work outlined on the invoices. He also created a fake email address through godaddy.com, purportedly belonging to the HIS employee, from which he approved the bogus invoices complemented AZS’s “work.”
Of course, when the bogus invoices came due, Mr. Williams could not pay Navarone. After months of excuses and non-payment on HIS invoices, Navarone contacted HIS headquarters. The pipeline company told Navarone they did not have, and never had, a business relationship with AZS or Mr. Williams.
In total, Mr. Williams presented 38 bogus invokes to Navarone, causing them to wire approximately $12.3 million into his bank account. He used the criminally derived proceeds to make a number of large purchases, including a home in Abilene and $500,000 in construction equipment.
Internal Revenue Service – Criminal Investigations, the United States Postal Inspection Service, and the Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorney Ann Howey of the Northern District of Texas prosecuted the north Texas case with significant assistance from Assistant U.S. Attorneys William Hagen and Jason Corley of the Southern District of Texas.
Denver Man Sentenced for Defrauding Texas Oil & Gas Co.Read the Press Release
A Denver man was sentenced yesterday 16 months in federal prison for defrauding a Wichita Falls oil and gas company, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Duquesne Energy Services owner Daren Scot Elliott, 55, pleaded guilty to wire fraud in April 2021. He was sentenced Tuesday by U.S. District Judge Mark Pittman, who also ordered the defendant to pay $32,000 in restitution and $20,000 in fines.
According to plea papers, Mr. Elliott admits that he offered to sell a 30,000 gallon propane tank to Gas Corporation of America (G.C.A.), a buyer and seller of oil field equipment located in Wichita Falls. He intimated that he owned the tank, when in fact it was owned by another company, Sampson Resources.
After Mr. Elliott promised to deliver the tank within a week of purchase, a representative of G.C.A. wired $32,000 to Mr. Elliott’s bank account. He never delivered the tank.
Ben Wilson, the owner of G.C.A., testified at Mr. Elliott’s sentencing that the fraud was significant and negatively impacted his business and business’s reputation.
The Federal Bureau of Investigation’s Dallas Field Office, Wichita Falls Resident Agency conducted the investigation. Assistant U.S. Attorney Mary Walters prosecuted the case.
Nocona Man Convicted of Sexual Exploitation of Missing BoyRead the Press Release
A Nocona man named a person of interest in the 2015 disappearance of a local 18-year-old pleaded guilty today to preying on the boy when he was a minor, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Hours after the court declared a mistrial due to juror injury, Ricky Dale Howard, 59, pleaded guilty to sexual exploitation of a child.
“Although much of what happened to this young boy remains a mystery, we know one thing for sure: Before he went missing, he suffered at the hands of a child sex predator. He was preyed upon by a man his family knew and trusted,” said Acting U.S. Attorney Shah. “Our fervent hope is that one day, he will be found. In the meantime, we are proud to put the man who abused him behind bars.”
FBI Dallas Special Agent in Charge Matthew J. DeSarno said, “We will continue to work with our partners to seek justice for this victim’s family and do all that we can to ensure that vulnerable members of our community are protected from those who seek to do them harm. The defendant will be held accountable for his reprehensible conduct, and we will remain committed to investigating anyone who seeks to exploit children.”
According to evidence presented in court before the mistrial was declared, law enforcement obtained several of Mr. Howard’s computers during an investigation into the disappearance of a high school senior who was reported missing on April 1, 2015, just two weeks after his 18th birthday.
On the computers, investigators found sexually explicit images that appeared to show Mr. Howard sexually abusing the missing boy. In pleading guilty, Mr. Howard admitted that he enticed the minor into engaging in sexually explicit conduct for the purpose of creating a visual depiction.
At trial, the boy’s mother testified she and her children had been close with the Howard family since the boys were children. Tami Diehl said her son began performing odd jobs for Mr. Howard during middle school.
Law enforcement officers testified that following the boy’s disappearance, Mr. Howard told police the last time he’d seen the victim was the weekend before he went missing, when the pair attempted to repair his broken-down truck. Several days into the missing person investigation, an officer observed a burn pit with several incinerated computers on Mr. Howard’s property.
Two years after the disappearance, Ms. Diehl discovered a small handheld tape recorder hidden in the back of a bathroom cabinet. The tape recorder contained audio of Mr. Howard asking himself polygraph questions pertaining to his sexual interest in young boys.
Shortly thereafter, investigators re-examined the missing persons case. Recalling the incinerated computers, officers asked Mr. Howard’s ex-wife and later his daughter for the computers, which were examined by analysts at the FBI’s North Texas Regional Computer Forensic Lab. Ms. Diehl, one of Mr. Howard’s sons, and Mr. Howard’s ex-wife all identified the missing victim in redacted versions of photographs extracted from the computers.
Mr. Howard now faces up to 30 years in federal prison.
The Federal Bureau of Investigation’s Dallas Field Office, Wichita Falls Resident Agency, the Montague County Sheriff’s Office, and the Nocona Police Department conducted the investigation with the assistance of the Montague County District Attorney’s Office and the Texas Rangers. Assistant U.S. Attorneys Brandie Wade and Nancy Larson are prosecuting the case. U.S. District Judge Reed O’Connor presided over trial in Fort Worth.
Cocaine, Firearms, $1.6 Million Cash Recovered in Drug BustRead the Press Release
Federal and local law enforcement recovered more than a kilogram of cocaine, half a kilogram of methamphetamine, 14 firearms, and nearly $1.6 million dollars in cash during a drug bust at a two-bedroom home in southeast Dallas last week, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
The agents also arrested Hector Manuel Castro-Quirino, 47, and his girlfriend Vanesa Ann Cervantes, 38. Charged via criminal complaint with drug conspiracy and possession with intent to distribute, they made their initial appearances in federal court on Friday.
“Far too often, gun and drugs are a lethal combination. We are thankful to the tenacious agents who took these dangerous items, and their owners, off our streets,” said Acting U.S. Attorney Prerak Shah. “The law enforcement community will not rest until we’ve made a real dent in violent crime in Dallas.”
“Mr. Castro and Ms. Cervantes were allegedly involved in more crimes than a Hollywood script. Fortunately for the people of Dallas, their criminal escapades came to a crushing end last week. ATF and our partners remain committed to Chief Garcia’s plan to reduce violent crime in Dallas. These arrests were another win for the good guys” stated ATF Special Agent in Charge Jeffrey C. Boshek II.
According to the complaint, the investigation began in June, when law enforcement was tipped off about drug dealers operating out of a home on South Acres Drive in Dallas. Later that month, agents with ATF, the Dallas Police Department, and Texas Department of Public Safety completed a series of undercover drug buys from the individuals living in the home.
On July 13, they raided the residence . Mr. Castro allegedly fled to the attic before surrendering; Ms. Cervantes was confronted in the kitchen.
During a search of the home, agents found five gallon-sized plastic bags containing bulk quantities of drugs stashed in the master bedroom alongside distribution-sized plastic baggies of assorted colors. They also found drug ledgers containing customer and payment information, as well as 14 firearms, some of them loaded. Inside tube socks, shoe boxes, and a large trash bag, agents found large sums of U.S. currency.
After his arrest, Mr. Castro allegedly admitted to trafficking drugs, saying he received roughly one kilogram of cocaine and one kilogram of meth each month. Ms. Cervantes allegedly admitted that she maintained the drug ledgers.
A criminal complaint is merely an allegation of wrongdoing, not evidence. Like all defendants, Mr. Castro-Quirino and Ms. Cervantes are presumed innocent until proven guilty in a court of law.
If convicted, they face up to 20 years in federal prison.
The Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division, the Dallas Police Departments’ Narcotics and SWAT units, and the Texas Department of Public Safety conducted the investigation with assistance from the Drug Enforcement Administration’s Dallas Field Division, the Federal Bureau of Investigation’s Dallas Field Office, and Homeland Security Investigations. Assistant U.S. Attorneys Phelesa Guy and Rick Calvert are prosecuting the case.
Woman Sentenced for Intimidating Sex Trafficking VictimRead the Press Release
An Amarillo woman was sentenced today to 34 months in federal prison for harassing a sex trafficking victim in an attempt to dissuade her from testifying against her trafficker, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Deziree Lujan, 29, pleaded guilty to witness tampering in March. She was sentenced Friday by U.S. District Judge Ada Brown.
According to plea papers, Ms. Lujan admitted that she threatened to beat a sex trafficking victim for cooperating against defendant Tremont Blakemore, who was charged in September 2019 with operating a large-scale human trafficking operation.
Mr. Blakemore, aka “Macknificent,” allegedly forced multiple women into commercial sex and slapped, punched, choked, and kicked victims he believed were not being honest or making enough money for him. He is slated to go to trial on August 23. (Like all defendants, Mr. Blakemore is presumed innocent until proven guilty.)
Ms. Lujan, a member of Mr. Blakemore’s alleged trafficking organization, admits she outed one of Mr. Blakemore’s alleged victims on social media, calling her “a snitch,” and “a rat.”
Ms. Lujan threatened the victim with physical harm, warned the victim that she would post law enforcement reports about the victim online, and reached out to known pimps to reveal the victim’s identity and cooperation.
The defendant admitted she acted intentionally to harass the victim in order to dissuade her from testifying against Mr. Blakemore.
Homeland Security Investigations’ North Texas Trafficking Task Force conducted the investigation into Ms. Lujan. They also led the investigation into Mr. Blakemore, with assistance from the Federal Bureau of Investigation’s Dallas Field Office and the Dallas Police Department. Assistant U.S. Attorney Melanie Smith prosecuted the case.
Exotic Cat Keeper Sentenced for Gun CrimeRead the Press Release
A Canadian national who overstayed his visa to work as a keeper of exotic cats has been sentenced to 28 months in federal prison for a gun crime, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Following two days of trial, in March, a federal jury convicted Paul Michael Malagerio, 65, of unlawful alien in possession of firearms. He was sentenced today by U.S. District Judge James Wesley Hendrix.
At trial, agents testified that they arrested Mr. Malagerio based on an administrative warrant for visa overstay at the Whitley Acres Exotic Ranch in Levelland, Texas in November 2020. Inside his RV, they found an AR-15, a shotgun, and a 9 mm pistol. Mr. Malagerio also had a mountain lion on the property.
(Mr. Malagerio’s unlawful presence in the country prevented him from possessing firearms.)
In jailhouse phone calls, Mr. Malagerio indicated that he knew he was in the United States illegally: “So I’m guilty of it, but can we plead where I can go and pack my stuff, my animals… and leave with my tail between my legs?” he asked. [Audio available to credentialed media upon request.]
During a court proceeding in February, Mr. Malagerio testified that he worked for James Garretson, the exotic cat enthusiast turned FBI informant featured in Netflix's “Tiger King.”
In another jailhouse call, Mr. Malagerio claimed that Mr. Garretson had reported him to immigration authorities, telling a friend, “see, James [Garretson] is the only one that knows where I am and he threatened to do this about a month ago.”
Homeland Security Investigations, Immigration & Customs Enforcement’s Enforcement and Removal Operations, and the Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division conducted the investigation with the assistance of the Texas Game Wardens. Assistant U.S. Attorneys Ryan Redd and Jeffrey Haag prosecuted the case.
Perryton Police Officer Pleads Guilty to Sharing Child Pornography on KikRead the Press Release
A former Perryton police officer pleaded guilty today to child pornography charges, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Aaron Bennett Daugherty, 36, pleaded guilty on Wednesday to one count of transportation of child pornography. He was charged via criminal complaint in February.
According to plea papers, Mr. Daugherty was nabbed in an undercover FBI investigation into individuals using Kik, a social media app popular among teenagers, to share explicit images of children.
On June 9 2020, a Kik user with an obscene screenname – later identified as Mr. Daugherty – shared a video file depicting an adult male engaged in sexual acts with a blindfolded prepubescent child.
“I’m here to look at CP, everybody,” the user posted two weeks later. “Go on with the CP content!”
Law enforcement later contacted Mr. Daugherty at the Perryton Police Department. He admitted that he used Kik to view and share child pornography, adding that child porn did not “bother” him.
The defendant now faces up to 20 years in federal prison. A sentencing hearing has not yet been set.
The Federal Bureau of Investigation’s Dallas Field Office – Amarillo Resident Agency, the Texas Rangers, and the Winnebago County Sheriff’s Office conducted the investigation with the full cooperation of the Perryton Police Department. Assistant U.S. Attorney Joshua Frausto is prosecuting the case.
Jury Convicts Medical Equipment Company Owners of $27 Million FraudRead the Press Release
A federal jury convicted Dallas area owners and operators of two durable medical equipment companies Thursday of one count of conspiracy to defraud the United States and to pay and receive health care kickbacks and one count of conspiracy to commit money laundering.
According to the evidence presented at trial, Leah Hagen, 49, and Michael Hagen, 54, of Arlington, Texas, were owners and operators of two durable medical equipment (DME) companies: Metro DME Supply LLC (Metro) and Ortho Pain Solutions LLC (Ortho Pain), both operated out of the same location in Arlington. The defendants paid a fixed rate per DME item in exchange for prescriptions and paperwork completed by telemedicine doctors that were used to submit false claims to Medicare. The defendants paid illegal bribes and kickbacks and wired money to their co-conspirator’s call center in the Philippines that provided signed doctor’s orders for orthotic braces. The evidence at trial showed emails exchanged between Leah and Michael Hagen and their co-conspirators showing a per-product pricing structure for orthotic braces but disguising their agreement as one for marketing and other services.
Through this scheme, the defendants billed Medicare Parts B and C approximately $59 million and were paid approximately $27 million. The defendants wired millions of proceeds into their personal bank accounts, both in the U.S. and overseas. At sentencing, the Hagens each face a maximum sentence of 25 years in prison.
Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division, Acting U.S. Attorney Prerak Shah of the Northern District of Texas, Special Agent in Charge Miranda Bennett of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Dallas Region, and Special Agent in Charge Matthew J. DeSarno of the FBI’s Dallas Field Office made the announcement.
This case was investigated by HHS-OIG and the FBI and was brought as part of Operation Brace Yourself, a federal law enforcement action led by the Health Care Fraud Unit of the Criminal Division’s Fraud Section, in partnership with the U.S. Attorney’s Offices for the Districts of South Carolina, New Jersey, and the Middle District of Florida.
Assistant Deputy Chief Adrienne Frazior and Trial Attorneys Brynn Schiess and Catherine Wagner of the Criminal Division’s Fraud Section are prosecuting the case.
The Fraud Section leads the Health Care Fraud Strike Force. Since its inception in March 2007, the Health Care Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,200 defendants who have collectively billed the Medicare program for nearly $19 billion. In addition, the Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
Serial Cell Phone Store Robber Sentenced to 45 Years in Federal PrisonRead the Press Release
A Long Beach, California man was sentenced today to 45 years in federal prison after being convicted at trial of committing a spree of violent cell phone store robberies, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
A federal jury found Edward Eugene Robinson, 50, guilty of one count of conspiracy to interfere with commerce by robbery, two counts of interfering with commerce by robbery, and two counts of brandishing a firearm during a crime of violence in March.
According to evidence presented at trial — which included eyewitness testimony, store surveillance videos, and evidence obtained from search warrants — Mr. Robinson was the leader of a robbery crew that committed at least 15 armed robberies of cell phone stores across North Texas and Southern California in the spring and summer of 2019.
During the robberies, Mr. Robinson and his accomplices threatened store employees with guns and tazers and demanded that they open the safes where the phones and other equipment were stored. The robbers then restrained the employees using zip-ties or cell phone chargers.
Over the course of the conspiracy, Mr. Robinson stole more than $600,000 of inventory, including cell phones, tablets, and watches.
The other defendants in the case — Aaron Hardrick and Ncholeion Hollie, both of Fort Worth, Texas — previously pleaded guilty. Mr. Hardrick pleaded guilty in 2019 to multiple federal robbery and firearms charges in North Texas and Southern California. He was sentenced to 45 years in federal prison. Ms. Hollie pleaded guilty in 2020 to one federal robbery charge in North Texas and was sentenced to 9 years in federal prison.
The Federal Bureau of Investigation’s Dallas Field Office, Fort Worth Police Department, Hurst Police Department, and Bedford Police Department conducted the investigation. Assistant U.S. Attorney Matthew Weybrecht and Nancy Larson of the Northern District of Texas prosecuted the case, with substantial assistance from Assistant U.S. Attorneys Jerry C. Yang and Peter H. Dahlquist of the Central District of California.
Darkweb Drug Trafficker Arrested in Operation DisrupTor Sentenced to 6.5 Years in PrisonRead the Press Release
A darkweb cocaine and heroin trafficker has been sentenced to 6 ½ years in federal prison for drug conspiracy, announced U.S. Attorney for the Northern District of Texas.
Aaron Brewer – a 39-year-old charged under Operation DisrupTor, a coordinated international effort to disrupt opioid trafficking on the Darknet – pleaded guilty in December to conspiracy to possess with intent to distribute a controlled substance. He was sentenced Thursday to 78 months by Chief U.S. District Judge Barbara M.G. Lynn, who also ordered the defendant to forfeit $50,000 in drug proceeds.
According to plea papers, Mr. Brewer admitted he created darkweb market vendor accounts in order to sell cocaine, heroin, and other controlled substances online.
Mr. Brewer’s customers paid him in cryptocurrency, typically bitcoin, and frequently used aliases for shipping. After receiving payment, Mr. Brewer used the U.S. Mail and other shipping services to transmit controlled substances to customers in North Texas and across the country.
In March 2020, law enforcement discovered a ledger linking controlled substances orders with tracking numbers inside his apartment.
Mr. Brewer later admitted that over an 11-monthe period, he dealt more than 4,000 grams of cocaine and more than 80 grams of black tar heroin, then used the more than $50,000 in proceeds of the illegal activity to pay his mortgage.
The U.S. Postal Inspection Service and the Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorney Sid Mody is prosecuting the case.
Operation DisrupTor actions have resulted in the arrest of 179 Darknet drug traffickers and fraudulent criminals who engaged in tens of thousands of sales of illicit goods and services across the United States and Europe. The operation also resulted in the seizure of over $6.5 million; approximately 500 kilograms of drugs worldwide (including approximately 275 kilograms of drugs in the U.S.); and 63 firearms.
Avanos Medical to Pay $22 Million to Resolve Criminal Charge Related to Fraudulent Misbranding of MicroCool Surgical GownsRead the Press Release
Avanos Medical Inc., a U.S.-based multinational medical device corporation, has agreed to pay more than $22 million to resolve a criminal charge relating to the company’s fraudulent misbranding of its MicroCool surgical gowns.
A criminal information filed yesterday in the U.S. District Court for the Northern District of Texas charges Avanos with one count of introducing misbranded surgical gowns into interstate commerce with the intent to defraud and mislead. According to court filings, Avanos falsely labeled the gowns as providing the highest level of protection against fluid and virus penetration.
Under the terms of a deferred prosecution agreement filed with the criminal information, Avanos will pay $22,228,000, composed of a victim compensation payment of $8,939,000, a criminal monetary penalty in the amount of $12,600,000, and a disgorgement payment of $689,000. The deferred prosecution agreement resolves a criminal investigation into Avanos’s misbranding of its MicroCool surgical gowns under the Federal Food, Drug, and Cosmetic Act (FDCA) and the company’s obstruction of a 2016 for-cause inspection conducted by the U.S. Food and Drug Administration (FDA) into Avanos’s surgical gown business.
“The last thing health care workers should have to worry about is whether their personal protective equipment lives up to manufacturers’ claims,” said Acting U.S. Attorney Prerak Shah for the Northern District of Texas. “Misbranded PPE can pose serious risks to medical professionals and patients alike. All companies that do business in Texas, health care or otherwise, will be held accountable for the promises they make about their products.”
“Companies that sell medical products put their customers at risk when they misrepresent the quality of those products,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “The Department of Justice will work with its law enforcement partners to prosecute companies that put profits over safety, especially when they provide products meant to protect medical professionals in potentially high-risk situations involving infectious diseases.”
“Customers of Avanos trusted the company to deliver on the promises it made about the safety of its surgical gowns,” said Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division. “Avanos betrayed that trust. This resolution emphasizes that the department will hold companies in the medical device industry accountable.”
“Medical devices, such as surgical gowns, must have truthful and accurate labeling,” said Assistant Commissioner for Criminal Investigations Catherine A. Hermsen of the FDA. “Surgical gowns with false or misleading labeling can put health care practitioners and patients at risk. The FDA’s Office of Criminal Investigations protects the American public by aggressively investigating allegations involving FDA-regulated products.”
According to court documents, surgical gowns sold in the United States are subject to regulation by the FDA, which recognizes a system of classification set forth by the American National Standards Institute (ANSI) and the Association for the Advancement of Medical Instrumentation (AAMI) — known as the ANSI/AAMI PB70 standard. The ANSI/AAMI PB70 standard was first established in 2003 and revised to be more rigorous in 2012. Under the standard, the highest protection level for surgical gowns — AAMI Level 4 — is reserved for gowns intended to be used in surgeries and other high-risk medical procedures on patients suspected of having infectious diseases.
As part of the deferred prosecution agreement, Avanos admitted that between late 2014 and early 2015, it sold hundreds of thousands of MicroCool surgical gowns that were labeled as AAMI Level 4 under the 2012 ANSI/AAMI PB70 standard but did not actually meet that standard. In addition, Avanos made direct misrepresentations to customers about the MicroCool gowns’ compliance with the 2012 ANSI/AAMI PB70 standard. For example, in November 2014, Avanos sent letters to certain hospitals and other potential purchasers that falsely claimed that the MicroCool gowns met the revised and more rigorous 2012 ANSI/AAMI PB70 standard for classification as AAMI Level 4 — a standard that Avanos’s employees knew the gowns had never met. At least one of these letters was sent in response to a request for assurances made by a health care provider seeking to obtain surgical gowns for use in responding to the 2014 Ebola outbreak. In total, Avanos sold approximately $8,939,000 worth of misbranded MicroCool gowns to customers in the United States and abroad.
In addition, according to court documents, an employee and an agent of Avanos obstructed a July 2016 FDA for-cause inspection of the company’s surgical gown business by making numerous false entries in four documents requested by FDA investigators.
As part of the criminal resolution, Avanos has agreed to continue to cooperate with the Justice Department and to report any evidence or allegation of a violation of the FDCA or U.S. obstruction or fraud laws committed by Avanos’s employees or agents upon any domestic government agency (including the FDA), regulator or any of Avanos’s customers. Avanos has further agreed to strengthen its compliance program and abide by specific reporting requirements, which require the company to submit yearly reports to the government regarding the status of Avanos’s enhancements to its compliance program and internal controls, policies and procedures aimed at deterring and detecting violations of the FDCA and U.S. obstruction and fraud laws, and the status of its remediation efforts.
The government reached this resolution with Avanos based on a number of factors, including the nature and seriousness of the offense conduct and Avanos’s failure to timely and voluntarily self‑disclose the offense conduct to the department. In addition, Avanos fully cooperated with the investigation conducted by the government, including conducting a thorough internal investigation, meeting requests from the government promptly, making factual presentations to the government, assisting in making a key foreign-based employee available for interview, and producing extensive documentation to the government, including documents located in a foreign jurisdiction.
The government also considered that Avanos engaged in remedial measures after the offense conduct, including: (i) changing the manufacturing process for the MicroCool surgical gowns to improve the quality of their sleeve seams; (ii) reorganizing its quality and regulatory departments so that they report directly to the CEO; (iii) substantially increasing the budget and headcount of its compliance and quality departments; (iv) creating a stand-alone Compliance Committee of the Board of Directors; (v) enhancing the independence, autonomy and resources of its compliance function by creating a stand-alone compliance department and appointing a full-time Chief Ethics and Compliance Officer who reports directly to the CEO and presents compliance reports to the Compliance Committee at least five times per year; (vi) enhancing compliance training for its employees; and (vii) implementing revised procedures for the review and approval of all medical device marketing material.
The criminal case was investigated by the FDA’s Office of Criminal Investigations.
Senior Litigation Counsel Allan Gordus and Trial Attorneys David Gunn and Max Goldman of the Civil Division’s Consumer Protection Branch, Trial Attorney John “Fritz” Scanlon of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Katherine Miller of the Northern District of Texas prosecuted the case.
Avanos Medical Inc. to Pay $22 Million to Resolve Criminal Charge Related to the Fraudulent Misbranding of Its MicroCool Surgical GownsRead the Press Release
Avanos Medical Inc., a U.S.-based multinational medical device corporation, has agreed to pay more than $22 million to resolve a criminal charge relating to the company’s fraudulent misbranding of its MicroCool surgical gowns.
A criminal information filed yesterday in the U.S. District Court for the Northern District of Texas charges Avanos with one count of introducing misbranded surgical gowns into interstate commerce with the intent to defraud and mislead. According to court filings, Avanos falsely labeled the gowns as providing the highest level of protection against fluid and virus penetration. Under the terms of a deferred prosecution agreement filed with the criminal information, Avanos will pay $22,228,000, composed of a victim compensation payment of $8,939,000, a criminal monetary penalty in the amount of $12,600,000 and a disgorgement payment of $689,000. The deferred prosecution agreement resolves a criminal investigation into Avanos’s misbranding of its MicroCool surgical gowns under the Federal Food, Drug, and Cosmetic Act (FDCA) and the company’s obstruction of a 2016 for-cause inspection conducted by the U.S. Food and Drug Administration (FDA) into Avanos’s surgical gown business.
“Companies that sell medical products put their customers at risk when they misrepresent the quality of those products,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “The Department of Justice will work with its law enforcement partners to prosecute companies that put profits over safety, especially when they provide products meant to protect medical professionals in potentially high-risk situations involving infectious diseases.”
“Customers of Avanos trusted the company to deliver on the promises it made about the safety of its surgical gowns,” said Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division. “Avanos betrayed that trust. This resolution emphasizes that the department will hold companies in the medical device industry accountable and shows the Criminal Division’s dedication to partnering with the Civil Division’s Consumer Protection Branch to root out fraud.”
“The last thing health care workers should have to worry about is whether their personal protective equipment lives up to manufacturers’ claims,” said Acting U.S. Attorney Prerak Shah for the Northern District of Texas. “Misbranded PPE can pose serious risks to medical professionals and patients alike. All companies that do business in Texas, health care or otherwise, will be held accountable for the promises they make about their products.”
“Medical devices, such as surgical gowns, must have truthful and accurate labeling,” said Assistant Commissioner for Criminal Investigations Catherine A. Hermsen of the FDA. “Surgical gowns with false or misleading labeling can put health care practitioners and patients at risk. The FDA’s Office of Criminal Investigations protects the American public by aggressively investigating allegations involving FDA-regulated products and violations of the FDCA. In this case, OCI worked with the Department of Justice to ensure a just resolution, and we applaud the exceptional work done by the team.”
According to court documents, surgical gowns sold in the United States are subject to regulation by the FDA, which recognizes a system of classification set forth by the American National Standards Institute (ANSI) and the Association for the Advancement of Medical Instrumentation (AAMI) — known as the ANSI/AAMI PB70 standard. The ANSI/AAMI PB70 standard was first established in 2003 and revised to be more rigorous in 2012. Under the standard, the highest protection level for surgical gowns — AAMI Level 4 — is reserved for gowns intended to be used in surgeries and other high-risk medical procedures on patients suspected of having infectious diseases.
As part of the deferred prosecution agreement, Avanos admitted that between late 2014 and early 2015, it sold hundreds of thousands of MicroCool surgical gowns that were labeled as AAMI Level 4 under the 2012 ANSI/AAMI PB70 standard but did not actually meet that standard. In addition, Avanos made direct misrepresentations to customers about the MicroCool gowns’ compliance with the 2012 ANSI/AAMI PB70 standard. For example, in November 2014, Avanos sent letters to certain hospitals and other potential purchasers that falsely claimed that the MicroCool gowns met the revised and more rigorous 2012 ANSI/AAMI PB70 standard for classification as AAMI Level 4 — a standard that Avanos’s employees knew the gowns had never met. At least one of these letters was sent in response to a request for assurances made by a health care provider seeking to obtain surgical gowns for use in responding to the 2014 Ebola outbreak. In total, Avanos sold approximately $8,939,000 worth of misbranded MicroCool gowns to customers in the United States and abroad.
In addition, according to court documents, an employee and an agent of Avanos obstructed a July 2016 FDA for-cause inspection of the company’s surgical gown business by making numerous false entries in four documents requested by FDA investigators.
As part of the criminal resolution, Avanos has agreed to continue to cooperate with the Justice Department and to report any evidence or allegation of a violation of the FDCA or U.S. obstruction or fraud laws committed by Avanos’s employees or agents upon any domestic government agency (including the FDA), regulator or any of Avanos’s customers. Avanos has further agreed to strengthen its compliance program and abide by specific reporting requirements, which require the company to submit yearly reports to the government regarding the status of Avanos’s enhancements to its compliance program and internal controls, policies and procedures aimed at deterring and detecting violations of the FDCA and U.S. obstruction and fraud laws, and the status of its remediation efforts.
The government reached this resolution with Avanos based on a number of factors, including the nature and seriousness of the offense conduct and Avanos’s failure to timely and voluntarily self‑disclose the offense conduct to the department. In addition, Avanos fully cooperated with the investigation conducted by the government, including conducting a thorough internal investigation, meeting requests from the government promptly, making factual presentations to the government, assisting in making a key foreign-based employee available for interview, and producing extensive documentation to the government, including documents located in a foreign jurisdiction.
The government also considered that Avanos engaged in remedial measures after the offense conduct, including: (i) changing the manufacturing process for the MicroCool surgical gowns to improve the quality of their sleeve seams; (ii) reorganizing its quality and regulatory departments so that they report directly to the CEO; (iii) substantially increasing the budget and headcount of its compliance and quality departments; (iv) creating a stand-alone Compliance Committee of the Board of Directors; (v) enhancing the independence, autonomy and resources of its compliance function by creating a stand-alone compliance department and appointing a full-time Chief Ethics and Compliance Officer who reports directly to the CEO and presents compliance reports to the Compliance Committee at least five times per year; (vi) enhancing compliance training for its employees; and (vii) implementing revised procedures for the review and approval of all medical device marketing material.
The criminal case was investigated by the FDA’s Office of Criminal Investigations.
Senior Litigation Counsel Allan Gordus and Trial Attorneys David Gunn and Max Goldman of the Civil Division’s Consumer Protection Branch, Trial Attorney John “Fritz” Scanlon of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Katherine Miller of the Northern District of Texas prosecuted the case.
Arlington Doctor Convicted in Pill Mill CaseRead the Press Release
An Arlington physician has been convicted of drug crimes, announced Acting U.S. Attorney Prerak Shah.
Following five days of trial, a federal jury convicted physician Clinton Battle, 68, of one count of conspiracy to distribute controlled substances and one count of distribution of a controlled substance.
According to evidence presented at trial, Dr. Battle routinely issued prescriptions for controlled substances – including hydrocodone, alprazolam, acetaminophen with codeine, tramadol, and phentermine – outside the usual course of professional practice and without a legitimate medical purpose.
At time, he issued prescriptions for controlled substances without conducting any medical examination at all, sometimes telling office staff to issue prescriptions for whichever controlled substance the patient wanted. He also issued prescriptions for friends or family members with whom he had no physician-patient relationship.
“Dr. Battle and his coconspirators knowingly propagated prescription drug abuse by dispensing powerful painkillers to individuals with no need for them,” said Acting U.S. Attorney Prerak Shah. “The U.S. Attorney’s Office is proud to partner with the DEA and other law enforcement agencies to stop unscrupulous pill pushers like Dr. Battle in their tracks.”
“As we continue to lose lives by the misuse and abuse of prescription drugs, we look to our medical professionals for sound guidance, professionalism, and integrity,” stated DEA Dallas Special Agent in Charge Eduardo A. Chávez. “Dr. Battle and his conspirators broke that oath for one sole purpose: greed. Today’s conviction is a testament to the work of our investigators, prosecutors, and law enforcement partners who will continue to protect the lives of our loved ones.”
At trial, one of Dr. Battle’s former employees testified that she, her husband, and Dr. Battle agreed that Dr. Battle would provide the employee’s husband with illegal controlled substance prescriptions in exchange for cocaine. In addition to cocaine, the evidence also showed that Dr. Battle would receive money in the form of fees paid by “patients” of $200 for an initial visit and $80 for return visits in exchange for controlled substance prescriptions.
Dr. Battle also allowed his nurse practitioner, co-conspirator Donna Green, to use his DEA registration number and medical credentials to issue prescriptions for controlled substances, despite knowing that Ms. Green was not legally authorized to issue such prescriptions.
On the morning trial was set to begin, Ms. Green pled guilty to one count of acquiring a controlled substance through fraud.
Throughout the course of the five-year conspiracy, Dr. Battle issued more than 50,000 controlled substance prescriptions, 17,000 of which were for the powerful opioid hydrocodone.
Dr. Battle faces up to 15 years in federal prison. A sentencing hearing has been set for October 28, 2021.
The Drug Enforcement Administration’s Dallas Field Division, the U.S. Department of Labor, the U.S. Postal Service Office of Inspector General, IRS – Criminal Investigations, and the Texas Department of Insurance conducted the investigation. Assistant U.S. Attorneys Matthew Weybrecht and Jay Weimer are prosecuting the case with the help of their appellate liaison, Assistant U.S. Attorney Leigha Simonton. U.S. District Judge Mark Pittman presided over the trial.
Texas Man Sentenced to Two Years in Prison for Looting Native American LandRead the Press Release
A San Marcos man has been sentenced to two years in federal prison for illegally excavating a Native American homestead in Amarillo, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Jeffrey Alan Vance, 37, pleaded guilty in February to violating the Archeological Resource Protection Act (ARPA), a federal law that prohibits the unauthorized removal of artifacts from tribal land. He was sentenced Tuesday by U.S. District Judge Matthew J. Kacsmaryk.
According to plea papers, Mr. Vance admits he and a coconspirator, 33-year-old Dax Wheatley, excavated Native American artifacts from a site known as 41PT109 – a former homestead of the Antelope Creek Culture, Native Americans who lived in the Texas panhandle between approximately 1200-1500 A.D.
In March 2019, a tipster alerted the Bureau of Land Management that an individual calling himself "Jerry Montopolis" had posted photographs of an illegal excavation on facebook. When a commenter warned “Jerry” that he was “digging in federal land and rangers enforce there,” he responded, “I’m not scared of the feds.”
The Bureau of Land Management sent the photographs – posted in December 2017 – to Homeland Security Investigations, which was able to identify the men in the photos as Mr. Vance and Mr. Wheatly. The facebook account, they determined, actually belonged to Mr. Vance, who bragged that he planned to display skeletons he’d excavated in his “secret artifact lair.”
In a text messages reviewed by law enforcement, Mr. Vance called himself an “infamous illegal excavator of Native American artifacts in Texas” and warned his contacts, “don’t be telling people we are digging on government property!”
Following a search of his home in November 2019, Mr. Vance admitted that he had human remains and burial beads inside his residence.
Mr. Wheatley also admitted to violating ARPA. He entered his guilty plea in February and is slated to be sentenced in July.
‘Doctor Bitcoin’ Pleads Guilty to Illegal Cash-to-Crypto SchemeRead the Press Release
A Richardson man who calls himself “Doctor Bitcoin” has pleaded guilty to illegally operating a cash-to-cryptocurrency conversion business, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Mark Alexander Hopkins, 42, pleaded guilty Tuesday to one count of operation of an unlicensed money transmitting business. (He was charged via a criminal information on July 29, 2021.)
“This defendant ignored federal law and allowed fraudsters to use Bitcoin to operate under the radar of law enforcement,” said Acting U.S. Attorney Prerak Shah. “We are determined to rid the Bitcoin marketplace of anyone who knowingly helps criminal actors stash illegal profits inside crypto wallets.”
According to plea papers, Mr. Hopkins admitted he ran a business that converted U.S. dollars to cryptocurrency, primarily Bitcoin, for a fee. He frequently sent BTC to customers’ crypto wallets without taking additional steps in verifying the source of the cash, he admitted.
In September 2019, a customer identified in court documents as “M.H.” approached Mr. Hopkins to convert U.S. dollars to BTC. The money Mr. Hopkins received from M.H. stemmed from a lottery scam he was running with a coconspirator in Nigeria.
Mr. Hopkins admitted he promised not to get involved in the details of M.H’s business dealings, but told M.H. how to circumvent financial institution reporting requirements by keeping deposits under $9,500, and directed M.H. to lie to financial institutions about the purpose of the business:
“I’m set up as a marketing company, so tell them you’re paying for a marketing campaign,” he said.
Over the course of about a year, Mr. Hopkins conducted 37 transactions with M.H., converting between $550,000 and $1.5 million, he said.
The defendant admitted he was not licensed to engage in the business of transmitting money within the states where he practiced, nor was he registered as a money transmitting business with the U.S. Department of the Treasury. He failed to follow federal laws that require money transmitting businesses to verify customers’ names, date of birth, and address – a law aimed at identifying those engaged in unlawful activity – and failed to file currency transaction reports for high-value cash-in transactions.
Mr. Hopkins now faces up to five years in federal prison.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorney Sid Mody is prosecuting the case.
Real Estate Developer Convicted of BriberyRead the Press Release
UPDATE: In an opinion handed down on Aug. 23, 2022, the Fifth Circuit Court of Appeals vacated the below conviction and remanded it for further proceedings.
A Dallas real estate developer has been convicted of bribing two former Dallas City Council members, Carolyn Davis and Dwaine Caraway, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Following two weeks of trial, a federal jury convicted Ruel Hamilton, the president of AmeriSouth Realty Group, of one count of conspiracy and two counts of bribery of an agent of a local government receiving federal funds.
“The people of Dallas deserve true public servants, not those bought and paid for by the city’s elite. By using money to bend elected officials to his will, Mr. Hamilton betrayed the communities he purports to hold dear,” said Acting U.S. Attorney Prerak Shah. “The U.S. Attorney’s Office will not allow a kickback culture to fester at City Hall. To anyone considering this sort of unscrupulous behavior: Think twice. Our prosecutors are tenacious, and we are determined to root out corruption wherever we find it.”
“Public corruption is one of the FBI’s top criminal priorities, it erodes the public’s trust and wastes valuable resources intended for taxpayers," said FBI Dallas Special Agent in Charge Matthew J. DeSarno. "Mr. Hamilton used his influence and money to circumvent the system by bribing two city council members to earn incentives for an affordable housing project and push an agenda to increase his political influence. The FBI and our law enforcement partners will continue to ensure that those who pay bribes, accept bribes and facilitate bribe payments are held fully accountable.”
According to evidence presented at trial, from 2013 to 2015, Mr. Hamilton shelled out tens of thousands of dollars in bribes to Carolyn Davis, who was then serving as chair of the city’s Housing Committee.
In return, Ms. Davis – who pleaded guilty to her role in the scheme prior to her death in 2019 – supported Mr. Hamilton’s Royal Crest housing project, voting to authorize a real estate development loan and resolutions supporting an award of a 9 percent tax credit for Royal Crest. Ms. Davis supported the Royal Crest housing project, despite the fact that it failed to meet the city’s enumerated multifamily housing priorities.
In an attempt to disguise the bribe payments, Mr. Hamilton funneled payments to Ms. Davis through a not-for-profit intermediary run by Jeremy “Jay” Scroggins. Mr. Scroggins – who also previously pleaded guilty – testified at trial that he cashed thousands of dollars’ worth of checks, solicited by Ms. Davis and made out to him personally or to his not-for-profit, “Hip Hop Government. Mr. Scroggins testified that he used $15,000 for a Freedom Ride Tour in November 2014, and cashed the remainder of the checks, turning most of the money over to Ms. Davis. The councilwoman told Mr. Scroggins payments would not pose a problem, because people “don’t go to prison for $2,000,” according to a recorded phone call played in court.
Evidence showed that Mr. Hamilton also paid Ms. Davis directly. Over the course of the conspiracy, Mr. Hamilton forked over cash, and on at least one occasion he invited her to accompany him to the bank to make a cash withdrawal. At Ms. Davis’ urging, Mr. Hamilton also directed campaign contributions to a political protégé. Further, Mr. Hamilton promised Ms. Davis a job once she was off the counsel. Evidence showed that Mr. Hamilton paid Ms. Davis in excess of $145,000, once she left the council.
At one point, Mr. Hamilton became concerned that a former city council member was going through their financial dealings with a “fine tooth comb,” telling Ms. Davis, “she scares me.” Even so, he continued to bribe Ms. Davis.
Three years later, in 2018, Mr. Hamilton paid a $7,000 bribe to councilman Dwaine Caraway, who Mr. Hamilton believed could persuade the mayor to put a paid sick leave referendum on the city council’s agenda. Mr. Hamilton hoped the referendum would increase turnout in the polls, advantaging his preferred political candidates.
Video admitted into evidence at trial shows the pair meeting at Mr. Caraway’s office on August 3, 2018:
“I want to do that, so… what can I do for you, right now, today?” Mr. Hamilton asks.
“You can answer that bill I just threw out there for about 62 [$6,200] today,” Mr. Caraway responds.
“Okay,” Mr. Hamilton says. “Can you follow through with the mayor?”
The pair then discuss what Mr. Hamilton should put in the memo line “for posterity” so that “if somebody ever asks, I can come up with a reference.”
[Video clips available to credentialed press upon request.]
Mr. Hamilton, who was originally charged in February 2019, now faces up to 25 years in federal prison – up to five years for the conspiracy count and up to ten years for each bribery count. (He was acquitted of count of use of an interstate facility to commit bribery in violation of the Travel Act, a count that carried a sentence of up to five years.) His sentencing has been set for Nov. 9, 2021.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation with the assistance of Internal Revenue Service - Criminal Investigations. Assistant U.S. Attorneys Tiffany H. Eggers, Chad E. Meacham, Joe A. Magliolo, Andrew Wirmani (fmr.), and Marcus Busch prosecuted the case with support from their appellate liaison, Assistant U.S. Attorney Stephen S. Gilstrap. Chief U.S. District Judge Barbara M. G. Lynn presided over the trial.
Man Who Sold Murder Weapon Pleads Guilty to Federal Firearms ChargeRead the Press Release
A Wichita Falls man who sold a weapon to a murderer has been convicted of a gun crime, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Devin DeAndre Mullins, 21, pleaded guilty on Friday to possession of a firearm by a convicted felon.
According to court documents, Mr. Mullins – who had been convicted of felony robbery in 2018 – admitted that he possessed a lime green 9mm Keltec pistol, which he later sold to a man named Gage Gillentine. Shortly thereafter, Mr. Gillentine used that gun to fatally shoot his girlfriend, 19-year-old Klowie Moore, inside a hotel room in Graham, Texas.
The pistol used in the murder, seized at the scene of the crime, matched photographs of a pistol Mr. Mullins posted to his social media accounts.
In a text message to a friend a few weeks before the murder, Mr. Mullins stated “Fin sell a pistol.” The following day, Mr. Gillentine messaged Mr. Mullins, “yo can bring that gun rn.”
In a noncustodial interview after the murder, Mr. Gillentine admitted to law enforcement that he purchased the murder weapon from Mr. Mullins.
Mr. Mullins now faces up to 10 years in federal prison. (Mr. Gillentine has been charged by the state in connection to the killing.)
The Bureau of Alcohol, Tobacco, Firearms & Explosives and the Texas Rangers conducted the investigation with the assistance of the Graham Police Department and the Young County Sheriff’s Office. Assistant U.S. Attorney Rob Boudreau is prosecuting the federal case against Mr. Mullins.
The case was brought under Project Guardian, the Justice Department's signature initiative to reduce gun violence and enforce federal firearms laws.
Dallas Men Sentenced for Hate Crimes After Targeting Gay Men on GrindrRead the Press Release
Three Texas men were sentenced yesterday for violent crimes against users of the gay dating app Grindr, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah and Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division.
Michael Atkinson, 28, Pablo Ceniceros-Deleon, 21, and Daryl Henry, 24, were sentenced to federal prison terms for their involvement in a scheme to target gay men for violent crimes. Atkinson was sentenced to more than 11 years in prison, Ceniceros-Deleon was sentenced to 22 years in prison, and Henry was sentenced to 20 years in prison.
“These defendants brutalized multiple victims, singling them out due to their sexual orientation. We cannot allow this sort of violence to fester unchecked,” said Acting U.S. Attorney Prerak Shah. “The Department of Justice is committed to prosecuting hate crimes. In the meantime, we urge dating app users to remain vigilant. Unfortunately, predators often lurk online.”
“These three men participated in and committed acts of violence against innocent victims because they believed the victims were gay men,” said Assistant Attorney General Kristen Clarke. “This type of bias-motivated violence runs contrary to our values and violates our federal civil rights laws. The Department of Justice’s Civil Rights Division will aggressively investigate and prosecute those who target members of the LGBTQI community.”
“One of the FBI’s top priorities is to defend the civil rights of the communities we serve. We actively work with our law enforcement partners to investigate hate crimes and achieve justice for the victims impacted by these violent crimes,” said Special Agent in Charge Matthew J. DeSarno of the FBI Dallas Field Office. “The victims in this case were specifically targeted because of their sexual orientation. The FBI wants to reassure the public that we will pursue individuals who commit violent hate acts against any member of our community.”
According to documents filed in connection with this case, these three defendants admitted that they conspired to and then targeted as many as nine men in and around Dallas, Texas for violent crimes including kidnapping, carjacking, and hate crimes. Beginning on or around Dec. 6, 2017, members of this conspiracy used Grindr, a social media dating platform used primarily by gay men, to lure men to an apartment complex in Dallas. When the men arrived, the conspirators held the men at gunpoint and forced them to drive to local ATMs to withdraw cash from their accounts.
Atkinson and Henry admitted to joining this conspiracy to target gay men for violent crimes. On Dec. 11, 2017, the conspirators used Grindr to lure five men to a vacant apartment in Dallas where they held the men at gunpoint, kidnapped, carjacked, and assaulted them. As part of his plea agreement, Henry admitted that he used violence and threats of violence to hold the victims in the backroom and closet of the vacant apartment while other conspirators used the victims’ vehicles to drive to local ATMs to steal cash from the victims’ accounts. Atkinson and Ceniceros-Deleon admitted that they traveled in the carjacked vehicles to take cash from the victims’ accounts. While the victims were held at gunpoint, some were physically assaulted, at least one victim was sexually assaulted, and all of the victims were taunted with gay slurs.
In 2019, Atkinson pleaded guilty to one count of conspiracy to commit hate crimes, kidnapping and carjacking and one count of kidnapping.
Ceniceros-Deleon pleaded guilty in 2019 to one hate crime count, one count of carjacking, and one count of use of a firearm during and in relation to a crime of violence.
Henry pleaded guilty in 2019 to one hate crime count and one count of conspiracy to commit hate crimes, kidnapping and carjacking.
A final member of the conspiracy will be sentenced on Oct. 6, 2021. This final conspirator, Daniel Jenkins, pleaded guilty on June 3 to a hate crime violation; conspiracy to commit hate crimes, kidnapping and carjacking; and use of a firearm during and in relation to a crime of violence. Under the plea agreement, Jenkins faces a maximum sentence of 26 years in prison.
The FBI’s Dallas Field Office conducted the federal investigation; a separate criminal investigation is being conducted by the Dallas Police Department. Special Litigation Counsel Rose E. Gibson and Trial Attorney Kathryn Gilbert of the Justice Department’s Civil Rights Division, along with Assistant United States Attorney Nicole Dana, are prosecuting the case.
Alleged Gang Members Charged with Drug TraffickingRead the Press Release
Nine alleged members of the “Hogg Life” gang have been charged with federal drug crimes, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
The defendants were indicted last Wednesday. Several of them made their initial appearances before U.S. Magistrate Judge Lee Ann Reno on Monday.
During a multi-pronged operation on Friday, law enforcement agents arrested several of the defendants and recovered nearly a kilogram of bulk marijuana, multiple grams of psilocybin (hallucinogenic mushrooms), oxycontin, alprazolam, four pistols, and more than $17,000 cash. This seizure follows the execution of a search warrant served in May, when law enforcement seized more than 125 pounds of bulk marijuana, THC products, and psilocybin products, and over $63,000 in cash from members of the “Hogg Life” gang.
According to court documents, the investigation began in spring 2018, when multiple anonymous callers reported interstate drug trafficking to the Amarillo Police Department. At least one tipster indicated that the alleged traffickers regularly posted about their illicit dealings on Snapchat.
In spring 2020, a cooperating defendant told the Amarillo Police Department’s Narcotics Unit that a group calling itself “Hogg Life,” a Crips gang, trafficked in marijuana. The cooperating defendant said dealers located in Texas mailed currency to a supplier in California in exchanged for narcotics, which were shipped to them through the U.S. Postal Service and FedEx.
The cooperating defendant confirmed the operation was facilitated through Snapchat and identified several dealers’ accounts. He also identified the account belonging to the California supplier, who he said branded his narcotics with “Dank of America.”
Shortly thereafter, an undercover agent posing as a buyer initiated Snapchat conversations with local Amarillo dealers. Videos and images captured from their accounts show the cultivation, packaging, and advertisement of large quantities of marijuana, psilocybin mushrooms, and other THC products. The local “Hogg Life” gang members allegedly sold marijuana and THC products with their own brand name, “No Boof.”
Both the supplier and the dealer allegedly flaunted their drug proceeds, frequently posting about luxury travel and dining, exotic vehicles, designer clothing and jewelry, and adult entertainment.
Those charged include:
- Demarcus Dave Grabert, aka “Rackz,” 24, charged with one count of conspiracy to distribute controlled substances, two counts of distribution of Psilocin, one count of distribution of marijuana, and one count of possession with intent to distribute marijuana.
- Grant Leonard Glover, 33 charged with one count of conspiracy to distribute controlled substances, one count of distribution of psilocin, and one count of distribution of marijuana.
- Tremaine Devante Watson, aka “T-watt,” 29, charged with one count of conspiracy to distribute controlled substances, one count of distribution of psilocin, one count of distribution of marijuana, and one count of possession with intent to distribute marijuana.
- Ashton Andrew Burns, aka “Trayo,” 31, charged with one count of conspiracy to distribute controlled substances and possession of a firearm by a prohibited person.
- Doshon Lee Johnson, aka “Nolia Boy Tat,” 24, charged with one count of conspiracy to distribute controlled substances and one count of distribution of psilocin
- Andre Shemar Lewis, aka “30,” 25, charged with one count of conspiracy to distribute controlled substances and one count of possession with intent to distribute marijuana
- Chandler Geveon Smith, aka “Lil Chan,” 23, charged with one count of conspiracy to distribute controlled substances
- Davona Traveil Carter, 28, charged with one count of conspiracy to distribute controlled substances and one count of possession with intent to distribute marijuana
One defendant, whose name remains sealed per court order, is a fugitive.
An indictment is merely an allegation of criminal conduct, not evidence. All defendants are presumed innocent until proven guilty in a court of law.
If convicted, the defendants face up to 40 years prison time.
The U.S. Postal Inspection Service and the Amarillo Police Department conducted the investigation with the assistance of the U.S. Marshals Service. Assistant U.S. Attorney Anna Marie Bell is prosecuting the case.
NDTX Round up: June 4 - 10Read the Press Release
SENTENCING – HENRY AGUSTIN MORENO
On June 7, Henry Agustin Moreno, 21, was sentenced to 12 years in federal prison for transporting or shipping child pornography. HSI received a tip from Kik that a user in the Dallas area was utilizing the messenger application to distribute child pornography. Agents obtained a search warrant of Moreno’s residence in Irving. Moreno admitted to agents that he downloaded several pornographic files depicting child pornography. He further admitted that he uploaded child pornography in exchange for other videos. This case was investigated by Homeland Security Investigations. Assistant U.S. Attorney Joseph Magliolo prosecuted the case.
SENTENCING – ESLEVY VARGAS-AVILA
On June 7, Eslevy Vargas-Avila, 31, was sentenced to 22 years in federal prison for two counts of interference with commerce by robbery and two counts of using or brandishing a firearm in furtherance of a crime of violence. In June 2016, Vargas-Avila and other co-conspirators conducted surveillance of jewelry stores to identify traveling jewelry salesmen. Vargas-Avila and the co-conspirators violently robbed two traveling salesmen at gunpoint in Tarrant County. This case was investigated by the FBI, Dallas Police Department, Garland Police Department, Arlington Police Department, and DFW Airport Department of Public Safety. Assistant U.S. Attorney Keith Robinson prosecuted the case.
SENTENCING – CHRISTOPHER JOEL RAMIREZ
On June 8, Christopher Joel Ramirez, 24, was sentenced to 4 years in federal prison for possession with the intent to distribute a controlled substance. On September 9, 2019, Ramirez possessed approximately 43 kilograms of heroin to distribute to another individual. The case was investigated by the DEA. Assistant U.S. Attorney P.J. Meitl prosecuted the case.
SENTENCING – SALVADOR GOMEZ
On June 4, Salvador Gomez, 24, was sentenced to 15 years in federal prison for conspiracy to possess with intent to distribute a controlled substance. In October 2020, Gomez negotiated the transaction of methamphetamine with another individual. Gomez indicated that a co-defendant delivering the methamphetamine would be pretending to perform maintenance on a red truck. Investigators observed and identified a co-defendant appearing as if he was performing maintenance on the vehicle as Gomez had instructed. Officers searched the vehicle and seized 5.2 kilograms of methamphetamine from the co-conspirator. This case was investigated by the DEA HIDTA. Assistant U.S. Attorney Laura Montes prosecuted the case.
10 Alleged Drug Dealers Charged Following FBI Operation ‘50/50 Love’Read the Press Release
Ten of the alleged drug dealers arrested in yesterday’s “Operation 50/50 Love” have been federally charged with conspiracy to distribute cocaine and other drug crimes, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
The operation – which involved more than 400 agents from the FBI, Dallas Police Department, DEA, and ATF – was announced at a press conference Thursday. Over the course of the investigation, law enforcement seized 36 weapons, more than $58,000 cash, six vehicles, and more than 18 kilograms of drugs, including suspected powder cocaine, crack cocaine, heroin, methamphetamine, marijuana, and PCP.
Defendant initial appearances began Friday morning.
According to court documents unsealed today, a number of defendants allegedly used so-called “trap room” on Meyers Street in Park Row, one of the most consistently violent areas in the city of Dallas, to distribute drugs.
The defendants – many of them gang members known for their involvement in various criminal activities, from illegal weapons trafficking to aggravated assault – operated out of an apartment complex made up of parallel two-story buildings.
Each trap room sold a specific type of controlled substance, and was equipped with a counter where sellers cut, packaged, and distributed drugs. Occasionally, when they ran low, sellers would “re-up” with controlled substances stored in vehicles parked on the property. For a small fee, dealers permitted customers to use drugs in a “party” unit onsite.
Competing factions dealt cocaine and other narcotics out of the “left side” and “right side” of the apartments, but were known to do so without retribution against the opposite side. Occasionally, when one side unexpectedly ran out of drugs, the opposing side would “loan” them drugs to sell. At one point, the “right side” permitted the “left side” to operate out of the “right side” due to a shooting at a trap house on the “left side.”
To secure drugs and maintain control, sellers on the “left side” possessed firearms, which they often kept in plain view near the drug counter.
“Like many cities across the country, Dallas is bracing for a surge in violent crime this summer. Violence almost always spikes in the summer months. But the chaos and frustration surrounding the pandemic has only made things more unpredictable and more volatile,” Acting U.S. Attorney Shah said during Thursday afternoon’s press conference (watch here). “The agencies and the people here today analyzed which areas and identified which people and groups were the drivers of violent crime, the types of crime that devastate communities, and then took decisive action against those individuals… The law enforcement action you saw today actually serves two purposes: first, to take some of our city’s most violent criminals off the streets, but also, to signal to the rest of the city that the feds are watching, we’re working with Dallas Police Department, and we’re ready to take action. Our efforts to stop violent crime in this city are only starting.”
“Fighting violent crime is a responsibility that we all share, and the Dallas FBI is proud to work alongside the Dallas Police Department, DEA, ATF and others as we deploy our collective strength to ensure the safety and security of our neighborhoods,” said FBI Dallas Special Agent in Charge Matthew J. DeSarno. “This FBI Dallas Safe Streets Task Force investigation combined traditional law enforcement techniques with intelligence resources which led to Thursday’s successful operation to remove criminal elements from our streets and protect the residents of Dallas.”
“The message today for the residents of Dallas is simple: the Dallas Police Department is not alone in keeping our community safe. The Dallas Police Department is not alone in weeding the criminal element off of our streets and the Dallas Police Department is not alone in seeding our communities with hope,” said Dallas Police Chief Eddie Garcia.
Some defendants were charged via indictment, others via criminal complaint.
Those charged via indictment include:
- Sataurus Joe Jackson, aka “Slicc,” charged with conspiracy to possess with intent to distribute a controlled substance
- Ardairus DeQuall Vatin, aka “Decc,” charged with conspiracy to possess with intent to distribute a controlled substance and possession with intent to distribute cocaine base (crack cocaine)
- Antuan Fulce, aka “Fatboy” or “Big Homie,” charged with conspiracy to possess with intent to distribute a controlled substance and possession with intent to distribute cocaine base
- Daymion Savannah-Womack, aka “Boulevard,” charged with conspiracy to possess with intent to distribute a controlled substance and possession with intent to distribute marijuana
- Terry Lee Hicks, charged with conspiracy to possess with intent to distribute a controlled substance and possession with intent to distribute cocaine base
- Exie Denise Alexander, charged with conspiracy to possess with intent to distribute a controlled substance and possession with intent to distribute cocaine base
- Aretha Lashun Minter, aka “Shun,” charged with conspiracy to possess with intent to distribute a controlled substance
Those charged via criminal complaint include:
- David Antwon Ricks, aka "Coogi," charged with possession with intent to distribute cocaine base
- Mark Antony White, charged with possession with intent to distribute cocaine
Additional name(s) will become available as they are unsealed by the court.
Indictments and complaints are merely allegations of criminal conduct, not evidence. All defendants are presumed innocent until proven guilty in a court of law.
If convicted, they face up to 20 years per count in federal prison.
The Federal Bureau of Investigation’s Dallas Safe Streets Task Force, along with the Dallas Police Department, headed up the investigation, with assistance from the Drug Enforcement Administration’s Dallas Field Division and the Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division. Assistant U.S. Attorneys Lindsey Beran and Nicole Dana are prosecuting the case.
West Texas Kidnapper Sentenced to More Than 30 Years in Federal Prison for Abducting 9-Year-Old GirlRead the Press Release
A west Texas man was sentenced today to 365 months in federal prison for abducting a 9-year-old girl from a birthday party, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Damien Dre Gonzales, 27, of Levelland, Texas pleaded guilty in February to one count of kidnapping. He was sentenced on Thursday by U.S. District Judge James Wesley Hendrix.
According to plea papers, Mr. Gonzales admitted to abducting a 9-year old girl at a birthday party in Levelland, Texas to engage in illicit sexual intercourse.
During the birthday party in August 2020, a woman began choking and most of the attendees went to assist with her sudden health emergency. While the minor’s father was attending to the woman, Mr. Gonzales lured the 9-year-old away by asking for her help carrying alcohol to his vehicle. Mr. Gonzales encouraged the girl to get inside the vehicle and then he drove away.
The girl’s disappearance set off a frantic search by her family and those at the birthday party. They notified law enforcement and replayed home surveillance footage that showed the 9-year-old leaving with Mr. Gonzales.
About that same time, the Levelland Police Department received a report of a vehicle parked in the middle of the street several miles from the location of the birthday party. Mr. Gonzales hit a residential mailbox and stopped in the road. While in the car, Mr. Gonzales sexually assaulted the girl by removing her clothes and touching her.
When law enforcement arrived on the scene to investigate the parked car, they discovered the girl inside. Officers noticed that Mr. Gonzales’ jeans were unzipped, and his belt was unbuckled. Inside Mr. Gonzales’ car was an open box of condoms sitting in the passenger seat and one condom was missing from the box.
The victim was immediately reunited with her parents and provided psychological and medical support.
The FBI Lubbock Resident Agency, Levelland Police Department, and Hockley County Sheriff’s Office conducted the investigation. Assistant U.S. Attorney Callie Woolam prosecuted the case.
Thirteenth Reagor Dykes Employee SentencedRead the Press Release
The thirteenth Reagor Dykes Auto Group employee was sentenced for her role in the auto group’s floor plan fraud scheme, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Andrea Kate Phillips, 40, pleaded guilty in January to misprision of a felony. On Tuesday, she was sentenced to 4 years’ probation and ordered to pay $40,254,297.72 in restitution by U.S. District Judge Matthew J. Kacsmaryk.
In plea papers, Ms. Phillips, an accounting associate and office manager at Reagor Dykes Plainview LP (a Ford store in Plainview, Texas) admitted the auto group participated in a fraudulent floor plan fraud scheme.
Ms. Phillips admitted that the auto group routinely sold vehicles “out of trust” – meaning that they failed to repay lenders within seven days of selling the vehicle financed by that lender.
Just before the lender conducted audits, Ms. Phillips admitted she routinely would create documents falsifying vehicles sales dates on official paperwork to make it appear as though the vehicle had sold within the prior seven days and was not yet out of trust.
Ms. Phillips is the thirteenth RDAG employee sentenced to more than 30 years combined in federal prison for the dummy flooring and check kiting scheme. Reagor Dykes employees previously sentenced include:
- Diana Urias, an office manager in Reagor Dykes’ used car mall in Levelland, pleaded guilty to conspiracy to commit bank fraud and was sentenced to 2 years in federal prison and ordered to pay $19,335,901.10 in restitution, joint and severally.
- Sheila Miller, an RDAG group controller, pleaded guilty to conspiracy to commit bank fraud and was sentenced to 27 months in federal prison and ordered to pay $19,335,901.10 in restitution, joint and severally.
- Paige Johnston, an office manager in Reagor Dykes’ Chevrolet store in Floydada, pleaded guilty to conspiracy to commit wire fraud and was to 27 in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Lindsay Williams, and RDAG group accounting manager, pleaded guilty to conspiracy to commit bank fraud and was sentenced to 27 months in federal prison and ordered to pay $19,335,901.10 in restitution, joint and severally.
- Sherri Wood, an office manager at Reagor Dykes’ Ford store in Plainview, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 30 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Pepper Rickman, an accounting controller at Reagor Dykes’ Toyota store in Plainview, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 4 years in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Brad Fansler, an RDAG group administrative director, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 42 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Ashley Dunn, executive assistant to the CEO, pleaded guilty to conspiracy to commit bank fraud and was sentenced to 30 months in federal prison and ordered to pay $19,335,901.10 in restitution, joint and severally.
- Whitney Maldonado, an office manager at Reagor Dykes’ Mitsubishi store in Lubbock, pleaded guilty to conspiracy to commit wire fraud was sentenced on 27 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Elaina Cabral, an office manager at Reagor Dykes’ Toyota store in Plainview, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 27 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Mistry Canady, an office manager at Reagor Dykes’ Ford store in Lamesa, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 2 years in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Wesley Neel, RDAG Safety & Compliance Manager, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 30 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
Steven Reinhart, RDAG Legal Compliance Director, and Shane Smith, RDAG CEO, both have pleaded guilty and are awaiting sentencing. Bart Reagor, owner of RDAG, is scheduled for trial in October.
The Federal Bureau of Investigation and Internal Revenue Services - Criminal Investigation Division conducted the investigation. Assistant U.S. Attorneys Joshua Frausto, Jeffrey Haag, and Amy Burch prosecuted the case.
Texas Man Pleads Guilty to Plotting to Attack Data CentersRead the Press Release
A Wichita Falls man who plotted to blow up a data center in Virginia pleaded guilty Wednesday to malicious attempt to destroy a building with an explosive, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Seth Aaron Pendley, 28, was arrested in April after attempting to obtain an explosive device from an undercover FBI employee in Fort Worth. He entered his guilty plea today before U.S. Magistrate Judge Hal R. Ray, Jr.
“Due in large part to the meticulous work of the FBI’s undercover agents, the Justice Department was able to expose Mr. Pendley’s twisted plot and apprehend the defendant before he was able to inflict any real harm,” said Acting U.S. Attorney Prerak Shah. “We may never know how many tech workers’ lives were saved through this operation – and we’re grateful we never had to find out. Bringing to justice domestic extremists remains one of the Department’s top priorities.”
FBI Dallas Special Agent in Charge Matthew J. DeSarno said, “The FBI thoroughly investigates all credible threats, and The North Texas Joint Terrorism Task Force acted quickly based on information received from a concerned citizen. The defendant sought to cause destruction with an explosive and investigators devised a strategy to disrupt the threat while keeping the public safe from harm. We ask the public to stay vigilant and to continue reporting suspicious or threatening behavior to law enforcement.”
In plea papers, Mr. Pendley admitted that he disclosed his plan to blow up a prominent tech company’s data center to a confidential human source via Signal, an encrypted messaging app, in January.
In late February, he sent the source a list of data center addresses and said he hoped a successful attack could “kill off about 70% of the internet.” When the source offered to help him obtain C4 explosives to use in the attack, Mr. Pendley responded, “F*** yeah.”
Mr. Pendley then showed the source a hand-drawn map of a data center on Smith Switch Road in Virginia, featuring proposed routes of ingress and egress at the facility. He later described how he planned to disguise his car to evade detection by law enforcement.
In late March, the confidential source introduced Mr. Pendley to an individual who he claimed was his explosives supplier. In actuality, the man was an undercover FBI employee.
In recorded conversations, Mr. Pendley allegedly told the undercover employee he planned to attack web servers that he believed provided services to the FBI, CIA, and other federal agencies.
“The main objective is to f*** up the Amazon servers,” he said, adding that he hoped to anger “the oligarchy” enough to provoke a reaction that would convince the American people to take action against what he perceived to be a “dictatorship.”
During that same conversation, Mr. Pendley claimed to have been present at the Jan. 6 attack on the U.S. Capitol. He said that although he did not enter the building, he came prepared with a sawed off AR rifle, which he left in his car.
On April 8, Mr. Pendley again met with the undercover FBI employee to pick up what he believed to be explosive devices. (In actuality, however, the undercover gave Mr. Pendley inert devices.) After the agent showed Mr. Pendley how to arm and detonate the devices, the defendant loaded them into his car. He was then arrested.
A subsequent search of his residence in Wichita Falls turned up an AR-15 receiver with a sawed off barrel, a pistol painted to look like a toy gun, masks, wigs, and notes and flashcards related to the planned attack.
Mr. Pendley now faces between five and 20 years in federal prison. His sentencing hearing has been set for Oct. 1 before U.S. District Judge Reed C. O’Connor.
The FBI’s Dallas Field Office, Wichita Falls Resident Agency and FBI’s North Texas Joint Terrorism Task Force conducted the investigation. Assistant U.S. Attorney Robert J. Boudreau of the Northern District of Texas is prosecuting the case with the assistance of Trial Attorney Alexandra Hughes of the National Security Division.
ADT Technician Sentenced for Hacking Home Security FootageRead the Press Release
A home security technician was sentenced today to 52 months in federal prison for repeatedly hacking into customers’ video feeds, announced Acting U.S. Attorney for the Northern District of Prerak Shah.
Telesforo Aviles, a 35-year-old former ADT employee, pleaded guilty to computer fraud in January. He was sentenced today by U.S. District Judge Brantley Starr.
“This deliberate and calculated invasion of privacy is arguably more harmfrul than if I had installed no security system and my house had been burglarized,” a female victim told the court in an impact statement. "This sick and corrupt individual's actions will have a lasting emotional and mental toll on me."
According to plea papers, Mr. Aviles admits that contrary to company policy, he routinely added his personal email address to customers’ “ADT Pulse” accounts, giving himself real-time access to the video feeds from their homes. In some instances, he claimed he needed to add himself temporarily in order to “test” the system; in other instances, he added himself without their knowledge.
Mr. Aviles took note of which homes had attractive women, then repeatedly logged into these customers’ accounts in order to view their footage for sexual gratification, he admits. Plea papers indicate he watched numerous videos of naked women and couples engaging in sexual activity inside their homes.
Over a four and a half year period, Mr. Aviles secretly accessed roughly 200 customer accounts more than 9,600 times without their consent, he admits.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorney Sid Mody prosecuted the case.
Jury Convicts Man of Robbing Cell Phone Store at GunpointRead the Press Release
A 38-year-old man who robbed a cell phone store at gunpoint has been found guilty of robbery, carjacking, and multiple gun crimes, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
After just an hour of deliberation, a federal jury in Dallas on Friday convicted Michael Tremaine Schexnayder of one count of interference with commerce by robbery, one count of carjacking, one count of brandishing a firearm during a crime of violence, and one count of possession of a firearm by a convicted felon.
According to evidence presented at trial, around 10:45 a.m. on July 16, 2019, Mr. Schexnayder entered a Grand Prairie T-Mobile store, armed with a small black pistol. After milling around for a few moments, he suddenly approached two employees and a customer, pointing his gun in their faces. He demanded they hand over personal possessions – cell phones, watches, cash, and car keys – and then ordered staff members to open the safe in the back of the store.
Terrified, one of the employees, an assistant store manager, explained that the safe was on a time delay, and would not open for a period of several minutes after she input the code. The employee testified that Mr. Schexnayder, who apparently did not believe her, grew agitated, and forced her instead to empty the till into a garbage bag. He then demanded that the same employee surrender her car keys and describe her vehicle, a boxy white Toyota Scion.
With their property in tow, he fled the store.
Employees and customers then barricaded themselves in the back of the store and the assistant manager dialed 911. Within moments of police’s arrival, the assistant manager noticed her vehicle was missing, as was her iPhone.
With the assistant store manager’s permission, officers quickly began tracking her phone, located the vehicle, and gave chase. An officer observed the driver run into a wooded area as the Toyota rolled to a stop. Officers later found Mr. Schexnayder lying in the woods, dressed in the same clothing robbery witnesses had described. A short distance away, they found a small black pistol stashed under a pile of wood.
Mr. Schexnayder now faces up to 52 years in federal prison. His sentencing is set for October 15, 2021.
The Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division conducted the investigation. Assistant U.S. Attorneys Gary Tromblay and Lindsey Beran are prosecuting the case. U.S. District Judge Sam A. Lindsay presided over the trial.
Yassein Said Sentenced to 12 Years for Concealing '10 Most Wanted' Suspect Yaser Said from ArrestRead the Press Release
The brother of capital murder suspect Yaser Said has been sentenced to 12 years in federal prison for helping the “10 Most Wanted” suspect evade capture for more than 12 years, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
In February, a federal jury in Fort Worth found Yassein Abdulfatah Said, Yaser Said’s 59-year-old brother, guilty of conspiracy to conceal a person from arrest, concealing a person from arrest, and conspiracy to obstruct an official proceeding. Yassein Said was sentenced today by U.S. District Judge Reed C. O’Connor.
Judge O’Connor varied upwardly from the sentencing guidelines, writing in a court filing, “the guidelines also do not adequately take into account the extravagant lengths that Defendant and his co-defendant, and perhaps others, went to harbor and conceal Yaser Said… Defendant’s efforts resulted in incalculable resources spent by law enforcement, both locally, nationally, and internationally.”
Yassein Said’s co-conspirator, his 32-year-old nephew Islam Said, pleaded guilty to the same charges prior to trial and was sentenced in April to 10 years in federal prison.
According to evidence presented at Yassein Said’s trial, Mr. Said sheltered his brother from arrest in an attempt to subvert the administration of justice.
Yaser Said had been a fugitive from justice since New Year’s Day 2008, when he allegedly murdered his teenage daughters, Amina and Sarah. According to law enforcement, he shot the girls to death inside his taxicab and abandoned their bodies inside the vehicle. He was captured by the FBI’s Violent Crimes Task Force in August 2020, and is currently in state custody.
Conspiring with his nephew, Yaser’s son Islam, Yassein Said helped harbor Yaser inside an apartment in Bedford, Texas, where a maintenance worker spotted Yaser on Aug. 14, 2017.
He later harbored his brother inside a home in Justin, Texas. On Aug. 25, 2020 FBI agents observed Mr. Said and his nephew deliver grocery bags to the residence, then followed the men to a shopping center 20 miles away, were they dumped trash retrieved from the home.
“Yassein Said prioritized the comfort of his brother, an alleged murder, over justice for his nieces, two innocent teenagers on the brink of adulthood,” said Acting U.S. Attorney Prerak Shah. “No sentence can bring Sarah and Amina back, but we are hopeful that seeing justice served brings a measure of comfort to those who loved these two young souls.”
“Yassein Said protected his brother and accused murderer, Yaser Said, by providing aid and comfort to him while he was a fugitive. By taking the law into his own hands, Yassein Said delayed justice for the victims, Amina and Sarah, and their family,” Matthew DeSarno, Special Agent in Charge of FBI’s Dallas Field Office, said after the trial.
The Federal Bureau of Investigation’s Dallas Field Division and the Irving Police Department conducted the investigation with the assistance of U.S. Customs & Border Patrol, the Dallas Police Department, the Garland Police department, the Grand Prairie Police Department, and the Texas Department of Public Safety. Assistant U.S. Attorneys Tiffany H. Eggers and Errin Martin are prosecuting the case with counsel from appellate Assistant U.S. Attorney Jonathan Bradshaw.
NDTX Round up: May 28 - June 3Read the Press Release
GUILTY PLEA – JAIME ULIZE CARCAMO
On June 1, Jaime Ulize Carcamo, 33, plead guilty to conspiracy to launder monetary instruments. During a DEA investigation, law enforcement learned that Carcamo received drug proceeds from the sale of controlled substances and transferred those proceeds to multiple individuals in Mexico. Carcamo and his co-conspirators conducted 134 wire transactions totaling $121,727 to individuals in Mexico, earning a fee for each transaction. Carcamo now faces up to 20 years in federal prison for his crimes. The DEA conducted the investigation. Assistant U.S. Attorney John Kull prosecuted the case.
GUILTY PLEA – ISRAEL COOPER
On June 1, Israel Cooper, plead guilty to possession of a firearm by a user of a controlled substance. In October 2019, Cooper was arrested by law enforcement with a .45 pistol. He admitted to law enforcement that he used marijuana prior to the offense. Cooper now faces up to 10 years in federal prison for his crimes. The ATF and the Dallas Police Department conducted the investigation. Assistant U.S. Attorney P.J. Meitl is prosecuting the case.
SENTENCING – MICHAEL RACHAEL MCCOY
On June 2, Michael Rachael McCoy, 57, was sentenced to 57 months in federal prison for aiding and abetting the possession with the intent to distribute cocaine. In the early morning of January 30, 2020, DEA agents executed a search warrant at a Dallas residence. As law enforcement entered the home, they encountered McCoy with a 9mm handgun in his coat pocket. Agents continued to search the residence and located cocaine packaged for resale. The DEA conducted the investigation. Assistant U.S. Attorney Suzanna Etessam prosecuted the case.
GUILTY PLEA – ISAAC LEONAR SANCHEZ CERVANTES
On June 3, Isaac Leonar Sanchez Cervantes, 25, plead guilty to possession of a firearm by an illegal alien. On March 25, 2020, Sanchez Cervantes was stopped by law enforcement for trespassing on a utility site that was under construction. Sanchez told officers that he had been cooped up with his girlfriend and had gone to “smoke a bowl and chill.” Law enforcement searched Sanchez Cervantes’ vehicle and located two 9mm pistols, two pairs of handcuffs, and approximately 275 rounds of ammunition. Sanchez Cervantes now faces up to 10 years in federal prison for his crimes. The ATF and the Irving Police Department conducted the investigation. Assistant U.S. Attorney Walt Junker is prosecuting the case.
GUILTY PLEA – JUVENAL DELBOSQUE
On May 25, Juvenal Delbosque, 23, plead guilty to conspiracy to possess with intent to distribute methamphetamine. On July 1, 2019, Delbosque and a co-conspirator received a shipment of 62 kilograms of methamphetamine which had been transported inside tires. Once it was received by Delbosque, he placed it in trash bags for further distribution. He faces up to life in federal prison for his crimes. The FBI, DEA, IRS, Secret Service, Dallas Police Department, and the IRS. Assistant U.S. Attorney George Leal is prosecuting the case.
Oncologist Sentenced to 20 Years in Prison in Pill Mill ConspiracyRead the Press Release
An oncologist has been sentenced to 20 years in federal prison for running a pill mill, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Arrested in DEA Dallas’ “Operation Wasted Daze,” Dr. Caesar Mark Capistrano, 61, was convicted at trial in January three counts of conspiracy to dispense a controlled substance and two counts of possession with intent to distribute a controlled substance. He was sentenced Thursday by U.S. District Judge Reed C. O’Connor.
“Doctors who run pill mills knowingly profit off of vulnerable people’s addictions,” said Acting U.S. Attorney Prerak Shah. “The Justice Department is determined to prosecute doctors who funnel powerful prescription drugs onto our streets. We will do everything within our power to curb the opioid epidemic.”
“Using one’s trusted status as a medical professional for unlawful acts cannot go unpunished,” stated Eduardo A. Chávez, Special Agent in Charge of the DEA’s Dallas Field Division. “The Dallas DEA will always seek justice against those who take advantage of individuals, especially ones who suffer from addiction.”
According to evidence presented at three different trials conducted in early 2021, Dr. Capistrano and his associate, 36-year-old Dr. Tameka Lachelle Noel, wrote prescriptions for hydrocodone, oxycodone, alprazolam, carisoprodol, zolpidem, phentermine, and promethazine with codeine, knowing the drugs would be diverted to the streets for illicit use.
Dr. Capistrano and Dr. Noel, assisted by 48-year-old clinic manager Shirley Ann Williams, used a network of recruiters to enlist individuals from the community and local homeless shelters to pose as “patients.” Recruiters paid each “patient” a small fee, usually $50 to $200 cash, to obtain controlled substance prescriptions from Dr. Capistrano and Dr. Noel.
The recruiters – who paid the clinic based in part on the amount of drugs prescribed – then filled the prescriptions at various complicit pill mill pharmacies and diverted the drugs for resale on the streets. The pharmacists charged the recruiters between $200 and $800 per prescription, filling hundreds and hundreds of prescriptions for a fee, according to evidence presented at trial.
At the clinic, many of the “patients” were seen not by the doctors, but by Ms. Williams, who possessed neither a medical license nor a DEA registration. After a perfunctory conversation with the “patient,” Ms. Williams allegedly coordinated with Dr. Capistrano and Dr. Noel to prescribe dangerous drugs without legitimate medical purpose. In order to make the prescriptions appear legitimate, the doctors occasionally included prescriptions for non-controlled substances, such as antibiotics and mineral ice.
Over a nine-year span, Dr. Capistrano issued prescriptions for more than 524,000 doses of hydrocodone, 430,000 doses of carisoprodol, 77,000 doses of alprazolam, and 2.07 million doses of promethazine with codeine. Over seven years, Dr. Noel issued prescriptions for more than 200,000 doses of hydrocodone, 55,000 doses of carisoprodol, 14,000 doses of alprazolam, and 450,000 doses of promethazine with codeine.
Often, the doctors prescribed multiple medications simultaneously and at the highest dosages available.
Medical professionals convicted in the scheme include:
- Caesar Mark Capistrano, medical doctor
Convicted at trial on 1/28/2021 of three counts of conspiracy to dispense a controlled substance and two counts of possession with intent to distribute a controlled substance and was sentenced to 20 years in federal prison
- Tameka Lachelle Noel, medical doctor
Pleaded guilty on 11/16/2020 to conspiracy to dispense a controlled substance and was sentenced to eight years federal prison
- Ngozika Tracey Njoku, nurse practitioner
Pleaded guilty on 11/20/2020 to conspiracy to dispense a controlled substance and was sentenced to six months in federal prison
Clinic staff convicted in the scheme include:
- Shirley Ann Williams, clinic office manager
Pleaded guilty on 11/18/2020 to conspiracy to disperse a controlled substance and was sentenced to six years in federal prison
- Latonya Ann Tucker, office staff
Pleaded guilty on 11/20/2020 to conspiracy to distribute a controlled substance and was sentenced to five years federal prison
Pharmacists convicted in the scheme include:
- Wilkinson Oloyede Thomas, Calvary Pharmacy
Convicted at trial on 1/28/2021 of three counts of conspiracy to dispense controlled substances and one count of possession with intent to distribute controlled substances
- Christopher Kalejaiye Ajayi, Remcare Pharmacy
Convicted at trial on 3/2/2021 of three counts of conspiracy to dispense controlled substances, and two counts of possession with intent to distribute controlled substances
- Bartholomew Anny Akubukwe, Beco Pharmacy
Pleaded guilty on 11/18/2020 to conspiracy to dispense a controlled substance and was sentenced to 11 years in federal prison
- Nedal Helmi Naser, Brandy Pharmacy
Pleaded guilty on 3/16/2021 to conspiracy to dispense a controlled substance
- Ethel Oyekunle-Bubu, Ethel’s Pharmacy
Convicted at trial on 1/28/2021 of three counts of conspiracy to dispense a controlled substance and two counts of possession with intent to distribute controlled substances
Recruiters convicted in the scheme include:
- Ritchie Dale Milligan, Jr
Pleaded guilty on 11/18/2020 to conspiracy to distribute a controlled substance and was sentenced to eight years federal prison
- Wayne Benard Kincade
Pleaded guilty on 11/16/2020 to conspiracy to distribute a controlled substance
- Katie Lorane Parker
Pleaded guilty on 11/16/2020 to conspiracy to distribute a controlled substance and was sentenced to four years in federal prison
- Cynthia Denise Cooks
Pleaded guilty on 11/25/2020 to conspiracy to distribute a controlled substance and was sentenced to five years federal prison
The DEA Dallas Field Division’s Fort Worth Office conducted the investigation, with the assistance of Homeland Security Investigations, IRS – Criminal Investigation, the U.S. Marshals Service, the U.S. Postal Inspection Service, the Parker County Sheriff’s Office, and the Fort Worth Police Department. The DEA’s Fort Worth Tactical Diversion Squad is comprised of DEA agents and task force officers from the Arlington Police Department, the Ellis County Sheriff’s Office, the North Richland Hills Police Department, the Benbrook Police Department, the Granbury Police Department, the Tarrant County Sheriff’s Office, and the Parker County Sheriff’s Office. This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) Strike Force Initiative, which provides for the establishment of permanent multi-agency task force teams that work side-by-side in the same location. This co-located model enables agents from different agencies to collaborate on intelligence-driven, multi-jurisdictional operations to disrupt and dismantle the most significant drug traffickers, money launderers, gangs, and transnational criminal organizations. Assistant U.S. Attorneys Laura Montes and Shawn Smith are prosecuting the case.
- Caesar Mark Capistrano, medical doctor
Texas Man Pleads Guilty to Hate Crime Charges After Using Dating App to Target Gay MenRead the Press Release
A Dallas man pleaded guilty Wednesday afternoon to federal hate crime charges, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah and Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division.
Daniel Jenkins, 22, pleaded guilty to one hate crime count, one hate crime conspiracy count, kidnapping, carjacking, and one count of using a firearm during a crime of violence. He is the last of four defendants to plead guilty to charges stemming from a scheme that targeted gay men on the dating app Grindr.
“These defendants brutalized multiple victims, singling them out due to their sexual orientation. We cannot allow this sort of violence to fester unchecked,” said Acting U.S. Attorney Prerak Shah. “The Department of Justice is committed to prosecuting hate crimes. In the meantime, we urge dating app users to remain vigilant. Unfortunately, predators often lurk online.”
"The Department of Justice and the Civil Rights Division are committed to confronting the scourge of hate-based violence gripping communities across our nation,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “We denounce hate-based violence in all of its forms, including violence targeting individuals based on sexual orientation and gender identity. We will continue to diligently investigate and prosecute violent, bias-motivated crimes to the fullest extent. As noted by Attorney General Garland, we stand ready to use every tool in our arsenal to address the rise in hate and we will work to hold perpetrators of hate-motivated violence accountable."
“Investigating hate crimes is one of the FBI's highest priorities because of the devastating impact they have on families and communities. We are committed to the pursuit of offenders and holding them accountable for perpetrating these harmful crimes,” said FBI Dallas Special Agent in Charge Matthew DeSarno. “No one should have to live in fear of violence because of who they are, where they are from or what they believe. We will continue working with our law enforcement and community partners to detect and prevent violent incidents motivated by hate or bias. We also urge the public to report any suspected hate crimes to the FBI and local law enforcement.”
According to court documents filed in connection with his guilty plea, Mr. Jenkins admitted that he and his co-conspirators used Grindr, a social media dating platform used primarily by gay men, to lure gay men to a vacant apartment and other areas in and around Dallas for robbery, carjacking, kidnapping, and hate crimes over the course of approximately a week in December 2017.
Mr. Jenkins admitted that he and his co-conspirators held victims against their will; pointed a handgun at victims and took their personal property, including their vehicles; and traveled to local ATMs to withdraw cash from the victims’ accounts. He further admitted that he and his co-conspirators physically injured at least one victim and taunted the victims based upon the co-conspirators’ perception of the men’s sexual orientation.
In March 2019, Mr. Jenkin’s co-conspirator Michael Atkinson pleaded guilty to conspiracy and kidnapping charges in connection with this case. In December 2019, Daryl Henry and Pablo Ceniceros-Deleon pleaded guilty to a federal hate crime and other charges in connection with this case. Sentencing for these three defendants is set for June 23.
Mr. Jenkins’ sentencing is set for Oct. 6. Pursuant to the terms of the plea agreement, he faces a sentence of up to 26 years in prison.
The FBI’s Dallas Field Office conducted the federal investigation; a separate criminal investigation is being conducted by the Dallas Police Department. Special Litigation Counsel Rose E. Gibson, Trial Attorney Kathryn Gilbert of the Justice Department’s Civil Rights Division, and Assistant U.S. Attorney Nicole Dana of the Northern District of Texas are prosecuting the case.
Guadalajara Man Sentenced to Nearly 20 Years in Federal Prison for Distributing Approximately 21 Kilograms of MethamphetamineRead the Press Release
DEL RIO – U.S. District Judge Alia Moses sentenced 40-year-old Ramon Antonio Yanez-Gonzalez, aka “Junior,” of Guadalajara, Mexico to 235 months in federal prison today for distributing about 21 kilograms of methamphetamine and money laundering.
On July 31, 2018, Yanez-Gonzalez pleaded guilty to one count of conspiracy to possess with intent to distribute methamphetamine. According to court documents, from January 2011 to April 2015, the defendant conspired with others to smuggle methamphetamine into the Eagle Pass area from Mexico and distribute it to San Antonio, Austin and Dallas. On December 12, 2019, Yanez-Gonzalez pleaded guilty to one count of conspiracy to launder monetary instruments that was transferred from the Northern District of Texas. By pleading guilty to that charge, Yanez-Gonzalez admitted that he laundered proceeds from drug sales in December 2012.
During this investigation, authorities seized approximately 17 kilograms of methamphetamine attributable to Yanez-Gonzalez and his organization.
U.S Attorney Ashley C. Hoff of the Western District of Texas, Acting U.S. Attorney Prerak Shah of the Northern District of Texas and Special Agent in Charge Daniel C. Comeaux of the Drug Enforcement Administration’s Houston Field Office made today’s announcement.
Yanez-Gonzalez has remained in federal custody since his arrest on August 28, 2017, in Las Vegas, Nevada.
The DEA together with the FBI, Homeland Security Investigations (HSI), U.S. Border Patrol, Val Verde County Sheriff’s Office, Dallas Police Department and Garland Police Department conducted this Organized Crime Drug Enforcement Task Forces (OCDETF) investigation named “Operation Guatemala Freeze.” OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
Assistant U.S. Attorneys Sydni Connell, Sarah Spears and Amy Hail prosecuted this case with assistance from Northern District of Texas Assistant U.S. Attorney George Leal.
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Retired FBI Agent Charged with Fraud in $800,000 ‘Secret Probation’ SchemeRead the Press Release
A retired FBI agent who allegedly convinced a Granbury woman she was on “secret probation” and conned her out of roughly $800,000 has been federally charged, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
William Roy Stone, Jr., 62, was indicted Tuesday on seven counts of wire fraud, one count of wire fraud conspiracy, one count of false impersonation of a federal officer, one count of engaging in monetary transactions in property derived from unlawful activity, and one count of false statements to law enforcement. He made his initial appearance before U.S. Magistrate Judge Rebecca Rutherford on Friday.
According to the indictment, in November 2015, Mr. Stone allegedly convinced his victim, identified in court documents as C.T., that she was under “secret probation” for drug crimes in “Judge Anderson’s court in Austin, Texas.”
He allegedly told the victim that the fictious federal judge had appointed Mr. Stone and another individual to “mentor” and “supervise” C.T., and claimed that her conditions of probation mandated that she report her activities, as well as a list of her assets, to Mr. Stone. Moreover, he said, C.T. was obligated to pay any expenses Mr. Stone incurred while supervising her, and was forbidden from disclosing her probation status to anyone. If she did not comply with the terms of this probation, Mr. Stone said, she would risk imprisonment and the loss of her children.
In order to convince C.T. the probation was real, Mr. Stone allegedly claimed that he had the ability to monitor her cell phone communications, said he discussed C.T.’s probation with a psychiatrist, enlisted another person to leave messages on his own phone purporting to be from the U.S. Drug Enforcement Administration “Intelligence Center,” and even placed “spoof” calls between himself, C.T., and the fictious Judge Anderson.
He told C.T. that he’d incurred significant expenses traveling to Austin to discuss C.T.’s probation with Judge Anderson, and intimidated her into reimbursing him for expenses associated with those trips. Further, he collected money he claimed was “restitution” for a wronged company which he secretly deposited into his own bank account. Eventually, he convinced her to hand over large sums of money to purchase a home and cars. At one point, he allegedly proposed to marry her, claiming he would then seek discharge of her probation.
Over the course of several years, C.T. gave Mr. Stone more than $800,000.
“Stone allegedly conned, threatened and stole from his victim, exploiting her trust in law enforcement for his own financial gain. The OIG is committed to holding accountable those who commit this type of conduct,” said Cloey C. Pierce, Special Agent in Charge of the Department of Justice Office of the Inspector General Dallas Field Office.
An indictment is merely an allegation of criminal conduct, not evidence. Like all defendants, Mr. Stone is presumed innocent until proven guilty in a court of law.
If convicted, he faces up to 178 years in federal prison.
The Texas Rangers and the U.S. Department of Justice Office of Inspector General conducted the investigation with the assistance of the Fort Worth Police Department. Mr. Stone retired from the FBI in October 2015 from the Dallas Field Office. Assistant U.S. Attorneys Marcus Busch and Katherine Miller are prosecuting the case.