Northern District of Texas
Press releases recorded for this federal judicial district.
Dallas Man Who Fired Numerous Shots at Federal Officers Pleads GuiltyRead the Press Release
DALLAS — Edgar Solorzano, 24, of Dallas, Texas, appeared this morning before U.S. District Judge Sam A. Lindsay and pleaded guilty to several felony offenses including assault on a federal officer, announced U.S. Attorney John Parker of the Northern District of Texas.
Specifically, Solorzano pleaded guilty to one count of possession with intent to distribute a controlled substance, two counts of assault on a federal officer and one count of using, carrying, brandishing and discharging a firearm during in relation to a crime of violence. The possession count carries a maximum penalty of up to 20 years in federal prison and a $1,000,000 fine. The assault on a federal officer counts each carry a maximum penalty of up to 20 years and a $250,000 fine. The firearm count related to a crime of violence carries a penalty of not less than 10 years and not more than life in federal prison and a $250,000 fine. Sentencing is set for August 7, 2017.
Co-defendant Victor Solorzano, 32, also of Dallas, is scheduled to begin trial April 10, 2017.
According to documents filed in the case, on November 19, 2015, Victor and Edgar Solorzano, cousins who lived across the street from each other, fired numerous gunshots at two federal officers with the U.S. Department of Homeland Security, Homeland Security Investigations (HSI) with high-powered, semi-automatic firearms, and riddled their pickup truck with bullets as the officers fled.
Officers went to install a court-ordered tracking device on Victor Solorzano’s vehicle at his residence on Wilbur Street in Dallas, Texas. Victor was under federal investigation by HSI for trafficking methamphetamine at the time. Immediately after installing the tracking device on Victor’s vehicle, Victor, armed with a pistol, confronted the officer in the street and began firing at the officer. The officer got inside the passenger’s side of a pickup as Victor and Edgar began firing numerous gunshots at the two federal officers, who did not return fire. Victor and Edgar continued firing at the federal officers as they sped away. The officer who installed the court-ordered tracking device sustained four nonfatal bullet wounds and the pickup driven by the other officer sustained numerous bullet strikes, all from the back.
After the shooting, Edgar hid the pistol in the attic of his residence and the pistol used by Victor in a neighbor’s backyard. The police searched Edgar’s residence and found the pistol hidden in the attic. The police also found in Edgar’s bedroom more than eight grams of methamphetamine, drug-distribution paraphernalia, and a variety of firearms and ammunition. The pistol used by Victor was found in the neighbor’s backyard.
The case was investigated by the Dallas Police Department, the Department of Homeland Security, and the Federal Bureau of Investigation. Assistant U.S. Attorneys Gary Tromblay, John Kull, and Rachael Jones are in charge of the prosecution.
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Dallas County Man Who Fired Numerous Shots at Officer with Ennis Police Department During a High Speed Pursuit Sentenced to 480 Months in Federal PrisonRead the Press Release
DALLAS — A Lancaster, Texas, Man, Javier Martinez, 24, was sentenced today before U.S. District Judge Jane J. Boyle to 480 months in federal prison for his involvement in an attempted kidnapping and then subsequently firing numerous shots at an officer with the Ennis Police Department during a high-speed pursuit, announced U.S. Attorney John Parker of the Northern District of Texas.
In October 2016, Martinez pleaded guilty to one count each of conspiracy to commit kidnapping; possession with intent to distribute cocaine; possession with intent to distribute heroin; using, carrying, and brandishing a firearm during or in relation to a crime of violence; and possession of a firearm in furtherance of a drug trafficking crime. Martinez has been in custody since the time of his arrest in September 2016.
Co-defendants Jose Cardenas Aguirre, 25, and Maria Guadalupe Bello, 22, were sentenced in March 2017. Aguirre was sentenced to 324 months in federal prison. Bello was sentenced to 18 months in federal prison. Co-defendants Melissa Trevino, 23, and Indolfo Martinez, 47, who is Javier Martinez’s father, have pleaded guilty to their roles in the kidnapping, cocaine and heroin distribution, and/or firearm offenses and are awaiting sentencing later this month. One remaining defendant charged in the case, Jonathan Benitez, remains a fugitive.
“The sentences in these cases reflect the horrific and stunningly brazen nature of these crimes,” said US Attorney Parker. “Extremely violent criminals like these will continue to be a high priority for my office.”
According to documents filed in the case, on July 12, 2016, Martinez, along with Aguirre and Trevino, planned to kidnap another individual because of an unpaid drug debt involving cocaine. During the planned kidnapping, Martinez and Aguirre wore ballistic vests and black camouflage clothing. The kidnapping was unsuccessful, and as Martinez, Aguirre, and Trevino fled the scene, they were engaged in a high-speed chase with officers with the Ennis Police Department. During this pursuit, Martinez, using an AR-156 style rifle, fired numerous shots at a police officer. Martinez led, supervised, and organized this planned kidnapping.
Between December 2015, and continuing to July 2016, Martinez conspired to possess with intent to distribute cocaine and heroin. On February 5, 2016, Martinez possessed a firearm in furtherance of these drug trafficking crimes.
In addition, according to the factual resume, on January 7, 2016, Martinez sold another individual one ounce of heroin and offered to sell that same individual one kilogram of heroin for $40,000. During that same conversation, Martinez offered to sell the same individual an AK-47 for $7,000 and an AR-15 rifle for $1,500. On April 11, 2016, Martinez sold three ounces of heroin and two AR-15’s to another individual; these drug and gun sales took place at his residence.
The case was investigated by the Ennis Police Department and the FBI’s Violent Gang Taskforce. Assistant U.S. Attorney P.J. Meitl prosecuted.
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Lubbock, Texas, Woman Sentenced to 60 Months in Federal Prison for Role in Methamphetamine Distribution ConspiracyRead the Press Release
LUBBOCK —Julia Ann Puentes, 33, was sentenced today by Senior U.S. District Judge Sam R. Cummings to 60 months in federal prison, following her guilty plea in December 2016 to her role in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.
Puentes pleaded guilty to one count of use of the mail in aid of racketeering. She has been on pretrial release, with conditions, since her arrest in November 2016.
According to plea documents in the case, on June 19, 2015, law enforcement executed a search warrant at 2309 Birch Avenue, Lubbock, Texas after receiving information that the Sinaloa Cartel sent three people to Lubbock to distribute methamphetamine for the cartel. Those three individuals were identified as Juan Carlos Pinales, Ramon Osvaldo Escobar-Robles, and Jesus Mario Moreno-Perez. Pinales, Escobar-Robles and Moreno-Perez were charged in a separate indictment and were sentenced in January 2016 to sentences ranging from 78-151 months in federal prison.
Puentes according to a drug ledger seized from 2309 Birch Avenue, had received about 82 ounces of methamphetamine from Pinales, Escobar-Robles, and Moreno-Perez. Puentes was also in contact with a methamphetamine distributor for the Sinaloa Cartel who resided in Mexico. Puentes communicated with the distributor 78 times from January 28, 2016, to June 10, 2016. During this time frame, Puentes received one pound of methamphetamine through the mail. After receiving that package with one pound of methamphetamine, Puentes distributed that methamphetamine to others.
The Federal Bureau of Investigation and Lubbock Police Department investigated the case. Assistant U.S. Attorney Jeffrey Haag prosecuted.
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Dallas County School Teacher Charged with Federal Child Pornography Offense Sentenced to 121 Months in Federal PrisonRead the Press Release
FORT WORTH, Texas — Mark Stutheit, 59, was sentenced today by U.S. District Judge John McBryde to 121 months in federal prison, following his guilty plea in October 2016 to one count of receipt of a visual depiction of a minor engaged in sexually explicit conduct, announced U.S. Attorney John Parker of the Northern District of Texas.
Stutheit who was a teacher at Reinhardt Elementary School in Dallas at the time of the offense has been in custody since his arrest in June 2016.
According to documents filed in the case, in June 2016, an undercover officer with the Queensland Police Service (Brisbane, Queensland, Australia) and Stutheit exchanged emails about the sexual exploitation of children.
On June 23, 2016, special agents with U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) executed a search warrant at Stutheit’s residence in Saginaw, Texas. A forensic evaluation of evidence seized revealed numerous files containing child pornography on Stutheit’s computer and mobile devices.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
ICE HSI investigated. Assistant U.S. Attorney A. Saleem prosecuted.
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Serial Armed Robber Sentenced to 184 Months in Federal PrisonRead the Press Release
DALLAS — A Dallas, Texas, man, Dequindrick Alexander, 22, was sentenced this afternoon by U.S. District Judge Jane J. Boyle to 184 months in federal prison, announced U.S. Attorney John Parker of the Northern District of Texas.
Alexander pleaded guilty in February 2016 to two counts of interference with commerce by robbery and one count of using, carrying, and brandishing a firearm during and in relation to, and possessing and brandishing a firearm in furtherance of a crime of violence. He has been in custody since his arrest in September 2014.
According to documents filed in the case, on June 29, 2014, Alexander entered Foot Locker, located at 655 West Illinois Avenue, Dallas, Texas, removed a .380 caliber Thunder Chief pistol
from a shoe box, pointed the gun at the employee and demanded money. Alexander took $209 in cash and two shoes from a display case as he exited the store.
On June 30, 2014, Alexander entered 7-Eleven, located at 835 Ninth Street, Dallas, Texas, pointed a gun at a store employee, as well as customers of 7-Eleven, and demanded money. Alexander took $146.72 in cash as well as cigarettes. Prior to the robbery of 7-Eleven located on Ninth Street, Alexander entered 7-Eleven, located at 2223 South Beckley Avenue, Dallas, Texas,
pointed a gun at a store employee and demanded money. Alexander took an unspecified amount of cash from the store and $220 in cash and property from a 7-Eleven customer, without her consent.
The Federal Bureau of Investigation investigated. Assistant U.S. Attorney Kate Rumsey prosecuted.# # #
Five Admit Robbing the Amarillo Education Credit UnionRead the Press Release
AMARILLO, Texas — Five defendants appeared in federal court and admitted robbing the Education Credit Union in Amarillo, Texas on September 23, 2016, announced U.S. Attorney John Parker of the Northern District of Texas.
Leonard Jovon Coulter, 29, and Raul Garcia, 28, each pleaded guilty to one count of credit union robbery, and one count of using and carrying a firearm during and in relation to a crime of violence. The robbery count carries a maximum statutory penalty of 20 years in federal prison and a $250,000 fine. The firearms offense carries a mandatory seven-year penalty and a $250,000 fine. Sentencing for Coulter and Garcia is set for July 11, 2017.
Richard Charles Cunningham, Jr., 39, and Desire Valverde, 23, also each pleaded guilty to one count of credit union robbery. Sentencing for Cunningham is set for July 10, 2017. Sentencing for Valverde is set for July 11, 2017.
Keli Edwards, 35, pleaded guilty to one count of misprision of a felony. This count carries a maximum statutory penalty of 3 years in federal prison and a $250,000 fine. Sentencing for Edwards is also set for July 10, 2017.
According to the plea documents, on September 23, 2016, Coulter and Cunningham Jr. entered the Education Credit Union located at 1801 FM 2381, Amarillo, Texas. Coulter approached the teller counter, pointed a firearm at the teller, and told the teller to give him all her money in the drawer. Coulter told the teller to not do or push anything or he would shoot her. The teller told Coulter the drawers were locked. Coulter jumped the counter, pressed the firearm in the teller’s back, and told the teller to hurry. Coulter got money out of the teller’s drawer, and then he demanded access to the vault. The teller stated she could not access the vault.
The manager was then ordered to come and open the vault. After Coulter took the money from the vault, the tellers and manager were ordered to the ground. Coulter and Cunningham exited the Credit Union with approximately $60,067.
The Federal Bureau of Investigation (FBI) and Potter County Sheriff’s office investigated the robbery. Agents learned through their investigation that Garcia was a get-a-way driver and planned this robbery with Coulter and Cunningham. Later, agents stopped Garcia in his pickup and located $5,020 in United States Currency packaged in Education Credit Union bank bands. Agents also recovered two firearms in Garcia’s vehicle, including the firearm Coulter used during the robbery.
Agents conducted a search warrant on Garcia’s residence. Agents located a backpack that had $23,890 in United States Currency, and some of the bills were packaged with Education Credit Union bank bands.
Later, FBI agents learned that Garcia and Coulter were involved in another Education Credit Union Robbery on May 25, 2016. Agents learned through their investigation that Valverde, an employee of Education Credit Union at the time, helped Garcia plan both robberies by providing Garcia information of how and when to commit each robbery. FBI agents discovered that Valverde was in contact with Garcia by phone during each robbery. On May 25, 2016, Valverde was working as a teller and gave Coulter money from her drawer. Garcia paid Valverde a portion of the money taken from the Education Credit Union robbery on May 25, 2016, for her help.
According to plea documents filed in Edwards’ case, Edwards was Coulter’s girlfriend and was watching out for law enforcement on September 23, 2016, when Coulter and Cunningham entered the Credit Union to commit the robbery. Edwards drove Cunningham away from the Credit Union after the robbery to Garcia’s vehicle. Cunningham, Coulter, and Garcia met at Edwards’ residence prior to the robbery and discussed committing the robbery.
The FBI, Amarillo Police Department, the Potter County District Attorney’s Office and the Potter County Sheriff’s Department investigated. Assistant U.S. Attorney Joshua Frausto is in charge of the prosecution.
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Amarillo Woman Pleads Guilty to Mail Fraud Stemming from a $400,000 Airline Travel SchemeRead the Press Release
AMARILLO, Texas — Ai Inthavong Lopez, 37, of Amarillo, Texas, appeared in federal court this morning before U.S. District Court Judge Sidney A. Fitzwater and pleaded guilty to one count of mail fraud, announced U.S. Attorney John Parker of the Northern District of Texas.
Lopez faces a maximum penalty of 20 years in federal prison and a $250,000 fine. Sentencing is set for July 11, 2017.
According to plea documents, from May 2014, and continuing through November 2015, Lopez participated in a scheme involving the sale of fictitious vouchers for future airline travel.
Specifically, Lopez, and persons acting at her direction, would telephonically contact customers in the United States who were falsely informed that they could purchase a voucher for either a round-trip domestic or international flights. Lopez claimed to customers that she was Stephanie Cancino, and that she received discounts on airline tickets through her employment.
Lopez would persuade some customers of her scheme, who did not know of the fraudulent nature of the scheme, to telephonically contact other customers to purchase airline vouchers for future travel. Customers who purchased vouchers would provide personal information, such as name, email address, phone number, and credit card information to Lopez. Lopez would receive money from customers via the United States Postal Service, PayPal, wire transfers, bank transfers, and credit card payments. Lopez, at times, would use the customer’s credit card to purchase other customers’ flight tickets.
To entice customers, Lopez would contact customers about vouchers for one-day sales or special promotions. Lopez knew actual airline tickets purchased by Lopez cost significantly more than the amount a customer paid to purchase the voucher. Lopez continued to solicit customers by promising vouchers below the market rate. Lopez would often have the customers purchase their airline tickets when they were stranded and Lopez would promise to reimburse the customer for the amount they spent. Several times during the course of this scheme, Lopez provided a check to customers to reimburse them for their loss, but the check would be returned to the customer by the bank due to insufficient funds. Lopez would then stop communication with the customer.
As a result of the scheme, Lopez’s false and fraudulent pretenses, representations, and promises fraudulently induced customers to issue monetary payments to Lopez, and for the benefit of Lopez, resulting in a total loss of approximately $401,955.06.
The Federal Bureau of Investigation and Amarillo Police Department investigated. Assistant U.S. Attorney Joshua Frausto is in charge of the prosecution.
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Two Sentenced in Child Sex Trafficking ConspiracyRead the Press Release
FORT WORTH, Texas — Audry Lane, a/k/a “Spud,” 29 and Alvin Lane, a/k/a “Spank,” 32, have been sentenced for their roles in a child sex trafficking conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.
Audry Lane, appeared before U.S. District Judge Reed C. O’Connor this morning and was sentenced to 280 months in federal prison and a lifetime of supervised release. He pleaded guilty to one count of conspiracy to engage in sex trafficking of children in November 2016.
Alvin Lane, appeared before U.S. District Judge Reed C. O’Connor last week and was sentenced to 166 months in federal prison. He also pleaded guilty to one count of conspiracy to engage in sex trafficking of children in October 2016.
Both defendants will be required to register as a sex offender.
According to documents filed in the case, in November 2015, U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) learned that a 16-year-old runaway, Jane Doe 1, was being trafficked by a group of people in Fort Worth, Texas; that group included the defendants. The investigation revealed that from approximately October 1, 2013, through April 16, 2016, the members of this group facilitated the commercial sex acts of several minor and adult females.
Audry Lane and Alvin Lane, along with co-conspirators Diwone Nobles, Deon Bonner, Chad Johnson, Katelyn Ward and Stanley Johnson, acted as pimps for the girls and women they trafficked. They instructed them on how much to charge and they kept proceeds from transactions. They also provided the girls and women with condoms, cellular phones and hotel rooms. Some of the member of the group bought and sold the girls and women they were trafficking amongst themselves.
To locate commercial sex customers, Nobles, Bonner, Chad Johnson, Stanley Johnson, Katelyn Ward, Audry Lane and Alvin Lane facilitated the placement of advertisements on various commercial websites, including Backpage.com. In many instances, rather than placing the Backpage.com advertisement themselves, co-conspirators and sisters Serrah Arnold and/or Jessica Arnold, who acted as “bottom girls,” were told to post the advertisements using Backpage.com accounts belonging to the Arnolds.
For instance, on approximately June 1, 2013, 17-year-old Jane Doe 4 was introduced to Audry Lane, Serrah and Jessica Arnold, and Alvin Lane by a family friend of the Arnolds, co-defendant Katelyn Ward. Ward asked the Lanes and Arnolds to teach Jane Doe 4 how to engage in commercial sex acts. Serrah and Jessica Arnold explained to Jane Doe 4 about Backpage.com and how to talk to commercial sex customers. Ward, along with Audry Lane, and later Alvin Lane, acted as Jane Doe 4’s pimp at various times between 2013 and 2015. Audry Lane knew she was 17 when he began facilitating her commercial sex acts, and he kept the proceeds she earned. Various members of the group posted Jane Doe 4 on Backpage.com and facilitated her commercial sex acts.
On approximately October 10, 2015, friends Deon Bonner and Stanley Johnson met 17-year-old Jane Doe 2 and her 16-year-old friend Jane Doe 1 in Fort Worth. They took the girls to a motel on Meacham Street in Fort Worth. Shortly thereafter, Stanley Johnson told Jane Doe 2 that he wanted her to engage in commercial sex acts, and he sought help from Audry Lane and Alvin Lane to post commercial sex ads for her on Backpage.com. Stanley Johnson told Jane Doe 2 how much to charge and he bought condoms for her; he also kept the money she made from engaging in commercial sex acts.
According to documents filed in the case, one adult, female victim engaged in commercial sex acts at the direction of Nobles, Chad Johnson, Audry Lane, and Serrah Arnold. While that victim worked at Audry Lane’s direction, he would have Serrah Arnold, his “bottom girl,” supervise the victim and take the money she received. Nobles, Johnson and Lane all used force, fraud and/or coercion to cause the victim to engage in commercial sex acts.
The Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Immigration and Customs Enforcement Homeland Security Investigations and the Fort Worth Police Department investigated. Assistant U.S. Attorney Cara Foos Pierce prosecuted.
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Methamphetamine Traffickers SentencedRead the Press Release
AMARILLO, Texas — Francisco Javier Gutierrez-Alvarez, 33, Octavio Cabrera-Mayorquin, 28, and Guillermo Urenda-Bustos, 31 were sentenced today by U.S. District Judge Sidney A. Fitzwater following their guilty pleas in December 2016 to one count of conspiracy to distribute and possess with intent to distribute 500 grams or more of methamphetamine, announced U.S. Attorney John Parker of the Northern District of Texas.
Judge Fitzwater sentenced Gutierrez-Alvarez to 70 months in federal prison, Cabrera-Mayorquin to 63 months in federal prison and Urenda-Bustos to 46 months in federal prison. The defendants have been in custody since their arrest in October 2016.
All three defendants are Mexican citizens and were in the United States illegally at the time of the offense. They will be deported after serving their sentence.
According to documents filed in the case, on October 6, 2016, New Mexico State Police (NMSP) made a traffic stop of a tractor-trailer (car hauler) for an obstructed license plate. During the course of the traffic stop, the officer noticed that the bill of lading regarding the shipment of a white Nissan Frontier was suspicious because it provided only general information. The officer asked the driver for consent to search the Nissan Frontier, and the driver granted consent to search the vehicle.
During the search of the vehicle, NMSP officers located 24 bundles of suspected methamphetamine concealed within the door panels. The bundles field tested positive for the presence of methamphetamine and had a gross weight of approximately 24.5 pounds.
The vehicle was being delivered to “Johnny” in Amarillo, Texas. “Johnny” was subsequently identified as Cabrera-Mayorquin.
On October 7, 2016, Homeland Security Investigation Amarillo and Homeland Security Investigation Albuquerque, along with the assistance from other law enforcement agencies and the truck driver, who was not involved in the conspiracy, delivered the Nissan Frontier to the scheduled destination in Amarillo, Texas. The Nissan Frontier was unloaded from the trailer and Cabrera approached the driver and took custody of the Nissan Frontier. Cabrera drove the Nissan Frontier to a nearby parking spot where it was left. Cabrera entered a silver F-150 pickup and left the area. The driver of the F-150 was subsequently identified as Gutierrez-Alvarez and the back passenger was later identified as Urenda-Bustos.
A tow truck arrived and loaded the Nissan Frontier. The tow truck transported the Nissan Frontier to a residence and then left. Gutierrez, Cabrera, and Urenda-Bustos were observed arriving in the alleyway behind the residence. Cabrera exited the F- 150 and moved the Nissan Frontier to the backyard of the residence.
Amarillo Police Department conducted a traffic stop of the silver F-150 pickup for a traffic violation. All three subjects were transported to the Amarillo Drug Enforcement Administration office for further investigation.
Subsequent testing by the DEA South Central Laboratory confirmed that the substance in the vehicle contained methamphetamine, a Schedule II controlled substance, with an approximate weight of 10,351 grams, and had a purity level of 94 percent.
The case was investigated by Homeland Security Investigation, with assistance from Amarillo Police Department and the Drug Enforcement Administration. Assistant U.S. Attorney Joshua Frausto was in charge of the prosecution.
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Amarillo Heroin Trafficker Pleads Guilty to Possessing More Than 17,000 Grams of HeroinRead the Press Release
AMARILLO, Texas — Jose Emmanuel Morales Rittingger, 29, appeared today before U.S. District Judge Sidney A. Fitzwater and pleaded guilty to possession with intent to distribute one kilogram or more of heroin, announced U.S. Attorney John Parker of the Northern District of Texas.
Rittingger faces a maximum statutory penalty of life in federal prison and a fine not to exceed $1 million. Sentencing is scheduled for July 10, 2017. Rittingger is a Mexican citizen and was in the United States illegally at the time of the offense. He will be deported after serving his sentence.
Co-defendant Joel Lara Merida, 31, was sentenced on Monday, February 27, 2017 by U.S. District Judge Sidney A. Fitzwater to 51 months in federal prison. Merida pleaded guilty to one count of possession with intent to distribute one kilogram or more of heroin and aiding and abetting in November 2016.
According to documents filed in the case, on August 15, 2016, a Texas Department of Public Safety (DPS) Trooper stopped a 1995 BMW for driving in the left lane when not passing and obstructed view through the windshield. Upon making contact with the driver of the vehicle, who was later identified as Merida, and the passenger, who was later identified as Rittingger, the Trooper noticed indicators of possible criminal activity. The Trooper asked Merida for consent to search the vehicle and Merida voluntarily consented to the search. Eighteen bundles in an aftermarket compartment under the back seat were located. There were nine bundles wrapped in black tape, four bundles were wrapped in cellophane, and five bundles were wrapped in silver tape. The heroin had a gross weight of 44.26 pounds and field tested positive for the presence of heroin.
Subsequent testing confirmed that the substance seized was, in fact, heroin, a Schedule I controlled substance, with a net weight of approximately 17,388 grams.
The case was investigated by the Texas Department of Public Safety and the Drug Enforcement Administration. Assistant U.S. Attorneys Joshua Frausto and Sean Taylor are in charge of the prosecution.
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Two Defendants Sentenced in Opioid Pill Mill CaseRead the Press Release
DALLAS — Ivery Myers, 64, and Cornelius Delshun Robinson, a/k/a “Tadow,” 37, both of Houston, Texas were sentenced by U.S. District Judge Sidney A. Fitzwater stemming from their involvement in a “pill mill” operation, announced U.S. Attorney John Parker of the Northern District of Texas.
Judge Fitzwater sentenced Myers to 37 months in federal prison following his guilty plea to one count of conspiracy to distribute a controlled substance in October 2015. Robinson was sentenced to 120 months in federal prison following his guilty plea to the same offense in November 2015. Both defendants have been in custody since their arrest.
In March 2015, a federal grand jury in Dallas indicted 23 individuals, including Myers and Robinson, on offenses related to their participation in a prescription drug distribution conspiracy. That indictment alleged that from at least May 2013 through July 2014, the defendants participated in a scheme to illicitly obtain prescriptions for pain medications, such as oxycodone and hydrocodone, and then distribute those controlled substances for profit. As part of the conspiracy, individuals, often homeless or of limited means, were recruited and paid to pose as patients at medical clinics, including the McAllen Medical Clinic in Dallas, to obtain prescriptions to fill those prescriptions at designated pharmacies.
According to plea documents filed for Myers, on February 24, 2014, acting at the direction of Robinson, co-conspirator Shane Barron drove him to Brady, Texas, and then San Angelo, Texas, to obtain oxycodone with the intent to distribute it later. Myers presented a prescription issued to another individual at a Walmart located in Brady, Texas, and obtained 120 30mg oxycodone pills. After obtaining the oxycodone in Brady, Texas, he and Barron transferred the oxycodone from the prescription bottle labelled for the other individual into a prescription bottle labelled for Shane Barron and disposed of the original bottle. Barron then drove Myers to San Angelo, Texas, to fill another prescription for oxycodone.
According to documents filed for Robinson, on multiple occasions Robinson obtained oxycodone from sources in Dallas and Houston and distributed oxycodone to customers in Texas and Louisiana. Robinson recruited and paid individuals to pose as patients at medical clinics to obtain prescriptions for oxycodone. He paid the recruits to go to pharmacies to fill the prescriptions. He also paid for clinic visits and for the prescriptions. He sent co-conspirators, including Ivery Myers and Shane Barron, to fill prescriptions as far away as San Angelo and Abilene to minimize the possibility of detection by law enforcement. Robinson then obtained the oxycodone and distributed it for profit. On May 25, 2013, in St. Martin's Parish, Louisiana, Robinson possessed approximately 1,543 oxycodone pills, consisting of 1,161 30mg oxycodone pills and 382 15mg oxycodone pills.
This Organized Crime Drug Enforcement Task Force (OCDETF) was investigated by the Drug Enforcement Administration and the Internal Revenue Service Criminal Investigation, with assistance from the Texas Department of Public Safety, the Louisiana State Police, the Grand Prairie Police Department, the Dallas Police Department, the Houston Police Department, the Arlington Police Department, the Greenville Police Department, the Parker County Sheriff’s Office, the U.S. Marshal’s Service, the U.S. Postal Inspection Service, and the Diplomatic Security Service. Assistant U.S. Attorney Mary Walters prosecuted.
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Lubbock Man Sentenced to 121 Months in Federal Prison for Role in Methamphetamine, Cocaine and Marijuana Distribution ConspiracyRead the Press Release
LUBBOCK, Texas — Christopher David Gonzales, aka “Chris,” 41, was sentenced today by Senior U.S. District Judge Sam R. Cummings to 121 months in federal prison, following his guilty plea in December 2016 to his role in a methamphetamine, cocaine and marijuana distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.
Twelve individuals were arrested and charged with similar federal offenses, stemming from their respective roles in a drug distribution conspiracy that operated in West Texas. Of those arrested, each defendant has pled guilty. Two defendants remain fugitives.
According to plea documents filed in the case, on August 18, 2015, Christopher David Gonzales was observed traveling in a 2009 black Dodge Pickup, from Big Spring, Texas. The vehicle arrived at a residence in Lamesa, Texas. This residence had been identified as being used as a “stash” location. Later that same day a Texas Department of Public Safety Trooper conducted a traffic stop on the black Dodge Ram for failure to use signal light during a lane change. The trooper identified the driver as Christopher David Gonzales. When asked if Christopher David Gonzales had anything illegal in his vehicle, he admitted to the trooper that there was methamphetamine in the center console. A search of the vehicle revealed a baggie containing methamphetamine in the center console.
A laboratory analysis was done on the substance seized from Gonzales. The substance weighed 174.2 grams with 92.0% purity level.
The Texas Department of Public Safety and the DEA investigated. Assistant U.S. Attorneys Juanita Fielden and Sean Long prosecuted.
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Lubbock Defendants Affiliated with Crips Criminal Street Gang Sentenced for Roles in Cocaine Distribution ConspiracyRead the Press Release
LUBBOCK, Texas — Four Lubbock residents, who pleaded guilty to their respective roles in cocaine trafficking have been sentenced, announced U.S. Attorney John Parker of the Northern District of Texas.
Dequan Deshawn Willard, 22, was sentenced by Senior U.S. District Judge Sam R. Cummings to 168 months in federal prison. He pleaded guilty in December 2016 to one count of conspiracy to distribute and possess with intent to distribute cocaine base and one count of possession of a firearm in furtherance of a drug trafficking crime.
Brothers, William Emmanuel Spence, 27, Jasmine Jamal Spence, 28, and Antonio Deon Ray Montgomery, 21, pleaded guilty to one count of conspiracy to distribute and possess with intent to distribute cocaine and cocaine base. Judge Cummings sentenced William Spence to 188 months in federal prison, Jasmine Spence was sentenced to 151 months in federal prison and Montgomery was sentenced to 30 months in federal prison.
All four defendants have been in custody since their arrests in October 2016.
According to documents filed in the case, the defendants are either confirmed or suspected members of the Crips criminal street gang in Lubbock.
As part of a joint investigation by U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), and the Lubbock County Sheriff’s Office, law enforcement executed a search warrant at a residence on East 1st Place Street in Lubbock on June 16, 2016, where officers had made a controlled purchase from co-defendant Dequan Willard a few days earlier. Willard was present during the search in which officers recovered approximately 40 grams of cocaine base.
In September 2016, officers conducted several controlled purchases of cocaine base from Jasmine and William Spence. On October 4, 2016, officers executed search warrants at four residences in Lubbock related to the investigation.
Antonio Montgomery was arrested at a residence on East Cornell where officers recovered approximately 110 grams of cocaine base. Montgomery advised the residence belonged to William Spence. Officers also found items associated with the production and sale of cocaine base as well as a loaded firearm.
William Spence was located at a residence on 40th Street. He had $1,379 in cash on his person and $15,020 in cash in a shoe box in the garage. Officers also located a case matching the firearm found at the East Cornell location.
Officers also searched a location on Knoxville Street in Lubbock known to be the residence of Dequan Willard and William Spence. Dequan Willard was arrested at the residence and a loaded firearm was located in the bed where he had been sleeping. In a shoe box with the name “Tucc”—Willard’s street name—written on the side, officers found approximately 427 grams of cocaine. Officers also found another bag in the residence that contained 427 grams of cocaine and also located $8,900 cash in William Spence’s bedroom. Inside of a red pickup truck parked at the residence, officers recovered an additional 84 grams of cocaine; Willard had been observed driving this pickup and his mail was found in the truck. Officers also located an additional 997 grams of cocaine in a Chevrolet Impala at the residence. Inside the vehicle, officers located documents belonging to William Spence and photos depicting both William and Jasmine Spence.
Jasmine Spence was arrested at a residence on 69th Street, where officers located approximately 40 grams of cocaine base in a kitchen drawer and an additional eight grams of cocaine base in sock in Jasmine Spence’s bedroom. Officers also discovered $7,410 in cash in the residence as well as a loaded handgun.
ICE, HSI, and the Lubbock County Sheriff’s Office investigated. Assistant U.S. Attorney Sean Long prosecuted.
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Fort Worth Man Sentenced to 120 Months in Federal Prison after Pleading Guilty to Felony Offense Stemming from a $5 Million Dollar Cattle SchemeRead the Press Release
FORT WORTH — Tony Eugene Lyon, 52, of Fort Worth, Texas, was sentenced today by U.S. District Judge John McBryde to serve 120 months in federal prison following his guilty plea in November 2016 to a felony offense stemming from a $5 million dollar cattle scheme he orchestrated, announced U.S. Attorney John Parker of the Northern District of Texas.
Specifically, Lyon pleaded guilty to one count of wire fraud. Judge McBryde ordered that he surrender to the Bureau of Prisons on April 14, 2017.
According to documents filed in the case, Lyon worked in the cattle industry in and around the town of Perrin, Texas, and became well-known in the North Texas cattle markets. Lyon engaged in the buying, fattening, and selling of cattle, which included securing and cultivating pastureland for the cattle and transporting them.
Midwestern Cattle Marketing (MCM) was a cattle brokering company located in Sidney, Nebraska. As a cattle brokering company, MCM bought and sold cattle for third party clients.
Lyon became a representative in North Texas for MCM and began buying and selling cattle on behalf of MCM at North Texas cattle sale barns.
In early 2014, Lyon told MCM they could save money if they bypassed the cattle sale barns and purchased directly from him. Lyon was provided with MCM checks and a signature stamp, enabling Lyon to purchase cattle using MCM checks without having to wait for authorization. When Lyon purchased cattle for MCM, he would send, via facsimile, a hand-written invoice containing the details of the sale, a computer-generated MCM invoice to reflect the transaction was then prepared. When Lyon received the MCM invoice, he would write an MCM check to the rancher from whom he purchased the cattle.
From February 4, 2015, and continuing to June 29, 2015, Lyon represented to MCM that George Cattle Company (GCC), located in Fort Worth, Texas and owned by John George, bought cattle from MCM at least 130 times. Lyon maintained control of all aspects of the cattle sales transactions involving GCC, including setting the sales prices and timing of the payments to MCM; thereby, facilitating a check-kiting scheme, in which he used MCM money as his own to pay various loans, debts, family, and other personal concerns. Lyon’s checking account was continually overdrawn as a result of both his personal spending and the additional deficits he caused when he wrote checks from the account as purported payments to MCM for its sales to GCC. To cover the increasing deficit, Lyon wrote and deposited MCM checks into his checking account at ever-increasing amounts causing insufficient funds (NSG) in the account to cover a five-million dollar check that Lyon wrote to purchase cattle from MCM for GCC. When contacted Lyon advised that John George agreed to provide $5.3 million to cover the NSF check, however, the account remained overdrawn. Lyon later admitted that neither John George nor GCC existed. As a result of Lyon's scheme, MCM suffered a loss of approximately $5,137,449, causing it to go out of business.
Federal Bureau of Investigation investigated the case. Assistant U.S. Attorney Nancy Larson prosecuted.
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Federal Jury Convicts Doctor of $40 Million Medicare FraudRead the Press Release
DALLAS – Following a five-day trial before U.S. District Judge Jane Boyle, a federal jury has convicted Noble U. Ezukanma, 57, of Fort Worth, Texas, of seven counts of health care fraud offenses, announced U.S. Attorney John Parker of the Northern District of Texas.
Ezukanma was convicted of one count of conspiracy to commit health care fraud and six counts of health care fraud. The health care fraud conspiracy count carries a maximum statutory penalty of 10 years in federal prison and a $250,000 fine. Each health care fraud count also carries a maximum statutory penalty of 10 years in federal prison and a $250,000 fine. Ezukanma was taken into custody following the verdict. A sentencing date will be set at a later date.
Co-defendants Myrna S. Parcon, a/k/a “Merna Parcon,” 62, of Dallas, Texas, Oliva A. Padilla, 57, of Garland, Texas, Ben P. Gaines, 55, of Plano, Texas, and Ransome N. Etindi, 57, of Waxahacie, Texas have pleaded guilty to their role in the scheme and are awaiting sentencing. Lita S. Dejesus, 70, of Allen, Texas, also pleaded guilty and was sentenced to 24 months in federal prison and ordered to pay $4,193,655.78 in restitution.
Ezukanma, Parcon, and Dejesus owned/operated US Physician Home Visits (USPHV), a/k/a “Healthcare Liaison Professionals, Inc.” located on Viceroy Drive in Dallas. Parcon was the owner/manager and Ezukanma was a licensed medical doctor who had an ownership interest in USPHV. Both Ezukanma and Etindi provided their Medicare number to the company to use to submit Medicare claims. Dejesus served in various roles at USPHV, including overseeing Medicare billing.
Gaines formed A Good Homehealth (A Good), a/k/a “Be Good Healthcare, Inc.,” which was located in the same office as USPHV. Parcon, who owned and operated A Good, purchased the company through a “straw” buyer; both Gaines and Parcon concealed Parcon’s ownership.
Parcon and Padilla formed Essence Home Health (Essence), a/k/a “Primary Angel, Inc.,” located on Midway Road in Addison, Texas.
While the three companies appeared to be set up as three separate entities, the companies worked as one; the same employees often worked for all three companies and were often paid by all three companies.
According to evidence presented at trial, from January 1, 2009 to approximately June 9, 2013, Ezukanma and Etindi certified 94% of the Medicare beneficiaries receiving home health services from A Good, and 65% of the Medicare beneficiaries receiving home health services from Essence. Had Medicare known of the true ownership and improper relationship between the three companies, Medicare would not have allowed these companies to enroll in the program and bill for services.
USPHV submitted billing primarily under Dr. Ezukanma’s Medicare provider number, regardless of who actually performed the service. They billed at an alarming rate, generally billing for only the most comprehensive physician exam, and always adding a prolonged service code. USPHV submitted claims to Medicare for physician visits of 90 minutes or more, when most visits took only 15 to 20 minutes. Most all of USPHV patients came from home health companies soliciting certifications and recertifications for home health. More than 97% of USPHV Medicare patients received home health care, whether they needed it or not. The false certifications caused Medicare to pay more than $40 million for fraudulent home health services.
The case was investigated by the U.S. Department of Health and Human Services – Office of Inspector General, the FBI, the and the Texas Attorney General’s Medicaid Fraud Control Unit and were brought as part of the Medicare Fraud Strike.
Assistant U.S. Attorneys Katherine Pfeifle and Douglas Brasher prosecuted.
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Federal Grand Jury Indicts Eight Individuals Charged in a $158 Million Health Care Fraud SchemeRead the Press Release
DALLAS – An indictment returned by a federal grand jury in Dallas this week, and unsealed today, charges eight individuals with offenses related to their participation in a health care fraud scheme, announced John Parker, U.S. Attorney for the Northern District of Texas.
The defendants charged are:
Jamshid Noryian, aka “James Noryian,” 59, of Austin
Dehshid Nourian, aka “David Nourian,” 53, of Plano
Christopher Rydberg, 40, of Fort Worth
Ashraf Mofid, aka “Sherri Mofid,” 68, of Van Alstyne
Leyla Nourian, 48, of Frisco
Leslie Benson, 63, of Waco
Michael Taba, 52, of McKinney
Kevin Williams, 47, of Waxahachie
Each indicted defendant is charged with one count of conspiracy to commit health care fraud. Jamshid Noryian, Dehshid Nourian, Rydberg, Mofid, and Leyla Nourian are also charged with one count of conspiracy to launder money and engage in monetary transactions in criminally derived property. The defendants were released on bond pending trial.
“This is yet another shocking example of how unmitigated greed can spawn a fraud so brazen that it almost takes your breath away,” said USA John Parker. “I would suggest that the costs of playing these games far outweigh whatever short term gains are realized, no matter their size.”
“Health care fraud schemes such as this threaten the financial integrity of public healthcare programs. The workers’ compensation program benefits thousands of postal employees who have received legitimate on-the-job injuries. This case should send a clear message to all health care providers that workers’ compensation fraud is a federal crime that carries serious consequences and will not be tolerated”, said Special Agent in Charge Max Eamiguel, U.S.P.S. Office of Inspector General, Southern Area Field Office.
“An important mission of the Office of Inspector General is to investigate allegations of fraud in relation to the Federal Employees’ Compensation Act. We will continue to work with our law enforcement partners to investigate these types of allegations,” stated Steven Grell, Special Agent-in-Charge of the Dallas Regional Office of the United States Department of Labor, Office of Inspector General.
“These charges underline VA OIG’s commitment to protecting the integrity of the worker’s compensation program, ensuring that resources are always available to VA employees who need it,” said Special Agent in Charge James Werner, VA Office of Inspector General.
The indictment alleges that from May 2014 until March 2017 Jamshid Noryian, Dehshid Nourian, and Rydberg obtained and maintained control of Ability Pharmacy, Industrial & Family Pharmacy, and Park Row Pharmacy and filed Payment Information Forms for Ability, Industrial and Family and Park Row to transmit payment electronically from Department of Labor-Office of Workers’ Compensation (“DOL-OWCP”) to the pharmacies for creams used to treat scars, wounds, and pain and had DOL-OWCP reimbursement rates of up to approximately $28,000 per container.
Mofid, Rydberg, and Leyla Nourian operated Bandoola Pharmaceutical in order to make payments to doctors for referring prescriptions of DOL-OWCP patients to the pharmacies and concealed these payments with “promissory notes” to make it appear as though the payments were loans instead of payments for sending prescriptions to the pharmacies.
Specifically, prescription pads were created and provided to doctors referring prescriptions to Ability. Jamshid Noryian marketed the creams to doctors treating DOL-OWCP patients and induced doctors to send unnecessary and excessive prescriptions for compound medications to the pharmacies in return for payments, free rent and other inducements and payments.
Jamshid Noryian instructed employees of Ability to contact patients and doctors and request refills when the pharmacy was not processing sufficient prescriptions, prescribe pain creams unnecessarily when patients were already prescribed controlled substance medications for pain management and write prescriptions for compound medications for all patients regardless of whether they wanted or needed the medications.
Taba instructed his employees to review the patient visit schedule at the end of each day and write prescriptions for compound creams for each patient, and send the prescriptions to the pharmacies. The medications were not tailored to the individual patient; every patient received the same compound medications.
Jamshid Noryian closely monitored the claims submitted to DOL-OWCP, and the payments received, by checking a computer program several times a day to see the amount of money that had been billed for the day. Jamshid Noryian instructed employees to text him the amount of money made at the end of the day if he was out of the office.
Approximately $158 million in false and fraudulent claims were submitted to FECA through OWCP, and approximately $82 million as payment for those claims were received. The government has seized over $50 million in assets related to the criminal conduct.
The indictment further alleges, Jamshid Noryian, Dehshid Nourian, and Rydberg established and maintained control of bank accounts for Ability, Industrial and Family, and Park Row, into which reimbursement payments based on false and fraudulent claims were deposited. Reimbursement payments were then transferred among bank accounts for entities including, among others, Bandoola Pharmaceuticals, Jade and Joy Holdings, and HJLM Holdings and personal bank and investment accounts in order to conceal the fraud and the fraud proceeds.
Jamshid Noryian and Rydberg purchased cashier’s checks, vehicles, and real property in monetary transactions of greater than $10,000 using proceeds from the fraud scheme.
An indictment is merely an allegation and defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. If convicted, however, each count of conspiracy to commit health care fraud carries a maximum statutory penalty of 10 years in federal prison and a $250,000 fine. The money laundering counts carry a maximum statutory penalty of 20 years in federal prison and a $500,000 fine or twice the value of the property involved, whichever is greater.
The indictment also includes a forfeiture allegation that would require the defendants, upon conviction, to forfeit to the U.S. any property traceable to the offense or used to facilitate the offense, including the more than $50 million already seized from the defendants, and a multimillion-dollar home on Lake Travis in Austin, Texas.
The case is being investigated by the United States Postal Service - Office of Inspector General, United States Department of Labor - Office of Inspector General, Veterans Affairs - Office of Inspector General, and Internal Revenue Service- Criminal Investigation.
Assistant U.S. Attorneys Adrienne Frazior is prosecuting the case. Assistant U.S. Attorney Mark Tindall is handling the forfeiture issues.
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ZTE Corporation Pleads Guilty for Violating U.S. Sanctions by Sending U.S.-Orgin Items to IranRead the Press Release
WASHINGTON – ZTE Corporation pleaded guilty today to conspiring to violate the International Emergency Economic Powers Act (IEEPA) by illegally shipping U.S.-origin items to Iran, obstructing justice and making a material false statement.
Attorney General Jeff Sessions of the U.S. Department of Justice, Acting Assistant Attorney General Mary B. McCord for National Security, U.S. Attorney John R. Parker for the Northern District of Texas and Assistant Director Bill Priestap for the FBI’s Counterintelligence Division made the announcement today. The plea was entered before U.S. District Judge Ed Kinkeade.
Specifically, ZTE pleaded guilty to one count of conspiring to unlawfully export in violation of the IEEPA, one count of obstruction of justice and one count of making a material false statement. ZTE agreed to pay a fine in the amount of $286,992,532 and a criminal forfeiture in the amount of $143,496,266, and submit to a three-year period of corporate probation, during which time an independent corporate compliance monitor will review and report on ZTE’s export compliance program.
As previously announced on March 7, at the time that ZTE agreed to plead guilty, the Corporation simultaneously reached settlement agreements with the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) and the U.S. Department of the Treasury’s Office of Foreign Assets Control. In total ZTE has agreed to pay the U.S. Government $892,360,064. The BIS has suspended an additional $300,000,000, which ZTE will pay if it violates its settlement agreement with the BIS.
According to plea documents filed in the case, between January 2010 and January 2016, ZTE, either directly or indirectly through a third company, shipped approximately $32,000,000 of U.S.-origin items to Iran without obtaining the proper export licenses from the U.S. government. In early 2010, ZTE began bidding on two different Iranian projects. The projects involved installing cellular and landline network infrastructure. Each contract was worth hundreds of millions of U.S. Dollars and required U.S. components for the final products.
In December 2010, ZTE finalized the contracts with Iranian customers. The contracts were signed by four parties: the Iranian customer, ZTE, Beijing 8 Star and ZTE Parsian (ZTE’s subsidiary in Iran). Court documents explain that ZTE identified Beijing 8 Star (8S) as a possible vehicle for hiding its illegal shipments of U.S. items to Iran. It intended to use 8S to export U.S.-origin items from China to ZTE customers in Iran. As part of this plan, ZTE supplied 8S with necessary capital and took over control of the company.
Under the terms of the Iran contracts, ZTE agreed to supply the “self-developed equipment,” collect payments for the projects and manage the whole network. ZTE Parsian was to provide locally purchased materials and all services. 8S was responsible for “relevant third-party equipment,” which primarily meant parts that would be subject to U.S. export laws. ZTE intended for 8S to be an “isolation company,” that is, ZTE intended for 8S (rather than ZTE) to purchase the embargoed equipment from suppliers and provide that equipment under the contract in an effort to distance ZTE from U.S. export-controlled products, and insulate ZTE from U.S. export violations. However, 8S had no purchasing or shipping history and no real business reputation.
Ultimately, although 8S was a party to the contracts, ZTE itself purchased and shipped the embargoed goods under the contract. In its shipping containers, it packaged the U.S. items with its own self-manufactured items to hide the U.S.-origin goods. ZTE did not include the U.S. items on the customs declaration forms, though it did include the U.S.-origin items on the packing lists included inside of the shipments.
In early 2011, when ZTE determined that the use of 8S was insufficient to hide ZTE’s connection to the illegal export of U.S.-origin goods to Iran, senior management of ZTE ordered that a company-level export control project team study, handle and respond to the company’s export control risks. In September 2011, four senior managers signed an Executive Memo, which proposed that the company identify and establish new “isolation companies” that would be responsible for supplying U.S. component parts necessary for projects in embargoed countries. The isolation companies would conceal ZTE’s role in the transshipment scheme and would insulate ZTE from export control risks.
In March 2012, Reuters published an article regarding ZTE’s sale of equipment to Iran. In response, ZTE made a decision to temporarily cease sending new U.S. equipment to Iran. By November 2013, however, ZTE had resumed its business with Iran. Beginning in July 2014, ZTE began shipping U.S.-origin equipment to Iran once again without the necessary licenses.
Instead of using 8S, however, ZTE identified a new isolation company. ZTE signed a contract with the new isolation company, which in turn signed contracts with the two Iranian customers. According to the new scheme, ZTE purchased and manufactured all relevant equipment – both U.S.-origin and ZTE-manufactured – and prepared them for pick-up at its warehouse by the new isolation company. The new isolation company then shipped all items to the Iranian customers. Shipments to Iran continued from January 2014 through January 2016.
Despite its knowledge of an ongoing grand jury investigation into its Iran exports, according to plea documents, ZTE took several steps to conceal relevant information from the U.S. government. It further took affirmative steps to mislead the U.S. government. In the summer of 2012, ZTE asked each of the employees who were involved in the Iran sales to sign nondisclosure agreements in which the employees agreed to keep confidential all information related to the company’s U.S. exports to Iran.
During meetings throughout late 2014, late 2015 and early 2016, outside counsel for ZTE, unaware that the statements ZTE had given to counsel for communication to the U.S. Government were false, represented to the DOJ and federal law enforcement agents that ZTE had stopped doing business with Iran and therefore was no longer violating U.S. export laws. Similarly, on July 8, 2015, in-house counsel for ZTE accompanied outside counsel in a meeting with the DOJ and federal law enforcement agents and reported that ZTE was abiding by U.S. laws. That statement was also false.
ZTE also hid data related to its resumed illegal sales to Iran from a forensic accounting firm hired by defense counsel to conduct an internal investigation into the company’s Iran sales. ZTE knew the forensic accounting firm was reviewing its systems and knew that the analysis was being reported to the DOJ and U.S. law enforcement. To avoid detection of its 2013-2016 resumed illegal sales to Iran, ZTE formed the “contract data induction team” (“CDIT”). The CDIT was comprised of approximately 13 people whose job it was to “sanitize the databases” of all information related to the 2013-2016 Iran business. The team identified and removed from the databases all data related to those sales. ZTE also established an auto-delete function for the email accounts of those 13 individuals on the CDIT, so their emails were deleted every night – a departure from its normal practices – to ensure there were no communications related to the hiding of the data.
The plea agreement ended a five-year joint investigation into ZTE’s export practices, which was handled by the DOJ’s National Security Division, the U.S. Attorney’s Office for the Northern District of Texas, the FBI, the BIS, the Department of Homeland Security and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.
The case is being prosecuted by Deputy Chief Elizabeth Cannon of the National Security Division’s Counterintelligence and Export Control Section and Assistant U.S. Attorney Mark Penley of the Northern District of Texas.
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Richardson Man Indicted for Making False Statement to the FBIRead the Press Release
DALLAS — A federal grand jury in Dallas returned an indictment yesterday, charging a Richardson, Texas, man with six counts of making false statements to federal agents, announced John Parker, U.S. Attorney for the Northern District of Texas and Eric Jackson, Special Agent in Charge of the Dallas Field Office of the FBI.
The charges stem from alleged false statements that Said Azzam Mohamad Rahim made to federal law enforcement officers on March 5, 2017, during a terrorism investigation. The indictment alleges that, when interviewed, Rahim made a number false statements related to his support for ISIS and his prior statements relating to violence and terrorist activity.
Rahim, 40, was arrested earlier this month on a criminal complaint and is in custody pending trial. A trial date has not been set. The maximum statutory penalty for each count alleged in the indictment is eight years in federal prison, a period of supervised release, and a $250,000 fine.
The Federal Bureau of Investigation is responsible for this investigation. Assistant United States Attorney Errin Martin is prosecuting the case with assistance from the National Security Division’s Counterterrorism Section.
The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes. If convicted of any offense, the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
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Dallas Man Convicted for His Role in Methamphetamine Distribution ConspiracyRead the Press Release
DALLAS — Following a four-day jury trial before U.S. District Judge David C. Godbey, a federal jury has convicted Gilberto Gomez, 37, on felony drug offenses, announced U.S. Attorney John Parker of the Northern District of Texas.
Gomez was convicted yesterday on one count of conspiracy to possess with intent to distribute 500 grams or more of methamphetamine, one count of possession with intent to distribute methamphetamine, one count of possession with intent to distribute cocaine, one count of possession with intent to distribute marijuana, and two counts of possession of a firearm in furtherance of a drug trafficking crime. The drug trafficking conspiracy count carries a maximum statutory penalty of life in federal prison and a $1 million fine. Sentencing is scheduled in June.
Co-conspirator Felix Cantu, 30, pled guilty in March 2017 to conspiracy to distribute methamphetamine and possession of a firearm in furtherance of a drug trafficking crime. No date has been set for his sentencing.
The government presented evidence at trial that beginning in November 17, 2015 until March 1, 2016 Gomez and Cantu operated a drug distribution enterprise from Gomez’s residence on Palacios Avenue in West Dallas. After a four-month long investigation, DEA and the Dallas Police Department executed a search warrant on the residence and recovered more than $37,000 in cash and over $40,000 worth of narcotics. To protect his drugs, Gomez installed three-inch steel coverings for the windows and a coded-entry metal gate in the hallway leading to the master bedroom. Gomez travelled to California every two weeks to purchase marijuana. He concealed the newly purchased marijuana in hidden compartments of vehicles and shipped them back to Texas on open-air tractor-trailers. In an effort to keep drugs off the streets in that neighborhood, the U.S. Attorney’s Office is seeking an order to forfeit the house since it was used for the criminal activity.
The Drug Enforcement Administration and the Dallas Police Department investigated. Assistant U.S. Attorneys Rachael Jones and P.J. Meitl prosecuted.
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ZTE Corporation Pleads Guilty for Violating U.S. Sanctions by Sending U.S.-Origin Items to IranRead the Press Release
ZTE Corporation pleaded guilty today to conspiring to violate the International Emergency Economic Powers Act (IEEPA) by illegally shipping U.S.-origin items to Iran, obstructing justice and making a material false statement.
Attorney General Jeff Sessions of the U.S. Department of Justice, Acting Assistant Attorney General Mary B. McCord for National Security, U.S. Attorney John R. Parker for the Northern District of Texas and Assistant Director Bill Priestap for the FBI’s Counterintelligence Division made the announcement today. The plea was entered before U.S. District Judge Ed Kinkeade.
Specifically, ZTE pleaded guilty to one count of conspiring to unlawfully export in violation of the IEEPA, one count of obstruction of justice and one count of making a material false statement. ZTE agreed to pay a fine in the amount of $286,992,532 and a criminal forfeiture in the amount of $143,496,266, and submit to a three-year period of corporate probation, during which time an independent corporate compliance monitor will review and report on ZTE’s export compliance program.
As previously announced on March 7, at the time that ZTE agreed to plead guilty, the Corporation simultaneously reached settlement agreements with the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) and the U.S. Department of the Treasury’s Office of Foreign Assets Control. In total ZTE has agreed to pay the U.S. Government $892,360,064. The BIS has suspended an additional $300,000,000, which ZTE will pay if it violates its settlement agreement with the BIS.
The plea agreement ended a five-year joint investigation into ZTE’s export practices, which was handled by the DOJ’s National Security Division, the U.S. Attorney’s Office for the Northern District of Texas, the FBI, the BIS, the Department of Homeland Security and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.
According to plea documents filed in the case, between January 2010 and January 2016, ZTE, either directly or indirectly through a third company, shipped approximately $32,000,000 of U.S.-origin items to Iran without obtaining the proper export licenses from the U.S. government. In early 2010, ZTE began bidding on two different Iranian projects. The projects involved installing cellular and landline network infrastructure. Each contract was worth hundreds of millions of U.S. Dollars and required U.S. components for the final products.
In December 2010, ZTE finalized the contracts with Iranian customers. The contracts were signed by four parties: the Iranian customer, ZTE, Beijing 8 Star and ZTE Parsian (ZTE’s subsidiary in Iran). Court documents explain that ZTE identified Beijing 8 Star (8S) as a possible vehicle for hiding its illegal shipments of U.S. items to Iran. It intended to use 8S to export U.S.-origin items from China to ZTE customers in Iran. As part of this plan, ZTE supplied 8S with necessary capital and took over control of the company.
Under the terms of the Iran contracts, ZTE agreed to supply the “self-developed equipment,” collect payments for the projects and manage the whole network. ZTE Parsian was to provide locally purchased materials and all services. 8S was responsible for “relevant third-party equipment,” which primarily meant parts that would be subject to U.S. export laws. ZTE intended for 8S to be an “isolation company,” that is, ZTE intended for 8S (rather than ZTE) to purchase the embargoed equipment from suppliers and provide that equipment under the contract in an effort to distance ZTE from U.S. export-controlled products, and insulate ZTE from U.S. export violations. However, 8S had no purchasing or shipping history and no real business reputation.
Ultimately, although 8S was a party to the contracts, ZTE itself purchased and shipped the embargoed goods under the contract. In its shipping containers, it packaged the U.S. items with its own self-manufactured items to hide the U.S.-origin goods. ZTE did not include the U.S. items on the customs declaration forms, though it did include the U.S.-origin items on the packing lists included inside of the shipments.
In early 2011, when ZTE determined that the use of 8S was insufficient to hide ZTE’s connection to the illegal export of U.S.-origin goods to Iran, senior management of ZTE ordered that a company-level export control project team study, handle and respond to the company’s export control risks. In September 2011, four senior managers signed an Executive Memo, which proposed that the company identify and establish new “isolation companies” that would be responsible for supplying U.S. component parts necessary for projects in embargoed countries. The isolation companies would conceal ZTE’s role in the transshipment scheme and would insulate ZTE from export control risks.
In March 2012, Reuters published an article regarding ZTE’s sale of equipment to Iran. In response, ZTE made a decision to temporarily cease sending new U.S. equipment to Iran. By November 2013, however, ZTE had resumed its business with Iran. Beginning in July 2014, ZTE began shipping U.S.-origin equipment to Iran once again without the necessary licenses.
Instead of using 8S, however, ZTE identified a new isolation company. ZTE signed a contract with the new isolation company, which in turn signed contracts with the two Iranian customers. According to the new scheme, ZTE purchased and manufactured all relevant equipment – both U.S.-origin and ZTE-manufactured – and prepared them for pick-up at its warehouse by the new isolation company. The new isolation company then shipped all items to the Iranian customers. Shipments to Iran continued from January 2014 through January 2016.
Despite its knowledge of an ongoing grand jury investigation into its Iran exports, according to plea documents, ZTE took several steps to conceal relevant information from the U.S. government. It further took affirmative steps to mislead the U.S. government. In the summer of 2012, ZTE asked each of the employees who were involved in the Iran sales to sign nondisclosure agreements in which the employees agreed to keep confidential all information related to the company’s U.S. exports to Iran.
During meetings throughout late 2014, late 2015 and early 2016, outside counsel for ZTE, unaware that the statements ZTE had given to counsel for communication to the U.S. Government were false, represented to the DOJ and federal law enforcement agents that ZTE had stopped doing business with Iran and therefore was no longer violating U.S. export laws. Similarly, on July 8, 2015, in-house counsel for ZTE accompanied outside counsel in a meeting with the DOJ and federal law enforcement agents and reported that ZTE was abiding by U.S. laws. That statement was also false.
ZTE also hid data related to its resumed illegal sales to Iran from a forensic accounting firm hired by defense counsel to conduct an internal investigation into the company’s Iran sales. ZTE knew the forensic accounting firm was reviewing its systems and knew that the analysis was being reported to the DOJ and U.S. law enforcement. To avoid detection of its 2013-2016 resumed illegal sales to Iran, ZTE formed the “contract data induction team” (“CDIT”). The CDIT was comprised of approximately 13 people whose job it was to “sanitize the databases” of all information related to the 2013-2016 Iran business. The team identified and removed from the databases all data related to those sales. ZTE also established an auto-delete function for the email accounts of those 13 individuals on the CDIT, so their emails were deleted every night – a departure from its normal practices – to ensure there were no communications related to the hiding of the data.
The case is being prosecuted by Deputy Chief Elizabeth Cannon of the National Security Division’s Counterintelligence and Export Control Section and Assistant U.S. Attorney Mark Penley of the Northern District of Texas.
Jury Convicts Two in Methamphetamine Distribution ConspiracyRead the Press Release
FORT WORTH — Following a two-day jury trial before U.S. District Judge Reed C. O’Connor, a federal jury has convicted two Fort Worth men on felony drug offenses, announced U.S. Attorney John Parker of the Northern District of Texas.
David Piper, Jr., 52, and Carlos Cortinas, 39, were each convicted late yesterday on one count of conspiracy to possess with intent to distribute methamphetamine. The drug trafficking conspiracy count carries a maximum statutory penalty of life in federal prison and a $10 million fine. Sentencing is scheduled for July 17, 2017.
Co-conspirator Chadwick Hernandez, 32, pleaded guilty in February 2017 to the same offense and is scheduled to be sentenced June 26, 2017.
The government presented evidence at trial that beginning in March 2015 until January 20, 2016 Piper and Cortinas possessed with the intent to distribute 500 grams or more of methamphetamine. Evidence elicited at trial showed that methamphetamine distributors from Arlington, including Cortinas, transported multiple pounds of methamphetamine to Piper for re-distrubution of methamphetamine in Bolivar, Missouri.
DEA Fort Worth investigated with the assistance of DEA’s Springfield and Tulsa offices, Arlington Police Department, Fort Worth Police Department, North Richland Hills Police Department, Oklahoma DPS, and Polk County, Missouri Sheriff’s Office. Assistant U.S. Attorneys Aisha Saleem and Shawn Smith prosecuted.
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Garland, Texas, Man Sentenced to 144 Months in Federal Prison on Federal Child Pornography ConvictionRead the Press Release
DALLAS — Jeffrey David Mitchell, 54, of Garland, Texas, was sentenced today by U.S. District Judge Ed Kinkeade to 144 months in federal prison and 10 years supervised release following his guilty plea in August 2015 to one count of transportation of child pornography, announced U.S. Attorney John Parker of the Northern District of Texas.
Mitchell has been in federal custody since his arrest in May 2015 on related charges.
According to documents filed in the case, the investigation began in late April 2015 resulting from a CyberTip from the National Center for Missing and Exploited Children (NCMEC) regarding the upload of images depicting child pornography to an electronic group and to various email accounts. The investigation led law enforcement to secure and execute a search warrant on Mitchell’s home on April 29, 2015; Mitchell and his parents were home during the search.
Mitchell admitted he possessed child pornography and that he sent and received child pornography via his email account. He confirmed that he created and used multiple email accounts to trade the child pornography, and that images of child pornography were on his desktop computer located in his bedroom.
Law enforcement seized several media items from the residence, and a forensic analysis and review of Mitchell’s email accounts revealed approximately 750 images and 100 videos of child pornography. Some of those images and videos depict sadistic/and/or violent content, and some of the files depict infants and toddlers.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The FBI, Collin County Sheriff’s Office and Garland Police Department investigated. Assistant U.S. Attorney Camille Sparks prosecuted.
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Serial Armed Robber Sentenced to 168 Months in Federal Prison for His Role in Three Armed RobberiesRead the Press Release
DALLAS — Coby Cole Ditto, 21, was sentenced yesterday by U.S. District Judge Sam A. Lindsay to serve a total of 168 months in federal prison for his role in committing several violent armed robberies in Dallas in 2015, announced U.S. Attorney John Parker of the Northern District of Texas.
Ditto pleaded guilty in October 2016 to one count of conspiracy to interfere with commerce by robbery and one count of using, carrying, brandishing and discharging a firearm during and in relation to a crime of violence.
All of Ditto’s codefendants in the case, Michael Deshun Holland, Jr., 22, Devonte Aaron Dillard, 24, Tatiana Renee Sallie, 20, and Trenton Kyle Sirkel, 21, have pleaded guilty to their respective roles in the conspiracy. Dillard was sentenced to 240 months in federal prison. Skirkel was sentenced to 24 month in federal prison. Holland and Sallie are awaiting sentencing.
According to documents filed in the case, Ditto discussed and planned with each other co-defendants, among other things, the robberies of convenience stores located in Mesquite and Garland, Texas.
On May 8, 2015, Dillard, Holland, Ditto and Sirkel entered the 7-Eleven store on Interstate Highway 30 in Mesquite, brandished a firearm, and robbed the store.
On May 12, 2015, Dillard, Holland, Ditto and Sallie entered the 7-Eleven store on Gus Thomasson Road in Mesquite, brandished a firearm, struck an employee in the head with the firearm, and robbed the store.
That same night, Dillard, Holland, Ditto and Sallie went to the 7-Eleven store on Northwest Highway in Garland, brandished a firearm, assaulted a store employee, and robbed the store.
The case was investigated by Mesquite Police Department, Garland Police Department and the Federal Bureau of Investigation.
Assistant U.S. Attorneys Jamie Hoxie and Keith Robinson prosecuted.
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Maryland Man Arrested for CyberstalkingRead the Press Release
A Maryland man was arrested today on a federal criminal complaint charging him with cyberstalking a Dallas, Texas resident, announced Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and U.S. Attorney John Parker of the Northern District of Texas.
John Rayne Rivello, 29, of Salisbury, Maryland, was arrested in Maryland today on a criminal complaint filed in the Northern District of Texas. The complaint was unsealed today following his initial appearance in the District of Maryland.
According to the allegations in the affidavit filed with the complaint, on Dec. 15, 2016, the victim, who is known to suffer from epilepsy, received a message via Twitter from Rivello. The tweet contained an animated strobe image embedded with the statement, “You deserve a seizure for your post.” Upon viewing the flashing strobe image the victim immediately suffered a seizure.
Additionally, according to the affidavit, evidence received pursuant to a search warrant showed Rivello’s Twitter account contained direct messages from Rivello’s account to other Twitter users concerning the victim. Among those direct messages included statements by Rivello, including “I hope this sends him into a seizure,” “Spammed this at [victim] let’s see if he dies,” and “I know he has epilepsy.” Additional evidence received pursuant to a search warrant showed Rivello’s iCloud account contained a screenshot of a Wikipedia page for the victim, which had been altered to show a fake obituary with the date of death listed as Dec. 16, 2016. Rivello’s iCloud account also contained screen shots from epilepsy.com with a list of commonly reported epilepsy seizure triggers and from dallasobserver.com discussing the victim’s report to the Dallas Police Department and his attempt to identify the Twitter user.
The charges contained in a criminal complaint are merely accusations, and a defendant is presumed innocent unless and until proven guilty.
The FBI and the Dallas Police Department investigated the case. The Maryland State Police and Ocean City Police Department assisted during the arrest. Assistant U.S. Attorney C.S. Heath of the Northern District of Texas and Aaron Cooper of the Criminal Division’s Computer Crime and Intellectual Property Section are prosecuting the case.
Rivello ComplaintMaryland Man Arrested for CyberstalkingRead the Press Release
WASHINGTON – A Maryland man was arrested today on a federal criminal complaint charging him with cyberstalking a Dallas, Texas resident, announced Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and U.S. Attorney John Parker of the Northern District of Texas.
John Rayne Rivello, 29, of Salisbury, Maryland, was arrested in Maryland today on a criminal complaint filed in the Northern District of Texas. The complaint was unsealed today following his initial appearance in the District of Maryland.
According to the allegations in the affidavit filed with the complaint, on Dec. 15, 2016, the victim, who is known to suffer from epilepsy, received a message via Twitter from Rivello. The tweet contained an animated strobe image embedded with the statement, “You deserve a seizure for your post.” Upon viewing the flashing strobe image the victim immediately suffered a seizure.
Additionally, according to the affidavit, evidence received pursuant to a search warrant showed Rivello’s Twitter account contained direct messages from Rivello’s account to other Twitter users concerning the victim. Among those direct messages included statements by Rivello, including “I hope this sends him into a seizure,” “Spammed this at [victim] let’s see if he dies,” and “I know he has epilepsy.” Additional evidence received pursuant to a search warrant showed Rivello’s iCloud account contained a screenshot of a Wikipedia page for the victim, which had been altered to show a fake obituary with the date of death listed as Dec. 16, 2016. Rivello’s iCloud account also contained screen shots from epilepsy.com with a list of commonly reported epilepsy seizure triggers and from dallasobserver.com discussing the victim’s report to the Dallas Police Department and his attempt to identify the Twitter user.
The charges contained in a criminal complaint are merely accusations, and a defendant is presumed innocent unless and until proven guilty.
The FBI and the Dallas Police Department investigated the case. The Maryland State Police and Ocean City Police Department assisted during the arrest. Assistant U.S. Attorney C.S. Heath of the Northern District of Texas and Aaron Cooper of the Criminal Division’s Computer Crime and Intellectual Property Section are prosecuting the case.
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Anesthesiologist and Forest Park Medical Center Founder Pleads Guilty to $40 Million Kickback SchemeRead the Press Release
DALLAS — Richard Ferdinand Toussaint, Jr., 58, of Dallas appeared today before U.S. District Judge Sidney A. Fitzwater and pleaded guilty to one count of conspiracy to pay health care bribes and kickbacks and one count of offering or paying illegal remuneration and aiding and abetting under the Travel Act announced U.S. Attorney John Parker of the Northern District of Texas.
Toussaint faces a maximum statutory penalty of five years in federal prison and a $250,000 fine for each count. Sentencing will be scheduled at a later date.
Co-defendants Andrea Kay Smith, 37, of Rockwall, Kelly Wade Loter, 48, of Dallas, and Israel Ortiz, 49, also of Dallas previously pleaded guilty to their role in the conspiracy. The remaining 17 defendants are awaiting trial scheduled for July 10, 2017.
According to plea documents filed in the case, Toussaint, an anesthesiologist, met co-defendant Barker in approximately 2003 and began providing anesthesia services for his cases around 2005. Around 2008, Toussaint and Barker decided to start their own physician-owned hospital, Forest Park Medical Center (FPMC). All the surgeries at FPMC were to be elective in nature. FPMC targeted bariatric and spinal surgeons because their surgeries generated the most money. The original plan was for FPMC to go in-network with the major insurance carriers when possible. Instead, FPMC attempted to negotiate better reimbursement rates and remained out-of-network so it could collect more in reimbursements.
All of the founders at FPMC, including Toussaint and co-defendants Beauchamp, Burt, Barker, and the other founders knew that FPMC would pay surgeons marketing checks in exchange for bringing surgeries, especially lucrative out-of-network surgeries, to FPMC as opposed to other facilities. Beauchamp discussed the details of the payments with each doctor, and he kept tabs on how many surgeries they brought to FPMC. Beauchamp used a metric to calculate the payments based on the surgeons anticipated case volumes at FPMC. The payments quickly grew from $300,000 a month to $1.2 million a month. Beauchamp would update Toussaint and Barker on the bribe payments. Toussaint would often be copied on emails where Barker would ask Beauchamp how much certain doctors were being paid.
To induce patients with both in-network and out-of-network benefits to come to FPMC, and to facilitate the bribe and kickback payments, FPMC systematically waived coinsurance or reduced it to in-network levels. According to Toussaint, this practice was concealed or misrepresented to insurance carriers so they would not refuse to reimburse the hospital. Everyone associated with FPMC, including Beauchamp, Burt, Toussaint, Barker, and the surgeons receiving bribe and kickback payments, knew that FPMC guaranteed patients prior to surgery that they would not pay or would pay only the equivalent of in-network patient-responsibility payments.
Toussaint and Barker owned a commercial real estate company that was working on the continued development of FPMC. Beauchamp used the company to funnel bribe and kickback payments in exchange for patient referrals.
FPMC also made bribe and kickback payments to chiropractors to induce them to send their patients that needed surgery to FPMC as opposed to other facilities. Toussaint would often meet with chiropractors for these discussions and there was a clear quid-pro-quo, that is, the chiropractors were paid to refer their patients to FPMC.
In addition to paying surgeons bribes and kickbacks for cases being performed at FPMC in the form of marketing money, FPMC also used the opportunity to invest in FPMC, and the number of investment units a surgeon could purchase, to induce surgeons to bring their patients to FPMC. The more surgeries a surgeon could bring to FPMC, the more they were allowed to invest and profit from the hospital’s billings. Beauchamp, Barker, and Toussaint often decided how many shares a surgeon should be able to purchase based on the number of surgical cases the surgeon could steer to FPMC. Surgeon-investors who did not bring enough surgical cases to FPMC were divested or their shares were cut.
The case was investigated by the FBI, the U.S. Department of Labor Office of Inspector General, the U.S. Department of Labor Employee Benefits Security Administration, the U.S. Department of Defense - Defense Criminal Investigative Service, the U.S. Office of Personnel Management Office of Inspector General, and Internal Revenue Service Criminal Investigation, with assistance from the Food and Drug Administration and the U.S. Postal Inspection Service.
Assistant U.S. Attorneys Andrew Wirmani, Kate Pfeifle and Mark Tindall are prosecuting the case.
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Federal Jury Convicts Man in Conspiracy to Illegally Manufacture Firearms That Were Sent to MexicoRead the Press Release
DALLAS — Following a one-week trial before U.S. District Judge Sam A. Lindsay, a federal jury convicted Gary Busby, 63, formerly of Flower Mound, Texas, on one count of conspiracy to manufacture firearms without a license and four counts of structuring transactions to evade reporting requirements, announced U.S. Attorney John Parker of the Northern District of Texas.
Specifically, in December 2010, Busby met an individual at a gun show and sold him firearms knowing he did not have federal firearms licenses (FFL). Busby agreed to manufacture AR-15 and AK stripped receivers into fully functional firearms in a series of transactions until December 2011. At some time during that period, Busby became aware that the firearms he was manufacturing, and the firearms he agreed to manufacture, had and would be sent to Mexico.
In January 2011, officers with the Hidalgo Police Department recovered fifteen firearms, hidden in a gas tank of a vehicle attempting to enter Mexico. Seven of those firearms were traced directly to the conspirators in this case, including Gary Busby.
In February 2011, officers with the Fort Worth Police Department saw Busby at a gun show negotiating gun purchases for this individual. Busby would contact potential sellers and negotiate the price. A firearm purchased at this gun show was later recovered in Mexico.
During a search of Busby’s residence in July 2011, federal agents catalogued all the firearms and ammunition at the residence. That same day, Busby signed a letter putting him on notice that he was to cease and desist in engaging in the business of selling firearms without a license and advising him that several of the firearms he had sold had been recovered during criminal activities. In spite of the notification, one of the firearms catalogued that day at Busby’s residence was later found in Mexico by authorities.
Over the course of 2010 and 2011, evidence showed that Gary Busby manufactured hundreds of AR-15 and AK firearm receivers into fully functional firearms and made thousands of dollars doing so. Law enforcement found approximately fifty of those firearms as they were being smuggled into or recovered in Mexico. The government also presented evidence showing that Busby lied on ATF forms related to firearm purchases, specifically of receivers, by stating that he was the actual buyer of the receiver, knowing that he would sell or trade that receiver to third parties.
Evidence also showed that from approximately December 2010 to September 2012, Busby purchased hundreds of postal money orders at dozens of post offices in the Dallas-Fort Worth area, in an effort to hide the proceeds of his illegal firearm activity. Busby would only purchase two $1,000 money orders at a time at one post office, using cash, and would travel to up to six post offices in one day, purchasing $2,000 in money orders at each. Doing so, he was knowingly evading the federal reporting requirement for when a customer purchases $3,000 or more in money orders. In 2011 alone, Busby purchased approximately $236,000 in postal money orders, in order to hide the money made manufacturing firearms. Evidence presented to the jury showed that he knowingly structured these cash transactions.
The Bureau of Alcohol, Tobacco, Firearms and Explosives and the U.S. Postal Inspection Service investigated. Assistant U.S. Attorney Kate Rumsey and First Assistant U.S. Attorney Chad Meacham are in charge of the prosecution.
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Three Heroin Dealers Arrested on Federal Drug Charges in Connection to the Overdose Death of a Farmers Branch WomanRead the Press Release
DALLAS — A Dallas-area man has been charged by federal criminal complaint stemming from his role in selling the heroin that caused a young woman’s overdose death at a McDonald’s restaurant in Farmers Branch in June 2016. Two other men were charged by federal criminal complaints stemming from their trafficking of illegal narcotics. The announcement was made today by U.S. Attorney John Parker of the Northern District of Texas.
“Tragically, heroin deaths like this are not isolated events anymore,” said U.S. Attorney Parker. “We obviously can’t bring this life back, but we can, together with our state and local partners, bring the full weight of law enforcement to bear on finding and prosecuting those who sell this poison. We will find you.”
Specifically, the complaint charges Rogelio Bernal, 20, of Dallas, Texas, and Zakariah Michael Wolf, 29, of Greenville, Texas, with conspiracy to distribute heroin in November of 2016, and separately charges Bernal with conspiracy to distribute heroin in June of 2016. Bernal and Wolf made appearances in federal court this week before U.S. Magistrate Judge Renee Harris Toliver, who ordered that Bernal remain in custody pending the detention hearing set for March 20, 2017, and Wolf remain in custody pending his detention hearing set for March 22, 2017.
In a separate complaint, Steven Gomez, 18, of Dallas, Texas, was charged with conspiracy to distribute methamphetamine on March 9, 2017, after having been found sharing a residence with Rogelio Bernal. Gomez made his initial appearance in federal court on March 9, 2017, before U.S. Magistrate Judge Renee Harris Toliver who ordered that he remain in custody pending trial.
According to the affidavit filed with the federal complaint for Bernal and Wolf, on November 9, 2016 investigators learned that Bernal distributed heroin in the Farmers Branch, Texas, area. Bernal had been the source of supply of heroin in the area since at least April 2016, and supplied Nancy Pineda, who was previously charged in a separate complaint for her role in the conspiracy. Investigators discovered Bernal had several text conversations with co-conspirators coordinating meetings to conduct illegal drug transactions.
On November 17, 2016, Farmers Branch Police Department observed Bernal arrive at a shopping center parking lot in Dallas, Texas. Officers observed a white male get into the front passenger seat of Bernal’s vehicle. The white male was later identified as Wolf. Approximately five to ten minutes later, Wolf exited Bernal’s vehicle and Bernal departed the location.
In the early morning hours of November 18, 2016, a Greenville Police officer observed a green 1994 Chrysler Concord, traveling east on Templeton Street in Greenville, Texas. The vehicle was stopped after committing multiple traffic violations, and the driver was identified as Wolf. Wolf was eventually arrested and the Greenville Police Department located a safe in the vehicle containing digital scale, several small clear zip lock style baggies, a syringe, a spoon with possible heroin residue, Suboxone sublingual packs, a half pill of Alprozolam, a plastic baggie containing suspected cocaine, a plastic baggie containing suspected methamphetamine, and a plastic baggie containing suspected heroin. Texas Department of Public Safety Laboratory Analysis of the drugs seized from the safe revealed 11.20 gross grams of heroin and 1.77 gross grams of methamphetamine. Two glass pipes, a wood stick, and 50 packaged syringes were also found in the vehicle.
According to the affidavit filed with the Gomez complaint, a federal search warrant was executed on March 9, 2017, at the residence of Bernal and Gomez. A search of Gomez’s room revealed a number of weapons, crack cocaine, and methamphetamine. Specifically, 490 gross grams of crack cocaine, 2,036 gross grams of suspected methamphetamine, and multiple firearms were located.
A federal complaint is a written statement of the essential facts of the offense charged, and must be made under oath before a magistrate judge. A defendant is entitled to the presumption of innocence until proven guilty. The U.S. Attorney’s office has 30 days to present the matter to a grand jury for indictment. The penalty for the offenses charged in these criminal complaints is not more than 20 years in federal prison and a $1 million fine.
The Farmers Branch Police Department, Greenville Police Department, and the Drug Enforcement Administration are investigating the case. The Grand Prairie Police Department and Dallas Police Department provided assistance for the operation on March 9, 2017. Deputy Criminal Chief Assistant U.S. Attorney Rick Calvert and Assistant U.S. Attorney Myria Boehm are prosecuting.
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Dallas Man Sentenced to 240 Months for His Role in a Methamphetamine Distribution ConspiracyRead the Press Release
DALLAS — Josue Tijerina, aka “J,” 30, of Dallas, was sentenced yesterday before U.S. District Judge Barbara M.G. Lynn for his role in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.
Tijerina was sentenced to 240 months in federal prison. Tijerian pleaded guilty in August 2016 to one count of distribution of a controlled substance.
Tijerina and 18 co-defendants were charged in a 12-count indictment charging each defendant with one count of conspiracy to possess with intent to distribute 500 grams or more of methamphetamine. All but three of the defendants are also charged with one substantive count of either distribution of methamphetamine or possession with intent to distribute methamphetamine. Two defendants are charged with a firearms offense.
The investigation into this drug trafficking organization, which operated out of the Pleasant Grove, Seagoville and Balch Springs areas of the DFW metroplex, began in early January 2016. During the investigation, law enforcement has seized more than 6700 grams of methamphetamine, approximately 13.2 kilograms of methamphetamine oil, 62 grams of marijuana, 2.5 grams of heroin, and 20 ml of gamma hydroxybutyrate (GHB), as well as 12 firearms and $12,379 in cash.
The Department of Public Safety and the Dallas Police Department investigated. Assistant U.S. Attorney Andrew Wirmani prosecuted.
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Lubbock Woman Sentenced to 87 Months in Federal Prison for Her Role in Methamphetamine Distribution ConspiracyRead the Press Release
LUBBOCK, Texas —Arleen Theres Keithley, 36, was sentenced this morning before U.S. District Judge Sam R. Cummings for her role in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.
Keithley was sentenced to 87 months in federal prison. Keithly pleaded guilty in November 2016 to one count of possession with intent to distribute methamphetamine and aiding and abetting.
According to documents filed in the case, on April 30, 2016, a trooper with the Texas Department of Public Safety (DPS) stopped a vehicle in Lubbock for traffic violations. Keithley was the driver; co-defendant Crystal Ann Alaniz was the passenger. Keithley was arrested for driving with an invalid license, and Alaniz, who had several outstanding warrants, was also placed under arrest.
Both Keithley and Alaniz were placed in the trooper’s vehicle. The in-car video recording system captured Keithley maneuver her hands—while handcuffed—to her left breast area and force a substance in a plastic bag out of her bra. Keithley then used her teeth to remove the item from her bra and toss it to the back seat area where Alaniz was seated. Alaniz hid the item in her pants. Both women were transported to the Lubbock County Detention Center. When asked if either was in possession of any contraband, Alaniz initially stated, “no,” before admitting “I have stuff on me.” Alaniz was searched and two plastic bags containing suspected methamphetamine were found in her pants. Alaniz was also in possession of two plastic bags that contained several smaller plastic bags with markings consistent with narcotics trafficking. Two additional plastic bags, containing suspected methamphetamine were found in Keithley’s bra. Two bundles of money, totaling nearly $2,000 were found in Keithley’s purse along with a digital scale that contained drug residue. Keithley also had $2,500 in small bills on her person.
The Texas DPS Crime Lab determined that the suspected methamphetamine was in fact methamphetamine, and it weighed a total of 54.93 grams.
The Lubbock Police Department, the Littlefield Police Department, the Texas Department of Public Safety and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Sean Long prosecuted.
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Federal Jury Finds Fort Worth Man Guilty of Bank RobberiesRead the Press Release
FORT WORTH — Following a five-day trial before Senior U.S. District Judge Terry R. Means, a federal jury convicted Waymon Scott McLaughlin, 57, of Fort Worth, Texas, on four counts of bank robbery, announced U.S. Attorney John Parker of the Northern District of Texas.
Each of the bank robbery counts carries a maximum statutory penalty of 20 years in federal prison and a $250,000 fine. McLaughlin will remain in custody pending sentencing scheduled for August 8, 2017.
The government presented evidence at trial that McLaughlin robbed the below listed locations:
May 6, 2016 First Convenience Bank, 3510 Altamesa Blvd., Fort Worth, Texas
May 20, 2016 Woodforest Bank, 2225 W. 120, Grand Prairie, Texas
May 27, 2016 First Convenience Bank, 3510 Altamesa Blvd., Fort Worth, Texas
May 27, 2016 First Convenience Bank, 6756 W. Vickery Blvd., Fort Worth, Texas
The Federal Bureau of Investigation, the Grand Prairie Police Department, and the Fort Worth Police Department investigated the case.
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Last Defendant Pleads Guilty in Opioid Pill Mill CaseRead the Press Release
DALLAS — Carolina Giselle Berrio, a/k/a “Carolina Slocum Berrio,” “Karrie,” 37, of Lafayette, Louisiana appeared last week before U.S. District Judge Sidney A. Fitzwater and pleaded guilty to a conspiracy charge stemming from her involvement in a “pill mill” operation, announced U.S. Attorney John Parker of the Northern District of Texas.
Specifically, Berrio pleaded guilty to one count of conspiracy to distribute a controlled substance. She faces a maximum statutory penalty of 20 years in federal prison and a fine not to exceed $1 million. Sentencing is scheduled for June 16, 2017.
In March 2015, a federal grand jury in Dallas indicted 23 individuals, including Berrio, on offenses related to their participation in a prescription drug distribution conspiracy. That indictment alleged that from at least May 2013 through July 2014, the defendants participated in a scheme to illicitly obtain prescriptions for pain medications, such as oxycodone and hydrocodone, and then distribute those controlled substances for profit. As part of the conspiracy, individuals, often homeless or of limited means, were recruited and paid to pose as patients at medical clinics, including the McAllen Medical Clinic in Dallas, to obtain prescriptions to fill those prescriptions at designated pharmacies.
To date, 29 defendants have pleaded guilty, including one doctor, one clinic owner, two pharmacists, and numerous co-conspirators, to their involvement in the conspiracy and several have been sentenced to prison terms ranging from probation to 48 months in federal prison.
According to plea documents filed for Berrio, on December 18, 2013, Berrio negotiated to purchase a quantity of oxycodone 30mg pills from co-conspirator Cornelius Robinson, her supplier. Robinson asked for a higher price to deliver the oxycodone to Berrio in Lafayette, Louisiana, and a lower price if Berrio picks up the pills in Houston. Robinson agreed to supply Berrio with oxycodone 30mg at $18.50 per pill, and Berrio agreed to pick up the pills in Houston, Texas. Berrio sought 300 oxycodone 30mg pills with the intent to distribute them at a later time.
In addition, Berrio admits to purchasing oxycodone 30 mg pills from Robinson in both May and March of 2014.
Co-defendant William Hopkins, a/k/a “New York,” 54 of Dallas, Texas was sentenced last week by U.S. District Judge Sidney A. Fitzwater to 5 years probation with intermittent confinement (weekend incarceration) for 52 weeks. Hopkins pleaded guilty in November 2016 to one count of unlawful use of a communication device.
According to documents filed for Hopkins, in a telephone call on August 15, 2013 Hopkins, a recruiter, admonishes a recruit to be available because a driver is trying to pick up the recruit to take him to the doctor’s office. Hopkins encourages the recruit to show up by saying, “This is your money,” meaning the recruit will be paid to go to the doctor’s office to obtain oxycodone or hydrocodone.
This Organized Crime Drug Enforcement Task Force (OCDETF) was investigated by the Drug Enforcement Administration, with assistance from the Texas Department of Public Safety, the Louisiana State Police, the Grand Prairie Police Department, the Dallas Police Department, the Houston Police Department, the Arlington Police Department, the Greenville Police Department, the Parker County Sheriff’s Office, the U.S. Marshal’s Service, the U.S. Postal Inspection Service, and the Diplomatic Security Service. Assistant U.S. Attorney Mary Walters prosecuted.
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Federal Indictment Charges Six in Methamphetamine Distribution ConspiracyRead the Press Release
LUBBOCK — Six defendants have been charged in a federal indictment, unsealed this week, with felony offenses stemming from their role in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.
Five defendants have made their initial appearance in federal court in Lubbock before U.S. Magistrate D. Gordon Bryant, Jr. and will remain in custody pending trial. One defendant remains a fugitive.
The nine-count indictment charges each of the following defendants with one count of conspiracy to distribute and possess with intent to distribute methamphetamine:
Isaias Perez-Benito, 31, of Amarillo
Juan Rodriguez Galindo, aka “Johnny,” 42, of Amarillo
Corina Villalpando, 50, of Plainview
Dusty Lee Stowers, 29, of Friona
Mona Lesa Thomas, aka “Lisa,” 52, of Lubbock
In addition, each defendant is charged with additional substantive counts of distribution of methamphetamine. Perez-Benito was an illegal alien and unlawfully in the United States at the time of the offenses charged and is charged with an additional count of illegal alien in possession of firearms.
A federal indictment is an accusation by a grand jury. A defendant is entitled to the presumption of innocence unless proven guilty. If convicted, however, the conspiracy count carries statutory penalties ranging from 5 years to life in federal prison and a $5 million to $10 million fine. The other substantive drug offenses carry similar penalties. If convicted of the firearm charge, Perez-Benito also faces a maximum statutory penalty of 10 years in federal prison and a $250,000 fine.
The Drug Enforcement Administration, Texas Department of Public Safety, Friona Police Department, and Plainview Police Department are in charge of the investigation.
Assistant U.S. Attorney Sean Long is in charge of the prosecution.
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ZTE Corporation Agrees to Plead Guilty and Pay over $430.4 Million for Violating U.S. Sanctions by Sending U.S.-Origin Items to IranRead the Press Release
ZTE Corporation has agreed to enter a guilty plea and to pay a $430,488,798 penalty to the U.S. for conspiring to violate the International Emergency Economic Powers Act (IEEPA) by illegally shipping U.S.-origin items to Iran, obstructing justice and making a material false statement. ZTE simultaneously reached settlement agreements with the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) and the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC). In total ZTE has agreed to pay the U.S. Government $892,360,064. The BIS has suspended an additional $300,000,000, which ZTE will pay if it violates its settlement agreement with the BIS.
Attorney General of the United States Jeff Sessions, Acting Assistant Attorney General for National Security Mary B. McCord, U.S. Attorney John R. Parker for the Northern District of Texas and FBI Assistant Director Bill Priestap for the Counterintelligence Division made the announcement today.
“ZTE Corporation not only violated export controls that keep sensitive American technology out of the hands of hostile regimes like Iran’s – they lied to federal investigators and even deceived their own counsel and internal investigators about their illegal acts,” said Attorney General Sessions. “This plea agreement holds them accountable, and makes clear that our government will use every tool we have to punish companies who would violate our laws, obstruct justice and jeopardize our national security. I am grateful to the Justice Department’s National Security Division, the U.S. Attorney’s Office for the Northern District of Texas and the FBI for their outstanding work on this investigation.”
“ZTE engaged in an elaborate scheme to acquire U.S.-origin items, send the items to Iran and mask its involvement in those exports. The plea agreement, which is pending before the Court, alleges that the highest levels of management within the company approved the scheme. ZTE then repeatedly lied to and misled federal investigators, its own attorneys and internal investigators. Its actions were egregious and warranted a significant penalty,” said Acting Assistant Attorney General McCord. “The enforcement of U.S. export control and sanctions laws is a major component of the National Security Division’s commitment to protecting the national security of the United States. Companies that violate these laws – including foreign companies – will be investigated and held to answer for their actions.”
“ZTE Corporation not only violated our export control laws but, once caught, shockingly resumed illegal shipments to Iran during the course of our investigation,” said U.S. Attorney Parker. “ZTE Corporation then went to great lengths to devise elaborate, corporate-wide schemes to hide its illegal conduct, including lying to its own lawyers.”
"The plea agreement in this case shows ZTE repeatedly violated export controls and illegally shipped U.S. technology to Iran," said Assistant Director Priestap. "The company also took extensive measures to hide what it was doing from U.S. authorities. This case is an excellent example of cooperation among multiple U.S. agencies to uncover illegal technology transfers and make those responsible pay for their actions."
The plea agreement, which is contingent on the court’s approval, also requires ZTE to submit to a three-year period of corporate probation, during which time an independent corporate compliance monitor will review and report on ZTE’s export compliance program. ZTE is also required to cooperate fully with the Department of Justice (DOJ) regarding any criminal investigation by U.S. law enforcement authorities. The plea agreement ends a five-year joint investigation into ZTE’s export practices, which was handled by the DOJ’s National Security Division, the U.S. Attorney’s Office for the Northern District of Texas, the FBI, the BIS and the Department of Homeland Security, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.
A criminal information was filed today in federal court in the Northern District of Texas charging ZTE with one count of knowingly and willfully conspiring to violate the IEEPA, one count of obstruction of justice and one count of making a material false statement. ZTE waived the requirement of being charged by way of federal indictment, agreed to the filing of the information and has accepted responsibility for its criminal conduct by entering into a plea agreement with the government. The plea agreement, which is contingent on the court’s approval, requires that ZTE pay a fine in the amount of $286,992,532 and a criminal forfeiture in the amount of $143,496,266. The criminal fine represents the largest criminal fine in connection with an IEEPA prosecution.
Summary of the Criminal Conduct
According to documents filed today, for a period of almost six years, ZTE obtained U.S.-origin items – including controlled dual-use goods on the Department of Commerce’s Commerce Control List (CCL) – incorporated some of those items into ZTE equipment and shipped the ZTE equipment and U.S.-origin items to customers in Iran. ZTE engaged in this conduct knowing that such shipments to Iran were illegal. ZTE further lied to federal investigators during the course of the investigation when it insisted, through outside and in-house counsel, that the company had stopped sending U.S.-origin items to Iran. In fact, while the investigation was ongoing, ZTE resumed its business with Iran and shipped millions of dollars’ worth of U.S. items there.
ZTE also created an elaborate scheme to hide the data related to these transactions from a forensic accounting firm hired by defense counsel to conduct a review of ZTE’s transactions with sanctioned countries. It did so knowing that the information provided to the forensic accounting firm would be reported to the U.S. government by outside counsel. Outside counsel was not aware of this scheme and indeed was wholly unaware that ZTE had resumed business with Iran. After ZTE informed its counsel of the scheme, counsel reported – with permission from ZTE – the conduct to the U.S. government.
The Iran Business
According to court documents, between January 2010 and January 2016, ZTE, either directly or indirectly through a third company, shipped approximately $32,000,000 of U.S.-origin items to Iran without obtaining the proper export licenses from the U.S. government. In early 2010, ZTE began bidding on two different Iranian projects. The projects involved installing cellular and landline network infrastructure. Each contract was worth hundreds of millions of U.S. Dollars and required U.S. components for the final products.
In December 2010, ZTE finalized the contracts with Iranian customers. The contracts were signed by four parties: the Iranian customer, ZTE, Beijing 8 Star and ZTE Parsian. Court documents explain that ZTE identified Beijing 8 Star (8S) as a possible vehicle for hiding its illegal shipments of U.S. items to Iran. It intended to use 8S to export U.S.-origin items from China to ZTE customers in Iran. As part of this plan, ZTE supplied 8S with necessary capital and took over control of the company.
Under the terms of the Iran contracts, ZTE agreed to supply the “self-developed equipment,” collect payments for the projects and manage the whole network. ZTE Parsian was to provide locally purchased materials and all services. 8S was responsible for “relevant third-party equipment,” which primarily meant parts that would be subject to U.S. export laws. ZTE intended for 8S to be an “isolation company,” that is, ZTE intended for 8S (rather than ZTE) to purchase the embargoed equipment from suppliers and provide that equipment under the contract in an effort to distance ZTE from U.S. export-controlled products and insulate ZTE from U.S. export violations. However, 8S had no purchasing or shipping history and no real business reputation.
Ultimately, although 8S was a party to the contracts, ZTE itself purchased and shipped the embargoed goods under the contract. In its shipping containers, it packaged the U.S. items with its own self-manufactured items to hide the U.S.-origin goods. ZTE did not include the U.S. items on the customs declaration forms, though it did include the U.S.-origin items on the packing lists included inside of the shipments.
In early 2011, when ZTE determined that the use of 8S was insufficient to hide ZTE’s connection to the illegal export of U.S.-origin goods to Iran, senior management of ZTE ordered that a company-level export control project team study, handle and respond to the company’s export control risks. In September 2011, four senior managers signed an Executive Memo, which proposed that the company identify and establish new “isolation companies” that would be responsible for supplying U.S. component parts necessary for projects in embargoed countries. The isolation companies would conceal ZTE’s role in the transshipment scheme and would insulate ZTE from export control risks.
In March 2012, Reuters published an article regarding ZTE’s sale of equipment to Iran. In response, ZTE made a decision to temporarily cease sending new U.S. equipment to Iran. By November 2013, however, ZTE had resumed its business with Iran. Beginning in July 2014, ZTE began shipping U.S.-origin equipment to Iran once again without the necessary licenses.
Instead of using 8S, however, ZTE identified a new isolation company. ZTE signed a contract with the new isolation company, which in turn signed contracts with the two Iranian customers. According to the new scheme, ZTE purchased and manufactured all relevant equipment – both U.S.-origin and ZTE-manufactured – and prepared them for pick-up at its warehouse by the new isolation company. The new isolation company then shipped all items to the Iranian customers. Shipments to Iran continued from January 2014 through January 2016.
The Obstruction and False Statement
According to court documents, despite its knowledge of an ongoing grand jury investigation into its Iran exports, ZTE took several steps to conceal relevant information from the U.S. government. It further took affirmative steps to mislead the U.S. government. In the summer of 2012, ZTE asked each of the employees who were involved in the Iran sales to sign nondisclosure agreements in which the employees agreed to keep confidential all information related to the company’s U.S. exports to Iran.
During meetings throughout late 2014, late 2015 and early 2016, outside counsel for ZTE, unaware that the statements ZTE had given to counsel for communication to the government were false, represented to the DOJ and federal law enforcement agents that ZTE had stopped doing business with Iran and therefore was no longer violating U.S. export laws. Similarly, on July 8, 2015, in-house counsel for ZTE accompanied outside counsel in a meeting with the DOJ and federal law enforcement agents and reported that ZTE was abiding by U.S. laws. That statement was also false.
ZTE also hid data related to its resumed illegal sales to Iran from a forensic accounting firm hired by defense counsel to conduct an internal investigation into the company’s Iran sales. ZTE knew the forensic accounting firm was reviewing its systems and knew that the analysis was being reported to the DOJ and U.S. law enforcement. To avoid detection of its 2013-2016 resumed illegal sales to Iran, ZTE formed the “contract data induction team” (“CDIT”). The CDIT was comprised of approximately 13 people whose job it was to “sanitize the databases” of all information related to the 2013-2016 Iran business. The team identified and removed from the databases all data related to those sales. ZTE also established an auto-delete function for the email accounts of those 13 individuals on the CDIT, so their emails were deleted every night – a departure from its normal practices – to ensure there were no communications related to the hiding of the data.
The case is being prosecuted by Deputy Chief Elizabeth Cannon of the National Security Division’s Counterintelligence and Export Control Sections and Assistant U.S. Attorney Mark Penley of the Northern District of Texas.
ZTE Information ZTE Plea Agreement Supplement ZTE Plea Agreement ZTE Factual ResumeZTE Corporation Agrees to Plead Guilty and Pay over $430.4 Million for Violating U.S. Sanctions by Sending U.S.-Origin Items to IranRead the Press Release
WASHINGTON – ZTE Corporation has agreed to enter a guilty plea and to pay a $430,488,798 penalty to the U.S. for conspiring to violate the International Emergency Economic Powers Act (IEEPA) by illegally shipping U.S.-origin items to Iran, obstructing justice and making a material false statement. ZTE simultaneously reached settlement agreements with the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) and the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC). In total ZTE has agreed to pay the U.S. Government $892,360,064. The BIS has suspended an additional $300,000,000, which ZTE will pay if it violates its settlement agreement with the BIS.
Attorney General of the United States Jeff Sessions, Acting Assistant Attorney General for National Security Mary B. McCord, U.S. Attorney John R. Parker for the Northern District of Texas and FBI Assistant Director Bill Priestap for the Counterintelligence Division made the announcement today.
“ZTE Corporation not only violated export controls that keep sensitive American technology out of the hands of hostile regimes like Iran’s – they lied to federal investigators and even deceived their own counsel and internal investigators about their illegal acts,” said Attorney General Sessions. “This plea agreement holds them accountable, and makes clear that our government will use every tool we have to punish companies who would violate our laws, obstruct justice and jeopardize our national security. I am grateful to the Justice Department’s National Security Division, the U.S. Attorney’s Office for the Northern District of Texas and the FBI for their outstanding work on this investigation.”
“ZTE engaged in an elaborate scheme to acquire U.S.-origin items, send the items to Iran and mask its involvement in those exports. The plea agreement alleges that the highest levels of management within the company approved the scheme. ZTE then repeatedly lied to and misled federal investigators, its own attorneys and internal investigators. Its actions were egregious and warranted a significant penalty,” said Acting Assistant Attorney General McCord. “The enforcement of U.S. export control and sanctions laws is a major component of the National Security Division’s commitment to protecting the national security of the United States. Companies that violate these laws – including foreign companies – will be investigated and held to answer for their actions.”
“ZTE Corporation not only violated our export control laws but, once caught, shockingly resumed illegal shipments to Iran during the course of our investigation,” said U.S. Attorney Parker. “ZTE Corporation then went to great lengths to devise elaborate, corporate-wide schemes to hide its illegal conduct, including lying to its own lawyers.”
"The plea agreement in this case shows ZTE repeatedly violated export controls and illegally shipped U.S. technology to Iran," said Assistant Director Priestap. "The company also took extensive measures to hide what it was doing from U.S. authorities. This case is an excellent example of cooperation among multiple U.S. agencies to uncover illegal technology transfers and make those responsible pay for their actions."
The plea agreement, which is contingent on the court’s approval, also requires ZTE to submit to a three-year period of corporate probation, during which time an independent corporate compliance monitor will review and report on ZTE’s export compliance program. ZTE is also required to cooperate fully with the Department of Justice (DOJ) regarding any criminal investigation by U.S. law enforcement authorities. The plea agreement ends a five-year joint investigation into ZTE’s export practices, which was handled by the DOJ’s National Security Division, the U.S. Attorney’s Office for the Northern District of Texas, the FBI, the BIS and the Department of Homeland Security, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.
A criminal information was filed today in federal court in the Northern District of Texas charging ZTE with one count of knowingly and willfully conspiring to violate the IEEPA, one count of obstruction of justice and one count of making a material false statement. ZTE waived the requirement of being charged by way of federal indictment, agreed to the filing of the information and has accepted responsibility for its criminal conduct by entering into a plea agreement with the government. The plea agreement, which is contingent on the court’s approval, requires that ZTE pay a fine in the amount of $286,992,532 and a criminal forfeiture in the amount of $143,496,266. The criminal fine represents the largest criminal fine in connection with an IEEPA prosecution.
Summary of the Criminal Conduct
According to documents filed today, for a period of almost six years, ZTE obtained U.S.-origin items – including controlled dual-use goods on the Department of Commerce’s Commerce Control List (CCL) – incorporated some of those items into ZTE equipment and shipped the ZTE equipment and U.S.-origin items to customers in Iran. ZTE engaged in this conduct knowing that such shipments to Iran were illegal. ZTE further lied to federal investigators during the course of the investigation when it insisted, through outside and in-house counsel, that the company had stopped sending U.S.-origin items to Iran. In fact, while the investigation was ongoing, ZTE resumed its business with Iran and shipped millions of dollars’ worth of U.S. items there.
ZTE also created an elaborate scheme to hide the data related to these transactions from a forensic accounting firm hired by defense counsel to conduct a review of ZTE’s transactions with sanctioned countries. It did so knowing that the information provided to the forensic accounting firm would be reported to the U.S. government by outside counsel. Outside counsel was not aware of this scheme and indeed was wholly unaware that ZTE had resumed business with Iran. After ZTE informed its counsel of the scheme, counsel reported – with permission from ZTE – the conduct to the U.S. government.
The Iran Business
According to court documents, between January 2010 and January 2016, ZTE, either directly or indirectly through a third company, shipped approximately $32,000,000 of U.S.-origin items to Iran without obtaining the proper export licenses from the U.S. government. In early 2010, ZTE began bidding on two different Iranian projects. The projects involved installing cellular and landline network infrastructure. Each contract was worth hundreds of millions of U.S. Dollars and required U.S. components for the final products.
In December 2010, ZTE finalized the contracts with Iranian customers. The contracts were signed by four parties: the Iranian customer, ZTE, Beijing 8 Star and ZTE Parsian. Court documents explain that ZTE identified Beijing 8 Star (8S) as a possible vehicle for hiding its illegal shipments of U.S. items to Iran. It intended to use 8S to export U.S.-origin items from China to ZTE customers in Iran. As part of this plan, ZTE supplied 8S with necessary capital and took over control of the company.
Under the terms of the Iran contracts, ZTE agreed to supply the “self-developed equipment,” collect payments for the projects and manage the whole network. ZTE Parsian was to provide locally purchased materials and all services. 8S was responsible for “relevant third-party equipment,” which primarily meant parts that would be subject to U.S. export laws. ZTE intended for 8S to be an “isolation company,” that is, ZTE intended for 8S (rather than ZTE) to purchase the embargoed equipment from suppliers and provide that equipment under the contract in an effort to distance ZTE from U.S. export-controlled products and insulate ZTE from U.S. export violations. However, 8S had no purchasing or shipping history and no real business reputation.
Ultimately, although 8S was a party to the contracts, ZTE itself purchased and shipped the embargoed goods under the contract. In its shipping containers, it packaged the U.S. items with its own self-manufactured items to hide the U.S.-origin goods. ZTE did not include the U.S. items on the customs declaration forms, though it did include the U.S.-origin items on the packing lists included inside of the shipments.
In early 2011, when ZTE determined that the use of 8S was insufficient to hide ZTE’s connection to the illegal export of U.S.-origin goods to Iran, senior management of ZTE ordered that a company-level export control project team study, handle and respond to the company’s export control risks. In September 2011, four senior managers signed an Executive Memo, which proposed that the company identify and establish new “isolation companies” that would be responsible for supplying U.S. component parts necessary for projects in embargoed countries. The isolation companies would conceal ZTE’s role in the transshipment scheme and would insulate ZTE from export control risks.
In March 2012, Reuters published an article regarding ZTE’s sale of equipment to Iran. In response, ZTE made a decision to temporarily cease sending new U.S. equipment to Iran. By November 2013, however, ZTE had resumed its business with Iran. Beginning in July 2014, ZTE began shipping U.S.-origin equipment to Iran once again without the necessary licenses.
Instead of using 8S, however, ZTE identified a new isolation company. ZTE signed a contract with the new isolation company, which in turn signed contracts with the two Iranian customers. According to the new scheme, ZTE purchased and manufactured all relevant equipment – both U.S.-origin and ZTE-manufactured – and prepared them for pick-up at its warehouse by the new isolation company. The new isolation company then shipped all items to the Iranian customers. Shipments to Iran continued from January 2014 through January 2016.
The Obstruction and False Statement
According to court documents, despite its knowledge of an ongoing grand jury investigation into its Iran exports, ZTE took several steps to conceal relevant information from the U.S. government. It further took affirmative steps to mislead the U.S. government. In the summer of 2012, ZTE asked each of the employees who were involved in the Iran sales to sign nondisclosure agreements in which the employees agreed to keep confidential all information related to the company’s U.S. exports to Iran.
During meetings throughout late 2014, late 2015 and early 2016, outside counsel for ZTE, unaware that the statements ZTE had given to counsel for communication to the government were false, represented to the DOJ and federal law enforcement agents that ZTE had stopped doing business with Iran and therefore was no longer violating U.S. export laws. Similarly, on July 8, 2015, in-house counsel for ZTE accompanied outside counsel in a meeting with the DOJ and federal law enforcement agents and reported that ZTE was abiding by U.S. laws. That statement was also false.
ZTE also hid data related to its resumed illegal sales to Iran from a forensic accounting firm hired by defense counsel to conduct an internal investigation into the company’s Iran sales. ZTE knew the forensic accounting firm was reviewing its systems and knew that the analysis was being reported to the DOJ and U.S. law enforcement. To avoid detection of its 2013-2016 resumed illegal sales to Iran, ZTE formed the “contract data induction team” (“CDIT”). The CDIT was comprised of approximately 13 people whose job it was to “sanitize the databases” of all information related to the 2013-2016 Iran business. The team identified and removed from the databases all data related to those sales. ZTE also established an auto-delete function for the email accounts of those 13 individuals on the CDIT, so their emails were deleted every night – a departure from its normal practices – to ensure there were no communications related to the hiding of the data.
The case is being prosecuted by Deputy Chief Elizabeth Cannon of the National Security Division’s Counterintelligence and Export Control Sections and Assistant U.S. Attorney Mark Penley of the Northern District of Texas.
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Mineral Wells Man Sentenced to 360 Months in Federal Prison on Federal Child Pornography ConvictionRead the Press Release
FORT WORTH — A 57-year-old Mineral Wells, Texas, man, Jimmy Gordon, who pleaded guilty in June 2016 to one count of production of child pornography, was sentenced this morning by U.S. District Judge David C. Godbey to 360 months in federal prison, announced U.S. Attorney John Parker of the Northern District of Texas.
According to documents filed in the case, in March 2016, Federal Bureau of Investigation agents executed a search warrant at the residence of Gordon in Mineral Wells, Texas. During the search, Gordon admitted that he communicated with an individual on Facebook, and that, over the course of their communications, Gordon used his cell phone to take a nude picture of his two-year old grandson and to transmit the image to the individual.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The Federal Bureau of Investigation investigated. Assistant U.S. Attorney A. Saleem prosecuted.
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Former Postal Employee Convicted at Trial in Scheme to Defraud Worker’s Compensation Program Sentenced to 21 Months in Federal PrisonRead the Press Release
DALLAS — McArthur Baker, 69, a former U.S. Postal Service employee, was sentenced today by U.S. District Judge Sam A. Lindsay to 21 months in federal prison for his role in a scheme to defraud the Department of Labor’s (DOL) Office of Worker’s Compensation Program (OWCP), announced U.S. Attorney John Parker of the Northern District of Texas.
Baker and co-defendant Tonya Evans, 52, both of Dallas, were each convicted following a one-week trial before U.S. District Judge Sam A. Lindsay on one count of conspiracy to defraud the U.S. with respect to claims and one count of false statements or fraud to obtain federal employees’ compensation. Evans is scheduled to be sentenced June 19, 2017.
The government presented evidence at trial that Baker and Evans engaged in a scheme to receive kickbacks in exchange for their completion of falsified medical documentation that was used by co-conspirators to defraud DOL’s OWCP. The government presented further evidence that Baker also falsified forms related to travel he purportedly made for medical services, and as a result, received funds from DOL to which he was not entitled.
Baker began working for the U.S. Postal Service in 1982; he was assigned to work as a mail handler equipment operator. Between 1984 and 2007, Baker filed eight different claims for disability, claiming he suffered from various injuries. As a result of these claims, Baker stopped working in approximately December 2007. He never returned to work but continued to receive disability compensation from December 2007 until at least October 2009. He received more than $68,000 in worker’s compensation payments. He retired from the U.S. Postal Service in October 2009 but he continued to receive disability medical care paid for through DOL, and he continues to be eligible for disability medical care.
Evans began working for the U.S. Postal Service in November 1985; she worked as a clerk primarily with the parcel post distribution machine. She filed disability claims in August 2001, August 2003, and August 2008 claiming that she suffered from various injuries. As a result of these claims, Evans was placed on worker’s compensation in 2001. She received more than $340,000 in worker’s compensation payments. In March 2010, she applied for disability retirement that was approved in October 2011.
Convicted co-conspirator, Larry Washington, was a licensed professional counselor and ran several businesses known as AAA Mental Health, LLC, Mind Spa, Inc., Solutions Health and Rehabilitation, and Convergence Emergence Diversion. Through these businesses, Washington purportedly provided patients with counseling, pain management, chiropractic services, physical therapy, and massage services. His patients were former postal and Veterans Administration employees who had suffered on-the-job injuries and were eligible to receive medical services and worker’s compensation related to those injuries. Earlier this year, Washington pleaded guilty to one count of conspiracy to commit health care fraud and was sentenced in May 2016 to 78 months in federal prison and ordered to pay $7.7 million in restitution.
To maintain and enhance his billings with OWCP, Washington asked claimants, including Baker and Evans, to falsify medical documentation, called “mood inventories,” that indicated they had received services on days they had not. Baker and Evans completed numerous mood inventory forms that contained false information about the days on which Baker and Evans received treatment from Washington or someone working for Washington. Baker and Evans received approximately $100 for each form they completed.
Over the course of the fraud, Baker received a total of at least $3,000 from Washington; Evans received at least $6,000.
As a result of Baker’s falsified documentation, Washington was able to fraudulently bill $105,125 from OWCP. As a result of Evans’ falsified documentation, Washington was able to bill $202,438 from OWCP.
The government presented further evidence that Baker submitted falsified documentation related to travel he purportedly made to receive medical services from Washington and others. He also requested reimbursement for twice the amount of mileage he would have received had he actually received the purported services. As a result, based on fraudulent travel forms he submitted, Baker received more than $3,000.
In addition to Baker and Evans, 20 claimants, four doctors or medical providers, a senior claims examiner at DOL, a claims representative, a Postal employee detailed to the Postal Service Health Resource Management Office, and a medical provider’s employee were charged and convicted in the scheme.
In total, the defendants were able to collectively fraudulently bill the federal government through the OWCP for more than $9.5 million and receive more than $8.7 million in government payments based on their fraudulent billing. The DOL made approximately $11.4 million in payments to these claimants for their compensation and medical services.
The investigation was led by the U.S. Postal Service Office of Inspector General, and the Department of Labor Office of Inspector General, with assistance from Internal Revenue Service Criminal Investigation, U.S. Treasury Office of Inspector General, Social Security Administration Office of Inspector General/Cooperative Disability Investigations Unit, and the U.S. Department of Veterans Affairs Office of Inspector General.
Assistant U.S. Attorneys P.J. Meitl, Nicole Dana and Special Assistant U.S. Attorney Jennifer Bray prosecuted.
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Dallas Methamphetamine Trafficker Sentenced to 210 Months in Federal PrisonRead the Press Release
DALLAS, Texas — On Friday, March 3, 2017, U.S. District Judge Sidney A. Fitzwater sentenced Pablo Erick Quincosa-Cabrera, 42, of Dallas, Texas, to 210 months in federal prison, following his guilty plea in November 2016, to one count of conspiracy to possess with intent to distribute a mixture and substance containing a detectable amount of methamphetamine, announced U.S. Attorney John Parker of the Northern District of Texas.
According to documents filed in the case, on five separate occasions between April 2016, and September 2016, Quincosa-Cabrera possessed with the intent to distribute or distributed half-kilogram to kilogram quantities of methamphetamine.
The Drug Enforcement Administration, the Allen Police Department, the Garland Police Department, and Rockwall Police Department investigated the case.
Assistant U.S. Attorney Suzanna Etessam prosecuted.
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Texas Man Sentenced to 78 Months in Prison for Running Fraudulent Investment Companies and Obstructing Securities and Exchange Commission InvestigationRead the Press Release
WASHINGTON – A San Angelo, Texas, man was sentenced to 78 months in prison today for running two investment fraud schemes that defrauded investors out of approximately $900,000 over a four-year period and obstructing a Securities and Exchange Commission (SEC) investigation.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, U.S. Attorney John R. Parker of the Northern District of Texas and Acting Special Agent in Charge Michael A. Costanzi of the FBI’s Dallas Office made the announcement.
Stanley Jonathan Fortenberry, 51, was sentenced by U.S. Districst Judge Sam R. Cummings of the Northern District of Texas. Judge Cummings also ordered the defendant to pay $890,310 in restitution and to forfeit $311,254. On Nov. 18, 2016, Fortenberry pleaded guilty on to two counts of mail fraud and one count of obustruction of justice.
In November 2016, when Fortenberry pleaded guilty to fraud and obstruction of justice charges, he admitted that he ran an investment company called Premier Investment Fund (Premier), which raised funds from investors for social media projects run by another company with ties to the country music industry. Fortenberry misled investors about the profitability of the company and about the destination of the investors’ funds. Fortenberry admitted that he diverted approximately half of investors’ funds into his own pocket and to pay the expenses of his fundraising operation.
Fortenberry also admitted that, from 2013 to 2014, he ran Wattenberg Energy Partners (Wattenberg), which raised funds for oil and gas drilling projects in northern Colorado. Fortenberry admitted that he set up the company in his son’s name because he was then under investigation by the SEC for misusing the Premier investors’ funds. He used a network of salespeople to solicit individuals over the phone to invest in drilling projects. Fortenberry admitted that he spent the vast majority of the funds on himself and the company’s fundraising operation. In October 2014, at an administrative hearing with the SEC, Fortenberry falsely denied having control of or working for Wattenberg.
Fortenberry admitted that the total loss to victims of both schemes was $887,311.
The FBI’s Dallas Office investigated the case. Trial Attorney William E. Johnston of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Sean Long of the Northern District of Texas are prosecuting the case. The SEC has provided substantial assistance in this case and referred this matter to the department.
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Texas Man Sentenced to 78 Months in Prison for Running Fraudulent Investment Companies and Obstructing Securities and Exchange Commission InvestigationRead the Press Release
A San Angelo, Texas, man was sentenced to 78 months in prison today for running two investment fraud schemes that defrauded investors out of approximately $900,000 over a four-year period and obstructing a Securities and Exchange Commission (SEC) investigation.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, U.S. Attorney John R. Parker of the Northern District of Texas and Acting Special Agent in Charge Michael A. Costanzi of the FBI’s Dallas Office made the announcement.
Stanley Jonathan Fortenberry, 51, was sentenced by U.S. Districst Judge Sam R. Cummings of the Northern District of Texas. Judge Cummings also ordered the defendant to pay $890,310 in restitution and to forfeit $311,254. On Nov. 18, 2016, Fortenberry pleaded guilty on to two counts of mail fraud and one count of obustruction of justice.
In November 2016, when Fortenberry pleaded guilty to fraud and obstruction of justice charges, he admitted that he ran an investment company called Premier Investment Fund (Premier), which raised funds from investors for social media projects run by another company with ties to the country music industry. Fortenberry misled investors about the profitability of the company and about the destination of the investors’ funds. Fortenberry admitted that he diverted approximately half of investors’ funds into his own pocket and to pay the expenses of his fundraising operation.
Fortenberry also admitted that, from 2013 to 2014, he ran Wattenberg Energy Partners (Wattenberg), which raised funds for oil and gas drilling projects in northern Colorado. Fortenberry admitted that he set up the company in his son’s name because he was then under investigation by the SEC for misusing the Premier investors’ funds. He used a network of salespeople to solicit individuals over the phone to invest in drilling projects. Fortenberry admitted that he spent the vast majority of the funds on himself and the company’s fundraising operation. In October 2014, at an administrative hearing with the SEC, Fortenberry falsely denied having control of or working for Wattenberg.
Fortenberry admitted that the total loss to victims of both schemes was $887,311.
The FBI’s Dallas Office investigated the case. Trial Attorney William E. Johnston of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Sean Long of the Northern District of Texas are prosecuting the case. The SEC has provided substantial assistance in this case and referred this matter to the department.
Methamphetamine Distributors Sentenced to Lengthy Federal Prison SentencesRead the Press Release
LUBBOCK, Texas — Two Littlefield, Texas, men, Juan Carlos Lara-Ochoa and Jose Alberto Cibrian, were sentenced this morning before U.S. District Judge Sam R. Cummings for their roles in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.
Lara-Ochoa, 24, was sentenced to 262 months in federal prison. Lara-Ochoa pleaded guilty in November 2016 to one count of possession with intent to distribute 50 grams or more of methamphetamine. Cibrian, 41, was sentenced to 235 months in federal prison. Cibrian also pleaded guilty in November 2016 to one count of possession with intent to distribute methamphetamine.
According to documents filed in court, on June 1, 2016, officers with the Lubbock Police Department learned that Lara-Ochoa would be delivering about two pounds of methamphetamine to Christopher Paul Andrade in Lubbock. Law enforcement set up surveillance and followed Lara-Ochoa from Littlefield, Texas to the La Michoacana grocery on Clovis Highway in Lubbock. Lara-Ochoa parked in the grocery store’s parking lot, and a short time later, Andrade arrived and parked next to him. Andrade got into the front passenger seat of Lara-Ochoa’s vehicle, stayed for less than one minute, and then exited that vehicle, returning to his. Law enforcement followed Andrade as he drove out of the parking lot, and after a brief pursuit, detained Andrade and found approximately 444 grams of methamphetamine that he had attempted to discard during the pursuit.
Andrade pleaded guilty in August 2016 to one count of possession with intent to distribute methamphetamine in a separate case. He was sentenced on December 1, 2016, by Senior U.S. District Judge Sam R. Cummings to 135 months in federal prison.
Law enforcement observed Lara-Ochoa depart the parking lot and return to Littlefield, where they arrested him. They obtained a search warrant for his vehicle and located a hidden compartment under the front passenger’s seat that contained two separate packages of methamphetamine, weighing a total of 2,230 grams. One of those was packaged exactly the same as the methamphetamine Andrade had discarded. Officers also obtained a search warrant for Lara-Ochoa’s storage unit and found an additional 1,782 grams of methamphetamine and five firearms.
On March 4, 2016, officers with the Littlefield Police Department learned of a suspicious vehicle at a nearby RV park. Upon arrival, officers found Jose Alberto Cibrian passed out in the driver’s seat of that vehicle, with the engine running and the gear shift in the drive position. After removing him from the vehicle, officers found a plastic bag containing methamphetamine in the center console, a methamphetamine pipe, a digital scale and a firearm in a bag in the backseat. Cibrian admitted he had recently purchased the methamphetamine and the firearm.
The Lubbock Police Department, the Littlefield Police Department, the Texas Department of Public Safety and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Sean Long prosecuted.
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Dallas Man Sentenced to 324 Months for Role in Violent Kidnapping Attempt, Shooting at Ennis Police Officer During High Speed PursuitRead the Press Release
DALLAS — Jose Cardenas Aguirre, 25, of Dallas, was sentenced yesterday by U.S. District Judge Jane J. Boyle to 324 months in federal prison, following his guilty plea in October 2016 to one count of conspiracy to commit kidnapping, announced U.S. Attorney John Parker of the Northern District of Texas.
Aguirre is a Mexican citizen and was in the United States illegally at the time of the offense. Aguirre will be deported after serving his sentence.
Co-defendants Melissa Trevino, 23, Javier Martinez, 24, Maria Guadalupe Bello, 22, and Indolfo Martinez, 47, who is Javier Martinez’s father, have pleaded guilty to their roles in the kidnapping, cocaine and heroin distribution, and/or firearm offenses in a case related to the attempted kidnapping of an individual because of an unpaid drug debt and are awaiting sentencing.
One remaining defendant charged in the case, Jonathan Benitez, remains a fugitive.
According to plea documents filed in the case, on July 12, 2016, Javier Martinez, along with co-defendants Jose Cardenas Aguirre and Melissa Trevino, planned to kidnap another individual because of an $800 unpaid drug debt involving cocaine. Prior to the planned kidnapping, Javier Martinez and Aguirre purchased rubber gloves, zip ties, and duct tape from Walmart. They wore ballistic vests and black camouflage clothing. In the attempt to kidnap the victim, Martinez and Cardenas Aguirre filed numerous shot into a home in Ennis. The kidnapping was ultimately unsuccessful, and as Javier Martinez, Aguirre, and Trevino fled the scene, they were engaged in a high-speed chase with officers with the Ennis Police Department. During this pursuit, Javier Martinez, using an AR-15 style rifle, fired numerous shots at a police officer. After their car was disabled, Martinez, Cardenas-Aguirre, and Trevino fled from police on foot. Cardenas Aguirre and Trevino were arrested following an eight-hour search. Martinez was apprehended several weeks later.
The case was investigated by the Ennis Police Department and the FBI’s Violent Gang Taskforce. Assistant U.S. Attorney P.J. Meitl prosecuted.
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Twenty-Three Indicted in Methamphetamine Distribution ConspiracyRead the Press Release
DALLAS — Twenty-three individuals, most from the Dallas, Texas, area, were charged in a federal indictment with offenses stemming from their respective roles in a methamphetamine distribution conspiracy this week, announced U.S. Attorney John Parker of the Northern District of Texas.
The indictment alleges the conspiracy began in January 2016 and continued to the date of the indictment, February 22, 2017. Count One of the indictment charges the following twenty-three defendants with conspiracy to possess with intent to distribute a controlled substance:
Roberto Omar Vera, 51, of Dallas, Texas
Kameron Paul Vera, 23, of Dallas, Texas
Roberto Trevizo Munoz, 19, of Dallas, Texas
Simon Louis Trevino, 30, of Dallas, Texas
Jorge Morales, 27, of Dallas, Texas
Kneely Denay Abadie, 23, of Arlington, Texas
Stephanie Jean Aldava, aka “Stephanie Jean Bradley,” Stephanie Jean May,” “Stephanie Jean Bristow,” 38, of Lufkin, Texas
Rodney Allen Broach, 48, of Kemp, Texas
Angela Danielle Burkham, 34 of Garland, Texas
Elizabeth Neely Causey-Eck, 47, of McKinney, Texas
Mark Allen Craven, 59, of Dallas, Texas
Lauren Allyson Crites, aka “Lauren Allyson Anderson,” 33, of Garland, Texas
Charley Seay Crossland, aka “Charley Denise Seay,” 37, of Dallas, Texas
Arthur Daniel Currie, aka “Aquaman,” 32, of Dallas, Texas
Caitlyn Taylor Johnson, 23, of Terrell, Texas
Chelsea Loraine Johnson, 24, of Terrell, Texas
Ilona Klonowshi King, aka “Ilona Klonowski Brazeal,” 46, of Dallas, Texas
Larry Ray Lincks, 52, of Quinlan, Texas
Daniel Moss, 31, of Mabank, Texas
John Craig Owen, 54, of Mesquite, Texas
Clisty Diane Pratt, aka “Clisty Diane Baker,” 44, of Kemp, Texas
Paul Wade Shreves, 27, Mesquite, Texas
Brandi Scott Turcola, aka “Brandi Scott Blackburn,” “Brandi Scott Smith,” 34, of Log Cabin, Texas
Each defendant was also charged with one count of possession with intent to distribute a controlled substance. Roberto Vera, Kameron Vera, and Larry Lincks were each charged with additional counts relating to the conspiracy.
An indictment is an accusation by a grand jury. A defendant is entitled to the presumption of innocence unless proven guilty. If convicted, the maximum penalty for the charged offenses is life in federal prison.
The Department of Public Safety and the Bureau of Alcohol, Tobacco, Firearms and Explosives led the investigation; Kaufman Police Department, Kaufman County Sheriff’s Office and Henderson County Sheriff’s Office assisted. Assistant U.S. Attorney P.J. Meitl is in charge of the prosecution.
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Amarillo Convicted Felon Pleads Guilty to Possessing 91 FirearmsRead the Press Release
AMARILLO — Pat Jarrett Helton, 43, of Amarillo, Texas, appeared in federal court yesterday and pleaded guilty before U.S. District Judge Sidney A. Fitzwater to one count of convicted felon in possession of a firearm, announced U.S. Attorney John Parker of the Northern District of Texas.
Helton faces a maximum statutory penalty of ten years in federal prison, and a $250,000 fine. Helton will remain on bond pending sentencing set for June 6, 2017. As part of the plea, Helton signed a forfeiture agreement waiving his right to a number of items seized, including $24,783 in currency, a 1992 Lamborghini Diablo, 2012 Kawasaki Ninja motorcycle, 2016 Polaris Razor, multiple vehicles and trailers.
According to documents filed in the case, on November 7, 2016, a federal search warrant was executed at Helton’s property in Mobeetie, Texas. The property included Helton’s residence and surrounding buildings. During the search, law enforcement agents located 91 firearms and large quantities of ammunition. The firearms included one shotgun with a barrel less than 18 inches, one semiautomatic rifle with a barrel of less than 16 inches, three stolen firearms, and at least four semiautomatic firearms that are capable of accepting large capacity magazines.
Before Helton possessed the 91 firearms, he had been convicted in 2003 of a felony offense for possession of a firearm not registered. Helton was sentenced to 46 months in federal prison.
The case was investigated by the Federal Bureau of Investigation, the Texas Department of Public Safety and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Sean Taylor is in charge of the prosecution.
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Two Sentenced in Pill Mill CaseRead the Press Release
DALLAS — Two defendants who pleaded guilty to their roles in a pill mill operation they were involved in during parts of 2013-2014 have been sentenced.
U.S. Attorney John Parker announced that Taneisha Nickerson, 29, of Dallas, Texas, was sentenced last week to 24 months in federal prison, following her guilty plea in August 2016 to one count of unlawful use of a communication device. Co-defendant Adrian Banks, 23, of Dallas, was also sentenced last week to 20 months in federal prison. He pleaded guilty in August 2016 to the same offense.
In March 2015, a federal grand jury in Dallas indicted 23 individuals, including Nickerson and Banks, on offenses related to their participation in a prescription drug distribution conspiracy. That indictment alleged that from at least May 2013 through July 2014, the defendants participated in a scheme to illicitly obtain prescriptions for pain medications, such as oxycodone and hydrocodone, and then distribute those controlled substances for profit. As part of the conspiracy, individuals, often homeless or of limited means, were recruited and paid to pose as patients at medical clinics, including the McAllen Medical Clinic in Dallas, to obtain prescriptions to fill those prescriptions at designated pharmacies. Many of those defendants have pleaded guilty and are awaiting sentencing.
According to documents filed in the Nickerson case, on March 5, 2014, in a telephone call Nickerson agreed to deliver 225 oxycodone 30mg pills to one of co-conspirator Cornelius Robinson’s customers. Nickerson possessed the pills with the intent to distribute them at the time of the call.
According to documents filed in the Banks case, on February 26, 2014, Banks called co-conspirator Cornelius Robinson and told him that he was in Dallas “running patients” and wanted to know if a “patient” could use a green card to fill a prescription at a pharmacy. Robinson told Banks that he thought so because it is an identification card. Banks told Robinson that the prescriptions he had to fill that day were for Lorcet, Robinson told him that there was not a lot of money in Lorcet. Banks responded that he expected to be “running patients,” that is, filling prescriptions, for oxycodone, within two weeks.
The investigation is being conducted by the Drug Enforcement Administration, with assistance from the Internal Revenue Service, Texas Department of Public Safety, the Louisiana State Police, the Grand Prairie Police Department, the Dallas Police Department, the Houston Police Department, the Arlington Police Department, the Greenville Police Department, the Parker County Sheriff’s Office, the U.S. Marshal’s Service, the U.S. Postal Inspection Service, and the Diplomatic Security Service. Assistant U.S. Attorney Mary Walters is prosecuting.
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Sixteen Individuals Charged in $60 Million Medicare Fraud SchemeRead the Press Release
DALLAS – An indictment returned by a federal grand jury in Dallas last week, and unsealed today, charges 16 individuals with offenses related to their participation in a health care fraud scheme, announced John Parker, U.S. Attorney for the Northern District of Texas.
The defendants charged are:
Bradley J. Harris, 35, of Frisco, Texas
Amy L. Harris, 42, of Frisco, Texas
Melanie L. Murphey, 35, of Fort Worth, Texas
Patricia B. Armstrong, 33, of Coppell, Texas
Mark E. Gibbs, 46, of Lindsay, Texas
Laila N. Hirjee, 50, of Plano, Texas
Syed M. Aziz, 51, of Frisco, Texas
Reziuddin Siddique, 63, of Allen, Texas
Charles R. Leach, 64, of Arlington, Texas
Jessica J. Love, 37, of Gainesville, Texas
Ali Rizvi, 49, of Carrollton, Texas
Tammie L. Little, 55, of Brashear, Texas
Mary Jaclyn Pannell, 29, of Krum, Texas
Taryn E. Stuart, 32, of Sanger, Texas
Slade C. Brown, 47, of Plano, Texas
Samuel D. Anderson, 35, of Carrollton, Texas
Each indicted defendant is charged with one count of conspiracy to commit health care fraud. Twelve of the defendants are also charged with at least one other count related to the conspiracy.
“That tens of millions of dollars were stolen through fraud is shocking enough,” said U.S. Attorney Parker. “That these defendants used human life at its most vulnerable stage as the grist for this scheme displays a shocking level of depravity that this community simply cannot tolerate.”
The indictment alleges that from July 2012 to September 2016, Novus billed Medicare and Medicaid more than sixty million dollars for fraudulent hospice services, of which more than thirty-five million dollars was paid to Novus. Specifically, defendants submitted false claims for hospice services, submitted false claims for continuous care hospice services, recruited ineligible hospice beneficiaries by providing kickbacks to referring physicians and healthcare facilities, and falsified and destroyed documents to conceal these activities from Medicare.
Novus Health Services and Optim Health Services, Inc. were operated and co-owned by Harris, who was a certified public accountant without any medical licenses. Harris operated the two companies essentially as one. Licensed physicians who were paid Novus medical directors provided little to no oversight of Novus’s hospice patients. Care was directed primarily by Novus nurses and by Harris. Defendants who were not physicians would determine whether a beneficiary would be certified for, recertified for, or discharged from hospice; whether they would be placed on continuous care; and how and to what extent they would be medicated with drugs such as morphine and hydromorphone. These decisions on medical care were often driven by financial interest rather than patient need. The defendants would decide whether to place, keep, or discharge a beneficiary from hospice depending on how that decision would affect Novus’s ability to bill Medicare.
Physicians were recruited who would refer hospice patients in exchange for medical director salaries. Assisted living facilities, in exchange for patient referrals, were provided remuneration including Certified Nursing Assistants paid for by Novus to staff the facilities.
Novus medical directors would sign certificates of terminal illness indicating that they had determined that a beneficiary was eligible for hospice services regardless of whether this was true or not; prepare re-certifications of terminal illness for beneficiaries already on hospice, which falsely indicated that the beneficiaries continued to be hospice eligible; and routinely give medical directors’ login information to others to log into Novus’s electronic medical records database to create and sign physician orders for services that had not been performed or had not been performed by the medical directors.
Harris would direct that beneficiaries be placed on continuous care, whether the beneficiaries needed this service or not. This decision would often be made without any consultation with a physician. Continuous care physician’s orders were falsified and uploaded into Novus’s electronic medical records database. When a beneficiary was on continuous care, the Novus nurses would administer high doses of Schedule II controlled medications such as morphine or hydromorphone, whether the beneficiary needed the medication or not. The defendants and others obtained these Schedule II medications with “C2” prescription forms (used for the prescription of controlled substances) which had been unlawfully pre-signed by medical directors. One reason for this aggressive medicating practice was that Harris wanted to ensure that the beneficiaries’ medical records contained documentation that would justify billing Medicare at the higher continuous care billing rate. There were instances when these excessive dosages resulted in serious bodily injury or death to the beneficiaries.
An indictment is merely an allegation and defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. If convicted, however, each count of conspiracy to commit health care fraud and substantive health care fraud count carries a maximum statutory penalty of 10 years in federal prison and a $250,000 fine.
The case is being investigated by the Federal Bureau of Investigation, the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG), and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU).
Assistant U.S. Attorney Russell Fusco is prosecuting the case.
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Heroin Trafficker SentencedRead the Press Release
AMARILLO, Texas — Joel Lara Merida, 31, arrested in August 2016 after a traffic stop in Potter County, Texas, and then found to have 17,388 grams of heroin in bundles in an aftermarket compartment, has been sentenced, announced U.S. Attorney John Parker of the Northern District of Texas.
On Monday, February 27, 2017, Merida was sentenced by U.S. District Judge Sidney A. Fitzwater to 51 months in federal prison. Merida pleaded guilty to one count of possession with intent to distribute one kilogram or more of heroin and aiding and abetting in November 2016. Co-defendant Jose Emmanuel Morales Rittingger, 29, is set to plea in March 2017.
According to documents filed in the case, on August 15, 2016, a Texas Department of Public Safety (DPS) Trooper stopped a 1995 BMW for driving in the left lane when not passing and obstructed view through the windshield. Upon making contact with the driver of the vehicle, who was later identified as Merida, and the passenger, who was later identified as Rittingger, the Trooper noticed indicators of possible criminal activity. The Trooper asked Merida for consent to search the vehicle and Merida voluntarily consented to the search. Eighteen bundles in an aftermarket compartment under the back seat were located. There were nine bundles wrapped in black tape, four bundles were wrapped in cellophane, and five bundles were wrapped in silver tape. The heroin had a gross weight of 44.26 pounds and field tested positive for the presence of heroin.
Subsequent testing confirmed that the substance seized was, in fact, heroin, a Schedule I controlled substance, with a net weight of approximately 17,388 grams.
The case was investigated by the Texas Department of Public Safety and the Drug Enforcement Administration. Assistant U.S. Attorneys Joshua Frausto and Sean Taylor prosecuted.
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Amarillo Men Sentenced on Cocaine OffensesRead the Press Release
AMARILLO, Texas — Two defendants, who pleaded guilty in November 2016 to their respective roles in cocaine trafficking have been sentenced, announced John Parker, U.S. Attorney for the Northern District of Texas.
Yesterday, U.S. District Sidney A. Fitzwater sentenced Roberto Rodriguez, 32, to a 60-month term of imprisonment. Rodriguez pleaded guilty to one count of possession with intent to distribute 500 grams or more of cocaine and aiding and abetting. Co-defendant Emmanuel Hira Robles, 30, was sentenced to 71 months in federal prison. He also pleaded guilty to one count of possession with intent to distribute 500 grams or more of cocaine and aiding and abetting.
According to court documents, on August 11, 2016, a Texas Department of Public Safety Trooper stopped a SUV for speeding and following to close. The Trooper noticed that the driver, later identified as Robles, took an abnormal amount of time to stop once the Trooper initiated the traffic stop. Upon making contact with Robles and the passenger, who was later identified as Rodriguez, the Trooper noticed indicators of possible criminal activity.
While the Trooper was in the process of issuing Robles a warning for the two traffic violations, he noticed inconsistencies between Robles’ and Rodriguez’ stories about their trip. The Trooper asked Robles for consent to search his vehicle, and Robles refused. The Trooper then asked Robles and Rodriguez to wait on the roadside while he waited for a narcotics detection canine unit. The narcotics detection canine conducted a free-air sniff of Robles’ vehicle, and the canine alerted to the presence of narcotics in Robles’ vehicle. Based on the canine’s alert to the presence of narcotics, the Trooper searched the vehicle. During the search, the Trooper observed a carpeted box that, based on his training and experience, he knew to be used to smuggle narcotics and currency. Both Rodriguez and Robles were immediately handcuffed and placed under arrest. Robles told the Trooper how to open the compartment. Two bundles were located in the compartment. A field test of the substance in the bundles yielded a positive result for the presence of cocaine, a Schedule II controlled substance.
The suspected cocaine was confirmed to be cocaine with a net weight of 1,995 grams.
The Drug Enforcement Administration and Texas Department of Public Safety investigated. Assistant U.S. Attorney Joshua Frausto prosecuted the case.
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Amarillo Man Admits Possessing Prepubescent Child PornographyRead the Press Release
AMARILLO, Texas — James Kenny Crawley, 60, of Amarillo, Texas, appeared today in federal court before U.S. District Judge Sidney A. Fitzwater and pleaded guilty to one count of possession of prepubescent child pornography, announced John Parker, U.S. Attorney for the Northern District of Texas.
Crawley, who is on bond, faces a maximum statutory penalty of 20 years in federal prison, a $250,000 fine and a lifetime of supervised release. Sentencing will be set at a later date.
According to documents filed in the case, Crawley used a laptop computer at his residence to search the Internet for images and videos of child pornography. In the course of searching for this material, Crawley located, downloaded and viewed approximately 5,000 images and over 100 videos constituting child pornography, and some of those images involved prepubescent minors engaging in sexually explicit conduct.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The Ochiltree County Sheriff’s Office, Texas Rangers and Federal Bureau of Investigation investigated the case. Assistant U.S. Attorney Joshua Frausto is in charge of the prosecution.
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Three Sentenced to Lengthy Federal Prison Sentences for Their Roles in a Child Sex Trafficking ConspiracyRead the Press Release
FORT WORTH, Texas — This morning, U.S. District Judge Reed C. O’Connor sentenced three defendants, with ties to the Polywood Crips street gang in Fort Worth, Texas, for their respective roles in a child sex trafficking conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.
Chad Johnson, a/k/a “Ocho Hood Fame,” 24, was sentenced to 300 months in federal prison. He pleaded guilty to one count of sex trafficking of children in November 2016.
Deon Bonner, a/k/a “Spanish Fly,” 26, was sentenced to 360 months in federal prison. He pleaded guilty to one count of conspiracy to commit sex trafficking of children in November 2016.
Stanley Johnson, a/k/a “Pee Wee,” 24, was sentenced to 168 months in federal prison. He pleaded guilty to one count of conspiracy to commit sex trafficking of children in October 2016.
All three defendants received lifetime sex offender registration.
Co-defendants Audry Lane, a/k/a “Spud,” 29, Diwone Nobles, a/k/a “Pooh,” 32, Katelyn Micelle Ward, a/k/a “KD,” 24, Jessica Arnold, 23, Serrah Arnold, a/k/a “Kristen,” 28 and Alvin Lane, a/k/a “Spank,” 32, have also pleaded guilty to varies offenses relating to their roles in the conspiracy and are awaiting sentencing.
According to documents filed in the case, in November 2015, U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) learned that a 16-year-old runaway, Jane Doe 1, was being trafficked by a group of people in Fort Worth, Texas; that group included the defendants. The investigation revealed that from approximately October 1, 2013, through April 16, 2016, the members of this group facilitated the commercial sex acts of several minor and adult females.
Nobles, Bonner, Chad Johnson, Stanley Johnson, Audry Lane and Alvin Lane, acted as pimps for the girls and women they trafficked. They instructed them on how much to charge and they kept proceeds from transactions. They also provided the girls and women with condoms, cellular phones and hotel rooms. Some of the members of the group bought and sold the girls and women they were trafficking amongst themselves.
To locate commercial sex customers, Nobles, Bonner, Chad Johnson, Stanley Johnson, Audry Lane and Alvin Lane facilitated the placement of advertisements on various commercial websites, including Backpage.com. In many instances, rather than placing the Backpage.com advertisement themselves, sisters Serrah Arnold and/or Jessica Arnold, who acted as “bottom girls,” were told to post the advertisements using Backpage.com accounts belonging to the Arnolds.
On approximately October 10, 2015, friends Deon Bonner and Stanley Johnson met 17-year-old Jane Doe 2 and her 16-year-old friend Jane Doe 1 in Fort Worth. They took the girls to a motel on Meacham Street in Fort Worth. Shortly thereafter, Stanley Johnson told Jane Doe 2 that he wanted her to engage in commercial sex acts, and he sought help from Audry Lane and Alvin Lane to post commercial sex ads for her on Backpage.com. Stanley Johnson told Jane Doe 2 how much to charge and he bought condoms for her; he also kept the money she made from engaging in commercial sex acts.
While Stanley Johnson was causing Jane Doe 2 to engage in commercial sex acts at a Fort Worth motel, Bonner was causing Jane Doe 1 to engage in commercial sex acts in another nearby room. After several days, Bonner left the hotel, and then Chad Johnson caused Jane Doe 1 to engage in commercial sex acts. Next, Nobles began causing Jane Doe 1 to engage in commercial sex acts. Chad Johnson and Nobles eventually took both Jane Doe 1 and Jane Doe 2 to another hotel in Fort Worth where Chad Johnson continued to cause Jane Doe 2 to engage in commercial sex acts.
When an adult female victim engaged in commercial sex acts at Chad Johnson’s direction, he physically assaulted her if she did not follow his instructions. On one occasion, Chad Johnson punched her in the ear hard enough to cause her eardrum to burst and bleed. Chad Johnson also raped her, and when he believed she had attempted to “renegade,” he had several friends gang rape her as punishment. “Renegade” is a term used to describe attempting to engage in commercial sex acts for money outside the knowledge or control of a pimp.
Some of the six pimp’s Facebook pages contained online posts, visible to the public, that reference making a lot of money through criminal activity, namely “pimping.” Chad Johnson’s Facebook page contained photos of him posing with large sums of cash while referencing commercial sex. Several of Chad Johnson’s Facebook friends were females observed in Backpage.com ads for commercial sex.
Nobles, Bonner, Chad Johnson, Stanley Johnson, and Audry Lane had several photos on their Facebook pages in which they can be observed flashing gang signs referencing the “Polywood Crips” street gang.
The Bureau of Alcohol, Tobacco, Firearms and Explosives, ICE HSI and the Fort Worth Police Department investigated. Assistant U.S. Attorney Cara Foos Pierce prosecuted.
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