Northern District of Texas
Press releases recorded for this federal judicial district.
U.S. Attorney Simonton Alerts Public to Charity Scams in Wake of Hurricane HeleneRead the Press Release
United States Attorney Leigha Simonton issued a public safety alert today advising the public to be vigilant to hurricane relief fraud in the wake of Hurricane Helene.
“North Texans are some of the most generous people I know,” said U.S. Attorney Leigha Simonton, the Northern District of Texas’ chief federal law enforcement officer. “We’ve all been impacted by the devastating images of Helene’s aftermath and are looking for ways to help. The best way to ensure your donations make a difference is to route them through a legitimate charity. Please, be vigilant for scams. Unfortunately, some fraudsters will stop at nothing to make a quick buck – even if it means exploiting a natural disaster and preventing funds from reaching the actual victims who are in need.”
On Sept. 26, Hurricane Helene made landfall in Florida’s Big Bend Region and quickly caused major devastation there and across states including Georgia, South Carolina, North Carolina, Tennessee, and others.
As we have seen in the wake of previous national disasters, fraudsters will target victims of the storm along with citizens across the country who want to do what they can to assist individuals affected by the storm.
Unfortunately, criminals exploit disasters for their own gain by sending fraudulent communications through email or social media and by creating deceiving websites designed to solicit contributions.The public should exercise diligence before giving contributions to anyone soliciting donations or individuals offering to assist those affected by Hurricane Helene. Solicitations can originate from phone calls, texts, social media, e-mail, door-to-door collections, flyers, mailings, and other similar methods. Before making a donation to benefit victims of Hurricane Helene, individuals should adhere to certain guidelines, including:
- Make contributions directly to known organizations rather than relying on others to make the donation on your behalf.
- Do not be pressured into making contributions as reputable charities do not use such tactics.
- Do not respond to any unsolicited communications (e.g., e-mails and texts), and never click links contained within those messages because they may be targeting your personal information, to include bank and credit card account information, and other identifiers such as dates of birth and social security numbers.
- Rather than clicking on a purported link to a charity, verify its legitimacy by utilizing various Internet-based resources that may assist in confirming whether the organization is a valid charity.
- Beware of organizations with copy-cat names similar to but not exactly the same as those of reputable charities.
- Avoid cash donations if possible. Pay by credit card or write a check directly to the charity. Do not make checks payable to individuals.
- Know that legitimate charities do not normally solicit donations via money transfer services, and their website will normally end in .org rather than .com.
- Be cautious of e-mails that claim to show pictures of the disaster areas in attached files because the files may contain viruses. Only open attachments from known senders.
The U.S. Department of Justice established the National Center for Disaster Fraud (NCDF) in the wake of Hurricane Katrina to deter, investigate, and prosecute fraud in the wake of disasters. More than 50 federal, state, and local agencies participate in the NCDF, which reminds the public to be aware of and report any instances of alleged fraudulent activity related to relief operations and funding for victims. Complaints of fraud may be reported online at www.justice.gov/DisasterComplaintForm. Complaints may also be reported to the NCDF at (866) 720-5721, a hotline that is staffed 24 hours a day, 7 days a week.
Nine Charged in Brownfield Drug BustRead the Press Release
Nine drug traffickers allegedly operating out of Brownfield, Texas and surrounding areas have been federally charged, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
The defendants were arrested Thursday in a takedown that involved officers and agents from the Brownfield Police Department, Drug Enforcement Administration’s Dallas Field Office – Lubbock Resident Agency, the Lubbock County Sheriff’s Office, the Lubbock Police Department, the Texas Department of Public Safety, and Homeland Security Investigations. They made their initial appearances Friday morning before U.S. Magistrate Judge Amanda ‘Amy’ R. Burch.
“The success of this investigation highlights DEA’s outstanding partnerships with federal, state, and local agencies in the Caprock area,” said Special Agent in Charge, Eduardo A. Chavez. “DEA Lubbock and its counterparts will continue to bring violent drug traffickers to justice in small rural communities and large metropolitan areas alike.”
“The Brownfield Police Department takes the health and safety of our community seriously. We will continue to do what is necessary to investigate, arrest, and prosecute those who distribute illegal narcotics on our streets and in our neighborhoods,” said Brownfield Police Chief Chris Kotzur.
Those charged in six separate indictments include:
- Kirkland Ryan Longoria, charged with conspiracy to distribute cocaine and distribution of cocaine
- Sandra Kay Cavazos, charged with conspiracy to distribute cocaine and distribution of cocaine
- Arthur Lee Willingham, charged with conspiracy to distribute methamphetamine, possession with intent to distribute methamphetamine, possession of a firearm in furtherance of a drug trafficking crime, and felon in possession of a firearm
- Steven Blake Johnston, charged with conspiracy to distribute methamphetamine, distribution of methamphetamine, and possession with intent to distribute methamphetamine
- Steven Rene Rodriguez, charged with conspiracy to distribute methamphetamine and distribution of methamphetamine
- Lorraine Riojas Davila, charged with conspiracy to distribute methamphetamine and distribution of methamphetamine
- Dewayne Deshae Willis, charged with conspiracy to distribute methamphetamine and possession with intent to distribute cocaine
- Larry Joe Franco, Jr., charged with conspiracy to distribute methamphetamine and distribution of methamphetamine
- Demetrick Ward, charged with distribution of cocaine
An indictment is merely an allegation of criminal conduct, not evidence. All defendants are presumed innocent until proven guilty in a court of law.
If convicted, some face potential life sentences in federal prison.
Brownfield Police Department, Drug Enforcement Administration’s Dallas Field Office – Lubbock Resident Agency, the Lubbock County Sheriff’s Office, the Lubbock Police Department, the Texas Department of Public Safety, and Homeland Security Investigations conducted the investigation. Assistant U.S. Attorneys Stephen Rancourt and Sean Long are prosecuting the cases.
Russian National Indicted for Series of Ransomware AttacksRead the Press Release
The Justice Department today unsealed an indictment charging Russian national Aleksandr Viktorovich Ryzhenkov (Александр Викторович Рыженков) with using the BitPaymer ransomware variant to attack numerous victims in Texas and throughout the United States and hold their sensitive data for ransom.
According to the indictment obtained in the Northern District of Texas, beginning in at least June 2017, Ryzhenkov allegedly gained unauthorized access to the information stored on victims’ computer networks. Ryzhenkov and his conspirators then allegedly deployed the strain of ransomware known as BitPaymer and used it to encrypt the files of the victim companies, rendering them inaccessible. An electronic note left on the victims’ systems contained a ransom demand and instructions on how to contact the attackers to begin ransom negotiations. Ryzhenkov and his conspirators allegedly demanded that victims pay a ransom to obtain a decryption key and prevent their sensitive information from being made public online.
The indictment further alleges that Ryzhenkov and others used a variety of methods to intrude into computer systems, including phishing campaigns, malware, and taking advantage of vulnerabilities in computer hardware and software. Ryzhenkov and coconspirators used this access to demand millions of dollars in ransom. Ryzhenkov is believed to be in Russia. View the FBI’s wanted poster for him here.
In coordination with the indictment’s unsealing, the Office of Foreign Assets Control of the U.S. Department of the Treasury today announced that Ryzhenkov was added to its list of specially designated nationals. The designation blocks property and interests in any property the designee may have in the United States and prohibits U.S. financial institutions from engaging in certain transactions and activities with the designated individual. To learn more, view the Treasury announcement here.
“The Justice Department is using all the tools at its disposal to attack the ransomware threat from every angle,” said Deputy Attorney General Lisa Monaco. “Today’s charges against Ryzhenkov detail how he and his conspirators stole the sensitive data of innocent Americans and then demanded ransom. With law enforcement partners here and around the world, we will continue to put victims first and show these criminals that, in the end, they will be the ones paying for their crimes.”
“Ransomware attacks – particularly those deployed by bad actors with ties to Russia – can paralyze a company in the time it takes to open a laptop. Whether or not the ransom is paid, recovering from a ransomware attack is generally costly and time-consuming,” said U.S. Attorney Leigha Simonton for the Northern District of Texas. “The U.S. Attorney’s Office for the Northern District of Texas is committed to pursuing cybercriminals who hold data hostage, no matter where in the world they may be hiding.”
“Aleksandr Ryzhenkov extorted victim businesses throughout the United States by encrypting their confidential information and holding it for ransom,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division. “Addressing the threat from ransomware groups is one of the Criminal Division’s highest priorities. The coordinated actions announced today demonstrate, yet again, that the Justice Department is committed to working with its partners to take an all-tools approach to protecting victims and holding cybercriminals accountable.”
“The FBI together with partners continues to leverage all resources to impose cost on criminals engaging in ransomware attacks,” said FBI Deputy Director Paul Abbate. “Today’s indictment delivers a clear message to those who engage in cyber-criminal activity – you will face severe consequences for your illicit activities and will be held accountable under the law.”
The FBI Dallas Field Office is investigating the case.
Trial Attorney Debra L. Ireland of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Vincent J. Mazzurco for the Northern District of Texas are prosecuting the case.
Victims of ransomware attacks are encouraged to contact their local FBI field office. For additional information on ransomware, please visit StopRansomware.gov.
An indictment is merely an allegation. Under United States law, all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Russian National Indicted for Series of Ransomware AttacksRead the Press Release
The Justice Department today unsealed an indictment charging Russian national Aleksandr Viktorovich Ryzhenkov (Александр Викторович Рыженков) with using the BitPaymer ransomware variant to attack numerous victims in Texas and throughout the United States and hold their sensitive data for ransom.
According to the indictment, beginning in at least June 2017, Ryzhenkov allegedly gained unauthorized access to the information stored on victims’ computer networks. Ryzhenkov and his conspirators then allegedly deployed the strain of ransomware known as BitPaymer and used it to encrypt the files of the victim companies, rendering them inaccessible. An electronic note left on the victims’ systems contained a ransom demand and instructions on how to contact the attackers to begin ransom negotiations. Ryzhenkov and his conspirators allegedly demanded that victims pay a ransom to obtain a decryption key and prevent their sensitive information from being made public online.
The indictment further alleges that Ryzhenkov and others used a variety of methods to intrude into computer systems, including phishing campaigns, malware, and taking advantage of vulnerabilities in computer hardware and software. Ryzhenkov and coconspirators used this access to demand millions of dollars in ransom. Ryzhenkov is believed to be in Russia. View the FBI’s wanted poster for him here.
In coordination with the indictment’s unsealing, the Treasury Department's Office of Foreign Assets Control today announced that Ryzhenkov was added to its list of specially designated nationals. The designation blocks property and interests in any property the designee may have in the United States and prohibits U.S. financial institutions from engaging in certain transactions and activities with the designated individual. To learn more, view the Treasury announcement here.
“The Justice Department is using all the tools at its disposal to attack the ransomware threat from every angle,” said Deputy Attorney General Lisa Monaco. “Today’s charges against Ryzhenkov detail how he and his conspirators stole the sensitive data of innocent Americans and then demanded ransom. With law enforcement partners here and around the world, we will continue to put victims first and show these criminals that, in the end, they will be the ones paying for their crimes.”
“The FBI, together with partners, continues to leverage all resources to impose cost on criminals engaging in ransomware attacks,” said FBI Deputy Director Paul Abbate. “Today’s indictment delivers a clear message to those who engage in cyber-criminal activity – you will face severe consequences for your illicit activities and will be held accountable under the law.”
“Aleksandr Ryzhenkov extorted victim businesses throughout the United States by encrypting their confidential information and holding it for ransom,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division. “Addressing the threat from ransomware groups is one of the Criminal Division’s highest priorities. The coordinated actions announced today demonstrate, yet again, that the Justice Department is committed to working with its partners to take an all-tools approach to protecting victims and holding cybercriminals accountable.”
“Ransomware attacks – particularly those deployed by bad actors with ties to Russia – can paralyze a company in the time it takes to open a laptop. Whether or not the ransom is paid, recovering from a ransomware attack is generally costly and time-consuming,” said U.S. Attorney Leigha Simonton for the Northern District of Texas. “The U.S. Attorney’s Office for the Northern District of Texas is committed to pursuing cybercriminals who hold data hostage, no matter where in the world they may be hiding.”
The FBI Dallas Field Office is investigating the case.
Trial Attorney Debra L. Ireland of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Vincent J. Mazzurco for the Northern District of Texas are prosecuting the case.
Victims of ransomware attacks are encouraged to contact their local FBI field office. For additional information on ransomware, please visit StopRansomware.gov.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Pain Doctors Sentenced to 6 ½ Years in $45 Million Healthcare FraudRead the Press Release
Two pain management doctors who pantomimed injections on patients were sentenced today to six and a half years apiece for healthcare fraud, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Drs. Desi Barroga, 51, and Deno Barroga, 51, were indicted in November 2023 and pleaded guilty in May 2024 to one count each of conspiracy to commit healthcare fraud. They were sentenced Thursday by U.S. District Judge Brantley Starr, who ordered them jointly and severally liable for $9,016,883.10 in restitution. Under the terms of their plea agreement, both men were also required to forfeit their medical licenses.
“These doctors exploited drug users’ vulnerabilities, requiring them to submit to monthly visits in exchange for controlled substance prescriptions, then billing their insurance providers for services the patients did not need nor receive. In a bizarre attempt to cover up their crimes, the defendants feigned giving injections without actually piercing the patients’ skin,” said U.S. Attorney Leigha Simonton. “Not only did they defraud their patients’ insurers, they facilitated their patients’ addictions. Their actions are antithetical to the practice of medicine, and the U.S. Attorney’s Office is proud to hold them accountable for their crimes.”
“Deno and Desi Barroga conspired to fraudulently bill private insurance companies, which included Employee Retirement Income Security Act of 1974 covered plans, tens of millions of dollars for services not rendered. Among other things, both doctors falsely represented to insurance companies that patients received over eighty injections during the office visits, when, in fact, the patients received few or no injections at all. This sentencing reflects the Office of Inspector General’s commitment to working with the U.S. Department of Labor’s (DOL) Employee Benefits Security Administration and our law enforcement partners to investigate and bring to justice those who engage in fraud against employee benefit programs,” said Casey J. Howard, Special Agent in Charge, Central Region, U.S. Department of Labor - Office of Inspector General.
According to court documents, the twin brothers admitted that they conspired to defraud Blue Cross Blue Shield, Cigna, and United Healthcare by submitting claims for corticosteroid injections that were never administered.
As part of the conspiracy, the Barrogas required patients to submit to monthly office visits. This allowed patients to continue receiving highly addictive Schedule II controlled substances – including hydrocodone, oxycodone, and morphine – while allowing the defendants to bill patients’ insurance companies for expensive services they never provided.
The Barrogas reported to insurance that they performed as many as 80 corticosteroid injections per patient per visit. In reality, the majority of these injections were never administered. In many instances, the doctor simply placed a needle on the patient’s body without actually piercing the skin to mimic giving an injection.
They defendants created fake medical records, which were often cut and pasted, or cloned, from patient to patient with little to no variation. They also instructed patients to include false statements pertaining to the injections and other treatments in the record.
In plea papers, the brothers admitted that they billed insurers at least $45 million and were paid at least $9 million as part of the scheme.
The U.S. Department of Labor’s Office of Inspector General, the U.S Department of Labor’s Employee Benefits Security Administration, U.S Office of Personnel Management’s Office of the Inspector General, the Drug Enforcement Administration’s Dallas Field Division Diversion Group, and the Texas Department of Insurance – Fraud Unit – Austin and Fort Worth Field Offices conducted the investigation. Assistant U.S. Attorney Renee Hunter is prosecuting the case. Assistant U.S. Attorney Dimitri Rocha assisted with forfeiture.
Sheriff’s Deputies Allegedly Tipped Off DEA TargetRead the Press Release
Two sheriff’s deputies who allegedly tipped off a drug trafficker about an impending DEA raid are being federally prosecuted, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Bernalillo County Sheriff’s Office Deputy Kyle Linker, 33, was charged via criminal information and pleaded guilty Tuesday to one count of obstruction of justice.
His colleague, Paul Jessen, Jr., 34, was indicted Tuesday on one count of conspiracy to obstruct justice, two counts of obstruction of justice, and two counts of making false statements. He has not yet entered a plea.
“Local, state, and federal law enforcement must work in concert to keep our communities safe. When we find a uniformed officer has undermined another agency’s investigation, we take swift action,” said U.S. Attorney Leigha Simonton. “Law enforcement works best when we work as a team.”
"It's deeply troubling when sworn Law Enforcement officers disclose information about upcoming operations to criminals," said Special Agent in Charge Raul Bujanda of the FBI Albuquerque Field Office. "It endangers the officers in the operation and jeopardizes the evidence they are seeking. The FBI will continue to provide all available resources towards identifying, investigating, and presenting for prosecution any individuals who betray their badges and their oaths of office."
“Every day, the men and women of the DEA work with local, state, and federal law enforcement partners to bring drug dealers to justice,” said Towanda Thorne-James, Special Agent in Charge of the DEA’s El Paso Field Division. “Mr. Linker chose to partner with the drug dealers instead, and now he too will face the consequences.”
According to Mr. Linker’s plea papers, the two deputies met the drug trafficker during the execution of a state search warrant in Los Ranchos, New Mexico, in July 2021. After finding methamphetamine inside his residence, they recruited him as a confidential informant.
In November 2021, a DEA agent notified Mr. Linker that the agency planned to conduct an operation near the drug trafficker’s home. Fearing the operation might target the trafficker, Mr. Linker reached out to warn him about the impending operation. The drug trafficker canceled his upcoming transaction, and the DEA was unable to gather evidence against him.
Upon examining the drug trafficker’s phone records, DEA agents began to suspect that he had been tipped off by Mr. Linker and decided to conduct another operation without notifying Mr. Linker first.
In December 2021, the DEA executed a search warrant at the drug trafficker’s residence and located more than 470 grams of methamphetamine and a firearm.
During the ensuing interview, the drug trafficker admitted to the agents that he had been previously tipped off by Mr. Linker. The DEA devised a plan to confirm the trafficker’s account.
Shortly thereafter, an agent contacted Mr. Linker to inform him the DEA was planning to use an informant to purchase methamphetamine from the drug trafficker. Although the agent specifically instructed Mr. Linker not to contact the trafficker, Mr. Linker messaged the trafficker to “call me ASAP.”
Unbeknownst to Mr. Linker, the drug trafficker was still in the presence of law enforcement.
The drug trafficker called Mr. Linker, who told him he was “on DEA’s radar” and instructed him to have someone else deliver drugs to the DEA informant.
Shortly after receiving word from the DEA that the operation would continue as planned, Mr. Linker texted Mr. Jessen to complain about the DEA’s plan.
“Tell [trafficker] not to sell to anyone. And go to a hotel or stay with someone else for a bit,” Mr. Jessen allegedly responded.
“What I should do is have you call [trafficker] that way when they ultimately say I tipped [trafficker] off I can show them my call logs and be like I haven’t talked to him since this morning,“ Mr. Linker texted back.
“I’ll [expletive] do it,” Mr. Jessen allegedly responded.
“Perfect,” Mr. Linker said. “Plausible deniability for me.”
The pair then allegedly called the drug trafficker from Mr. Jessen’s phone.
Mr. Linker told the drug trafficker the DEA would move forward with the operation and advised him to “shut everything down.” He then gave the trafficker excuses he could use to explain why he’d called off the transaction.
The drug trafficker was charged in a separate federal case. In June 2024, he pleaded guilty to possession with intent to distribute methamphetamine and is currently awaiting sentencing.
Mr. Linker now faces up to 20 years in federal prison. His sentencing date has not yet been set.
Mr. Jessen – who is presumed innocent until proven guilty in a court of law – faces up to 70 years in federal prison if convicted of all counts.
The Federal Bureau of Investigation’s Albuquerque Field Office, the Drug Enforcement Administration’s Albuquerque District Office, and the Department of Justice – Office of Inspector General conducted the investigation. Northern District of Texas Assistant U.S. Attorney Sean Long is prosecuting the case in the District of New Mexico.
Seven Charged with Possessing Contraband in Seagoville PrisonRead the Press Release
In an effort to combat contraband in federal prisons, the U.S. Attorney’s Office has charged seven men with possessing of various prohibited items while behind bars.
“The Northern District of Texas will not tolerate contraband inside federal prisons, period,” said U.S. Attorney Leigha Simonton. “Inmates who handle drugs, phones, or child sexual abuse material risk having significant time tacked onto their sentences. The safety of prison guards, other inmates, and even those outside prison walls depends on our enforcement of these rules.”
"I am very pleased to work with our law enforcement partners and provide evidence that contributed to these indictments," said Dr. Scarlet Grant, Warden of the Seagoville Federal Correctional Institution. “When cell phones and narcotics are introduced into a prison, it causes significant safety and security concerns to the employees and adults in custody. Deterring contraband remains a top priority of the Federal Bureau of Prisons and these indictments send a clear message that smuggling contraband into a prison is a federal offense and it will not be tolerated."
“Contraband largely serves to facilitate criminal acts in prison and poses real and potential danger to Federal Correctional Institute Seagoville personnel, other prisoners and to the community at large,” said FBI Dallas Acting Special Agent in Charge James Godley. “We will continue to work with our federal partners to investigate contraband encounters.”
Those charged in five separate indictments include:
- Isaac Martinez, charged with possessing contraband in prison (methamphetamine)
- Nicholas Evans, charged with possessing contraband in prison (buprenorphine) and possession with intent to distribute a controlled substance
- Hugo Castaneda, charged with two counts of possession of a prohibited object (methamphetamine) and one count of possession with intent to contribute a controlled substance
- Abdullah El Hage, charged with possession of a prohibited object (methamphetamine)
- Matthew Rodriguez, charged with possession of a prohibited object (methamphetamine) and possessing contraband in prison (phone)
- Deaunte Lakeith Johunkin, charged with possession of contraband (K2) in prison and attempted possession with intent to distribute a controlled substance
- Richard King, charged with possession of child pornography (printed, black and white, sexually explicit photos of prepubescent girls)
All seven recently charged defendants are inmates at Federal Correctional Institute Seagoville, a low-security Bureau of Prisons (BOP) facility southeast of Dallas with a population of just under 1,800 male offenders.
According to BOP’s policy, prison contraband includes items that could reasonably be expected to cause physical injury or adversely affect the security, safety, or good order of the institution.
An indictment is merely an allegation of criminal conduct, not evidence. All defendants are presumed innocent until proven guilty in a court of law.
If convicted, the inmates may have additional prison time tacked onto their sentences.
Earlier this year, two men were charged with attempting to smuggle cell phones and marijuana into the yard of a federal prison in Fort Worth via a mesh bag affixed to a drone. Prison staff found the mesh bag hanging from a parachute cord on the side of a building after being notified of a drone in their airspace.
Joseph Mora and Reza Ayari both pleaded guilty to attempt to provide contraband to a prisoner and were sentenced to 58 and 50 months, respectively, in federal prison. In Mora’s case, the Court ordered his 58-month sentence to be served consecutive to any sentence imposed in his other federal case.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigations with the cooperation of the Federal Bureau of Prisons. Assistant U.S. Attorney Luis Suarez is prosecuting the Seagoville inmates’ contraband cases and Assistant U.S. Attorney Levi Thomas prosecuted the Fort Worth drone case.
Businessman Sentenced in Tax Scheme, Ordered to Pay $38.9 Million in RestitutionRead the Press Release
A former Frisco man was sentenced yesterday to 52 months in prison and ordered to pay more than $38.9 million in restitution to the IRS, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Ronald James Paolucci, the 55-year-old co-founder and employee of American Management Staffing (AMS), was charged by felony information in January 2023 and pleaded guilty in February 2023 to conspiracy to defraud the United States and making and subscribing a false tax return. He was sentenced Monday by U.S. District Judge Sam A, Lindsay.
“We were proud to partner with IRS-CI on this important case,” said U.S. Attorney Leigha Simonton. “We stand ready to prosecute any employer who pockets employees’ payroll taxes and those who otherwise refuse to meet their tax obligations.”
“Nearly 70% of total U.S. revenues collected by the IRS are collected through employment taxes. When the employer withholds the payroll taxes but fails to pay the taxes over to the IRS, they may be criminally investigated and prosecuted for failing to withhold, collect, and pay over the tax. This was the case with Mr. Paolucci, his failure to remit withheld taxes is not only a breach of trust but a serious crime with severe consequences,” said Christopher J. Altemus Jr., Special Agent in Charge IRS Criminal Investigation, Dallas Field Office. “In addition to failing to meet payroll tax obligations, Mr. Paolucci failed to report his personal compensation and was ordered to pay approximately $10 million in restitution for his personal tax obligations. Let this sentence serve as a stark reminder: tax compliance is not optional; it is the law.”
According to court documents, AMS provided temporary staffing services to business clients. Mr. Paolucci was employed by AMS from approximately 2011 through 2020 and had control over AMS’ business affairs, including, approving payments and controlling AMS’s bank accounts.
AMS was obligated to pay the temporary employees and withhold and pay all applicable taxes for the employees. Mr. Paolucci withheld payroll taxes from the employees’ paychecks, including federal income taxes, Medicare and social security taxes. AMS was required to make deposits of the payroll taxes to the Internal Revenue Service (IRS) on a periodic basis and to file Employer’s Quarterly Federal Income Tax Return forms setting forth the total amount of wages, total amount of income tax withheld, total amount of social security and Medicare taxes due and the total tax deposits.
Mr. Paolucci agreed to continue to withhold payroll taxes from the temporary employees but understood that taxes would not be paid over to the IRS. Mr. Paolucci continued to issue IRS Forms W-2 to the temporary employees representing to the employees and the IRS that AMS was withholding and paying to the IRS payroll taxes.
From 2014 through 2020, AMS paid temporary employees and withheld approximately $13 million in payroll taxes from its employees. During the same time, AMS issued IRS W-2 forms to the employees showing that AMS withheld approximately $13 million in payroll taxes from those employees, however, AMS did not make any payments to the IRS.
IRS – Criminal Investigation conducted the investigation. Assistant U.S. Attorney Marty Basu prosecuted the case.
San Angelo Man Charged with Sextorting Minors and AdultsRead the Press Release
A San Angelo man has been charged with sextorting minors, ranging from 11 to 17 years old, and adults across the United States, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Juelz Sincere Armstead, 21, was charged in a superseding indictment with seven counts of production and attempted production of child pornography, two counts of attempted production of child pornography, and ten counts of cyber stalking. He was arraigned on Wednesday before U. S. Magistrate John R. Parker and is currently in custody.
According to the superseding indictment, beginning in August 2021, Mr. Armstead persuaded at least seven minors to engage in sexually explicit conduct and produced visuals of such conduct. On February 26, 2024, Mr. Armstead attempted to do the same with two additional minors. Mr. Armstead used the images he produced to harass and intimidate the individuals and caused them substantial emotional distress.
An indictment is merely an allegation, not evidence. Mr. Armstead is presumed innocent until proven guilty in a court of law.
Homeland Security Investigations, Tom Green County Sheriff’s Office, San Angelo Police Department, and several federal, state, and local law enforcement agencies in Texas, Indiana, Oregon, California, New Jersey, Colorado, Maryland, Pennsylvania, Kansas, North Carolina, Georgia, and Mississippi conducted the investigation. Assistant U.S. Attorney Callie Woolam is prosecuting the federal case.
Final Medoc Defendant Sentenced in $4.4 Million Prescription Kickback SchemeRead the Press Release
The final defendant in the Medoc kickback conspiracy was sentenced yesterday to 10 months in federal prison for his role in a prescription kickback scheme that cost federal insurance programs more than $4.4 million, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
The first indictment was filed in January 2020. Those sentenced include:
- Kevin Douglas Kuykendall, cofounder of Medoc Health Services, sentenced to 36 months in prison and ordered to pay $4.4 million in restitution for conspiracy to solicit and receive illegal kickbacks
- Sabrina Burmester Kuykendall, Kevin’s wife, sentenced to 36 months’ probation and ordered to pay $4.4 million in restitution for conspiracy to solicit and receive illegal kickbacks
- Mark David Schneider, cofounder of Medoc Health Services, sentenced to 15 months in prison and ordered to pay $4.4 million in restitution for conspiracy to solicit and receive illegal kickbacks
- Michael Ray Schneider, sentenced to 14 months in prison and ordered to pay $4.4 million in restitution for conspiracy to solicit and receive illegal kickbacks
- Trenton Lynn Moody, sentenced to 12 months and 1 day in prison and ordered to pay $257,500 in restitution for conspiracy to solicit and receive illegal kickbacks
- Cuong “Michael” Nguyen, founder of Total RX pharmacy, sentenced to 10 months in prison for misprision (concealment) of a felony and paid in restitution in the amount of $591,142
- Moky Chung, sentenced to 10 months in prison and ordered to pay $150,000 in restitution for conspiracy to solicit and receive illegal kickbacks
According to court documents, Medoc conspirators knowingly solicited illegal kickbacks from Total RX, a Rowlett pharmacy that was struggling to stay afloat.
In December 2014, Medoc executives Kevin Kuykendall and Mark Schneider approached Total RX owner Cuong Nguyen with a proposal: Nguyen could convert Total RX from an infusion pharmacy into a compounding pharmacy and begin filling prescriptions for Medoc. In return for referring lucrative prescriptions to Total RX, Medoc would receive a 50 percent commission.
The initial agreement only covered prescriptions covered by private insurers and specifically excluded any prescriptions paid by federal insurance programs, such as Medicare, Medicaid, Tricare, and Worker’s Compensation. At the time, Kuykendall and Schneider acknowledged that Medoc could not get paid on prescriptions paid by federal insurance programs. (They later admitted they knew of the federal Anti-Kickback Statute (AKS), which makes it illegal to receive remuneration in return for the referral of prescriptions funded by federal insurers.)
However, in early 2015, Kevin Kuykendall directed Nguyen to enter into a sham employment agreement with Mark Schneider’s brother, co-defendant Michael Ray Schneider, which would grant him a 45 percent commission on all prescriptions covered by federal health insurance that were referred by Medoc to Total RX.
Though nominally an “employee” of the pharmacy, Michael Schneider would be neither trained nor supervised Total RX. He would not work out of the Total RX offices, would not perform duties at Total RX’s behest, and would rarely communicate with Total RX. In court documents, multiple defendants admitted that the employment agreement between Michael Schneider and Total RX served as a way to “paper up” the payment of illegal kickbacks on prescriptions paid out by federal insurers.
Initially, Nguyen declined to execute the employment agreement, concerned that it specifically tied commission payments to government insurance programs. During a conference call, Kevin Kuykendall, Mark Schneider, and Moky Cheung agreed to designate prescriptions covered by federal health insurance programs as “<PRESCRIBER NAME> T” in order to internally track federal prescriptions for purposes of calculating kickbacks owed to all the conspirators but yet conceal the criminal nature of the scheme.
Defendants Kevin Kuykendall, Mark Schneider, Moky Cheung, and Trenton Moody then created various entities, including “Barolo Partners,” to receive and distribute Mr. Schneider’s purported salary payments. A portion of the money deposited into the Barolo account was eventually dispersed to K&S Biotherapeutics, an entity controlled by the Kuykendalls, and to Radiux Resources, an entity controlled by Moky Chung.
Beginning in August 2015, Medoc entered into a similar scheme with Doctors Specialty Pharmacy (DSP). In return for Medoc referring prescriptions to DSP, the pharmacy paid a hefty commission to the conspirators via Vantage Investment Partners, an entity they created for that purpose. The money was disguised as payment for “marketing services,” but no marketing occurred.
In total for the various schemes, the conspirators submitted claims for $10,448,856.90. and received payment of $5,837,219.70.
In 2019, the U.S. Attorney’s Office for the Northern District of Texas intervened and filed its own complaint in a civil qui tam lawsuit that relator Mark Adams brought in 2017 pursuant to the False Claims Act, captioned United States ex rel. Mark Adams v. Medoc Health Services, L.L.C. et al., Civ. No. 3:17-CV-2977-M (N.D. Tex., Dallas Division). Under the False Claims Act, a private party can file an action on behalf of the United States and receive a portion of the recovery. As part of the resolution of these civil claims, Kevin and Sabrina Kuykendall paid $4 million, and Trenton Moody paid $600,000 to the United States. In addition, Mark and Michael Schneider stipulated to entry of a $3 million civil judgment; Cuong “Michael” Nguyen to a $2.25 million civil judgment; and Moky Cheung to a $300,000 civil judgment.
FBI, HHS-OIG, Department of Labor, and the Texas Attorney General’s Office Medicaid Fraud Control Unit, conducted the investigation. Assistant U.S. Attorneys Donna Max, Doug Brasher, Nick Bunch (fmr), and Matthew Smid (fmr) prosecuted the criminal case. Assistant U.S. Attorneys Kenneth Coffin, Richard Guiltinan, Beverly Chapman, Katie Carr Jacobs, and Clayton Ray Mahaffey (fmr) handled the civil suit.
35-Year-Old Man Sentenced to 50 Years for Filming 9-Year-Old’s MolestationRead the Press Release
A Granbury man was sentenced Thursday to 50 years in federal prison for filming himself molesting a 9-year-old girl, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Stephen Wayne, Ashley, Jr., 35, was charged in March and pleaded guilty in May to sexual exploitation of a child and possession of child pornography. He was sentenced Thursday by U.S. District Judge Mark Pittman to 600 months in prison – 360 months as to the sexual exploitation count and 240 months as to the child pornography count, to run consecutively. Judge Pittman also ordered the defendant to pay $13,500 in restitution to several victims and to register as a sex offender.
“This defendant chose to repeatedly sexually exploit a child and then made a conscious decision to film himself conducting these egregious offenses,” said HSI Dallas Assistant Special Agent in Charge Jesse Woods. “HSI is grateful for the collaboration of all our law enforcement partners for their role in this investigation, ensuring that this individual will never harm an innocent child again.”
According to court documents, the investigation began when the New South Wales Police in Australia began looking into an individual who shared links containing child pornography on Twitter (now known as X). One of the links, which contained over 1,600 files of mostly child pornography, was traced to Mr. Ashley.
On March 11, agents executed a search warrant at Mr. Ashley’s residence, where they found Mr. Ashley’s phone. On the phone, they found a hidden folder containing videos of Mr. Ashley sexually molesting a 9-year-old girl.
After being Mirandized, Mr. Ashley admitted to officers that he began filming the child when she was 7 and continued to do so for a period of years.
Homeland Security Investigations’ Dallas Field Office conducted the investigation with the assistance of the New South Wales Police and the Hood County District Attorney’s Office. Assistant U.S. Attorney Aisha Saleem prosecuted the case.
Eight Arrested in Lubbock PSN TakedownRead the Press Release
Eight targets were arrested during a Project Safe Neighborhoods takedown in Lubbock on Wednesday, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Those arrested include:
- Corey Rashad Gilmore, indicted on one count of conspiracy to distribute and possess with intent to distribute fentanyl, one count of possession with intent to distribute cocaine, and one count of convicted felon in possession of a firearm
- Justin Tyrece Crawford, indicted on one count of convicted felon in possession of a firearm
- Joe Lewis Ybarra, Jr., indicted on one count of felon in possession of a firearm
- Wesley Glenn York, Jr., indicted on one count of possession with intent to distribute marijuana, one count of possession of firearms in furtherance of a drug trafficking crime, and one count of convicted felon in possession of a firearm
- Landon Henderson Jackson, indicted on one count of conspiracy to distribute and possess with intent to distribute methamphetamine and one count of possession with intent to distribute methamphetamine
- Matthew Nelson, indicted on one count of conspiracy to distribute and possess with intent to distribute methamphetamine and one count of possession with intent to distribute methamphetamine
- Kelli Lenay Hargrave, indicted on one count of conspiracy to possess with intent to distribute methamphetamine, two counts of distribution and possession with intent to distribute methamphetamine, and one count of possession with intent to distribute methamphetamine
- Philip Murphy, indicted on one count of conspiracy to possess with intent to distribute methamphetamine, one count of distribution and possession with intent to distribute methamphetamine, and one count of possession with intent to distribute methamphetamine
One additional target, Matthew De La Cruz, charged with one count of conspiracy to distribute and possess with intent to distribute methamphetamine and one count of possession with intent to distribute methamphetamine, remains a fugitive. Members of the public with information regarding his whereabouts are urged to contact the DEA’s Dallas Field Division at 214-366-6900.
“This Project Safe Neighborhoods takedown relied on the cooperation of more than three dozen agents and officers from local, state, and federal law enforcement, along with federal prosecutors from my office,” U.S. Attorney Leigha Simonton said at a press conference announcing the bust on Thursday. “PSN relies on the collective wisdom of law enforcement agencies – big and small – to identify, investigate, and prosecute our communities’ most significant drivers of violence. Instead of agencies working in silos, overlapping and competing, PSN brings federal and state law enforcement together to take action that will have outsized impact…. Following the tenets of the PSN program, we targeted repeat offenders known to be inciting crime here in Lubbock. These defendants all have rap sheets, including assault, robbery, controlled substances, and deadly conduct.”
“The apprehension of the suspects related to this case is a testament to the strong working relationships we experience between agencies here in West Texas,” said Lubbock Police Chief Seth Herman.
From the eight arrested defendants, law enforcement seized 12 firearms along with 946 grams of methamphetamine, 2 ounces of cocaine, and more than 10 pounds of marijuana.
If convicted, the defendants face a combined total of up to 330 months in federal prison.
More than three dozen officers and agents participated in the takedown, including men and women from the Bureau of Alcohol, Tobacco, Firearms & Explosives Dallas Field Division – Lubbock Resident Agency; the Drug Enforcement Administration’s Dallas Field Division – Lubbock Resident Agency; the Lubbock Police Department; the Lubbock County Sheriff’s Office; the Texas Anti-Gang Center; the Texas Department of Public Safety; the Texas Tech Police Department; the Plainview Police Department; Homeland Security Investigations’ Dallas Field Office; and the Federal Bureau of Investigation’s Dallas Field Office – Lubbock Resident Agency. The Lubbock County District Attorney’s Office also provided substantial assistance.
Assistant U.S. Attorneys Ryan Redd, Sean Long, Matthew McLeod, and Stephen Rancourt are prosecuting the cases with the assistance of Assistant U.S. Attorney Jeff Haag.
These cases are part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results. For more information about Project Safe Neighborhoods, please visit Justice.gov/PSN.
Charitable Foundation Treasurer Sentenced to 7+ Years for FraudRead the Press Release
A self-professed stock “trader” who also served as the treasurer of a church’s charitable foundation was sentenced Friday to more than seven years in federal prison for fraud, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Thomas Calhoun Bain, 75, of Dallas, pleaded guilty to a felony information charging two counts of wire fraud in March. He was sentenced Thursday by U.S. District Judge Jane Boyle, who ordered him to pay $1,725,551 in restitution to various victims.
Mr. Bain, who served as the treasurer of a Dallas church’s charitable foundation from 2016 to 2022, was responsible for transmitting monetary donations to organizations that supported gospel-based initiatives.
According to plea papers, Mr. Bain recommended the foundation issue 15 large donations to an entity Mr. Bain claimed furthered the church’s mission. In turn, he told the entity that the foundation simply wanted to funnel the funds through the entity and on to other charities, in order to keep its donations anonymous. He directed the entity to transmit all funds to him, purportedly so that he could distribute the money to the charities.
Instead, Bain pocketed the funds, totaling approximately $1.4 million, and used it to support his lifestyle, including rent on a home in Highland Park, a membership to a country club, domestic and international travel, and a vacation rental in Aspen.
During the same time period, Mr. Bain also defrauded investors through his company, BainTrade. Though he had no professional licenses, certification, training, or specific educational background, he represented to investors that he was a “Trader” and falsely guaranteed an annual return of at least 8 percent on their investments with BainTrade, with a 50-50 split between himself and investors for any yearly return above 8 percent.
In fact, Mr. Bain engaged in a Ponzi-type scheme, using new investor funds to make distribution payments to prior investors. He put remaining investor funds toward his high-end rental home, country club membership, and travel, bolstering his appearance as a wealthy and successful “trader.”
To further legitimize the scheme, Mr. Bain generated fake contracts that he required investors to sign, and fraudulent account statements showing fake annual earnings and profits generated. He also falsely told investors that he was investing his own money.
Between 2010 and 2022, Mr. Bain fraudulently obtained more than $871,000 from BainTrade investors.
Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorney Jenna Rudoff prosecuted the case.
Spanish Tutoring and Child Care Company Enters into Settlement Agreement After Rejecting Child with EpilepsyRead the Press Release
Spanish Schoolhouse, a company that offers Spanish language programs for preschool, kindergarten, and elementary-age children on nineteen campuses in the greater Dallas, Fort Worth, and Houston areas, will implement an anti-discrimination policy, accept students with epilepsy, and train its employees to administer anti-seizure medication as required by the Americans with Disabilities Act, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
In March of 2021, a couple attempted to enroll their two-year-old child in Spanish Schoolhouse’s daycare program. They informed the program that the student had epilepsy. Spanish Schoolhouse accepted and enrolled the child and requested a “seizure action plan” drafted by the child’s physician. The plan submitted by the couple outlined treatment protocols should a seizure occur, including removing the student from the classroom upon onset of a seizure and administering a rectal medication for seizures lasting more than three minutes.
Citing the seizure action plan, the school reversed its acceptance decision. A director told the parents that the staff were uncomfortable with monitoring the student for potential administration of the medication and lacked the manpower to be able to remove the child from the classroom in the event of a seizure. The parents said it would be acceptable to treat the child inside the schoolroom, rather than removing the child. The school still refused to accept the child.
The Justice Department later concluded that the school’s decision violated Title III of the Americans with Disabilities Act (ADA), which requires businesses that serve the public to make “reasonable modifications” to policies, practices, and procedures to accommodate those with disabilities.
Spanish Schoolhouse entered into a settlement agreement with the United States Attorney’s Office on Aug. 29. The agreement requires the company to allow the child to enroll at any of its facilities and to pay the parents $5,000 to compensate them for the harm caused. It also requires the company to implement an Emergency Anti-Seizure Medication Administration Policy, to train necessary staff annually on seizure disorders and the administration of anti-seizure medication as well as CPR, and to advise all parents of students with seizure disorders of the policy.
Under the terms of the agreement, Spanish Schoolhouse must forward any complaints related to reasonable modifications to the Department of Justice within 30 days of receipt.
Dallas Man Pleads Guilty in $27M Oil & Gas, Water Rights FraudRead the Press Release
A Dallas man pleaded guilty Tuesday to defrauding investors out of more than $27 million in various oil and gas and water rights scams, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Dennis James Rogers, II, 35, originally of Las Cruces, NM, was charged via felony information. On Tuesday, he pleaded guilty to two counts of securities fraud.
“This defendant lined his own pockets at the expense of would-be investors, lying and cheating his way to a life of luxury,” said U.S. Attorney Leigha Simonton. “Today’s plea is a step towards justice for his victims.”
“Investment and securities scams result in high volumes of complaints and high loss amounts to victims, and also undermine the integrity of our financial markets at-large,” said Dallas FBI Special Agent in Charge Chad Yarbrough. “The FBI is committed to investigating criminal activity that is designed to defraud unsuspecting individuals and will continue to dedicate substantial resources to investigating ever-evolving fraud schemes like those perpetrated by the defendant.”
According to plea papers, in August 2019, Mr. Rogers successfully solicited $10 million from an investor, purportedly so that his company, Oregon Mountain Trading Company, could purchase fuel. The investor, identified in court documents by the initials J.I., handed over the funds after the pair agreed he would receive a fifty percent return on investment. Instead of purchasing fuel as promised, Mr. Rogers diverted the funds to a private jet service, a custom home builder, a law firm, an investment account, business entities, credit card companies, and other personal expenditures.
Ten months later, Mr. Rogers solicited $4.1 million and $2.1 million from investors S.W. and D.W., respectively. He told the investors that a large international fuel company was exiting its stock position in Brownsville, Texas and planned to dispose of its fuel via an exclusive, invitation-only auction. (In reality, the company never held an auction and had no relationship with Mr. Rogers.) Instead of purchasing fuel at auction, Mr. Rogers diverted the money to fund an unrelated investment account, purchase real estate, and pay personal expenses.
Mr. Rogers also successfully collected $11 million in investments for a purported water rights deal associated with a dairy farm in New Mexico. In furtherance of the scheme, he held a call with an investor and an alleged member of the dairy farmer family. He also told investors he had an account worth $5 million that could be used as collateral. In reality, Rogers never had a relationship with the dairy farmer, the account had no collateral value, and there was never a contract for water rights.
Mr. Rogers now faces up to ten years in federal prison. His sentencing hearing is set for Dec. 18, 2024 before U.S. District Judge Ed Kinkeade.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorney Marcus Busch is prosecuting the case.
Knox County Enters into Settlement Agreement Following Complaint by Deaf CitizenRead the Press Release
Knox County, Texas will take steps to ensure qualified sign language interpreters, real-time transcription services, and other accommodations are available to deaf and hard-of-hearing citizens as required by the Americans with Disabilities Act, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
In February of 2020, a citizen contacted the county, via email, about arranging a marriage ceremony at the county courthouse. He explained that both he and his fiancée (now spouse) are deaf and would need an interpreting service. The county’s Justice of the Peace responded, also via email, that “the arrangement for an interpreter will need to be made by you and funded by you.”
The Justice Department later determined that the response constituted a violation of Title II of the Americans with Disabilities Act (ADA), which requires public entities to “furnish appropriate auxiliary aids and services where necessary to afford individuals with disabilities … an equal opportunity to participate in, and enjoy the benefits of, a service, program, or activity of a public entity.”
The county entered into a settlement agreement with the United States Attorney’s Office on Aug. 27. The agreement requires the county to post a notice outlining its responsibilities under the ADA on its website, in conspicuous locations in each of its public buildings, and in a newspaper of general circulation serving the county. It also requires the county to identify and develop procedures for using vendors able to provide sign language interpreters, real-time transcription services, braille, and other accommodations, and to develop and implement a training program to educate its employees on the requirements of the Americans with Disabilities Act.
Complaints that a county service, program, or activity is not accessible to persons with disabilities may be directed to the Knox County Judge at (940) 459-2191 or [email protected]. Under the terms of the agreement, any complaints made to the county alleging discrimination based on disability must be forwarded to the Department of Justice within 21 days.
Law Firm Employee Who Embezzled Nearly $1.5M Sentenced to 4+ Years in Federal PrisonRead the Press Release
A law firm controller who embezzled over $1.48 million from her firm by inflating her payroll was sentenced today to more than four years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Christiane Kathleen Irwin, 44, was indicted in March 2022. She pleaded guilty in August 2023 to wire fraud and was sentenced Wednesday to 50 months in prison by U.S. District Judge Brantley Starr, who also ordered her to pay $1,483,008.56 in restitution.
According to court documents, Ms. Irwin, who worked for a law firm and was responsible for submitting payroll each week, falsely inflated her salary, which was set at approximately $140,000 annually, not including bonuses, some as high as $50,000.
In accordance with her fraudulent payroll submission, the firm’s payroll vendor transferred her purported pay from the firm’s bank account into her bank account every two weeks.
Over the course of three years, from 2019 to 2021, Ms. Irwin took home over $1.48 million in fraudulently obtained funds. Irwin used these funds to enhance her personal lifestyle, including the purchase of a luxury vehicle, and multiple vacations.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorneys Nashonme Johnson and Jenna Rudoff prosecuted the case with the help of Financial Auditor Sheila Powell.
Drug Trafficker Who Hid Fentanyl Pills in Kid’s Stuffed Animal Sentenced to 8+ YearsRead the Press Release
A Dallas drug trafficker who stashed fentanyl pills inside his child’s stuffed bear was sentenced today to more than eight years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Jorge Miguel Arteaga Medina, 23, was charged via criminal complaint in April 2023 and indicted later that month. He pleaded guilty in February to possession of a controlled substance with intent to distribute and was sentenced Tuesday by U.S. District Judge Ada Brown to 97 months confinement.
According to court documents, Mr. Arteaga Medina acquired fentanyl pills from a source of supply in Mexico known to agents as “22” and sold them to customers in the Dallas area.
In February 2023, a confidential source bought 171 grams of fentanyl pills from Mr. Arteaga Medina. During the meeting, which was recorded, the defendant advised the source to contact him if he/she needed more fentanyl pills in the future.
In April 2023, the confidential source again reached out to Mr. Arteaga Medina and asked to purchase more pills. The defendant said he had roughly 3,000 pills in his possession but would need to contact his superior in Mexico – believed to be “22” – if the source needed more than that.
Agents then approached Mr. Arteaga Medina and advised him of their investigation. He readily admitted to having a large quantity of pills in his apartment as well as a Smith & Wesson handgun inside the satchel strapped to his chest.
He brought the agents to his apartment, where his wife and small child lived, and showed them the pills. Some were in this bedroom closet, and the remainder were concealed in his child’s stuffed bear.
At Tuesday’s sentencing hearing, prosecutors introduced into evidence photographs of the pills inside the stuffed animal as well as posters Mr. Arteaga Medina kept in his home glorifying “Santa Muerte” (“Our Lady of Holy Death”), the skeletal so-called patron saint of drug dealers.
The Drug Enforcement Administration’s Dallas Field Division conducted the investigation. Assistant U.S. Attorney George Leal prosecuted the case.
The case was investigated under the Organized Crime Drug Enforcement Task Forces (OCDETF). OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. For more information about Organized Crime Drug Enforcement Task Forces, please visit Justice.gov/OCDETF.
Additional photographs introduced into evidence at sentencing available upon request.
Holly Elkins Sentenced to Two Life Terms for Orchestrating Killing of Alyssa BurkettRead the Press Release
A Rowlett woman who helped her fiancé orchestrate the brutal murder of his ex-girlfriend was sentenced today to two consecutive life sentences, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Holly Ann Elkins was indicted in June 2023. A jury convicted her in April 2024 of conspiracy to stalk, stalking using a dangerous weapon resulting in death, and brandishing a firearm in relation to a crime of violence. She was sentenced Thursday by U.S. District Judge Jane Boyle.
Ms. Elkins’ former fiancé, Andrew Beard, previously pleaded guilty to stalking using a dangerous weapon resulting in death and discharging a firearm during a crime of violence and was sentenced to 43 years in federal prison.
“Month after month, Holly Elkins and Andrew Beard relentlessly harassed Alyssa Ann Burkett. They called her despicable names. They filed false police reports. They placed illegal contraband in her vehicle. And when all that failed, they plotted a particularly painful and bloody death,” said U.S. Attorney Leigha Simonton. “We can never bring back what Ms. Burkett’s family has lost. We can never heal the pain her young daughter has had to endure. But we can give them this measure of justice. Holly Elkins and Andrew Beard will never terrorize their family again.”
According to evidence presented at trial, Ms. Elkins helped plot the Oct. 2, 2020 murder of 24-year-old Alyssa Ann Burkett, Mr. Beard’s ex-girlfriend, with whom he shared a young daughter.
The government argued that Ms. Elkins – who apparently dreamt of a life with Mr. Beard and a mother/ child relationship with his daughter – repeatedly attempted to call into question Ms. Burkett’s fitness as a parent. When that failed, Ms. Elkins goaded Mr. Beard into taking Ms. Burkett’s life, labeling the victim a “c**t” and a “dumb b**ch” and a “garbage s**t mom.”
The perpetrators’ relationship began in early April 2020. Later that month, Ms. Elkins spent her first weekend with Mr. Beard and his daughter. By May, the couple were shopping for engagement rings. In June, however, Ms. Elkins grew frustrated at Mr. Beard’s continuing association with Ms. Burkett, writing, “your BM [baby mamma] owns you,” “you continue to put BM first,” “you choose to be idk for lack of a better term submissive to her,” and “I don’t have want or need any bullshit from anyone.”
Ms. Elkins began a campaign to harass Ms. Burkett in summer 2020, shortly after Ms. Elkins moved into Mr. Beard’s home.
In June, Ms. Elkins and Mr. Beard conspired to place a GPS tracker on Ms. Burkett’s vehicle. A month later, Ms. Elkins placed a call to 911 under the name fake “Amber,” falsely claiming that Ms. Burkett’s car was driving erratically on the interstate. In August 2020, Ms. Elkins falsely reported to police that Ms. Burkett’s mother had attacked her, creating scratches on her own chest to support the lie. Five days later, Ms. Elkins and Mr. Beard paid a private investigator to dig up dirt on Ms. Burkett and her new boyfriend. (The investigator, who testified at trial, found nothing incriminating.) In September, Ms. Elkins helped Mr. Beard plant drugs and a gun in Ms. Burkett’s vehicle; Mr. Beard then placed a call to police under a fake name claiming Ms. Burkett was selling drugs to black men out of her car.
Then, on Sept. 10, just three weeks before the murder, Ms. Elkins accompanied Mr. Beard to a sporting goods store, where he purchased a black rainsuit in cash. On Sept. 14, two and a half weeks before the murder, Ms. Elkins purchased dark makeup from a drug store. On Sept. 19, she accompanied Mr. Beard to a big box store, where they purchased .410 shotgun shells and a Camillus knife.
One week prior to the murder, Ms. Elkins texted Mr. Beard and said “I hope you handle it.” She requested that he be “ride or die” for her and said if he was not, she is not sure the relationship can continue. Shortly after that text exchange, Google records reflect that Andrew Beard began conducting searches for how to remove gunpowder from his hands.
On Oct. 2, 2020, Mr. Beard, dressed in a black rainsuit and disguised as a Black man, shot Ms. Burkett in the head with a shotgun while she sat behind the wheel of her car in her work parking lot. As she staggered out of the car, Mr. Beard grabbed her and stabbed and slashed her 44 times. Her coworkers testified at trial that they found Ms. Burkett covered in blood and gasping for air in front of her office front door. She died as her coworkers tried to render aid to her.
During the murder, Ms. Elkins stayed at Beard’s home in Rockwall with Ms. Burkett’s daughter. In an attempt to create an alibi, she later claimed Mr. Beard had been home with her during the crime.
At the trial, Ms. Burkett’s new boyfriend testified that he believed Ms. Elkins was the “puppet master” behind the murder.
The Federal Bureau of Investigation’s Dallas Field Office, the Carrollton Police Department, and the Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Office conducted the investigation. Assistant U.S. Attorneys Gary Tromblay, Rick Calvert, and Ryan Niedermair are prosecuting the case. U.S. District Judge Jane Boyle presided over trial.Inmate Who Enticed Child into Sexually Explicit Video from Behind Bars Sentenced to 28+ YearsRead the Press Release
A 26-year-old inmate who used a video-visitation kiosk to entice a teenager into making sexually explicit videos from behind bars was sentenced this week to more than 28 years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Obadiah Fraser was indicted in September 2022 and pleaded guilty in May 2023 to production of child pornography. He was sentenced Wednesday to 340 months in federal prison by U.S. District Judge Brantley Starr, who also ordered him to register as a sex offender.
“This defendant willfully exploited a minor by coercing the victim into producing sexually explicit material without any regard for the mental and physical anguish his offenses would cause,” said Lester R. Hayes Jr., Special Agent in Charge of HSI Dallas. “I’m grateful for the collaborative efforts between HSI and our law enforcement partners in ensuring another child predator is brought to justice.”
While incarcerated in Dallas County Jail on an unrelated charge of possession of child pornography, Mr. Fraser used the jail’s video visitation kiosk to communicate with a 17-year-old girl.
Because the video visitation platform requires users to be 18 years of age or older, the child used Mr. Fraser’s cellmate’s wife’s account to communicate with him.
During their calls – which were monitored by a third-party company – Mr. Fraser instructed the girl to make sexually explicit videos of herself. When she hesitated, he yelled and cursed at her.
When Dallas County Jail officials confronted him about the videos, Mr. Fraser admitted to making them and said he knew the child was only 17.
Homeland Security Investigations’ Dallas Field Office conducted the investigation with the assistance of the Dallas County Sheriff’s Office and the full cooperation of Dallas County Jail. Assistant U.S. Attorneys Sarah Douglas and Camille Sparks (fmr.) prosecuted the case.
UPDATE: The United States Attorney's Office initially misidentified the technology Mr. Fraser used to communicate with the victim. He spoke to her via a video-visitation kiosk inside the jail, not via a jail-issued tablet.
Violent Felon Armed with Switch Charged with Firearm CrimeRead the Press Release
A violent felon armed with a Glock switch has been charged with a firearm crime, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Jaterrian Damon Johnson, 28, was arrested last Wednesday and charged via criminal complaint with felon in possession of a firearm. He made his initial appearance before U.S. Magistrate Judge Rebecca Rutherford Monday morning.
According to the complaint, on Aug. 7, plainclothes officers were conducting increased surveillance at an apartment complex near Walnut Hill Lane and Greenville Avenue when they witnessed a black Kia Sorrento commit traffic violations while exiting the parking lot. (The increased police surveillance was in response to an incident involving Dallas Police Department officers who engaged suspects who crashed a stolen pickup truck into a patrol vehicle.)
Patrol officers stopped the Kia. While walking back to their patrol vehicle with the driver’s license, the officers observed Mr. Johnson, who was seated in the passenger seat, making furtive movements and repeatedly turning to look back at the officer.
When they returned to the Kia, they observed a high-capacity Glock magazine resting on the passenger floorboard underneath Mr. Johnson’s seat. Inside the glove compartment, they found a .40 caliber Glock handgun with a live round inserted in the chamber and a Glock switch slotted into the backplate.
A criminal history query revealed that Mr. Johnson previously pleaded guilty to a state charge of aggravated assault with a deadly weapon and was sentenced to three years in prison.
A criminal complaint is merely an allegation of wrongdoing, not evidence. All defendants are presumed innocent until proven guilty in a court of law.
If convicted, Mr. Johnson faces up to 15 years in federal prison.
The Dallas Police Department’s Violent Crimes Task Force, the Federal Bureau of Investigation’s Dallas Field Office, and the Bureau of Alcohol, Tobacco, Firearms, & Explosives’ Dallas Field Office conducted the investigation. Assistant U.S. Attorney Robert Withers is prosecuting the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
It is also a part of “Operation Texas Kill Switch,” a statewide initiative taking aim at machinegun conversion devices, also known as “switches,” which transform commercially available semi-automatic firearms into fully-automatic weapons capable of firing faster than military-grade machine guns. Spearheaded by U.S. Attorneys Leigha Simonton, Alamdar Hamdani, Damien Diggs and Jaime Esparza, Operation Texas Kill Switch relies on partnerships with state and local law enforcement as well as rewards offered by Crime Stoppers
Men Who Stole USPS Arrow Keys Sentenced to Combined 17+ Years in PrisonRead the Press Release
Three Fort Worth men have been sentenced to a combined 17 years in federal prison for robbing a U.S. letter carrier, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Cedrick Eugene Mims, Danny Yogi Oriszul Powell, and Cameron Kemond Gist were indicted in February. They each pleaded guilty to robbery of property of the United States. Mr. Gist was sentenced Friday to U.S. District Judge Mark Pittman to 70 months in federal prison; Mr. Mims and Mr. Powell were previously sentenced to 75 months and 70 months, respectively.
“These defendants brazenly robbed a U.S.P.S. letter carrier at gunpoint in pursuit of an arrow key that would allow them to steal mail from collection boxes,” said U.S. Attorney Leigha Simonton. “In response to a concerning rise in arrow key robberies, the U.S. Attorney’s Office for the Northern District of Texas has become laser-focused on prosecuting these cases. We commend our partners at the U.S. Postal Inspection Service for their commitment to investigating these crimes and stopping them in their tracks.”
“The sentencing of these three individuals shows the utmost importance we place on the safety of U.S. Postal Service employees,” said Fort Worth Division Inspector in Charge Kai Pickens. “We will not stop pursuing those who seek to harm our employees and will bring them to justice to account for their violent crimes. Robberies of our employees are a top investigative priority for the U.S. Postal Inspection Service and a traumatic event for our employees which we do not take lightly. The partnerships we’ve established with the U.S. Attorney’s Office and Fort Worth Police Department allowed us to work jointly to pursue and hold these individuals accountable. Let this serve as reminder to those who harm and traumatize our employees: We will find you and bring you to justice.”
According to plea papers, the three men robbed a letter carrier, identified in court documents as C.S., in Fort Worth on Oct. 24, 2023.
Mr. Mimms admitted he pointed a 39mm pistol at the carrier and demanded “the key” – a reference to the carrier’s “Arrow Key,” a master key used by the U.S. Postal Service to gather mail deposited in blue collection boxes that is prized by mail thieves.
The men admitted that they also purloined a postal scanner and the keys to the letter carrier’s official vehicle. Mr. Powell drove the getaway car and Mr. Gist provided the firearms, plea papers indicate.
The U.S. Postal Inspection Service conducted the investigation with the assistance of the Fort Worth Police Department. Assistant U.S. Attorney Laura Montes prosecuted the case.
This case is the result of Project Safe Delivery (PSD), a joint U.S. Postal Service and U.S. Postal Inspection Service initiative aimed at countering postal crime and safeguarding postal employees. Announced in May 2023, in direct response to a rise in threats and attacks on letter carriers and mail theft incidents, PSD seeks to protect Postal employees and the mail stream, prevent incidents through education and awareness, and enforce the laws that protect our nation’s mail stream. Since the launch of PSD, postal inspectors, working with law enforcement partners, have arrested more than 287 individuals for postal-related robberies through June 30, 2024. In the first six months of the fiscal year, the number of arrests for postal-related robberies rose 72% versus the same period the previous year, while the number of postal-related robberies dropped 21%. Meanwhile, the number of mail theft complaints received during that period decreased 35%, suggesting the PSD approach is achieving the intended result.
Man Who Posed as 14-Year-Old Sentenced to 25 Years for Producing Child Sexual Abuse MaterialRead the Press Release
A 46-year-old Amarillo man who pretended to be a 14-year-old boy in order to obtain pornographic images from a child was sentenced today to 25 years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Willie Gonzales was indicted in December 2023 and pleaded guilty in April 2024 to production of child pornography. He was sentenced Friday by U.S. District Judge Matthew J. Kacsmaryk to 300 months in prison followed by a lifetime of supervised release.
According to plea papers, in the fall of 2022, Homeland Security Investigations and the Texas Department of Public Safety – acting off a tip from the National Center for Missing and Exploited Children – conducted a search warrant at Mr. Gonzales’ home, where they found an iPhone containing sexually explicit images of a 10-year-old girl.
A forensic examination of the phone revealed that Mr. Gonzales persuaded the child to send him photos and videos of herself. At sentencing, the judge noted that Mr. Gonzales had posed on Snapchat as a 14-year-old boy in order to entice his victim.
Homeland Security Investigations and the Texas Department of Public Safety conducted the investigation. Assistant U.S. Attorney Josh Frausto prosecuted the case.
Kennedale Tax Preparer Sentenced to 6+ Years in PrisonRead the Press Release
A Texas tax preparer who pleaded guilty to a $2.6 million tax fraud was sentenced to more than six years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Anthony “Tony” Floyd, 51, was charged in June 2023 with ten counts of aiding in the preparation and presentation of false tax returns. On the morning of his trial, shortly after a jury was seated, Mr. Floyd pleaded guilty to all 10 charges. He was sentenced Monday to 77 months in federal prison by U.S. District Judge Mark Pittman, who also ordered him to pay more than $1.9 million in restitution.
According to court documents, Mr. Floyd filed approximately 400 fraudulent tax returns that included false information designed to increase the amount of refund owed to the taxpayer.
He recruited victim “clients” outside big box stores and through other clients. He obtained their personal information, such as income and deduction information, via text or cell phone conversations, rarely meeting clients in person. Mr. Floyd purposely submitted the returns without reviewing with the taxpayer, then diverted all or most of the refund to his own account.
The resultant tax loss to the United States exceeded $2.6 million.
The tax filings included falsified W2s – filed on behalf of individuals purportedly working in catering, lawn care, event planning, interior décor, and other professions -- and included nonexistent charitable deductions, nonexistent college attendance, and even fictitious relatives.
“Mr. Floyd’s sentencing sends a message that tax fraud is not a victimless crime,” said Christopher J. Altemus Jr., Special Agent in Charge of the IRS Criminal Investigation’s Dallas Field Office. “Mr. Floyd took advantage of his neighbors by preparing fraudulent tax returns and trying to steal approximately $2 million from the U.S. government. His sentence of 77 months in prison holds him accountable for his crimes.”
“Everyone must ensure what is submitted is true and accurate when filing their taxes, even if they are prepared by a professional,” Mr. Altemus added.
IRS – Criminal Investigations conducted the investigation. Assistant U.S. Attorneys P.J. Meitl, Nancy Larson, and Mark Nicols (fmr) prosecuted the case.
Gas Station Robber Who Crashed into Apartment Complex SentencedRead the Press Release
A robber who led police on a 100 mph chase before crashing into an apartment complex was sentenced today to over 21 years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Jaden Christofer Tipton, 21, was indicted in October 2023 and pleaded guilty in February 2024 to two counts of Hobbs Act robbery and two counts of brandishing a firearm in furtherance of a crime of violence. He was sentenced Thursday by U.S. District Judge James Wesley Hendrix to a total of 255 months imprisonment.
In plea papers, Mr. Tipton admitted to robbing two Lubbock gas stations the course of just 53 minutes on July 10, 2023.
In both robberies, Mr. Tipton pulled a firearm from his waistband, chambered a round, pointed it at the nearest cashier, and demanded all the money in the register.
Shortly after the second robbery, officers located Mr. Tipton’s blue four-door traveling eastbound. They attempted to conduct a traffic stop, but Mr. Tipton fled, leading officers on a high-speed chase before crashing into an apartment complex, where he was taken into custody.
Inside Mr. Tipton’s vehicle, officers found a black bag of cash and a loaded Taurus 9mm pistol.
At Thursday's sentencing hearing, prosecutors noted that when the defendant crashed into the apartment complex, he rammed into a couple’s bedroom. Both were hospitalized with serious injuries.
Both convenience store clerks submitted written statements to the Court, which were read at sentencing.
Tipton’s crime “uprooted my entire life and sent my mental state spiraling,” wrote clerk B.V.
“I wake up from night terrors, seeing that whole experience replaying in my mind, hearing that bullet going into the chamber,” clerk J.N. wrote.
The Lubbock Police Department and the Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division conducted the investigation. Assistant U.S. Attorney Stephen Rancourt prosecuted the case.
Fentanyl Dealer Implicated in Two Fatal ODs Sentenced to 22+ Years in PrisonRead the Press Release
A fentanyl dealer who admitted he was involved in at least three overdoses, two of them fatal, was sentenced Thursday to nearly 23 years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Rhett Barclay, 23, was indicted in September 2023 and pleaded guilty in February to conspiracy to possess with intent to distribute fentanyl. He was sentenced Thursday to 275 months in federal prison by U.S. District Judge Mark Pittman.
“This defendant is implicated in multiple deaths, including the tragic demise of his unborn child,” said U.S Attorney Leigha Simonton. “Those who traffic in fentanyl should know that the poison they peddle can take the lives of anyone who ingests it – even their nearest and dearest. Once again, this case proves that even half of one pill can kill.”
“Overdose deaths from fentanyl continue to have a devastating impact on communities across North Texas,” said DEA Fort Worth Special Agent in Charge Eduardo A. Chávez. “We are directing all our available resources to investigate those who distribute this deadly, illicit poison to our friends and family. Mr. Barclay, while responsible for the deaths of these individuals, also impacted countless others by his callous disregard for life. May others see this as a warning that DEA Fort Worth and our law enforcement partners across North Texas will continue to investigate drug distributors and seek significant jail sentences for their criminal activity.”
In plea papers, Mr. Barclay admitted that the fentanyl he obtained led to two fatal overdoses in less than two years.
On Jan. 24, 2021, Mr. Barclay distributed a single fentanyl pill to two women, identified in court documents as A.R. and T.M. The women split the pill. Both overdosed. Medics were able to resuscitate T.M., but A.R.'s overdose was fatal.
Less than two years later, on Jan. 12, 2023, Mr. Barclay obtained approximately 40 fentanyl pills. His girlfriend, identified in court documents as K.H., ingested one of the pills and suffered a fatal overdose.
At Thursday's sentencing hearing, prosecutors noted that K.H. was pregnant at the time. She passed away as their toddler watched.
The Drug Enforcement Administration's Dallas Field Division – Fort Worth Resident Agency conducted the investigation with the help of the Wise County Sheriff’s Office. Assistant U.S. Attorney Laura Montes prosecuted the case.
Illicitly produced fentanyl pills – often referred to as “M-30s” because of their resemblance to legitimate prescription pills like Oxycontin or Percocet – are highly dangerous. According to the DEA, six out of ten pills laced with fentanyl contain a potentially lethal dose. One pill can kill. For resources, visit https://www.dea.gov/onepill.
Forney Man Who Used Hidden Cameras, Molested Toddler Sentenced to 120 Years in PrisonRead the Press Release
A Forney man who filmed himself molesting a toddler and used concealed cameras to capture nude images of preteens was sentenced Thursday to 120 years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Leslie Michael Alt, 40, was indicted in September 2022 and pleaded guilty in September 2023 to two counts of production of child pornography and three counts of transportation of child pornography. He was sentenced Thursday to 1,440 months in prison by U.S. District Judge Ada Brown.According to court documents, Mr. Alt admitted to using concealed cameras to surreptitiously record sexually explicit videos of two preteen girls.
At Thursday's sentencing hearing, prosecutors noted that sexually explicit videos were found on a computer recovered from Mr. Alt’s home in late August 2022.
During a subsequent search of Mr. Alt’s residence, an FBI electronic detection canine alerted to a safe in Mr. Alt’s closet. The safe was open and appeared to be empty, but the canine insistently continued to alert on the safe. Agents removed the carpeted flooring of the safe and found SD cards and a concealed camera.
On one of the SD cards, they found videos of Mr. Alt sexually abusing a toddler.
“Seeing the images he had of my daughter as a toddler shattered me. Unable to voice she was uncomfortable, unable to communicate to me, her mother, that any of this was happening to her,” the victim’s mother testified at sentencing. “She currently does not have a conscious memory of what has happened. One day, I will have to tell her.”
One of the teenage victims also spoke, saying the news of the defendant’s crimes “shattered me.”
“My trust had been used against me, and I would never fully recover,” she said. “It makes me sick to my stomach.”
The Texas Department of Public Safety’s Criminal Investigations Division and the Federal Bureau of Investigation’s Dallas Field Office conducted the investigation with the assistance of the Grand Prairie Police Department’s Internet Crimes Against Children Unit. FBI Electronics Detection Canine “Iris” played an important role in the investigation. Assistant U.S. Attorneys Brandie Wade and Camille Sparks (ret.) prosecuted the case.
Nigerian Man Pleads Guilty to Real Estate Phishing / Spoofing SchemeRead the Press Release
A Nigerian man pleaded guilty today to conning prospective homeowners and others out of down payments using a “man-in-the-middle” email phishing and spoofing attack, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Kolade Akinwale Ojelade, a 34-year-old Nigerian national living abroad in Leicester, was indicted in February 2023. He was extradited from the U.K. to the U.S. in April 2024 and pleaded guilty Wednesday to wire fraud affecting a financial institution and aggravated identity theft.
“Unfortunately, sophisticated phishing and spoofing attacks can ensnare even the most tech-savvy among us. They can be disastrous for companies and absolutely calamitous for individuals,” said U.S. Attorney Leigha Simonton. “We look forward to holding this defendant accountable for the financial devastation he has wrought. In the meantime, I urge the public to follow CFPB’s best practices for wiring down payments.”
“Mr. Ojelade orchestrated the theft of funds from unsuspecting homeowners and real estate companies who believed they were legitimately wiring money to a trusted party,” said FBI Dallas Special Agent in Charge Chad Yarbrough. “The FBI successfully worked with our foreign partners to ensure he is held accountable by the U.S. judicial system.”
According to court documents, Mr. Ojelade sent phishing emails to real estate businesses, gained unauthorized access to many of their accounts, and monitored their email traffic to determine when large transactions were about to take place. He then intercepted wire payment instructions, changed the information, and resent the emails via spoofed email addresses that mimicked the original senders’ addresses.
Unbeknownst to the victims – including prospective homeowners wiring money to real estate companies and real estate companies wiring money to title companies – the modified wiring instructions directed them to accounts controlled by Mr. Ojelade and his co-conspirators. Once the funds hit the accounts, Mr. Ojelade and his coconspirators withdrew the money or transferred it into other bank accounts.
Mr. Ojelade now faces up to 32 years in federal prison. After serving his sentence, he will be subject to deportation.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation, with substantial assistance from FBI International Operations at Mission U.K., United Kingdom authorities, and the U.S. Marshals Service. The Justice Department’s Office of International Affairs provided substantial assistance in securing the arrest and extradition of Mr. Ojelade from the United Kingdom. Assistant U.S. Attorney Matthew Weybrecht is prosecuting the case.
The Consumer Financial Protection Bureau advises prospective homeowners to confirm wiring instructions – including account numbers – in person or by phone, and instructs anyone who believes they may have fallen victim to a scam to call their banks as soon as possible to ask for a wire recall.
Jury Convicts Snyder Man of Attempted EnticementRead the Press Release
A 38-year-old Abilene man who attempted to meet a “kid” for sex at a local park was convicted at trial, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Jose Luis Espinoza, Jr., 38, was indicted in February. In May, he pleaded guilty before Magistrate Judge D. Gordon Bryant, Jr, but withdrew the plea before the District Court accepted it, citing intimidation by counsel. Following a two-day trial, a jury deliberated for just 30 minutes before convicting Mr. Espinoza of attempted enticement of a minor.
At trial, a Synder police officer testified that Mr. Espinoza was caught in an undercover online investigation.
On Feb. 5, the officer created a social media profile posing as a 13-year-old girl named “Maddi.” Later that day, Mr. Espinoza reached out to Maddi’s profile and immediately began discussing sexual activity and requesting photographs.
After receiving a photograph of what appeared to be a 13-year-old girl (but was in actuality an age-regressed photo of the officer), Mr. Espinoza asked Maddie how old she was.
“I am almost 14,” she replied.
Mr. Espinoza continued to send lewd and lascivious messages, asking Maddi about her body and her sexual history and detailing what he wanted to do to her.
“You really are a kid, aren’t you,” he wrote. “I’m a horny old guy… guys get locked up for talking to girls like you.”
Two days later, Mr. Espinoza instructed Maddi to meet him at a park near her house. Mr. Espinoza promised the child Skittles and whisky and said he would bring a towel, as Maddi would likely bleed following intercourse.
“Idk if I wanna do it I am scared,” she said.
Mr. Espinoza responded with a laughing emoji, then told her she was “so whiny” and needed to “relax.”
Mr. Espinoza was arrested at a park in Snyder on Feb. 7. Inside his car, officers found Skittles, whiskey, condoms, a towel, and a 9mm Glock handgun.
He now faces not less than ten years and up to life in federal prison.
The Snyder Police Department conducted the investigation with the help of the Federal Bureau of Investigation’s Dallas Field Office. Assistant U.S. Attorneys Ryan Redd, Callie Woolam, and Jeffrey Haag prosecuted the case. U.S. District Judge James Wesley Hendrix presided over the trial.
Slync Founder Sentenced to 20 Years in Federal Prison for FraudRead the Press Release
Slync founder Christopher Kirchner was sentenced today to 20 years in federal prison for defrauding investors of tens of millions of dollars, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Mr. Kirchner, 37, who founded supply chain management software company Slync in 2017 and held the position of CEO until his termination by the Board of Directors in 2022, was initially charged in February 2023. Just 11 months later, a jury convicted him of four counts of wire fraud and seven counts of engaging in monetary transactions in property derived from specified unlawful activity. He was sentenced Thursday to 240 months in federal prison by U.S. District Judge Mark Pittman, who also ordered him to pay more than $65 million in restitution.
“Even as his company was circling the drain, Chris Kirchner was spending millions of his investors’ money on himself. Apparently, projecting personal prosperity was more important to him than making payroll,” said U.S. Attorney Leigha Simonton. “His duplicity earned him 20 years in prison. We are proud to hold him accountable for his crimes and are committed to pursuing all businesspeople engaged in criminal conduct.”
"Mr. Kirchner fraudulently raised money from investors and embezzled those funds from the company he led to fund a lavish lifestyle. Today’s sentence underscores the gravity of those crimes. He acted without any regard for how it would affect the company, employees, or investors," said FBI Dallas Special Agent in Charge Chad Yarbrough. “The FBI is committed to working with our partners to investigate any allegation of financial misconduct. We will hold individuals accountable who use their positions of trust for personal profit.”
According to evidence presented at the sentencing hearing, between 2020 and 2022, Mr. Kirchner fraudulently raised more than $71 million from numerous investors based on false representations and promises about Slync’s business operations, false representations about Slync’s financials, false representations about Slync’s customers, and fantastical revenue projections. As the jury’s verdict indicated, Mr. Kirchner then misappropriated over $25 million of the investor funds in various ways.
Between April 2020 and March 2022, Mr. Kirchner initiated nearly 100 wire transfers moving money from Slync’s Silicon Valley Bank account into the company’s account at JPMorgan Chase Bank – an account only he had access to. He then wired much of the money from the Chase account to his personal bank accounts. In addition, Mr. Kirchner wired $20 million directly from Slync’s Silicon Valley Bank account into his personal checking account. Mr. Kirchner then used the misappropriated funds to buy, among other things, a $16 million private jet, a suite at AT&T Stadium, exotic vehicles including a Rolls Royce and Mercedes Benz G-Class, and jewelry including a $500,000 Richard Mille watch, several Rolex watches, and a Cartier necklace.
When Slync, drained of funds, struggled to make payroll in the spring of 2022, Mr. Kirchner attempted to replace some of the money he had misappropriated by convincing at least four investors to wire approximately $850,000 to Slync as part of a purported Series C investment round. Slync’s Board of Directors never authorized a Series C investment round.
In the meantime, Mr. Kirchner offered various explanations for Slync’s payroll issues – all of which were untrue. Mr. Kirchner also fired a Slync employee after the employee reported to the Board of Directors that Mr. Kirchner may have falsely exaggerated Slync’s financial performance to investors.
Immediately following his suspension by the Board of Directors in late July 2022, Mr. Kirchner removed certain IT administrator privileges from key Slync employees, preventing the employees from accessing Slync’s computer systems. He then attempted to delete approximately 18 gigabytes of Slync data, including emails.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorneys Joshua D. Detzky, Nashonme Johnson, and Jay Weimer prosecuted the case. Assistant U.S. Attorney Dimitri Rocha handled the forfeiture; Assistant U.S. Attorney Katie Carr Jacobs worked on restitution. Assistant U.S. Attorney Brian McKay served as appellate liaison.
Five Sentenced in 17-Year-Old’s Sex Trafficking CaseRead the Press Release
Five people involved in sex trafficking a 17-year-old girl have been sentenced to a combined 63 ½ years in federal prison, announced U.S. Attorney for the Northern District of Texas.
They include:
- Jaelind Fountaine, 27, who was sentenced today to 327 months in prison for sex trafficking and attempted sex trafficking of a minor and required to register as a sex offender
- Sarah Gonzales, 26, who was previously sentenced to 87 months for interstate transportation to engage in prostitution and required to register as a sex offender
- Cameron Phifer, 25, who was sentenced to 240 months for distribution and receipt of child pornography and required to register as a sex offender
- Deryan Thomas, 33, who was sentenced to 87 months for interstate transportation to engage in prostitution and required to register as a sex offender
- Bianka Vega, 23, who was sentenced to 21 months for misprision (concealment) of a felony
“As a prosecutor and as a mother, my heart breaks for this teenager, who was passed from trafficker to trafficker like a piece of livestock, beaten and even branded by violent men looking to profit from her misery. No person, adult or child, should have to suffer like that,” said U.S. Attorney Leigha Simonton. “The U.S. Attorney’s Office and our law enforcement partners will stop at nothing to recover these victims, and we tenaciously prosecute anyone involved in trafficking them.”
According to plea papers, the 17-year-old victim went missing from her apartment complex in Lubbock on Nov. 28, 2022.
The investigation revealed that her neighbor and neighbor’s boyfriend, Bianka Vega and Deryan Thomas, took the child to Odessa to meet with known sex trafficker Cameron Phifer. The four of them then drove to Carlsbad, New Mexico, where they took sexually explicit photographs of the child and posted ads for her sexual services online.
At one point, Ms. Vega reminded Mr. Phifer that the victim was a minor, and informed him that both her mother and law enforcement were looking for her. Phifer told Ms. Vega it was “too late to stop,” and continued trafficking the child until abandoning her at a hotel in Carlsbad in early January.
On Jan. 15, Sarah Gonzales approached the victim in the hotel lobby, and later introduced her to Jaelind Fountaine, a known trafficker who went by the alias “Valentino.”
In an interview with law enforcement, the child said Mr. Fountaine arranged for meetings with clients, taught her how to engage in the sex trade, and took all the money she made – approximately $10,000. She said that she believed she would receive some of that money, but in the end, she never did.
The child told investigators that Mr. Fountaine physically assaulted her on multiple occasions, threatened to hurt her if she left him, and forced her to “brand” herself with a “V” tattoo to indicate his ownership of her. Law enforcement found photos of the tattoo on Mr. Fountaine’s phone.
The Federal Bureau of Investigation’s Dallas Field Office – Lubbock Resident Agency, and the Lubbock, Abilene, and Carlsbad Police Departments conducted the investigation. Assistant U.S. Attorneys Callie Woolam, Jeff Haag, and Matt McLeod prosecuted the case.
Men Who Robbed 8 USPS Letter Carriers Plead GuiltyRead the Press Release
The men responsible for eight mail carrier robberies have entered guilty pleas, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Jerrad Coleman, 18, and Louis Dixon, 18, were charged via criminal complaint in April. Mr. Dixon pleaded guilty on June 26 to robbery of property of the United States and conspiracy to rob and unlawfully possess property of the United States; Mr. Coleman pleaded guilty to the same charges on July 2.
“The U.S. Postal Service and the U.S. Postal Inspection Service will never cease placing employee safety as one of our top priorities,” said Inspector in Charge Kai Pickens, Fort Worth Division of the U.S. Postal Inspection Service. “Let this serve as a warning to anyone who seeks to harm and traumatize our employees: The U.S. Postal Inspection Service will utilize every resource to find you and bring you to justice. I appreciate our partnerships with the U.S. Attorney’s Office as well as the Arlington Police Department, Dallas Police Department, Fort Worth Police Department, and Frisco Police Department, which assisted with the investigation into Mr. Coleman and Mr. Dixon.”
According to court documents, the men trawled the streets of DFW looking for U.S. Postal Service letter carriers to rob in hopes of obtaining an Arrow Key, a master key used by letter carriers to gather mail deposited in blue collection boxes. Unauthorized possession of these keys, prized by mail thieves, allows individuals to illicitly access mailboxes to steal victim mail, checks, credit cards, bank account information, and other sensitive information.
Over the course of about four months, the men conspired to commit robberies against U.S. Postal Service Letter Carriers, including those on Jan. 17 in Fort Worth, Jan. 18 in Fort Worth, Jan. 25 in Dallas, Jan. 29 in Dallas, March 15 in Fort Worth, March 28 in Arlington, April 4 in Frisco, and April 17 in Fort Worth.
After robbing the mail carriers, often at gunpoint, the men fled in getaway vehicles. They then unlawfully used, sold, or disposed of the Arrow Keys.
Both men now face up to 15 years in federal prison.
The U.S. Postal Inspection Service conducted the investigation with the help of the Arlington, Dallas, Fort Worth, and Frisco Police Departments. Assistant U.S. Attorney Levi Thomas is prosecutingWoman Who Defrauded Health & Human Services Tech Company Sentenced to 4+ Years in PrisonRead the Press Release
A Mansfield woman convicted in a $3.7 million wire fraud scheme was sentenced Monday to more than four years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Tanisha Adderley, 51, was charged via criminal information in September 2023. She pleaded guilty to wire fraud in November 2023 and was sentenced Monday by U.S. District Judge Sam A. Lindsay to 51 months in federal prison. The judge also ordered her to pay $3,769,401.90 in restitution.
According to court documents, Ms. Adderley worked for a health and human services technology company that recovered fees paid by their clients and remitted refunds to them via wires from their funds recovery bank account. Ms. Adderley had access to the funds recovery bank account and was responsible for obtaining approvals and processing fee refunds.
Over the course of four years, from 2019 to 2023, Ms. Adderley manufactured false approvals and processed wire payments to business bank accounts that she controlled.
Ms. Adderley fraudulently obtained more than $3.7 million in company funds.
The United States Secret Service Dallas Field Office conducted the investigation. Assistant U.S. Attorney Nashonme Johnson prosecuted the case.Dallas Gang Member Charged with Possessing Glock SwitchesRead the Press Release
A gang-affiliated murder suspect has been charged with possessing multiple Glock switches, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Jamarion White, 19, was charged by the feds via criminal complaint with possession of a machinegun and was arrested Thursday evening. He was subsequently charged by the state with the June 9 murder of an 18-year-old boy.
“To think that some of our DFW’s most violent alleged criminals are armed with machinegun conversion devices is not just unsettling – it’s terrifying,” said U.S. Attorney Leigha Simonton. “Switch-equipped guns can fire faster than military-issue M4s. This is not the kind of weapon we want criminals carrying. This is why my office is focused on prosecuting switch cases—to protect our north Texas communities from the life-shattering effects of these devices.”
According to the federal complaint, on June 12, just three days after the alleged murder, law enforcement received a call about two suspicious men smoking marijuana inside a “beat-up Ford.” When officers arrived on scene, they approached the suspect vehicle and found Mr. White, a known member of the 65 Groveside criminal street gang, in the front seat.
An officer spotted a Glock pistol under Mr. White’s leg and directed him to place his hands on the dash. Instead, Mr. White allegedly fled, leaving the gun in plain view on the seat. Officers pursued him into a wooded area, where they lost sight of him. Eventually, they located him at a nearby home after receiving a call about an unknown intruder.
When the officers returned to the vehicle to secure the firearm, it was gone. A bystander reported that during the pursuit, another man had removed a bag from the Ford and placed it in a nearby car. Officers located the bag, which contained three loaded Glocks, all equipped with machinegun conversion devices, colloquially known as “switches.”
A subsequent search of Mr. White’s social media accounts yielded photos of the defendant allegedly holding one of the switch-equipped guns, as well as a music video in which the defendant allegedly explained how switches operate and the devastation they cause.
A complaint is merely an allegation of criminal conduct, not evidence. Mr. White is presumed innocent until proven guilty in a court of law.
If convicted of the machinegun charge, he faces up to 10 years in federal prison.
Homeland Security Investigations’ Dallas Field Office, the Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division, and the Mesquite Police Department conducted the federal firearms investigation. The Dallas Police Department conducted the homicide investigation. Assistant U.S. Attorney Marissa Aulbaugh is prosecuting the federal case.
The case is part of “Operation Texas Kill Switch,” a statewide initiative taking aim at machinegun conversion devices, which transform commercially available semi-automatic firearms into fully-automatic weapons capable of firing faster than military-grade machine guns. Spearheaded by U.S. Attorneys Leigha Simonton, Alamdar Hamdani, Damien Diggs and Jaime Esparza, Operation Texas Kill Switch relies on partnerships with state and local law enforcement as well as rewards offered by Crime Stoppers.
Texas Man Who Allegedly Imported Switches Charged with Gun CrimeRead the Press Release
A Rockwall man who allegedly imported Glock switches from China has been charged with a firearm crime, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Joshua Javier Menjivar, 20, was charged via criminal complaint on Friday with unlawful possession of an unregistered firearm. He made his initial appearance before U.S. Magistrate Judge Renée Harris Toliver on Wednesday.
“This defendant allegedly imported machinegun conversion devices from China and installed at least one of them in an untraceable ghost gun,” said Leigha Simonton, U.S. Attorney for the Northern District of Texas. “Whether manufactured abroad or printed here at home, switches are capable of firing a stunning amount of ammunition in seconds and are highly erratic – making them highly dangerous weapons. We cannot and will not allow these lethal devices to proliferate in north Texas.”
“As this arrest proves, we weren’t joking a few weeks ago when we told you that we were coming for you. The possession or importation of machine gun conversion devices will eventually lead to a visit by ATF or any of our law enforcement partners. I commend US Attorney Simonton and her team for their dedication to protecting the people of North Texas by aggressively prosecuting these cases. Further, I thank our partners at CBP who work tirelessly to keep Americans safe, a lot of times going unnoticed,” said ATF Dallas Special Agent in Charge Jeffrey Boshek.
According to the complaint, on May 16, Customs & Border Protection agents intercepted a suspicious package bound for Mr. Menjivar’s home. The parcel allegedly contained four machinegun conversion devices, also known as switches.
Further investigation showed that between May 2023 and May 2024, approximately 35 suspicious packages were allegedly delivered to Mr. Menjivar’s address. The shipments – at least one of which was allegedly sent by a known international firearms supplier – were manifested as various items, including household tools, protective gloves, glass cups, hats, and clothing, and were addressed to various fictitious individuals.
On June 10, ATF agents collected trash placed in a bin outside Mr. Menjivar’s home. Inside, they allegedly found a non-value gold metal commemorative bitcoin, an item often used to conceal switches by confusing x-ray machines and packaging consistent with illicit firearms shipments.
On June 20, agents executed a search warrant on Mr. Menjivar’s residence, where they allegedly found a privately made firearm, also known as a “ghost gun,” equipped with a switch, five additional switches, 72 rounds of assorted ammunition, two commemorative bitcoins, and various firearm accessories. In an interview, Mr. Menjivar allegedly asserted that anything illegal found in the residence, including the switches, belonged to him and affirmed that he knew how switches work.
The Bureau of Alcohol, Tobacco, Firearms, & Explosives’ Dallas Field Division, Homeland Security Investigations’ Dallas Field Office, the Dallas Police Department, the Rockwall County Sheriff’s Department, and U.S. Customs & Border Patrol conducted the investigation. Assistant U.S. Attorney Robert Withers is prosecuting the case.
The case is part of “Operation Texas Kill Switch,” a statewide initiative taking aim at machinegun conversion devices, which transform commercially available semi-automatic firearms into fully-automatic weapons capable of firing faster than military-grade machine guns. Spearheaded by U.S. Attorneys Leigha Simonton, Alamdar Hamdani, Damien Diggs and Jaime Esparza, Operation Texas Kill Switch relies on partnerships with state and local law enforcement as well as rewards offered by Crime Stoppers.
Texas Doctor Sentenced to 7 Years in Pill Mill SchemeRead the Press Release
A Texas doctor who prescribed hydrocodone and other controlled substances to drug-seekers without legitimate medical purpose was sentenced to seven years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Dr. Leovares Mendez, 59, and his coconspirators, Dr. Cesar Pena-Rodriguez, 56, and recruiter Jorge Hernandez, 35, were indicted in February 2020. Dr Pena-Rodriguez and Mr. Hernandez pleaded guilty to trial, but Dr. Mendez elected to stand trial by jury. He was convicted in February 2024 of one count of conspiracy to distribute a controlled substances and six counts of unlawful distribution of controlled substances and sentenced Monday by Chief U.S. District Judge David Godbey.
“This defendant wasn’t practicing medicine – he was dealing drugs, plain and simple,” said U.S. Attorney Leigha Simonton. “The vast majority of doctors prescribe opioids to ease suffering. But when medical professionals abuse their DEA registrations in ways that cause suffering, the Justice Department will bring the full force of the law to bear.”
“We will continue to investigate and seek prosecution against medical professionals who break the law and simply put, deal drugs,” said DEA Dallas Special Agent in Charge Eduardo A. Chávez. “Not only did Dr. Mendez flagrantly dismiss his professional and ethical duties, evidence showed he attempted to conceal his criminal conduct by suggesting methods to thwart law enforcement intervention. He failed. DEA will continue to hold these rouge doctors responsible for their reckless and illegal behavior.”
According to evidence presented at trial, Dr. Mendez and Dr. Pena-Rodriguez, owners of Cumbre Medical Center, prescribed hydrocodone, alprazolam, and tramadol to “patients” including those brought to them by recruiter Jorge Hernandez.
They wrote the prescriptions for no legitimate medical purpose, without conducting medical exams, in return for cash payments of between $200 and $250.
In video and audio recordings introduced into evidence, undercover officers posing as patients requested medications by name and received prescriptions despite never having complained of pain. The undercover officers received the illegal prescriptions on multiple visits that spanned almost two years. On multiple occasions, Dr. Mendez coached the undercover officers about what to say if ever contacted law enforcement, but urged them to keep a low-profile so as not to attract the attention of any potential investigators.
The Drug Enforcement Administration’s Dallas Field Division conducted the investigation. Assistant U.S. Attorneys Donna Max, Rachael Jones, Marty Basu, and Renee Hunter prosecuted the case, with help from appellate liaisons Gail Hayworth and Amy Mitchell.
Amarillo City Employee Pleads Guilty to Embezzling $465,000 from Homeless ProgramRead the Press Release
An Amarillo city employee pleaded guilty today to embezzling more than $465,000 in funds meant to provide shelter for homeless people, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Amy Dixon, 44, the City of Amarillo’s former Homeless Management Information Specialist, pleaded guilty Monday to a criminal information charging conspiracy to embezzle from a federally funded program.
In her role, Ms. Dixon was responsible for distributing funds to local landlords through the U.S. Department of Housing & Urban Development’s Emergency Solutions Grant (ESG) Program. She communicated with Amarillo property owners who were willing to lease their properties through the program, assisted in completing lease agreements, coordinated physical inspections of their properties, and assembled payment voucher packages. (The program paid market-rate rents to landlords willing to house those who needed assistance.)
According to plea papers, in September 2020, Ms. Dixon used a relative's personally identifiable information to create a fictitious landlord, for whom she created fraudulent payment voucher packages. She instructed Amarillo’s Finance Department to call her when the payment vouchers were ready, then signed the relative’s name on the checks and deposited the funds into her personal bank account.
In April 2021, when HUD announced that it would accept inspections completed by outside companies, she began to process payments for fictitious properties.
In total, Ms. Dixon created 223 fraudulent payment vouchers resulting in 66 checks written to fictitious landlords, with a total loss amount of $465,511.65.
Ms. Dixon now faces up to five years in federal prison.
The Federal Bureau of Investigation’s Dallas Field Office – Amarillo Resident Agency and the U.S. Department of Housing & Urban Development – Office of Inspector General conducted the investigation. Assistant U.S. Attorney Joshua Frausto is prosecuting the case.
Fort Worth Man Charged with Threatening Federal Agent: ‘Guns Will Come Out’Read the Press Release
A Fort Worth man has been charged with threatening an FBI agent involved in a high-profile investigation, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Timothy Muller, 43, was charged via criminal complaint on Thursday with interstate threatening communications and influencing, impeding, or retaliating against a federal official. He was arrested outside his home on Thursday morning without incident.
According to the complaint, Mr. Muller allegedly placed a call to an FBI special agent at 5:03 p.m. on June 11.
The agent was known to have been involved in an investigation into a laptop belonging to H.B. Shortly before Mr. Muller allegedly placed his call to the agent, media outlets reported that H.B. had been convicted following a trial related to a 2018 firearm purchase.
According to the complaint, Mr. Muller said, “hey,” and the agent disconnected the call. Mr. Muller immediately called back and allegedly left a one-minute and five-second message threatening the agent and his family:
“You can run, but you can’t [expletive] hide,” Mr. Muller allegedly said. “ You covered up child pornography. You covered up [H.B.] raping his own [expletive] niece.”
“So here’s how it’s gonna go,” Mr. Muller allegedly continued. “[T.]’s gonna win the re-election, and then we’re gonna [expletive] go through the FBI and just start throwing you [expletive]s into jail. Or, you can steal another election, and then the guns will come out, and we’ll hunt you [expletive]s down and slaughter you like the traitorous dogs you are in your own [expletive] homes. In your own [expletive] beds. The last thing you’ll ever hear are the horrified shrieks of your widow and orphans. And then you know what we’re going to do? … We’re going to slaughter your whole [expletive] family.”
Mr. Muller then allegedly sent the agent several texts, writing, “How’s the family? Safe?” and “Did you [expletive]s really think you were going to disenfranchise 75 million Americans and not die? Lol.”
A criminal complaint is merely an allegation of criminal conduct, not evidence. Mr. Muller is presumed innocent until proven guilty in a court of law.
If convicted, he faces up to 10 years in federal prison.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. The U.S. Attorney’s Office for the Northern District of Texas is prosecuting the case.
Sentenced for Role in $2 Million Unemployment Insurance FraudRead the Press Release
A Garland man was sentenced Monday to two years in prison for his role in a $2 million unemployment insurance fraud, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Frank Sherman, 60, was indicted in November 2022. He pleaded guilty in October 2023 to theft of government funds and was sentenced Monday by U.S. District Judge David Godbey, who also ordered him jointly and severally liable for nearly $2.3 million in restitution.
According to plea papers, Mr. Sherman admitted that from July 2020 through September 2021, he helped unknown coconspirators he met on social media pass fraudulently-obtained unemployment funds to individuals in Canada.
Mr. Sherman agreed to ship preloaded debit cards issued by the Nevada Department of Employment, Training, & Rehabilitation from his home in Garland to unknown individuals in Canada.
Over the course of 14 months, he received at least 200 Nevada unemployment insurance debit cards loaded with more than $2 million in unemployment insurance funds. He shipped most of the cards to Canada, but on at least one occasion, kept a debit card and used it for his own benefit.
Mr. Sherman also admitted to purloining $3,000 in unemployment funds from the California Employment Development Department, despite never having worked in the state.
The U.S. Department of Labor – Office of Inspector General and U.S. Department of Homeland Security – Office of Inspector General conducted the investigation. Assistant U.S. Attorney Marty Basu prosecuted the case.
Texas U.S. Attorneys Announce “Operation Texas Kill Switch” Aimed at Machinegun Conversion DevicesRead the Press Release
Today, U.S. Attorneys for the Northern, Southern, Eastern, and Western Districts of Texas announced “Operation Texas Kill Switch,” a statewide initiative targeting illegal machinegun conversion devices, colloquially known as “switches.”
At simultaneous press conferences throughout the state, U.S. Attorneys Leigha Simonton, Alamdar Hamdani, Damien Diggs, and Jaime Esparza, joined by Bureau of Alcohol, Tobacco, Firearms, & Explosives Special Agents in Charge Jeffrey Boshek and Michael Weddel, lambasted switches, which transform commercially available firearms into fully automatic weapons capable of firing faster than military-grade M4s.
“We’re here to talk about a roughly one-inch piece of plastic. It looks innocuous enough, a little like a lego or a k’nex block. But this one-inch piece of plastic is killing people,” U.S. Attorney Leigha Simonton said at Monday’s press conference. “Machinegun conversion devices can turn Second Amendment-protected firearms into illegal weapons of war, and petty criminals into brutal killers. We cannot have our streets turned into war zones. We cannot – and we will not – allow switches to proliferate in north Texas.”
“I have been in this business for a long time, and nothing scares me more than the rapid flood of machine gun conversion devices on the streets of Texas and beyond. Rest assured that ATF and its partners are doing everything we can to stop the flow of these things and to prevent the carnage they can create. I applaud our U.S. Attorney partners for their willingness to aggressively prosecute these criminals and gangsters” stated ATF Dallas Field Division Special Agent in Charge Jeffrey C. Boshek II.
About an inch long, switches may be made of metal or plastic and can be printed on commercially available 3D printers. They generally slot into the butt of a gun and allow the shooter to fire “full auto,” unloading dozens of rounds with a single pull of the trigger. (In contrast, regular semi-automatic firearms require a separate trigger pull for each round fired.) To date, switches have been used in numerous fatal shootings, including at least one juvenile mass shooting and multiple police killings.
Except in very limited circumstances, possession of a switch is illegal, as the National Firearms Act classifies the switch itself as a machinegun.
Yet the number of switches recovered by law enforcement has risen dramatically in the past few years. Between 2017 and 2023, Texas-based ATF agents seized 991 switches; 490 of those, 50 percent, were seized just last year. They are often sold over social media, marketed to adults and juveniles alike.
At Monday’s press conference, the U.S. Attorneys announced that as part of Operation Texas Kill Switch, they are partnering with Crime Stopper programs statewide to combat the proliferation of these illegal devices.
From now until Aug. 31, local Crime Stopper programs will offer cash rewards for information leading to the apprehension or prosecution of those who possess switches or 3D printers being used to manufacture them. To be eligible for cash rewards, tipsters must provide information to their local Crime Stoppers program. Tipsters may also use **TIPS to be connected to a Crime Stoppers program in their area. Tips can be submitted 24 hours a day, and anonymity is guaranteed by law. Information may also be submitted directly to ATF at www.atf.gov/contact/atf-tips.
U.S. Attorneys Simonton, Esparza, Diggs, and Hamdani also urged local law enforcement to partner with the feds on switch cases, which carry maximum sentences of up to 10 years in the federal system. They laid out their case in a joint op-ed published Monday in the Austin American Statesman, which you can read here. Watch clips from a machinegun conversion device shooting demonstration here and here.
Perryton ISD Coach Charged for Enticing 15-Year-Old StudentRead the Press Release
A Perrytown ISD coach has been charged following an alleged sexual relationship with his 15-year-old student, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Cole Underwood, 29, was charged via criminal complaint with enticement of a minor. He made his initial appearance before U.S. Magistrate Judge Lee Ann Reno on Thursday afternoon.
According to the complaint, Perryton ISD’s superintendent reached out to law enforcement on May 7 to report a possible inappropriate relationship between Mr. Underwood and a female student. According to the superintendent, surveillance video allegedly showed Mr. Underwood meeting with the girl alone after hours, despite being given a specific directive not to be alone with her.
Agents reviewed the footage and observed Mr. Underwood propping an exterior door open and then shutting off lights. Approximately 15 minutes later, the girl entered the darkened building through the propped door and walked into Mr. Underwood’s office.
In interviews with law enforcement, the child said Mr. Underwood had sex with her in his office more than a dozen times between February and May.
She said that after she added him as a contact on Snapchat, he established a personal friendship with her, and even invited her to his office to confide in him. She said that Mr. Underwood began messaging her in a flirtatious and sexual manner in December, and eventually used Snapchat to arrange sexual encounters.
A search of the girl’s cell phone revealed multiple late-night conversations – some lasting more than six hours – between her and Mr. Underwood, who allegedly occasionally referred to the child as “wifey” and told her he loved her.
A complaint is merely an allegation of criminal conduct, not evidence. Mr. Underwood is presumed innocent until proven guilty in a court of law.
If convicted, he faces up to life in federal prison.
The Federal Bureau of Investigation’s Dallas Field Office – Amarillo Resident Agency and the Ochiltree County Sheriff’s Office conducted the investigation with the full cooperation of the Perryton Independent School District. Assistant U.S. Attorney Callie Woolam is prosecuting the case.
Fentanyl Trafficker Who Fled Scene of 16-Year-Old’s Overdose Sentenced to 20 Years in PrisonRead the Press Release
A drug trafficker who dealt fentanyl to a 16-year-old who overdosed was sentenced 20 years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Julian Apodaca, 28, and several co-conspirators were indicted in August 2023. Mr. Apodaca pleaded guilty in January to possession with intent to distribute fentanyl and was sentenced Wednesday by U.S. District Judge Matthew J. Kacsmaryk.
“Shockingly, this defendant gave a deadly drug to a 16-year-old child and watched as the child overdosed; then, instead of rendering aid, he fled the scene to avoid criminal liability,” said U.S. Attorney Leigha Simonton. “My office is proud to have brought this man to justice to pay for these heinous actions, and we are also proud that we are holding accountable several others in the defendant’s drug network who contributed to this child receiving fentanyl. But we cannot end this epidemic alone. Please talk with your kids about avoiding fentanyl. They should not take any pill that wasn’t bought in a pharmacy. Remember: One pill can kill.”
“Justice has been served with the recognition by the court of the callous actions and total disregard of human life by defendant Apodaca,” said DEA Dallas Special Agent in Charge, Eduardo A. Chávez, who oversees all DEA operations in Amarillo. “DEA Amarillo and our law enforcement partners in the panhandle will relentlessly pursue individuals like defendant Apodaca and hold them accountable for the poison they peddle on our streets.”
According to plea papers, Mr. Apodaca admitted he dealt fentanyl to several individuals in the Amarillo area.
In his vehicle, officers found 113 blue M-30 pills containing fentanyl and a 9mm pistol.
At his sentencing hearing, prosecutors introduced evidence that Mr. Apodaca dealt fentanyl to a 16-year-old who overdosed in the defendant’s car.
When he realized the teen had suffered an overdose, Mr. Apodaca, fearful that he would be arrested on outstanding warrants if he called authorities, fled the scene and contacted associates asking them to call 911. First responders eventually revived the victim with Narcan.
Eight of Mr. Apodaca’s co-conspirators – including his sources of supply, Gary Eugene Carlisle, Robert Tucker Witt, and Rebecca Ann Schmitkons – pleaded guilty to possession with intent to distribute fentanyl, and one co-conspirator, Rachel Lynn Waddell, was convicted at trial of conspiracy to distribute fentanyl. Mr. Witt was sentenced in May to 20 years in federal prison; eight of the defendants are awaiting sentencing; one defendant is set for trial in August 2024.
The Drug Enforcement Administration’s Dallas Field Division – Amarillo Resident Office and the Amarillo Police Department conducted the investigation. Assistant U.S. Attorney Anna Marie Bell prosecuted the case.
Serial Child Sexual Abuser Sentenced to 60 Years in PrisonRead the Press Release
A Dallas man who filmed himself sexually assaulting girls as young as six years old was sentenced today to 60 years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Gemond Copage Miller, 34, was indicted in December 2021 and pleaded guilty in January 2024 to two counts of production of child pornography. He was sentenced Wednesday by U.S. District Judge Brantley Starr, who also ordered that the defendant be supervised for life following his release from prison.
According to plea papers, Mr. Miller filmed himself sexually assaulting children as young as six years old, then sold the footage on the internet.
Investigators were able to match distinctive tattoos shown in the footage to Mr. Miller’s tattoo.
At Wednesday’s sentencing hearing, prosecutors said Mr. Miller admitted to abusing at least ten girls under the age of twelve. Law enforcement identified at least 38 videos of child sexual abuse material produced by Mr. Miller. To date, not all of the victims have been identified.
Mr. Miller was also in possession of approximately 722 images and 1,733 videos constituting child sexual abuse material.
“My sense of safety and security has been shattered,” a 13-year-old victim, just six years old when she was first assaulted, said in a statement read aloud by her mother. “I am the first victim to come forward… Knowing that there are others shows that this is what he does. This is who he is. And he does not care that he took the innocence of children.”
Homeland Security Investigations' Dallas Field Office and the Dallas Police Department conducted the investigation, which began with a tip from the National Center for Missing and Exploited Children. Assistant U.S. Attorney Michelle Winters prosecuted the case.
Medical Device Manufacturer Innovasis Inc. and Two Top Executives Agree to Pay $12M to Settle Allegations of Improper Payments to PhysiciansRead the Press Release
Spinal device manufacturer Innovasis Inc. and senior executives Brent Felix and Garth Felix agreed to pay a total of $12 million to resolve allegations that they violated the False Claims Act by paying kickbacks to spine surgeons to induce their use of Innovasis’s spinal devices. Brent Felix is the founder, President and Chairman of the Board of Innovasis, which is headquartered in Utah. Garth Felix served in various leadership roles for Innovasis, including as the company’s Chief Financial Officer.
“Payments from medical device manufacturers intended to influence a physician’s judgment about which medical devices or supplies to select are illegal,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “When medical devices are used in surgical procedures, patients deserve to know that their device was selected based on quality of care considerations and not on improper payments from manufacturers.”
“The integrity of our healthcare system is dependent upon physicians’ recommendations being motivated by patient health,” said U.S. Attorney Leigha Simonton for the Northern District of Texas. “Any time we learn that physician recommendations are being corrupted by improper financial inducements, we will seek to hold those involved accountable.”
“Improper financial arrangements can compromise medical judgment and adversely influence the medical decision-making process,” said Special Agent in Charge Jason E. Meadows of the Department of Health and Human Services Office of Inspector General (HHS-OIG). “These arrangements have no place in our healthcare system, and we will continue working with our federal partners to pursue such allegations.”
The Federal Anti-Kickback Statute prohibits offering or paying anything of value to induce referrals of items or services covered by Medicare and other federally funded programs. The statute is intended to ensure that medical providers’ judgments are not compromised by improper financial incentives.
The settlement announced today resolves allegations that from Jan. 1, 2014, through Dec. 31, 2022, Innovasis provided improper remuneration to seventeen orthopedic surgeons and neurosurgeons to induce them to use Innovasis spinal implants, devices and other equipment in medical procedures the physicians performed on Medicare beneficiaries, in violation of the Anti-Kickback Statute. The improper remuneration was allegedly provided in the form of consulting fees, intellectual property acquisition and licensing fees, registry payments and performance shares in Innovasis, as well as travel to a luxury ski resort, lavish dinners and holiday parties for surgeons, their office staff and family members. For example, Innovasis allegedly paid physicians for consulting services at rates far in excess of fair market value or, in some cases, for work that was never actually performed. Similarly, the company allegedly paid physicians far in excess of fair market value to acquire or license purported intellectual property for which Innovasis never obtained any valuation prior to purchase and thereafter never used for meaningful product development. Innovasis also paid physicians to attend a company-sponsored conference held at a luxury resort in Deer Valley, Utah, which included the cost of travel, lodging and high-end meals, among other things. During the relevant period, Brent Felix, along with his brother Garth Felix, allegedly controlled or otherwise directed Innovasis’s operations, strategic decisions, and the agreements with surgeons who allegedly received improper remuneration from Innovasis.
The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Robert Richardson, a former Regional Sales Director for Innovasis. Under those provisions, a private party can file an action for false claims on behalf of the United States and receive a portion of any recovery. Richardson will receive approximately $2.2 million as his share of the recovery in this case. The qui tam case is captioned United States ex rel. Richardson v. Innovasis Inc., et al., No. 3:19-CV-02440-X (N.D. Tex.).
The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section and the U.S. Attorney’s Office for the Northern District of Texas, with assistance from HHS-OIG.
Trial Attorneys Jessica E. Krieg, Olga Yevtukhova and Adam J. DiClemente of the Justice Department’s Civil Division and Assistant U.S. Attorneys Andrew S. Robbins and George M. Padis for the Northern District of Texas handled the matter.
The investigation and resolution of this matter illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement can be reported to the HHS at 800-HHS-TIPS (800-447-8477).
The claims resolved by the settlement are only allegations. There has been no determination of liability.
SettlementHeavily Armed Carrollton Fentanyl Supplier Sentenced to 15 YearsRead the Press Release
A major source of supply in the Carrollton juvenile fentanyl overdose case, which has claimed the lives of four children to date, was sentenced today to 15 years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Julio Gonzales, Jr., a 19-year-old who called himself “J-Money,” was charged via criminal complaint in July 2023. He pleaded guilty in October 2023 to conspiracy to possess with intent to distribute a Schedule II controlled substance (fentanyl) and was sentenced Wednesday by U.S. District Judge Ed Kinkeade.
“This defendant – a heavily-armed, prolific drug trafficker – was involved in providing pills that caused 14 Carrollton kids to overdose, and four of them to die,” said U.S. Attorney Leigha Simonton. “I want to implore our community: Please, educate your children on the dangers of fentanyl. Drug traffickers are not your friends. They know one pill can kill, and they hand them over anyway.”
“Julio Gonzalez will spend the next 15 years in federal prison because of his involvement in supplying and distributing poison in the form of one deadly pill. Because of that same pill, illicit fentanyl, lives have been lost and families have been forever changed,” said DEA Dallas Special Agent in Charge Eduardo A. Chávez. “The women and men of DEA Dallas will never stop investigating overdose and poisoning deaths and bring those responsible to justice. We all must do our part to prevent and educate others that truly One Pill Can Kill.”According to evidence presented at Wednesday’s hearing, Mr. Gonzales was one of three main sources of supply for Luis Eduardo Navarrete, the 22-year-old dealer who supplied fentanyl to students at R.L. Turner High School, Dewitt Perry Middle School, and Dan Long Middle School.
(Mr. Navarrete was sentenced last week to 20 years in federal prison after prosecutors introduced evidence showing that he blatantly ignored a text message, “another youngin dead bro,” alerting him to multiple child overdoses. One of Mr. Navarrete’s other main sources of supply, Jason Xavier Villanueva, pleaded guilty to conspiracy to distribute fentanyl and distribution of fentanyl to a person under 21 and was sentenced to 15 years in prison; his third source, Jessie Alexander Perez Martinez, is awaiting trial.)
In plea papers, Mr. Gonzales admitted he trafficked blue M-30 pills laced with fentanyl to Mr. Navarrete, Navarrete’s drug runner Robert Gaitan, and at least one juvenile dealer. He stipulated that he trafficked approximately 120,000 pills over the course of the conspiracy, often selling them in “K Packs,” which consisted of 1,000 pills at a time.
When he was arrested on July 20, agents searched his Dallas home and seized from 16,000 counterfeit M-30 pills from his microwave, $74,294 in drug proceeds from shoe boxes in his bedroom, and at least nine firearms, including a Romanian Draco AK-47 style handgun, a Kel-Tec long-range pistol, and a Glock equipped with a machinegun conversion device. They also recovered numerous high-capacity magazines, body armor, a vacuum sealer, digital scales, a money counter, and multiple cell phones.
Mr. Gonzales, Jr. is one of 11 defendants charged federally in connection with the case, which has resulted in 14 juvenile overdoses, four of them fatal, of children as young as 13.
The Drug Enforcement Administration’s Dallas Field Office and the Carrollton Police Department conducted the investigation with the assistance of School Resource Officers from the Carrollton – Farmer’s Branch Independent School. Assistant U.S. Attorneys Rick Calvert and Phelesa Guy are prosecuting the case.
Note: Illicitly produced, fentanyl-laced pills often look similar to legitimate prescription pills like Oxycontin or Percocet, but can pose significantly more danger. On the street, these pills are often referred to as “M30s” (a reference to the markings on some of the pills), “blues,” “perks,” “yerks,” “china girls,” or “TNT.” DEA research shows that six out of ten pills laced with fentanyl contain a potentially lethal dose. One pill can kill. For resources, visit https://www.dea.gov/onepill.Mansfield Tax Preparer Convicted of 33 Counts of Tax Fraud After Bench TrialRead the Press Release
A would-be lawyer who falsely inflated dozens of client tax returns was convicted Friday of 33 counts of tax fraud, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
John Anthony Castro, 40, owner of the virtual tax preparation business Castro & Company, was indicted in January. Following a five-day bench trial before Senior U.S. District Judge Terry R Means, he was convicted on all 33 counts of assisting in the preparation of a fraudulent return and was immediately taken into custody.
“While most tax preparers are honest and provide honest tax services to their clients, some like Mr. Castro victimize their clients all in the name of greed,” stated Jenifer L. Piovesan, Special Agent in Charge, IRS Criminal Investigation, Newark Field Office. “Mr. Castro is now a convicted felon facing a lengthy prison sentence.”
According to evidence presented in court, Mr. Castro – who had graduated law school but repeatedly failed the bar exam – held himself out as an “international tax expert” and “federal practitioner.” (He also falsely claimed to be a graduate of West Point.)
He was successful at marketing to clients around the world, claiming to be an expert on certain tax issues related to Australian ex-pats, among other things. Between 2017 and 2019, he filed more than 1,900 tax returns on behalf of individuals from all over the world.
As part of his pitch, Mr. Castro promised his clients a significantly higher refund than they would receive from other preparers, claiming he knew how to identify and claim deductions that others did not. He added there was no risk, as he would simply split the additional refund amount with them to account for his fee. He would not share the tax return with clients before filing, but would instead simply inform them of the amount of the anticipated refund.
On many occasions, he filed tax returns on behalf of clients without their permission or knowledge. In other instances, he claimed deductions that had no basis in fact. For example, for one client, who made approximately $103,000 in income, Mr. Castro claimed over $90,000 in deductions related to unreimbursed employee expenses.
Mr. Castro claimed deductions based on extreme and unsupported legal theories, including deductions such as (1) those for any expense related to preventing an illness qualified as an “impairment related work expense,” (2) those for expenses related to commuting to and from work, (3) the full value of one’s mortgage and utilities as long as the taxpayer had some type of Schedule C business to claim, (4) those related to dry-cleaning for work clothes, and (5) the full value of one’s cell phone bill even when their employer provided them with a work phone. For example, with respect to one client, Mr. Castro deducted over $26,000 in expenses that he claimed related to a nascent cupcake business that had generated only $250 in revenue.
According to trial testimony, in February 2018, an undercover IRS – CI agent contacted Mr. Castro for assistance. The agent asked to meet with Mr. Castro in person, but Mr. Castro’s office told him that in-person meetings required a $5,000 retainer. They spoke via email instead.
On February 13, 2018, the undercover agent submitted a W2 and a Form 1098-T showing wages of $142,217. About two weeks later, one of Mr. Castro’s employees called the agent to discuss deductions, noting that Mr. Castro would make any decisions regarding what items would be included on the tax filing. The agent denied having any unreimbursed employee expenses, charitable contributions, or other items that could lead to deductions.
On March 12, 2018, Mr. Castro sent the undercover agent his tax analysis. He said that if the agent used another preparer, he would receive a refund of $373, but that if he used Mr. Castro, he would receive a refund of $6,007. Mr. Castro would take half, netting him $3,008. The analysis said the return would include $29,339 in deductions but did not specify which deductions would be used.
Two days later, Mr. Castro filed the agent’s return, which claimed $29,339 in fraudulent deductions, including $2,400 in employee expenses, and 28,600 in other expenses that the undercover agent had never discussed with Mr. Castro or his employees.
According to evidence presented at trial, Mr. Castro engaged in a similar pattern with his other clients. When the victim-taxpayers learned what Mr. Castro had done, many of them demanded copies of their tax returns. Mr. Castro refused to engage in conversation and even delayed providing returns for months at a time. Mr. Castro often acted in a highly vindictive manner when questioned or challenged by clients or others, often berating individuals in emails, threatening legal actions, or by filing amended tax returns, without clients’ permission or knowledge, that removed all deductions, causing the taxpayer-victim to then owe the IRS tens of thousands of dollars.
During the trial, Mr. Castro took the stand in his own defense, and upon cross-examination, admitted that his positions were extreme, outlandish, and not supported by the law. He also admitted to a bevy of prior falsifications and vindictive actions.
Many of the victim-taxpayers have since been audited and/or filed amended returns, causing them significant financial hardship.
Mr. Castro now faces up to 99 years in federal prison, three years per count.
IRS Criminal Investigation conducted the investigation. Assistant U.S. Attorneys P.J. Meitl and Nancy Larson are prosecuting the case.
Carrollton Juvenile Overdose Defendant Who Ignored Deaths Sentenced to 20 Years in PrisonRead the Press Release
The first defendant charged in the Carrollton juvenile fentanyl overdose scandal – which claimed the lives of at least four North Texas teenagers – was sentenced today to 20 years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Luis Eduardo Navarrete, 22, was charged via criminal complaint in February 2023 and indicted the following month. He pleaded guilty in November 2023 to conspiracy to possess with intent to distribute a Schedule II controlled substance and distribution of a controlled substance to a person under 21 years of age and was sentenced Wednesday by U.S. District Judge Ed Kinkeade.
“Even as children overdosed and died around him, this defendant continued to distribute poisonous pills to juvenile dealers to sell in grade schools,” said U.S. Attorney Leigha Simonton. “Brushing off the pain of his young victims’ family and friends, he delivered fentanyl into the hands of children, extinguishing lives before they’d even really begun. The callousness he displayed is truly chilling. Although we can never bring these kids back, we hope today’s verdict is a balm to their families’ unbearable suffering.”
“Today’s a very important day for DEA Dallas and all of those who were involved in this investigation. Defendant Navarrete was one of the first individuals identified in what later became a complex ring of various fentanyl traffickers selling poison in our neighborhoods,” said DEA Dallas Special Agent in Charge Eduardo A.. Chavez. “While we cannot bring back the lives lost and undo so much tragedy amongst the affected families, we are proud that justice has been served and remained committed to fighting illicit fentanyl trafficking in North Texas.”
“Today’s sentencing of twenty years, I feel, is appropriate for the seriousness of Navarrete’s crimes. Navarrete and others were responsible for causing enormous heartache and sorrow to many families. It is appropriate to show that the Carrollton Police Department and the DOJ remain serious about protecting our citizens, and especially our youth, from drug dealers who think they can prey on our children by pushing poison on them. I am grateful for our partnership with the US Attorney’s Office for the Northern District of Texas and DEA-Dallas; without their help, this would not have been possible.”
According to court documents, Mr. Navarrete and several co-conspirators trafficked fentanyl pills to a network of juvenile drug dealers, who then sold the pills – stamped M-30 to resemble oxycodone – to students at R.L. Turner High School, Dewitt Perry Middle School, and Dan Long Middle School.
At Wednesday’s sentencing hearing, a DEA task force officer testified that Mr. Navarrete began trafficking fentanyl in August 2022. When he was placed on a GPS ankle monitor following a domestic altercation, he relied on two drug runners, co-defendants Rafael Soliz Jr. and Robert Gaitan, to pick up counterfeit M-30 pills from his sources and deliver them to his residence in Carrollton.
According to evidence presented at the hearing, Mr. Navarrete continued to supply fentanyl pills to children even after he was told they were causing overdoses.
On Jan. 26, 2023, a juvenile dealer informed Mr. Navarrete that one of his counterfeit M30 pills had caused a 14-year-old middle school student, identified in court documents by the initials J.P., to “pass away.” The dealer even included a photograph of first responders at the victim’s residence attempting, unsuccessfully, to resuscitate him. Despite being told that a minor had died from pills that he was distributing, Navarrete continued to distribute the pills to adult and minor customers.
Less than a week later, on Feb. 1, 2023, a different juvenile dealer informed Mr. Navarrete that a 17-year-old high school student who had taken one of his counterfeit M-30 pills “couldn’t wake up.”
“Od bro… wtf happening,” the dealer wrote. “Don’t tell me it was u that sold em like 18 30s … that’s another youngin dead bro.”
After being told of the second overdose death, Mr. Navarrete continued to traffic fentanyl, unabated, until his arrest two days later.
At Thursday’s sentencing hearing, the DEA task force officer testified that the fentanyl Mr. Navarrete sold originated from the Sinaloa Cartel in Mexico. Over the course of the investigation, he said, officers and agents made roughly 40 adult and juvenile arrests and seized more than 1.2 million fentanyl pills off the street. The conspiracy resulted in at least 14 juvenile overdoses, four of them fatal.
Mr. Navarrete is one of 11 defendants charged federally in connection with the case. Mr. Navarrete’s main supplier, Jason Xavier Villanueva, was sentenced to 15 years in federal prison, and his drug runners, Mr. Soliz and Mr. Gaitan, were sentenced to 15 to and five years respectively.
At Mr. Navarrete’s sentencing hearing, the mother of one of the late juvenile victims testified:
“He was the soul of our home,” she said of her son in Spanish. “I would like for everyone who’s present to know that these people who sell fentanyl, they destroy families…. On behalf of all those children who have passed away due to fentanyl, this has to stop.”
The Drug Enforcement Administration’s Dallas Field Office and the Carrollton Police Department conducted the investigation with the assistance of School Resource Officers from the Carrollton – Farmer’s Branch Independent School. Assistant U.S. Attorneys Rick Calvert and Phelesa Guy are prosecuting the case.
Note: Illicitly produced, fentanyl-laced pills often look similar to legitimate prescription pills like Oxycontin or Percocet, but can pose significantly more danger. On the street, these pills are often referred to as “M30s” (a reference to the markings on some of the pills), “blues,” “perks,” “yerks,” “china girls,” or “TNT.” DEA research shows that six out of ten pills laced with fentanyl contain a potentially lethal dose. One pill can kill. For resources, visit https://www.dea.gov/onepill.Pain Doctors Plead Guilty in $45 Million Healthcare FraudRead the Press Release
Two pain management doctors who pantomimed injections on patients pleaded guilty today to healthcare fraud charges, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Drs. Desi Barroga, 51, and Deno Barroga, 51, were indicted in November 2023. The pair pleaded guilty Tuesday to one count each of conspiracy to commit healthcare fraud before U.S. Magistrate Judge Rebecca Rutherford.
According to court documents, the twin brothers admitted that they conspired to defraud Blue Cross Blue Shield, Cigna, and United Healthcare by submitting claims for corticosteroid injections that were never administered.
As part of the conspiracy, the Barrogas required patients to submit to monthly office visits. This allowed patients to continue receiving highly addictive Schedule II controlled substances – including hydrocodone, oxycodone, and morphine – while allowing the defendants to bill patients’ insurance companies for expensive services they never provided.
The Barrogas reported to insurance that they performed as many as 80 corticosteroid injections per patient per visit. In reality, the majority of these injections were never administered. In many instances, the doctor simply placed a needle on the patient’s body without actually piercing the skin to mimic giving an injection.
They defendants created fake medical records, which were often cut and pasted, or cloned, from patient to patient with little to no variation. They also instructed patients to include false statements pertaining to the injections and other treatments in the record.
In plea papers, the brothers admitted that they billed insurers at least $45 million and were paid at least $9 million as part of the scheme.
They now face up to 10 years each in federal prison.
Under the terms of their plea agreement, both men agreed to immediately surrender their DEA registrations and to forfeit their medical licenses at least 14 days prior to sentencing. They also agreed to joint and several restitution in an amount to be determined at a later date by the court.
The U.S. Department of Labor’s Office of Inspector General, the U.S Department of Labor’s Employee Benefits Security Administration, U.S Office of Personnel Management’s Office of the Inspector General, the Drug Enforcement Administration’s Dallas Field Division Diversion Group, and the Texas Department of Insurance – Fraud Unit – Austin and Fort Worth Field Offices conducted the investigation. Assistant U.S. Attorney Renee Hunter is prosecuting the case.
22 Alleged Drug Traffickers Charged in Wichita FallsRead the Press Release
Twenty-two alleged drug dealers in Wichita Falls, Texas have been federally charged, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Sixteen of the 22 defendants were arrested during a takedown on Thursday that included the use of multiple tactical units, including SWAT teams from five FBI divisions, the FBI’s Hostage Rescue Team (HRT), the Texas Department of Public Safety Special Response Teams, the U.S. Marshals, and the Wichita Falls Police Department. Six defendants had been previously taken into custody.
Twenty-one of the 22 defendants were charged via criminal complaint with conspiracy to possess with intent to distribute controlled substances:
- Dywane Cecil Graham, aka “D”
- Dmetrius Lakeith Brooks, aka “D Blocc”
- Dominique Equincy Hall, aka “Playa D”
- Nicholas Bryan Darcus, aka “Locc D”
- Brandy Lynn Flowers, aka Brandy Mason
- Jaryd Blake Howard
- Jewel Wayne Fletcher, Sr., aka “Goofi”
- Sarah Leann Parker, aka Sarah Davis
- Robert “Bobby” Lee Collins
- Madeline Josephine Stephens, aka Madeline Kearney
- Elisha Earl Johnson, aka “Cash”
- Samuel Conta Manuel, aka “Butterman”
- Kiesha Tanga Wyatt, aka “Tanga”
- Shedrick “Sed” Cortez Cyrus
- Robert Thomas Bustamante
- Kenzie June Lozano
- William Lee Freeman, aka “Ghost”
- Jack Bishop Cline
- Dwight Albert Simpson, aka “Tray”
- Jimmie Scott Williams, aka “Motorcycle Man”
- Stanley Wayne Britt
The 22nd defendant, Ujamaa Jelani Rashaun Ballard, was charged in a sperate criminal complaint with conspiracy to possess with intent to distribute controlled substances.
According to the 21-defendant criminal complaint, the investigation began in March 2023, when law enforcement learned from confidential informants that Dwayne Graham and Dmetrius Brooks – both associated with the notoriously violent Crips street gang – were operating a methamphetamine distribution ring in Wichita Falls, Vernon, and its environs.
Over the ensuing months, law enforcement deployed several confidential sources to make multiple drug buys, which were video and audio recorded. They also searched several suspects’ vehicles and residences, where they recovered copious amounts of methamphetamine and numerous firearms. On one occasion, a defendant led police on a 9.5- mile pursuit, tossing a Ziploc baggie full of meth out his window as he sped off.
To date, law enforcement has recovered 7,229.46 grams of methamphetamine, approximately 719 grams of powder cocaine, approximately 55 grams of crack cocaine, approximately 49.75 grams of powdered fentanyl, approximately 2,197 counterfeit Percocet pills laced with fentanyl, and nine firearms in the course of the investigation.
A criminal complaint is merely an allegation of wrongdoing, not evidence. All defendants are presumed innocent until proven guilty in a court of law.
If convicted, they each face a minimum of 10 years and up life in federal prison.
The Federal Bureau of Investigation’s Dallas Field Office - Wichita Falls Resident Agency, the Wichita Falls Police Department, the Wichita County Sheriff’s Office, the U.S. Marshals Service, and the Texas Department of Public Safety conducted the investigation with assistance from the Drug Enforcement Administration’s South Central Lab. Valuable assistance was also provided by Wichita County District Attorney’s Office Drug Enforcement Division, Wilbarger County District Attorney’s Office, Vernon Police Department, Crowell Police Department, Oklahoma Bureau of Narcotics, and the Clay County Sheriff’s Office. Assistant U.S. Attorney Laura Montes is prosecuting the case.
Ten Indicted in Vehicle Pollution SchemeRead the Press Release
Nine men and a company have been charged with conspiring to install so-called “defeat devices” on diesel trucks, thereby allowing the vehicles to emit far more pollutants than allowed by law, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Phillip Dwain Waddell, Philip Matthew Ormand, Kolby Douglas Huneycutt, Kyle Kris Kizer, Jonathan Joseph Lohrmeyer, Justin Loutoyama Pasamonte, Archie George Sims, and Adam Marsh Stanley, along with auto dealership James Hodge Motors, Inc. (doing business as Jay Hodge Dodge) and its Chief Operating Officer, Curtis Kevin Poore, were indicted on conspiracy to violate the Clean Air Act. They made their initial appearances before U.S. Magistrate Judges Hal R. Ray, Jr., Rebecca Rutherford, and Renée H. Toliver.
“These defendants intentionally flouted laws designed to ensure our children – and our children’s children – have clean air to breathe. By installing devices that bypassed automakers’ built in emissions controls, they spewed pollutants into our neighborhoods. The Justice Department, along with our partners at the Environmental Protection Agency, take violations of the Clean Air Act very seriously," said U.S. Attorney Leigha Simonton.
"Pollutants emitted from tampered vehicles can have significant harm to public health,” said Kim Bahney, Special Agent in Charge for the Environmental Protection Agency Criminal Investigation Division. "This scheme occurred over several years and spanned across multiple states, diminishing air quality."
According to the indictment, Mr. Waddell allegedly sold aftermarket diesel exhaust components, tuners, and so-called “delete tunes” that allowed vehicles to spew excess pollutants into the air by overriding on-board diagnostic (OBD) systems required by the Clean Air Act.
Operating normally, OBDs monitor vehicle emissions to ensure they fall below the limits set by the Clean Air Act. When an OBD detects excess emissions, it sends input to the vehicle’s on-board computer, which may activate an indicator light and place the vehicle in “limp mode,” capping its speed at as low as five miles per hour.
With delete tunes installed, diesel exhaust systems can be modified so that OBDs cannot detect emission changes; thus, the vehicle cannot activate indicator lights, record diagnostic trouble codes, or place a vehicle into limp mode.
Mr. Waddell allegedly purchased the delete tunes from Mr. Ormand, who allegedly customized each tune for a specific vehicle. From Aug. 2018 to April 2021, Mr. Waddell allegedly paid Mr. Ormand more than $2 million for delete tunes, and allegedly sold the tunes for between $300 and $1,350. Mr. Waddell’s customers included James Hodge Motors and several individuals who operated their own diesel repair and customization businesses.
Mr. Huneycutt, Mr. Kizer, Mr. Lohrmeyer, Mr. Pasamonte, Mr. Sims, and Mr. Stanley allegedly purchased tuners and delete tunes from Mr. Waddell and installed them on their customer’s vehicles in a process called “tuning” or “reflashing.” James Hodge Motors, acting with the knowledge and under the supervision of Mr. Poore, also engaged in such behavior, and on at least one occasion, falsified invoices to conceal the nature of such work it performed on a customer’s truck.
An indictment is merely an allegation of criminal conduct, not evidence. All defendants are presumed innocent until proven guilty in a court of law.
If convicted, each defendant faces up to five years in federal prison; the company faces up to $500,000 in fines.
The Environmental Protection Agency – Criminal Investigation Division’s Southwest Area Branch (Region 6) conducted the investigation with the assistance of the Texas Commission on Environmental Quality. Assistant U.S. Attorney Douglas Brasher is prosecuting the case.