Southern District of Texas
Press releases recorded for this federal judicial district.
Former Dickinson Resident and Leader of Meth Trafficking Organization Gets 30 YearsRead the Press Release
HOUSTON - Huey Joseph Hebert, 35, formerly of Dickinson, has been sentenced to 360 months in federal prison for his role as a leader in a methamphetamine trafficking organization, announced United States Attorney Kenneth Magidson. Hebert pleaded guilty May 9, 2013.
Today, U.S. District Judge Sim Lake handed Hebert 120 months for methamphetamine trafficking along with two additional 120-month-terms for engaging in monetary transactions in property greater than $10,000 with narcotics proceeds. All sentences were ordered to be served consecutively for a combined 30-year sentence. Hebert must also pay a $2000 fine and will serve five years of supervised release following completion of his prison term. Judge Lake further ordered the forfeiture of two Harris County properties.
At the time of the plea, Hebert admitted he conspired with 14 other individuals to distribute methamphetamine with a purity just shy of 100% (referred to as “ice”) from Dickinson to Louisiana and elsewhere from mid-2008 until February of 2012. In addition to distributing methamphetamine, the organization also distributed more than 1000 kilograms of marijuana during this timeframe.Nash Pitre, 46, of Houma, La., a narcotics and currency courier for Hebert, was also sentenced today. Judge Lake ordered he serve a term of 112 months followed by five years supervised release for transporting 100 kilograms or more of methamphetamine and marijuana from Houston to Houma.
This investigation was conducted by a Drug Enforcement Administration lead Organized Crime Drug Enforcement Task Force (OCDETF) investigation dubbed “Operation Country Roads.” Officials with the Internal Revenue Service - Criminal Investigation lead the financial aspect of this case. These officials were invaluably assisted by a wide variety of law enforcement agencies including police departments in Dickinson, League City and Pasadena; sheriff's offices in Galveston, Harris, Jefferson, Fort Bend and Brazoria Counties; as well as Texas Department of Public Safety and the U.S. Marshals Service.Assistant United States Attorney Shelley Hicks is prosecuting.
CBP Officer Arrested on Alien Transporting ChargesRead the Press Release
LAREDO, Texas – Juan Gabriel Bonilla, 27, a Customs and Border Protection (CBP) officer from Laredo, has been arrested for attempting to transport aliens into the United States and conspiracy to do so, announced United States Attorney Kenneth Magidson.
The indictment was returned under seal Dec. 17, 2013, and unsealed today upon his arrest. Bonilla is expected to make an initial appearance tomorrow at 9:00 a.m. before U.S. Magistrate Judge J. Scott Hacker along with co-defendant Martha Maria Escobar, 35. Escobar, a legal permanent resident from Mexico, has been in federal custody since Oct. 11, 2013, the date of her initial arrest.
They are charged with conspiracy and three counts of transportation or attempted transportation of aliens in the United States.
According to the criminal complaint filed upon Escobar’s arrest, she was transporting several relatives in her car, three of whom were undocumented aliens from Mexico. Bonilla conducted an inspection of her vehicle and passengers, but allegedly released them to enable them to enter the United States illegally. Further inspection by another officer led to the discovery that the three of the passengers were illegal aliens and were being transported by Escobar, according to the allegations.
If convicted, each faces up to five years in federal prison on each count and a possible $250,000 fine.
The case is being investigated by CBP, CBP-Office of Internal Affairs, Immigration and Customs Enforcement-Office of Professional Responsibility and Department of Homeland Security-Office of the Inspector General. Assistant United States Attorney Homero Ramirez is prosecuting the case.
Defendants are presumed innocent unless and until convicted through due process of law.Brazoria County Resident Indicted for Sending False Distress SignalRead the Press Release
HOUSTON – David Matthew Geissen, 21, has been arrested following the return of an indictment alleging he communicated a false distress message to the Coast Guard, announced United States Attorney Kenneth Magidson. Geissen, of Danbury, was arrested today without incident.
The sealed indictment was returned Dec. 12, 2013, and unsealed upon his arrest. He made his initial appearance in Galveston today before U.S. Magistrate Judge John R. Froeschner, at which time he was permitted release on bond pending further criminal proceedings.
The indictment alleges that on or about March 22, 2013, Geissen communicated the false distress message by firing red flares into the sky. The Coast Guard deployed in an attempt to save lives and property when, in fact, no help was needed.
If convicted, Geissen faces up to six years in federal prison as well as a possible $250,000 maximum fine.
The charges are the result of an investigation conducted by the U.S. Coast Guard Investigative Service and Freeport Police Department. Assistant United States Attorney Robert Stabe is prosecuting.
A defendant is presumed innocent unless convicted through due process of law.Two Area Women Head to Federal Prison in Home Health Services ConspiracyRead the Press Release
CORPUS CHRISTI, Texas – Debra Jean Velasquez, of Robstown, and Sylvia Salinas Ramirez, of Driscoll, have been ordered to prison in a scheme to defraud the Texas Medicaid program through fraudulent home health billings, announced United States Attorney Kenneth Magidson along with Texas Attorney General Greg Abbott. The woman entered guilty pleas Sept. 4, 2013, to conspiring to submit false and fraudulent bills to the Texas Medicaid Program by wire transmissions as well as wire fraud.
Today, Senior U.S. District Judge Janis Graham Jack handed Velasquez, 42, and Ramirez, 52, respective terms of 51 and 41 months in federal prison for wire fraud and conspiracy to commit wire fraud. In handing down the sentence, Judge Jack noted that the sentence was necessary considering the number of victims, the need to deter future criminal conduct and to protect the public. Both will also be required to serve a term of two years of supervised release following completion of the prison term.
The two women admitted that from or about Aug. 1, 2009, through on or about June 15, 2010, they were employed by the Corpus Christi office of MRNG Inc. doing business as Caring Touch Home Health. During that time, they conspired to submit false and fraudulent bills through wire transmissions to the Texas Medicaid program and the Medicaid funded managed care organizations known as Evercare of Texas LLC and Superior Health Plan Inc. for home health services that had not been provided. Ramirez and Velasquez admitted they created false and fraudulent time sheets for former Caring Touch employees for home health services that had not been provided and then fraudulently billed Medicaid, Evercare and Superior in the name of Caring Touch for those non-existent services. They sent approximately 562 of those false and fraudulent bills by wire.
Ramirez and Velasquez also admitted that in order to personally profit from their fraudulent billings, they created phony payroll records from the fraudulent time sheet which they then sent to Caring Touch’s payroll staff. Ramirez and Velasquez then obtained the payroll checks generated from the false and fraudulent time records, forged the signatures of the former Caring Touch employees, then cashed the checks and divided the money among themselves. Caring Touch and the former employees whose names were used on the false time sheets and checks were not accused of any wrongdoing.
Ramirez and Velasquez admitted that as a result of their false and fraudulent claims, Texas Medicaid, Evercare and Superior paid the approximate aggregate sum of $155,127.72. As part of their pleas, the women have agreed to pay restitution in that amount.
Previously released on bond, Ramirez and Velasquez were taken into custody following the sentencing today where they will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The charges were the result of a joint investigation conducted by officers and agents of the Corpus Christi Police Department, the FBI, Department of Health and Human Services - Office of Inspector General and the Texas Attorney General’s Medicaid Fraud Control Unit. Special Assistant United States Attorney Rex Beasley and Assistant United States Attorney Jeffery D. Preston are prosecuting the case.
Stash House Operator Sentenced to More Than 10 Years in Federal PrisonRead the Press Release
McALLEN, Texas – Martin Saucedo-Mata, 48, of Pharr, has been ordered to prison for 121 months for storing cocaine at his residence, announced United States Attorney Kenneth Magidson. Saucedo-Mata pleaded guilty to conspiracy to possess with intent to distribute cocaine on Oct. 3, 2013.
On June 20, 2013, federal and state agents and local task force officers followed a taxi cab after it made entry into the United States from Mexico to the residence of Saucedo-Mata in Pharr. After the cab departed, Saucedo-Mata gave agents permission to search the residence, at which time they found 25 bundles of cocaine weighing approximately 28.6 kilograms.
At the sentencing hearing today, it was determined Saucedo-Mata had previously stored cocaine at his residence during the week prior to his arrest. U.S. District Judge Micaela Alvarez took that fact into consideration as well as his prior criminal history and handed him the 121-month-term, noting it was a poor decision on his part to commit this serious crime. Judge Alvarez also ordered him to pay a $5,000 fine to serve a five-year-term of supervised release after his incarceration. A legal resident alien from Mexico, Saucedo-Mata is expected to face deportation proceedings following completion of his prison term.
Saucedo-Mata had been in custody since his arrest on June 20, 2013, where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The investigation was conducted by the U.S. Drug Enforcement Administration and the Texas Department of Public Safety with assistance from the City of Pharr Police Department. Assistant United States Attorney Juan F. Alanis is prosecuting.
Multi-Million Dollar Fraud Scheme Results in Significant Sentence and Nearly $10 Million Restitution OrderRead the Press Release
HOUSTON – Charles Craig Jordan, 34, has been ordered to federal prison for 13 years following his conviction related to his life settlement insurance business, announced United States Attorney Kenneth Magidson along with acting special agent in charge Bernard Butler, Internal Revenue Service – Criminal investigation (IRS-CI) and Inspector in Charge Robert Wemyss, U.S. Postal Inspection Service (USPIS).
Jordan was accused along with Kelly Taylor Gipson, also 34, of misappropriating investor funds which ultimately resulted in policies lapsing and investors losing their investment. Jordan entered a guilty plea to conspiracy to commit mail and wire fraud, while Gipson pleaded to conspiring to launder the proceeds from the fraud scheme.
“Investment scheme promoters prey upon trusting investors and then steal their hard earned money,” said Butler. “IRS-CI is committed to unraveling complex financial transactions and money laundering schemes where con artists promise high returns to investors. This sentence sends a message to would be promoters that IRS-CI will work with our law enforcement partners to actively pursue promoters and bring them to justice.”
At a hearing that concluded approximately 30 minutes ago, U.S. District Judge Lee H. Rosenthal sentenced Jordan to 156 months in federal prison to be followed by three years of supervised release. Jordan was further ordered to pay restitution of $9,661,660.15 to 503 individuals named as victims in the case. Gipson is set for sentencing Jan. 24, 2014.
Jordan and Gipson were accused of devising a scheme to defraud investors from around the United States and Canada who invested millions in the life settlement offerings of Secure Investment Services and American Settlement Associates of Houston. Secure Investment Services was a business name utilized by Jordan initially in this scheme.
A life settlement is an investment in which a person, who is typically elderly or terminally ill, sells his or her life insurance policy for a cash payment, which is a percentage of the life insurance policy’s face value or death benefit payable by the insurance company upon the insured’s death. Once the insured sells an insurance policy, the insured is no longer responsible for paying the policy’s premiums. To keep the policy in force, the life settlement company must ensure any premiums are paid. All premiums due prior to the death of the insured must be paid, in full and on a timely basis, to prevent additional cost or lapse. Investors who purchase life settlements only realize a profit if the total amount invested in the policy, including the purchase price and any additional premium costs, is less than the amount of the death benefit. A life settlement is not profitable if the expenses of acquiring and maintaining the policy (including the amount of premiums that are paid) are more than the amount of the death benefit paid when the insured dies. Typically, the longer an insured lives, the more expensive it is to maintain a life settlement.
“This investigation was an excellent example of a partnership between federal law enforcement agencies working together to bring down a fraud conspiracy,” said Wemyss. “Postal Inspectors have investigated criminal schemes like this for more than 150 years, and we intend to continue delivering justice to anyone targeting our most vulnerable citizens.”
Jordan resided in Los Angeles, Calif., and Gipson lived in Rockwall, Texas, while they have been on bond pending the criminal proceedings. While on bond, each are to make monthly payments into the registry of the court towards an anticipated restitution order.
The criminal investigation was conducted by IRS-CI and USPIS and prosecuted by Assistant United States Attorney Melissa Annis.Houston Men Ordered to Prison for Wells Fargo RobberyRead the Press Release
HOUSTON - Aaron Derrow, 43, and Terrance Jackson, 35, both of Houston, have been sentenced for their roles in the robbery of the Wells Fargo Bank on Kirby Drive in Houston in December 2012, announced United States Attorney Kenneth Magidson. Both pleaded guilty as did co-defendants Willie Wright III, 32, and Justin Levar Taylor, 33, both also of Houston.
Today, U.S. District Judge Nancy Atlas sentenced Derrow to 51 months for aggravated bank robbery as well as a consecutive seven years for brandishing a firearm during a crime of violence for a total of 135 months in federal prison. Last Friday, Jackson was given a sentence of 108 months for his conviction of aggravated bank robbery.
On Friday Dec. 28, 2012, Derrow and the others robbed the Wells Fargo Bank at 5202 Kirby Drive in Houston. All of the men were wearing various disguises, and Wright, Derrow and Taylor were armed with pistols. Jackson and Derrow jumped over the teller counter while Wright and Taylor controlled the lobby. Derrow threatened a male teller with his gun while filling a bag with money. After getting the money, the two jumped back over the teller counter and all four ran out of the bank to their getaway vehicle, a stolen white Toyota pickup truck. All were apprehended a short time later at a residence several miles away.
Earlier this month, Judge Atlas sentenced Wright to 46 months for aggravated bank robbery as well as a consecutive seven years for brandishing a firearm during a crime of violence for a total of 130 months in federal prison. Taylor will be sentenced in January 2014 and was also convicted of aggravated bank robbery and brandishing a firearm during a crime of violence.
All have been and will remain in custody.
The case was investigated by the FBI’s Bank Robbery Task Force and is being prosecuted by Assistant United States Attorney Jennie Basile.
Former Laredo Business Owner Convicted in Large Marijuana CaseRead the Press Release
LAREDO, Texas - A federal jury has returned a guilty verdict against Marco Antonio Marchan, 45, for engaging in a conspiracy to distribute and possession with intent to distribute in excess of 1,000 kilograms of marijuana, announced United States Attorney Kenneth Magidson.
During trial, evidence was presented that Marchan was a former Laredo resident who had several businesses but moved to the Dallas area in 2008, where he operated a business known as Bumper World. According to testimony, upon moving there, he began coordinating to have Los Zetas supply him with multi-ton quantities of marijuana in the Laredo area for ultimate delivery to him in the Dallas area.
A former co-conspirator testified that Marchan had previously been kidnapped by the Zetas for a drug debt and decided to move his drug trafficking operation to the Dallas area. From 2008 to 2009, Marchan had been supplied with at least seven marijuana loads. The investigation revealed Marchan’s co-conspirators had sent him 5,500 pounds to the Dallas area on Nov. 30, 2009, and then an additional load of 1,132 kilograms three days later.
Between Nov. 24, 2009, through Dec. 2, 2009, Marchan recruited a person to secure a warehouse and truck driver who could deliver 1,300 kilograms of marijuana from Laredo to Dallas. That person reported the incident to the Drug Enforcement Administration (DEA) and an undercover operation was launched during which time agents coordinated to receive the marijuana.
Marchan ordered the drugs to be delivered to a certain address on Dan Morton Street in Dallas. Marchan’s business trucks were seen throughout the area conducting counter surveillance while the transaction was underway. Marchan’s people also followed a white van to a second location where the marijuana was off-loaded from the undercover tractor trailer to the van. The white van then transported the marijuana to a third location, a residence on Lynnacre in Dallas. There, a search warrant was executed which resulted in the discovery of the 1,132 kilograms of marijuana in the van. An additional 2,877 kilograms of marijuana was also found inside the residence which was believed to be the load sent to Marchan on Nov. 30, 2009.
The total weight of marijuana seized was 4009 kilograms with a value of more than $2.5 million.
The jury deliberated for less than an hour in returning the guilty verdict today.
Marchan will remain in custody pending sentencing, which will be set at a later date before U.S. District Judge Marina Garcia Marmolejo.
The case was investigated by DEA with the assistance of local Dallas law enforcement authorities and prosecuted by Assistant United States Attorneys Mary Lou Castillo and Sanjeev Bhaskar.2 Cases Closed – Last of 25 Violent Bank Robbers Now Headed to Federal PrisonRead the Press Release
HOUSTON – The final of 25 convicted in two separate, but similar bank robbery cases that gripped the Houston and surrounding areas has now been ordered to prison, announced United States Attorney Kenneth Magidson along with Stephen L. Morris, special agent in charge of the FBI in Houston. The two groups were ultimately held accountable in court for approximately 34 robberies of the area banks in 2010-2011.
“The prosecution of these cases should send a strong message that the penalties for robbing banks in a serial fashion will be swift and severe,” said Magidson. “Whatever criminal role is played, be it getaway driver, lookout, firearms supplier, enforcer or shooter, you will be prosecuted to the fullest extent of federal law.”
A total of 11 defendants were convicted in the first case. They were responsible for approximately 16 intimidating robberies inside grocery stores, including the Aug. 4, 2011, robbery of Wells Fargo Bank in Sugar Land during which an off-duty Harris County Sheriff’s Office (HCSO) sergeant was shot. Anthony Demonde Nowlin and Shelton McGowen, both 24, pleaded guilty before a trial, set to begin May 28, 2013. During jury selection, seven opted to enter guilty pleas – Derrick Williams, 28, Marcus Rosemond Tarpley, 32, Reginald Mosley, 37, Joel Keon Jackson, 33, Hakim Ibn Ahmad, 31, Alonzo Horace Harris, 37, and Patrick Wayne Simmons, 29. Calvin Wesley Gray, 34, pleaded guilty the morning of opening statements, while David Dwayne Holmes, 34, pleaded guilty following the government’s opening remarks and with a witness about to take the stand.
Today, U.S. District Judge David Hittner sentenced Holmes to a total sentence of 346 months in federal prison to be followed by five years of supervised release. In October, Mosley - identified as the shooter of the off-duty deputy – received a sentence of 525 months. Simmons, Tarpley and Harris each were sentenced to 480 months in prison, while Ahmad and Gray will serve 444 and 300 months in prison, respectively. Nowlin was ordered to serve 144 months, while McGowen, Jackson and Williams were convicted of one count of conspiracy and will each serve a sentence of 60 months.
“No one goes into a grocery store expecting to be confronted by a group of masked gunman carrying assault rifles. This is absolutely unacceptable in our community,” said Morris. “Today’s sentencing places the final member of this dangerous crew behind bars and demonstrates that anyone playing any role in these crimes will be held accountable to the fullest extent of the law.”
During the course of the sentencings, additional evidence and testimony was presented including statements from the wounded deputy and another victim. The deputy commented upon his actions and that he would not change anything he did that day. He testified that he saw that something was going to happen and that it was his obligation as a law enforcement officer to step up and act. He further noted the effect the shooting has had on him, his family and well as the sheriff and his family.
These defendants were part of a sophisticated criminal organization that planned and executed violent takeover style bank robberies of banks inside grocery stores. The conspiracy began on May 4, 2007, and ended with the arrest of some of the men on Sept. 16, 2011. They would target banks and credit unions that were located in grocery stores, using force, violence and intimidation to rob them. During the robberies, the defendants wore dark clothing, gloves, material over their faces and were armed with semi-automatic pistols, shotguns and Uzi style firearms to intimidate the bank employees.
The second case involved a separate group of violent armed robbers that have been held responsible by the court for 18 incidents, including the Pearland Chase branch bank on Dec. 31, 2010, which resulted in a nearly six-hour standoff with law enforcement.
Larry Smith, 37, and Raymond Tierra Johnson, 32, were convicted by a federal jury in March 2013 after five days of trial, while Jeremy Benton, 22, Glenn Bonner, 42, Gregory Wayne Ferguson, 21, Arlington Davis Wilkes aka AD, 24, Carl Ray Turner Jr. aka CT, 27, Edward Johnson, 29,John Berley Scott aka Fresh, 32, Derrick Lashon Paley aka Crybaby, 35, Michael Maurice Wilson Jr. aka Blue/Mikey Poo, 26 Roderick Marshall Beagle, 41, Michael Dushon Duncan aka Mikey, 21, and Kelvin Dewayne Thomas aka Little Kevin, 23, each had previously entered guilty pleas.
U.S. District Judge Gray Miller sentenced Smith, found to be the leader of that group, to 1080 months in federal prison - 90 years. Johnson was considered to be the “muscle” of the crew and, on several occasions, assaulted and/or pistol-whipped victims indiscriminately. He will serve 744 months – 62 years in federal prison. Bonner forced a victim to place a 911 call and subsequently told officers during the standoff that he was going to start to kill victims within minutes if his demands weren’t met. Judge Miller imposed a total sentence for him of 257 months. Benton will serve 235 months, while Scott and Wilson received respective sentences of 271 and 288 months. Wilkes was handed a sentence of 120 months for his role in the conspiracy. Ferguson received a sentence of 12 months and a day, while Edward Johnson and Turner each received an 84-month sentence. Thomas, Duncan, Paley and Beagle received sentences of 70, 207, 231 and 220 months, respectively.
This 14-man conspiracy involved the organized recruitment of co-conspirators, who would engage in advanced coordination and planning Evidence at trial indicated the conspirators used lookouts during robberies and used stolen or “hot” cars as get-a-way vehicles to commit the offenses. Most bank robberies were affected through the brandishing and firing of firearms during the course of the robbery to ensure compliance with their demands. Testimony revealed some of the violence witnessed by those in the banks and the threats made to gain compliance.
One victim specifically mentioned the individual trauma she has experienced and admits suffering from post-traumatic stress syndrome as a result of the horrific event. Another victim, also a witness at the trial, described the event as a life changing experience. That victim had been beaten in the course of the robbery and was off work for a great deal of time. Both victims also reported they have been unable to return to the banking industry for work and have even been unable to enter a bank since the violent event. The government also provided evidence to the court that during the course of this bank robbery conspiracy, more than 80 victims have been identified.
“Our office will continue to work with the FBI Bank Robbery Task Force and its state and local partners and utilize all available resources to secure both prosecution and stiff sentences for the perpetrators of such crimes,” Magidson added.
All 25 men will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Both cases were investigated by the FBI Bank Robbery Task Force and included personnel from the FBI, HCSO, police departments in Houston, Pearland, Friendswood, Baytown and Pasadena, Fort Bend County Sheriff’s Office, Harris County Precinct 4 Constable’s Office, District Attorney’s Offices in Harris and Brazoria counties as well as Crimestoppers. The cases were both prosecuted by Assistant U.S. Attorneys Suzanne Elmilady and Kebharu H. Smith.
Smoke Shop Owner and Realtor Head to Federal Prison for Structuring Financial TransactionsRead the Press Release
CORPUS CHRISTI, Texas – The co-owner of Mr. Nice Guys Smoke Shop and a local real estate agent have been ordered to federal prison following their convictions related to a multi-agency investigation into the structuring of financial transactions, announced United States Attorney Kenneth Magidson. Leroy Mitchan Jr., 34, and Justin Colmenero, 30, previously pleaded guilty as did Mitchan’s wife, Kimberly Davis, 27. All are from Corpus Christi.
Today, U.S. District Judge John D. Rainey, handed Mitchan a sentence of 20 months to be followed by one year of supervised release, while Colmenero will be on probation for three years, but must pay a $6000 fine. In handing down the sentence, Judge Rainey distinguished the roles of all the defendants and noted he had never in his career seen a structuring case this extensive. Davis was sentenced to five months in custody and five months of home confinement on Nov. 18, 2013.
All were arrested in May 2013 on charges relating to their participation in a conspiracy to structure more than $100,000 in cash deposit transactions over a 12-month period with a domestic financial institution in order to avoid the legal reporting requirements of the bank.
The charges came as a result of an investigation in reference to the sale of synthetic marijuana. Mitchan and Davis, who own Mr. Nice Guys, also own another smoke shop located at 5433 S. Staples St. in Corpus Christi as well as a used car dealership located at 5757 Everhart Rd. From February 2012 through January 2013, officers with the Corpus Christi Police Department (CCPD) seized more than 40.93 grams of synthetic marijuana during numerous undercover purchases from both of the smoke shops. On Feb. 1, 2013, CCPD executed state search warrants at the shops and seized a total of 1.5 kilograms of synthetic marijuana as well as various smoking paraphernalia such as pipes, bongs, glassware, grinders and scales. Also seized were detailed drug ledgers and price lists relating to the sale of synthetic marijuana along with documents guiding employees on the proper coded vocabulary to use when describing the illegal items being sold to customers.
The Drug Enforcement Administration (DEA) learned Mitchan and Davis had recently purchased three real estate properties in Corpus Christi and were making payments on these properties with large cash transactions. A preliminary review of bank accounts revealed several cash deposits under $10,000. Internal Revenue Service – Criminal Investigation (IRS-CI) then initiated the financial investigation.
The Bank Secrecy Act of 1970 (BSA) requires financial institutions to file reports with the Treasury Department of cash transactions exceeding $10,000.
As part of the plea, Davis admitted she conducted three separate deposits in one morning at Members First Credit Union. She first deposited $9,000 in the drive-thru at 7:39 a.m., then drove away and immediately re-entered the drive-thru lane and conducted a second cash deposit of $9,000 at 8:17 a.m. She drove away again but returned and conducted a third cash deposit of $8,801 at 9:16 a.m. In another instance, she conducted two separate deposits right after the other – the first in the lobby of the bank and the another in the drive-thru lane approximately 30 minutes later. The total amount for all five deposits was $44,101. All of these deposits did not exceed the $10,000 currency transaction filing requirement for financial institutions and were made in an attempt to avoid the reporting requirements.
Mitchan admitted he worked with Colmenero, a local real estate agent, and provided him with large amounts of cash. Mitchan told Colmenero to deposit it into his personal bank account and later withdraw the money in the form of cashier’s checks or via Moneygram to pay for property he was purchasing. The total amount Colmenero structured at the direction of Mitchan was approximately $461,000. Mitchan directed him and others to structure currency transactions to avoid the threshold reporting requirement and had even asked about the success of structuring the money without having any of the bank tellers ask any questions.
Mitchan and Davis have also agreed to the criminal forfeiture of three pieces of real property located in Nueces County, valued at approximately $1,200,000, approximately $396,000 in cash as well as 42 vehicles valued at approximately $409,000.
Previously released on bond, Mitchan was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
The investigation leading to the criminal charges was conducted in Corpus Christi lead by IRS-CI, DEA and CCPD. The case is being prosecuted by Assistant Unites States Attorneys Hugo R. Martinez and Lance A. Watt.
Former Kindergarten Teacher Heads to Prison for Sexually Exploiting ChildrenRead the Press Release
HOUSTON - Stephen Wayne Sudduth, 38, of Sealy, has been ordered to prison for 30 years following his convictions on two counts of production of child pornography, announced United States Attorney Kenneth Magidson. Sudduth entered a plea of guilty Tuesday, Sept. 3, 2013.
The charges against Sudduth arose as a result of an international investigation conducted by members of the Houston office of Homeland Security Investigations (HSI), the office of the Caribbean Attache for Homeland Security, the Texas Attorney General’s Cybercrime Unit, the Public Prosecutor’s Office in Curacao, a special task force unit in Curacao comprised of Dutch and local law enforcement officers and the equivalent of the juvenile sex crimes unit of the Curacao Police Corps.
Today, U.S. District Judge Nancy Atlas handed Sudduth a 360-month sentence for each of the two convictions which will be served concurrently. Sudduth received credit for the more than three years he has been in federal custody. Additional information was also presented today, including copies of some of the images and a written victim impact statement from the mother of one victim. Additionally, the mother of a second victim came to court and provided a statement. Sudduth was further ordered to pay restitution to the two victims and will serve 25 years of supervised release following completion of his prison term, during which time he will have to participate in counseling, have no contact with minors under the age of 18 and very limited access to computers and the Internet. He will also be ordered to register as a sex offender.
The federal sentence will also run concurrently with a 60-year sentence Sudduth received in August 2013 for promotion of child pornography in Austin County.
The investigation began in 2009 when the Texas Attorney General’s Office received a tip concerning Sudduth. A state search warrant for Sudduth’s residence in Sealy was secured and later executed on July 14, 2009. At that time, officers seized a laptop computer and two external hard drives which all were found to contain child pornography.
During the review of the images, officers observed images that contained Sudduth and images that appeared to have been taken in a classroom. They were able to confirm the classroom was at a school in Curacao and that Sudduth taught kindergarten at that school. Houston HSI agents were then contacted to handle the international aspect of the investigation.
Still images of young girls that constituted child pornography were located and found to have been taken with a digital camera.
In December 2009 and May 2010, HSI agents and a forensic child interviewer traveled to Curacao and were able to identify and interview the children depicted in the images.
Sudduth has been in custody where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.This case, prosecuted by Assistant United States Attorney Robert Stabe, was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Father and Son Telemarketers Convicted in Timeshare Resale Fraud Affecting 1000 VictimsRead the Press Release
HOUSTON – Ronald Frank Muise, 51, and his son, Michael Derek Muise, 28, both of Las Vegas, Nev., have been convicted of conspiracy to commit wire and mail fraud in connection with a telemarketing fraud scheme that spanned almost five years and victimized approximately 1000 people, announced United States Attorney Kenneth Magidson. The Muises entered guilty pleas in federal court in Houston late yesterday afternoon.
The Muises and other alleged co-conspirators used various businesses known as The Jariv Companies to conduct a telemarketing timeshare resale scheme targeting timeshare owners throughout the United States and Canada. The Muises and others solicited timeshare owners by telephone to pay advance fees in exchange for The Jariv Companies promising they had willing buyers for the timeshare properties or points. In fact, the defendants did not have buyers and did not market or sell the property. They simply kept the money - almost $6 million in 2011-2012 alone.
The Jariv Companies were registered in various states and conducted business at multiple addresses in Houston; Las Vegas, Nev.; Los Angeles, Calif.; Chicago, Ill.; and Seattle, Wash.
The defendants and their employees falsely represented that they had buyers for timeshare weeks or points and solicited fees, ranging from hundreds of dollars to several thousand dollars from each timeshare owner. They falsely represented that the fees were fully refundable at closing and were used to secure the owners’ place in an acquisition involving corporate buyers, as well as to pay for legal expenses such as title searches, estoppel letters and closing costs.
The defendants made several false representations to give the appearance of legitimacy. They claimed they were the only legitimate company selling timeshares for owners, were “certified,” had sold hundreds of timeshares and had hundreds of employees. They also posted fake testimonials on websites for The Jariv Companies purporting to be from satisfied customers, but were actually written by employees.
After monies were paid for these “sales contracts,” the telemarketer would advise the owner that either the corporate buyer had pulled out of the acquisition or that other problems were encountered, but they had another buyer for the timeshare. The telemarketer would then conduct another pitch for additional money to ensure the deal closed. At times, veiled threats were made stating the owner could lose whatever money they had previously paid as well as their ?place in line? for inclusion in the sale or the deal.
Closings were not scheduled, sales did not occur and no payments were made to timeshare owners for the sale of their property.
The defendants and employees of The Jariv Companies simply pocketed the advanced fees paid by the timeshare owners.
Between Feb. 1, 2011, and Jan. 31, 2012, The Jariv Companies received approximately $6,925,137.04 in fraudulently obtained timeshare owner funds from approximately 1000 victims living in Canada and throughout the United States. The Muises received significant commissions for fraudulently obtaining victims money - 30-40% in most cases. In 2011-2012, Ronald Muise received nearly $1 million, while Michael Muise received $440,000.
U.S. District Court Judge Lynn N. Hughes, who accepted the guilty pleas yesterday, has set sentencing for March 17, 2013. The conspiracy count carries a maximum imprisonment of 20 years in federal prison, but because the wire/mail fraud involved telemarketing of 10 or more victims over the age of 55, federal law provides for an additional 10-year sentence in addition to what was imposed for the underlying fraud. Both defendants were permitted to remain on bond pending that hearing.
The convictions are the result of an investigation conducted by U.S. Secret Service and Internal Revenue Service – Criminal Investigation with assistance by FBI and Environmental Protection Agency. Assistant U.S. Attorneys Martha Minnis and Katherine Haden are prosecuting the case.
Bankruptcy Fraud Results in Federal PrisonRead the Press Release
HOUSTON – Darren David Chaker, 41, of Beverly Hills, Calif., and Las Vegas, Nev., has been ordered to federal prison following his conviction of bankruptcy fraud, announced United States Attorney Kenneth Magidson. Chaker was found guilty April 4, 2013, following a five-day bench trial before U.S. District Judge Nancy Atlas.
Today, Judge Atlas sentenced Chaker to a term of 15 months in prison to be immediately followed by a three-year-term of supervised release. He was further ordered to pay a $2000 fine. As part of the sentencing, Judge Atlas included special conditions that he not stalk or harass anyone and obtain mental health counseling and anger management. In handing down the sentence, Judge Atlas noted that the bankruptcy system depends on the reliability of those who petition for bankruptcy relief and added that the case involved a defendant who could not tell the truth to the court. She rejected Chaker’s request for a sentence of probation, calling this a significant crime and finding that a sentence of custody is critical.
The evidence at trial showed that Chaker filed bankruptcy under Chapter 13, in which a debtor is required to propose a plan of reorganization to pay the debtor’s creditors over time. The debtor is required to pay at least as much as the creditors would receive if the debtor’s assets were liquidated on the date of the filing of the bankruptcy petition. The process is designed to achieve an orderly transfer of a debtor’s assets to creditors from available assets truthfully and accurately disclosed and to provide a “fresh start” to honest debtors by allowing them to obtain a discharge or release of debt incurred prior to filing bankruptcy.
According to the evidence, Chaker filed for bankruptcy under Chapter 13 on March 6, 2007. Specifically, on or about March 26, 2007, during a bankruptcy hearing before the Honorable Jeffrey Bohm, while under oath, Chaker falsely and fraudulently represented to the court that the property was never leased out prior to January 2007, when he had in fact previously contracted with a realtor who secured at least two rental contracts with Chaker personally. Chaker failed to disclose income and the existence of past and present residential leases of a residential property facing foreclosure in Houston to his creditor, Saxon Mortgage in the hearing and to the court.
In order for the bankruptcy system to work for all parties, it is imperative for the debtor to be truthful and forthright in all aspects of the bankruptcy process. The bankruptcy system is based on an honor system - the debtor agrees to provide all of the necessary information requested by the trustee and to assist the trustee in collecting all assets of debtors and comply with the court’s orders to obtain the relief desired under the chapter the case was filed.
Chaker will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
This case was investigated by the FBI with assistance from the United States Trustee’s Office and is being prosecuted by Assistant United States Attorneys Carolyn Ferko and Sharad Khandelwal.
San Antonio Man Guilty of Armed Bank RobberyRead the Press Release
CORPUS CHRISTI, Texas – Joseph C. M. Krist, 41, has been convicted of bank robbery and using a firearm during the commission of a crime of violence, announced United States Attorney Kenneth Magidson. The Corpus Christi federal jury convicted Krist following a two-day trial and less than three hours of deliberation.
On Jan. 13, 2013, Krist robbed the IBC Bank on the corner of Everhart and Burney in Corpus Christi. Krist entered the bank wearing a hoodie and a green shirt sleeve covering part of his face while carrying a .40 caliber pistol. He pointed the weapon at the tellers and told them to “hurry up.” He obtained a large amount of currency and fled the bank.
The Corpus Christi Police Department (CCPD) responded to the robbery, but were unable to apprehend Krist at that time. Three days later, the U.S. Marshals Service (USMS) was able to locate Krist at a camp ground in Uvalde and arrested him. At that time, authorities found a large amount of cash, the firearm, a hoodie and a green t-shirt missing a single shirt sleeve. Krist admitted to committing the robbery.
At the time of the robbery, Krist was a prior convicted bank robber both in state and federal court and was wanted by the authorities for violations of his state parole and federal supervised release.
At trial, Krist claimed he was not in Corpus Christi at the time of the robbery and that he knew the robber’s identity and is prepared to assist the authorities.
U.S. District Judge Nelva Gonzalez Ramos, who presided over trial, has set sentencing for March 28, 2014. At that time, he faces up to 20 years in federal prison for the bank robbery as well as a mandatory seven-year-term for using the firearm during the commission of the crime which must be served consecutively to any other prison term imposed.
The case was investigated by the FBI and CCPD with the assistance of USMS. Assistant United States Attorney Lance Duke prosecuted the case.
Houston Man Heads to Prison for Area Bank RobberyRead the Press Release
HOUSTON – Terrance Trent Batiste, 21, has been ordered to prison for his involvement in the November 2012 robbery of Amegy Bank in Houston, announced United States Attorney Kenneth Magidson.
Today, U.S. District Judge Kenneth Hoyt sentenced Batiste to 60 months for conspiracy to commit bank robbery as well as 78 months for aiding and abetting aggravated bank robbery which will be served concurrently. He was also convicted of aiding and abetting the brandishing of a firearm during a crime of violence for which he received a consecutive 84-month sentence for a total term of imprisonment of 162 months in federal prison. He will be further required to serve five years of supervised release following completion of the prison term.Kendrick Deswhan Castille, 20, Joshua Demond Clay, 29, also pleaded guilty to the bank robbery and are pending sentencing.
On Nov. 7, 2012, at approximately 12:00 p.m., the Amegy Bank on 1502 Eldridge Parkway in Houston was robbed. Batiste, Castille and Clay were apprehended by Houston Police Department (HPD) officers a short distance from the bank following a pursuit.
The investigation revealed that Castille and Batiste entered the bank wearing baseball hats. Batiste was armed with a dark colored revolver which was given to him by Castille before they entered the bank. Castille and Batiste both jumped over the teller counter and demanded money from the victim teller. Clay did not enter the bank, but all three got back into their vehicle and fled after the robbery. After a pursuit by HPD, the vehicle carrying the defendants stopped into the Forest Park Cemetery, located at 12800 Westheimer in Houston, where it ran over and destroyed several tombstones. Clothing and hats worn by Batiste and Castille were recovered from the vehicle along with a large amount of U.S. currency.
The case was investigated by the FBI’s Bank Robbery Task Force and is being prosecuted by Assistant United States Attorney Jennie Basile.Corpus Christi Man Sentenced for Possession of Child PornographyRead the Press Release
CORPUS CHRISTI, Texas – Rex D. McBride, 44, has been ordered to prison for possession of child pornography, announced United States Attorney Kenneth Magidson. McBride pleaded guilty Sept. 18, 2013.
Today, Senior U.S. District Judge John D. Rainey considered the seriousness of the crime and sentenced McBride to a total of 63 months in federal prison to be followed by 10 years of supervised release
On Nov. 12, 2012, Corpus Christi Police Department – Internet Crimes Against Children (CCPD-ICAC) detectives were conducting an undercover investigation into persons trading child pornography on the Gnutella network. At that time, detectives identified an online user, later identified as McBride, who was offering child pornography for distribution. On three occasions in late 2012, detectives successfully downloaded child pornography from McBride.
On March 20, 2013, a search warrant was executed, during which McBride admitted to downloading and viewing child pornography on the Internet through file sharing software. A forensic evaluation of McBride’s computer led to the discovery of nearly 1500 images of child pornography.
Homeland Security Investigations and CCPD-ICAC investigated.
This case, prosecuted by Assistant United States Attorney Lance Duke, was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visitwww.usdoj.gov/psc. For more information about internet safety education, please visitwww.usdoj.gov/psc and click on the tab "resources."Two Sentenced for Conspiring to Transport MarijuanaRead the Press Release
LAREDO, Texas - Roberto Garcia, 29, and Juan Javier Reyna, 33, both of Houston, have been sentenced to federal prison for conspiring to possess with the intent to distribute in excess of 100 kilograms of marijuana, announced United States Attorney Kenneth Magidson.
Today, U.S. District Judge George P. Kazen handed Garcia a sentence of 100 months, while Reyna received 72 months.
Between September and November 2011, Reyna worked with other co-conspirators including Garcia to transport 100-200 pounds of marijuana from Roma to Houston on at least two occasions.
On Oct. 19, 2011, Reyna was driving in tandem with a vehicle driven by Garcia. His role on that day was to provide an escort vehicle for the load of marijuana. A Department of Public Safety (DPS) trooper attempted to pull Garcia over for traffic violations. However, when the DPS trooper walked up to the vehicle, Garcia sped off and caused a three-car crash on Highway 83 at Pita Magana Road. Garcia abandoned the vehicle, which contained 14 bundles of marijuana, weighing 55.45 kilograms. Garcia then ran through a gas station and was picked up by Reyna. A high-speed chase ensued, during which Garcia opened the passenger door and fled. Reyna bailed out of the vehicle a short time later and was apprehended hiding in the brush nearby.
This case is the result of a two-year investigation led by the Drug Enforcement Administration with the assistance of Homeland Security Investigations. Assistant United States Attorneys Elizabeth Rabe and James Hepburn are prosecuting the case.
Bank Robber Ordered to Federal PrisonRead the Press Release
HOUSTON – The last of four convicted in the armed bank robbery of a Wells Fargo Bank in September 2012 has been ordered to federal prison, announced United States Attorney Kenneth Magidson.
Today, U.S. District Judge Melinda Harmon sentenced David Holiday, 35, of Houston, to 135 months for his role in the aggravated bank robbery.
On Sept. 26, 2012, at approximately 9:45 a.m., the Wells Fargo Bank on Fulton Street in Houston was robbed by Holiday and two others – Stanley Snowden, 40, and Alvin Theotis Snowden, 41, both of Houston - wearing masks and bandanas. Stanley Snowden and Alvin Snowden were armed with semiautomatic pistols.
Holiday and Alvin Snowden jumped over the teller counter and demanded the bank employees lay down on the ground, while Alvin Snowden pointed his weapon at them. Alvin Snowden took the bank manager to the vault and demanded money, and Holiday took one of the bank employees to her teller drawer.
Stanley Snowden controlled the lobby area, during which time he assaulted an elderly female customer by throwing her to the ground and pointing his pistol directly at her as she lay on the floor of the bank.
After the robbery, the three men exited the bank and entered a Chevrolet Impala, driven by Anthony D. Brown, 40, of Houston, who drove the others to the bank prior to the robbery. All were apprehended a short time later, at which time a .32 caliber pistol, a 9mm pistol and money stolen from the bank were recovered from the vehicle.
The three others also pleaded guilty. Alvin Snowden received a sentence of 319 months, Stanley Snowden received a sentence of 177 total months, while Brown will serve 92 months in federal prison.
The investigation was conducted by the FBI Bank Robbery Task Force, which is comprised of personnel from the FBI, Houston Police Department and Harris County Sheriff's Office. Assistant United States Attorney Jennie Basile is prosecuting the case.
Smuggler Gets Enhanced SentenceRead the Press Release
McALLEN, Texas ‐ Jose Guadalupe Reyna-Esparza, 21, of Tampico, Tamaulipas, Mexico, has been ordered to federal prison for nine years as a result of his conviction of smuggling undocumented aliens, United States Attorney Kenneth Magidson announced today. Reyna-Esparza pleaded guilty Oct. 2, 2013.
Today, U.S. District Judge Micaela Alvarez sentenced Reyna-Esparza to a sentence of 108 months imprisonment. The sentence was enhanced as the court took into consideration the fact he had sexually assaulted a 14-year-old female undocumented alien on a number of occasions. As an illegal alien, Reyna-Esparza is expected to face deportation proceedings following his release from prison.
From July 16 to July 17, 2012, Reyna-Esparza harbored undocumented aliens at a residence located in McAllen. On July 17, 2012, law enforcement officers observed Reyna-Esparza and two other individuals leave the residence in a vehicle. When officers attempted to conduct a traffic stop, Reyna-Esparza who was driving, led them on a high speed chase before eventually stopping and absconding into a field. Through investigation, it was discovered that Reyna-Esparza had sexually assaulted the 14-year-old undocumented alien.
The investigation leading to the charges was conducted by Homeland Security Investigations, Border Patrol, San Juan Police Department and Alton Police Department.
Assistant United States Attorneys Kimberly Ann Leo and Kristen Rees prosecuted the case.
Rio Grande City Nurse Practitioner on Her Way to Federal Prison in Marijuana CaseRead the Press Release
McALLEN, Texas – Celia Raquel Zuniga, 45, of Rio Grande City, has been ordered to prison following her conviction of conspiracy to possess with intent to distribute and possession with intent to distribute marijuana, announced United States Attorney Kenneth Magidson. The McAllen federal jury convicted Zuniga following a two-day trial and approximately two hours of deliberations on Wednesday, Sept. 25, 2013.
U.S. District Judge Micaela Alvarez, who presided over the trial, handed Zuniga a total sentence of 78 months in prison to be immediately followed by four years of supervised release. At the hearing today, the court enhanced her sentence, finding she obstructed justice when she perjured herself while testifying at trial. She was further ordered to pay a $5,000 fine as to each count. In handing down the sentence, Judge Alvarez noted while Zuniga performed a great service to the community as a nurse practitioner, she was causing great harm to the community because of this type of criminal activity.
During trial, Starr County sheriff’s deputies testified that on Dec. 6, 2012, they observed three vehicles driving in tandem going east on Expressway 83 near the Starr County and Hidalgo County line. They then observed the middle vehicle change lanes without signaling. Deputies conducted a traffic stop and identified Zuniga as the driver. At that time, deputies noticed a strong odor of marijuana emitting from the vehicle and a canine subsequently alerted to the presence of narcotics.
Initially, Zuniga lied to deputies and denied there was anything illegal in her vehicle. However, after stepping out of her vehicle and when asked a second time, Zuniga admitted there was something illegal inside. Deputies then recovered 24 bundles of marijuana, weighing approximately 243 kilograms within the car.
In her defense, Zuniga testified she had been kidnaped by multiple men while she was driving to a friend’s house. She claimed they took her to a cemetery while bundles of marijuana were loaded into her vehicle. She further testified they told her she would need to drive the vehicle to McAllen or else something would happen to her family.
The jury was not convinced of Zuniga’s claim of duress and ultimately found her guilty as charged.
Previously released on bond, Zuniga was taken into custody following the return of the verdict where she will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The case was investigated by Homeland Security Investigations with the assistance of the Starr County Sheriff’s Office. Assistant United States Attorney Kimberly Ann Leo is prosecuting.
Laredo Jury Convicts “Shrek” in Operation El PatronRead the Press Release
LAREDO, Texas – Oscar De Leon, aka “Shrek,” 38, of Laredo, has been convicted of multiple drug and international money laundering counts resulting from a long-term Organized Crime Drug Enforcement Task Force (OCDETF) investigation, announced United States Attorney Kenneth Magidson. The jury returned its verdict late yesterday following a three-day trial and approximately three hours of deliberation.
DeLeon was a co-conspirator working for a Laredo-based drug trafficking organization. He assisted with a drug conspiracy, existing from 2006 to 2010, that shipped cocaine, marijuana and U.S. currency from Mexico through Laredo to Atlanta, Ga., and throughout the United States. De Leon was convicted on drug and international money laundering conspiracy charges from 2006-2010 as well as possession with intent to distribute more than 100 kilograms of cocaine and more than 300 kilograms marijuana from May 2008 and May 2009, respectively.To date, a total of 38 co-conspirators have been convicted and sentenced as part of this investigation. During the course of the investigation that led to the convictions, federal agents seized more than $7.5 million in drug proceeds and more than 450 kilograms of cocaine. Agents also seized a drug ledger that attributes the movement/distribution of approximately 12,500 kilograms of cocaine and $41. 9 million in drug proceeds by these and other co-conspirators.
U.S. District Gregg Costa, who presided over this trial, has set sentencing for March 2014. At that time, DeLeon faces no less than 20 years and up to life in federal prison.The charges and resulting convictions are the result of OCDETF operations dubbed “Operation El Patron” and “Havoc” involving Homeland Security Investigations, Internal Revenue Service-Criminal Investigation and the Drug Enforcement Administration with the assistance of Webb County District Attorney’s Office, U.S. Border Patrol, Laredo Police Department and the Texas Department of Public Safety.
Assistant U.S. Attorneys Graciela Rodriguez Lindberg and Sanjeev Bhasker prosecuted the case.
Jury Convicts Inmate in Murder for Hire Plot Against Federal JudgeRead the Press Release
FORT WORTH, Texas - Phillip Monroe Ballard, 72, of Fort Worth, has been convicted in the attempted murder for hire of a federal judge in Texas, announced United States Attorney Kenneth Magidson of the Southern District of Texas. The verdict was returned this afternoon after approximately two days of trial and less than an hour of deliberation.
From on or about Sept. 9, 2012 and continuing through Sep. 27, 2012, Ballard solicited the murder for hire of a U.S. District Judge in the Northern District of Texas. During trial, the jury heard from four government witnesses, one of whom was an informant who testified he had developed a friendship with Ballard as they both were in custody on unrelated criminal matters. He stated that Ballard had asked him if he would help him arrange the shooting death of the judge, who was presiding over his federal tax case. They eventually negotiated a price of $100,000.
The informant reported the incident to authorities and the plot was foiled before any harm came to the judge.
Ballard’s defense claimed he never had any actual intent to kill the judge. The jury disagreed and convicted him as charged.
U.S. District Judge Donald E Walter from the Western District of Louisiana presided over trial. He has set sentencing for March 2014 in Fort Worth, at which time Ballard faces up to 20 years in prison and a $250,000 fine. Ballard will remain in custody pending that hearing.
The case was investigated by the FBI. Assistant U.S. Attorneys Mark McIntyre and Craig Feazel from the Southern District of Texas are prosecuting the case.
Former Houston Banker Arrested for Bank FraudRead the Press Release
HOUSTON – Carlos Ibarra, 33, formerly of Houston, has been arrested on charges of bank fraud and money laundering, announced United States Attorney Kenneth Magidson.
Ibarra was taken into custody yesterday without incident at a family member’s residence in Houston. He is expected to appear this afternoon before U.S. Magistrate Judge Stephen Wm. Smith at 2:00 p.m.
The 10-count sealed indictment was returned June 19, 2013, and unsealed upon his arrest. It alleges he knowingly executed a scheme to defraud Chase Bank and obtain money under the control of the bank by means of materially false and fraudulent pretenses.
Ibarra had been employed by J.P. Morgan Chase Bank in Houston. Between September 2010 and June 2012, Ibarra allegedly purchased cashier’s checks on an account at Chase that belonged to a deceased individual. According to the indictment, he gave those checks to others for them to deposit into their own bank accounts. They then made wire transfers and obtained cashier’s checks as instructed by Ibarra, according to the allegations.
If convicted, Ibarra faces up to 30 years imprisonment on each of three counts of bank fraud and a possible $1 fine. For the remaining seven charges of money laundering, Ibarra also faces up to 20 years and a maximum $500,000 fine upon each conviction.
The indictment further contains a notice of forfeiture of $779,000, alleged illegal proceeds derived from the charged crimes.
The case was investigated by the Secret Service and is being prosecuted by Assistant United States Attorney John Braddock.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.Brownsville Drug Dealer Gets Four Life SentencesRead the Press Release
BROWNSVILLE, Texas – Julio Cesar Cardenas, 40, has been given four life sentences in federal prison for his involvement in leading a drug trafficking organization for several years out of Brownsville, announced United States Attorney Kenneth Magidson. Cardenas was convicted by a federal jury following a two-week trial on May 31, 2013.
Today, Senior U.S. District Judge Hilda Tagle, who presided over the trial, handed down the sentence, noting her concern for the safety of the community due in part to his extensive criminal history. At the hearing, it was noted that this was the sixth felony conviction for Cardenas. He was further ordered to pay restitution in the amount of $1,700. Cardenas was sentenced on a total of 17 counts in two indictments and given other sentences ranging from five to 40 years to run concurrent with the life sentences. The life sentences imposed were for conspiracy to possess with intent to distribute more than five kilograms of cocaine, conspiracy to possess with intent to distribute more than 100 kilograms of marijuana, possession with intent to distribute approximately 31 kilograms of cocaine and possession with intent to distribute approximately 20 kilograms of cocaine.
Cardenas was convicted at trial on all 17 counts in which he was charged in the two indictments, including the aforementioned charges as well as operating an illegal money remitting business and numerous substantive marijuana and cocaine counts. He was also convicted for being a felon in possession of a firearm.
Cardenas was one of 13 people originally charged in an indictment returned in June 2012. According to the evidence and testimony presented in court, Cardenas led the drug trafficking organization whose aim was to distribute cocaine and marijuana through commercial freight lines to numerous states, including Texas, Florida, Georgia, Tennessee, Kansas, Missouri, Michigan, Ohio, Mississippi, South Carolina, Indiana and Illinois. After the marijuana and cocaine was sold in these states, Cardenas directed the illegal money remitting of the transportation costs and drug proceeds of the narcotics back to the Brownsville area by utilizing cash deposits in bank accounts in the names of other individuals and co-conspirators. Branch banks were utilized in the receiving states with the money to be withdrawn by the co-conspirators here in Brownsville on a regular basis.
Testimony at trial demonstrated that Cardenas engaged in numerous drug trafficking and illegal money remitting conversations in March, April and June 2011. The investigation led law enforcement to four separate seizures of large amounts of marijuana during these months. Cardenas was also convicted of several other historical seizures of cocaine and marijuana.Cardenas was arrested Sept. 13, 2012, at which time a weapon was found at his home. Evidence at trial established that within minutes of approximately 365 pounds of marijuana being seized at the house of co-conspirator, he had commented about the need to get a gun out of his house. Cardenas was convicted in three separate cases of delivery of cocaine in 1995 and is, therefore, prohibited by federal law from possessing a firearm.
The jury also heard that Cardenas had ties to the Gulf Cartel. Evidence established that Cardenas assisted in the possession of approximately 31 kilograms of cocaine in April 2011 that was supplied to a co-conspirator by an individual named “La Tia” from Matamoros. “La Tia” was identified by several cooperating witnesses as an alleged high ranking member of the Gulf Cartel.
Cardenas offered to help store and sell three kilograms of the total load of 31 kilograms. He also provided advice to the co-conspirator on how to deal with “La Tia” during the transportation of the cocaine to Chicago, Ill. The jury heard that Cardenas advised the co-conspirator to employ violence, such as kidnaping and the use of a bomb, in their dispute with “La Tia” regarding the seizure of the 31 kilograms of cocaine by the Cameron County Sheriff’s Office.
Law enforcement has identified “La Tia” as Idalia Ramos Rangel, 58. She is a fugitive and has been charged by the United States Attorney’s Offices in Brownsville and Little Rock, Ark., on separate narcotics trafficking indictments. She is considered innocent until proven guilty through due process of law.
The government also presented evidence that Cardenas received bank deposits in the names of co-conspirators in excess of $841,000. Cardenas was the leader of the co-conspirators in the indictment and, on one occasion, wanted to steal electricity from a neighboring church to power one of the warehouses he was using to ship and package narcotics.
The case was investigated by the Drug Enforcement Administration, Homeland Security Investigations, Internal Revenue Service-Criminal Investigation, FBI, Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Marshals Service, Cameron Country Sheriff’s Office, Police Departments in Brownsville and Harlingen as well as the Hidalgo and Cameron County High Intensity Drug Trafficking Area Task Forces and the Cameron County District Attorney’s Office.
Cardenas will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The 11 remaining defendants all pleaded guilty on various dates prior to the Cardenas trial. Emmanuel Leal Mancha, 36, was sentenced to 46 months for illegal money remitting and possession with intent to distribute approximately 82 kilograms of marijuana. Juan Gonzalez, 39, Pablo Torres, 22, and Ronny Robertson, 22, received respective sentences of 60, 37, and 24 months for possession with intent to distribute approximately 166 kilograms of marijuana. For his two convictions of conspiracy to possess with intent to distribute more than five kilograms of cocaine and more than 100 kilograms of marijuana, Byron Green, 33, was handed a 125-month sentence, while Guadalupe Vidaurri, 34, received 48 months for possession with intent to distribute approximately 194 kilograms of marijuana. Alejandro Trevino, 38, received credit for time served for illegal money remitting. Israel Avila was sentenced yesterday to 40 months, while four others - Juan Torres, Pablo Rodriguez and Carlos Lopez - are set for sentencing next year.
The case was prosecuted by Assistant U.S. Attorneys Jody Young and Angel Castro as part of the Organized Crime and Drug Enforcement Task Force Operation “Hips Don’t Lie.”
Zeta Cartel Member Convicted in Conspiracy to Smuggle Firearms/Grenades into MexicoRead the Press Release
LAREDO, Texas – Richard John Medina aka “El Guero,” 40, of Laredo, has entered a plea of guilty to being a felon in possession of multiple firearms and grenades, announced United States Attorney Kenneth Magidson.
On Oct. 9, 2013, Medina was arrested at his Laredo residence in possession of five firearms and five grenades. As part of the plea, Medina admitted he attempted to traffic and export these items from the United States into Mexico, exclusively for the Mexican Zeta Cartel.
Medina was hired to export the weapons for $2,500. Medina was to receive half the payment upfront, with the remainder paid upon delivery of the weapons to a Zeta Cartel house in Nuevo Laredo, Mexico. On Oct. 9, 2013, Medina received the weapons and was subsequently arrested in the United States. Investigation revealed Medina was a convicted felon and did not have permission under the International Traffic in Arms Regulations to export these military defense weapons.
U.S. District Judge Diana Saldana will set a date for sentencing in the near future. At the time of the hearing, Medina will face up to 10 years in prison and a possible $250,000 fine.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, Homeland Security Investigations and the Laredo Police Department. Assistant U.S. Attorneys Sanjeev Bhasker and Homero Ramirez are prosecuting.
Honduran Man Convicted of High Speed Flight from Border Patrol CheckpointRead the Press Release
LAREDO, Texas – Miguel Angel Chavarria-Martinez, 28, a Honduran national illegally in the United States, has entered a guilty plea to eluding and high speed flight from a Border Patrol (BP) checkpoint, announced United States Attorney Kenneth Magidson.
On Oct. 6, 2013, at approximately 12:30 a.m., Chavarria-Martinez arrived at the BP checkpoint located on U.S. Highway 59 near Farm to Market Road 2050 in East Webb County near Freer as driver and sole occupant of a blue Freightliner semi-tractor. BP agents initiated an immigration inspection, but Chavarria-Martinez did not answer any questions. At the request of agents, Chavarria-Martinez began to exit the cab of his vehicle, but quickly returned to the driver’s seat. He then drove away from the inspection station with the agent standing on the cab’s side deck by the driver’s window. Chavarria-Martinez ignored the agent’s orders to stop the vehicle and departed the checkpoint and headed towards Freer.
BP agents pursued Chavarria-Martinez’s vehicle along with Texas Department of Public Safety (DPS) officers. The vehicle reached speeds of up to 80 miles per hour on Highway 59 as he attempted to flee and as it approached, entered and drove through Freer. The posted speed limit is 45 miles per hour before entering Freer and then drops to 30 miles per hour through the community. The driver finally stopped at a roadblock initiated within the city by the Freer Police Department (FPD). At that time, FPD officers turned Chavarria-Martinez over to Border Patrol agents.
Chavarria-Martinez was determined to be a citizen and national of Honduras illegally in the United States and has been deported at least once before.
U.S. Magistrate Judge Guillermo R. Garcia presided over the plea and a sentencing date will be set in the near future before U.S. District Judge Diana Saldana. At that time, he faces a maximum of five years in federal prison and/or a possible $250,000 fine. Chavarria-Martinez has been in federal custody since his arrest Oct. 6, 2013, where he will remain pending that hearing.
BP investigated in conjunction with DPS and FPD. Assistant United States Attorney Homero Ramirez is prosecuting the case.
Federal Jury Convicts Parole Officer for Accepting Bribes from ParoleeRead the Press Release
HOUSTON - Crystal M. Washington, aka Crystal Bureau, 53, has been convicted on three counts as charged by a federal jury sitting in Houston, announced United States Attorney Kenneth Magidson. Washington was employed as a parole officer at the Texas Department of Criminal Justice (TDCJ) office located on Hamilton Street in Houston.
Following a two-day trial, the jury found Washington accepted bribes from a parolee - a suspected heroin dealer - from 2009 to 2012 and that she warned the dealer of a Houston Police Department investigation in 2009. She was convicted of conspiracy to possess with intent to distribute heroin as well as conspiracy to commit extortion under color of official right for accepting money from the dealer. Further evidence was presented which showed Washington accepting money from a cooperating parolee in May 2012.
U.S. District Judge Lee H. Rosenthal, who presided over the trial, has set sentencing for March 25, 2014. At that time, Washington faces up to 20 years in federal prison on each count. In addition, the extortion convictions carry as possible punishment maximum $250,000 fines, while the conspiracy count could result in a $1 million fine.
Washington was relieved of all duties and her employment terminated upon arrest. She was permitted to remain on bond, but the court modified the conditions to include electronic monitoring based upon the jury’s verdict today.
The operation was a combined public corruption task force effort by the FBI, Houston Police Department, TDCJ-Office of Inspector General and the Texas Rangers.
The case is being prosecuted by Assistant United States Attorneys Jim McAlister and Carolyn Ferko.
Federal Jury Convicts Austin Man Who Harbored Female at Local MotelRead the Press Release
CORPUS CHRISTI, Texas - Jose Gallegos, 47, of Austin, has been found guilty by a Corpus Christi jury of harboring and transporting an undocumented person, announced United States Attorney Kenneth Magidson. The verdict was returned late this morning following a two-day trial and approximately 45 minutes of deliberation.
On Aug. 17, 2013, Gallegos was caught at the Sarita Border Patrol checkpoint with a scantily-clad 18-year-old female passenger. During trial, the jury heard testimony that she was being smuggled by Gallegos and his associates from Mexico to New Jersey. The young woman provided tearful testimony that she was sexually assaulted by Gallegos, forced to wear revealing clothing and receive facial piercings. She further testified she was threatened with death if she disobeyed or told anyone.
Gallegos kept the young woman and other undocumented persons being smuggled from Mexico at a Palmview motel for two weeks prior to being arrested at the checkpoint.
The defendant appeared pro se, representing himself in all proceedings and claimed the government was merely attacking him. The jury disagreed and found him guilty as charged.
U.S. District Judge Nelva Gonzales Ramos, who presided over the trial, will set sentencing at a later date. At the time of that hearing, Gallegos will face up to five years imprisonment and a possible $250,000 fine. He will remain in custody pending sentencing.
The matter was investigated by Homeland Security Investigations in conjunction with the U.S. Border Patrol. Assistant United States Attorney Jeffrey D. Preston prosecuted the case.
“Investment Advisory Firm” Owner Convicted of FraudRead the Press Release
GALVESTON – Kimberly Fontenot, a Brazoria County resident, has been convicted of defrauding clients of her so-called investment advisory firm, Stellar Grants Inc., announced United States Attorney Kenneth Magidson.
As outlined in documents filed with the court and admitted by Fontenot during her guilty plea today, from at least January through December 2012, Fontenot lured potential clients by falsely claiming to know numerous wealthy investors located throughout the United States. She offered access to these wealthy investors, whom she called her “angel investors,” to potential Stellar Grants clients in exchange for money. Specifically, Fontenot misrepresented that in exchange for money, she could put Stellar Grants clients in contact with the “angel investors” and would help them seek investments from the angel investors.
In addition to claiming personal and business relationships with them, Fontenot used the web-based email services Yahoo.com and Gmail.com to create fake email accounts in the names of the investors. She used these accounts to send emails to Stellar Grants clients, making it seem as if the emails were coming to and from the “angel investors” when, in reality, they were coming from Fontenot.Fontenot also hired a voice actor to impersonate the “angel investors” or their representatives during telephone calls with Stellar Grants clients. She also instructed the actor how to act and what to say during the calls. Fontenot then held fake conference calls in which she pretended to represent the Stellar Grants client and the voice actor pretended to be the angel investor or a representative of the angel investor, all in an attempt to justify the consulting fees paid by the Stellar Grants clients.
To avoid detection, Fontenot arranged for Stellar Grants clients or their representatives to sign “Master Consulting Agreements.” These agreements included a penalty clause which imposed heavy financial penalties if the clients contacted any of the angel investors.
U.S. District Judge Gregg Costa accepted Fontenot’s plea and has set sentencing for Feb. 24, 2013. At that time, she faces a maximum penalty of 20 years in federal prison and a $250,000 maximum fine or twice the pecuniary gain or loss. She was permitted to remain on bond pending that hearing.
The case is being investigated by the FBI and prosecuted by Assistant U.S. Attorney John Pearson.
Mexican Man Indicted for Attempting to Smuggle Military Type Semi-Automatic Rifles to MexicoRead the Press Release
CORPUS CHRISTI, Texas – Angel Aquino-Pineda, 26, of Tijuana, Mexico, has been charged by a federal grand jury with one count of smuggling firearms from the United States and being a convicted felon in possession of a firearm, announced United States Attorney Kenneth Magidson.
Count one of the indictment charges that on or about Oc. 29, 2013, Pineda did aid, abet and assist another person to fraudulently and knowingly attempt to export 35 AK-47 type 7.62x39 caliber firearms from the United States, knowing them to be intended for Mexico.
He is further charged with possessing those firearms on the same date after he had been previously convicted of a crime, a violation of federal law.
Aquino-Pineda faces up to 10 years in federal prison as well as a possible $250,000 fine, if convicted.
The Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation with the assistance of the Kingsville Specialized Crimes and Narcotics Task Force. Assistant United States Attorney Hugo R. Martinez is prosecuting the case.
Last of 24 Arrested in Massive Marijuana Grow House Case Ordered to PrisonRead the Press Release
HOUSTON – Those arrested as a result of the discovery of approximately 14,000 marijuana plants from 43 marijuana grow houses in Harris, Fort Bend and Montgomery Counties in August 2012 have now been ordered to prison, announced United States Attorney Kenneth Magidson along with Javier Peña, special agent in charge, Drug Enforcement Administration (DEA). With the sentencing of Yen Thi Do, 43, formerly of Boston, Mass., today, all those arrested have now been convicted and ordered to prison.
“Today’s sentencing illustrates the seriousness of growing marijuana in Texas,” said Peña. “Whether our investigation leads us to marijuana grow houses operating within city limits or to a country field outside of the city, DEA’s mission is to investigate these illegal operations. The defendants of this organization now recognize DEA does not discriminate on which location you choose. DEA and its law enforcement partners will continue to aggressively and proactively target all areas of drug trafficking.”
Do pleaded guilty to conspiring to maintain a premises for the manufacture, distribution, possession or use of marijuana as did the other 23 defendants involved in the clandestine indoor marijuana grow organization. All of the defendants were born in Vietnam, most of whom were naturalized Canadian, Swedish or U.S. citizens, or permanent U.S. resident aliens. All foreign nationals are subject to deportation upon completing their prison terms.
U.S. District Judge Sim Lake sentenced Do to a total of 57 months in federal prison to be followed by a three-year-term of supervised release. Do was a marijuana grow house tender who left Boston to begin tending the houses in the Houston area.
On Wednesday, Nov. 27, 2013, Judge Lake sentenced the three highest ranking members of the organization charged in this case - Thu Loan Dinh, 36, Van Long Tran, 34, and Thang Van Doan, 36. Each of these three defendants occupied leadership or managerial roles in the organization which generated hundreds of thousands of dollars each quarter with the sale of harvested high potency marijuana. Dinh received a sentence of 108 months, while Tran and Doan will serve respective sentences of 97 and 78 months.
The remaining 20 defendants consisted of either marijuana grow house tenders who were paid to tend and harvest the marijuana plants in their respective grow house, or maintenance men who collected and removed garbage and/or did the lawn care. They received varying sentences up to 56 months in prison.
The investigation focused upon a domestic clandestine hydroponic marijuana cultivation and distribution organization in Harris, Montgomery and Fort Bend Counties. On Aug. 21, 2012, search warrants were executed at more than 60 residences identified during the course of the investigation - 43 marijuana grow houses and 17 residences - leading to the arrest of the 24 people and the seizure of approximately 14,000 marijuana plants, $121,000 in cash, numerous vehicles and hydroponic equipment.Each of the “grow” houses had been leased from unsuspecting homeowners for use as a family residence. With one exception, none of the grow houses were actually occupied, but were used exclusively to grow marijuana. While the exterior and lawns of the leased houses were well maintained to avoid drawing the attention of the homeowners, neighbors or law enforcement, the interiors had been extensively modified to produce a “rapid growth” environment for the marijuana plants. The modified environment permitted the harvesting of 120 – 150 marijuana plants or 12 – 15 pounds of high potency “bud” marijuana every two months once a “grow house” had begun operation.
Arrest warrants remain outstanding for two other suspected leaders/managers - Johnny Ng, 52, and Hein Le, 44. Anyone having information regarding their whereabouts is asked to contact DEA Houston at (713) 693-3000 or their local DEA office.
The investigation was conducted by a DEA-lead Organized Crime Drug Enforcement Task Force investigation dubbed “Operation Green House” which included representatives of sheriff’s offices in Harris, Fort Bend and Montgomery Counties, officers of the Houston Police Department and the Texas Department of Public Safety. Those agencies provided invaluable additional resources and assistance along with the Bureau of Alcohol, Tobacco, Firearms and Explosives, FBI, Homeland Security Investigations, police departments in Katy, Pearland, Willis, Conroe, Huntsville and Pasadena as well as the National Guard Joint Counter Drug Unit and Cypress Creek Emergency Medical Services during the course of the investigation.This case was prosecuted by Assistant United States Attorney (AUSA) Nancy G. Herrera and former AUSA Jesse Rodriguez.
Last Man Sentenced in Attempted Armored Car RobberyRead the Press Release
HOUSTON - James Patrick Campbell, 26, has been ordered to federal prison for conspiracy to interfere with commerce by robbery, announced United States Attorney Kenneth Magidson. Campbell pleaded guilty Oct. 3, 2012, to the conspiracy to rob an armored car operated by Loomis Armored US Inc.
Today, U.S. District Judge Keith P. Ellison handed Campbell a total sentence of 41 months in federal prison.
Also charged in the crime and previously sentenced were Malcolm Jamal Austin, 25, Terrance Saffore, 25, and William Terrell Archer, 22, all of Houston. Saffore was sentenced to 51 months and Archer was sentenced to 63 months. Austin was sentenced to 12 months plus 10 years for discharging a weapon for a total of 132 months.
Campbell admitted he was part of a conspiracy to rob a Loomis armored car as it was about to leave a Bank of America at 12188 Gulf Freeway in Houston on June 22, 2011. Campbell had previously worked for Loomis and provided information regarding driver protocols to the co-conspirators.
On June 22, 2011, Saffore drove Archer and Austin to the bank in a white Grand Prix which was owned by Campbell. Archer went into the bank prior to the robbery. Austin then approached the guard, demanded money and reached for a gun. The guard discharged his weapon and shot Austin three times. Austin also fired, but did not strike the guard. During the robbery, Campbell was waiting around the corner in another vehicle.
Once shots were fired, Archer ran back to Campbell’s nearby apartment. After the failed robbery attempt and shooting, Austin and Saffore fled the scene in Campbell’s vehicle.
The case was investigated by the FBI’s Bank Robbery Task Force and is being prosecuted by Assistant United States Attorney Jennie Basile.
Legal Permanent Resident Alien Convicted of Possession of Child PornographyRead the Press Release
LAREDO, Texas – Daniel Frias Gomez, 22, a legal permanent resident born and raised in Jalisco, Mexico, has entered a guilty plea to possessing child pornography, announced United States Attorney Kenneth Magidson.
Gomez was apprehended on Sept. 27, 2013, as he applied for admission back into the United States via the Lincoln-Juarez International Bridge, Port of Entry No. 2, in Laredo as a passenger onboard a commercial bus. During the course of inspection, Customs and Border Protection officers discovered multiple electronic devices, including DVDs and memory cards.
Gomez, who had been residing with his immediate family in Iowa, claimed ownership of those devices. A search was conducted and approximately 200 child pornographic images and videos were discovered. Some of the images included variations of pornography, including some involving bestiality.
Gomez made claims that he was approached by an “unknown” male, who offered him pornographic images because he had a PSP device. He ultimately decided to plead guilty as charged.
U.S. District Judge Diana Saldana will set a sentencing date at a later time. At the time of that hearing, Gomez faces up to 10 years in federal prison. He also faces a potential fine of $250,000 and up to life on supervised release during which the court can impose a number of special conditions designed to protect children and prohibit the use of the Internet. Gomez will remain in custody pending that hearing.
Homeland Security Investigations and CBP investigated.
This case, prosecuted by Assistant United States Attorney Suntrease Williams, was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Houston Man Ordered to Prison for Wells Fargo RobberyRead the Press Release
HOUSTON - Willie Wright III, 32, of Houston, has been sentenced for his role in the robbery of the Wells Fargo Bank on Kirby Drive in Houston in December 2012, announced United States Attorney Kenneth Magidson.
Today, U.S. District Judge Nancy Atlas sentenced Wright to 46 months for aggravated bank robbery as well as a consecutive seven years for brandishing a firearm during a crime of violence for a total of 130 months in federal prison.
On Friday Dec. 28, 2012, Wright, along with Aaron Derrow, 43, Terrance Jackson, 35, and Justin Levar Taylor, 33, all of Houston, robbed the Wells Fargo Bank at 5202 Kirby Drive in Houston. All of the men were wearing various disguises, and Wright, Derrow and Taylor were armed with pistols. Jackson and Derrow jumped over the teller counter while Wright and Taylor controlled the lobby. Derrow threatened a male teller with his gun while filling a bag with money. After getting the money, the two jumped back over the teller counter and all four ran out of the bank to their getaway vehicle, a stolen white Toyota pickup truck. All were apprehended a short time later at a residence several miles away.
Derrow and Jackson both also pleaded guilty to aggravated bank robbery and will be sentenced later this month. Derrow also entered a plea of guilty to brandishing a firearm during a crime of violence. Taylor will be sentenced in January 2014 and was convicted of aggravated bank robbery and brandishing a firearm during a crime of violence.
The case was investigated by the FBI’s Bank Robbery Task Force and is being prosecuted by Assistant United States Attorney Jennie Basile.
Former Bank VP Heads to Federal PrisonRead the Press Release
HOUSTON - Shawn Nelson, 39, of Houston and a former vice-president at Members Choice Credit Union (MCCU), has been ordered to serve more than three years in prison for embezzling approximately $340,000 from the bank, announced United States Kenneth Magidson. Nelson entered a guilty plea on June 27, 2013.
Today, U.S. District Court Judge Keith P. Ellison, who accepted the guilty plea, handed Nelson a 37-month sentence. In handing down the sentence, Judge Ellison described Nelson’s misconduct as “grievous” and further ordered him to pay restitution of $340,000 – the amount Nelson stole from MCCU over a nine-year period. Following completion of his prison term, Nelson will be on supervised release for three years.
As part of his guilty plea, Nelson admitted he was a vice-president of Lending at MCCU. From 2001 through 2010, Nelson opened loan accounts in the names of his friends and family members, without their authorization. He then withdrew money from these accounts, again without their authorization. By the time the fraud was discovered, Nelson had stolen about $340,000 from the credit union.
Nelson was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prison facility to be determined in the near future.
U.S. Secret Service investigated. The case was prosecuted by Assistant United States Attorney (AUSA) Sharad S. Khandelwal, while AUSA Kristine Rollinson is handling forfeiture matters.
Deaths of Smuggled Aliens Lands Mexican National in Federal Prison for 10 YearsRead the Press Release
CORPUS CHRISTI, Texas – Idelfonso Garcia-Benitez, 20, of Michoacan, Mexico, has been ordered to prison for smuggling of a group of 14 Illegal aliens that left seven dead, announced United States Attorney Kenneth Magidson today along with Brian M. Moskowitz, special agent in charge of Homeland Security Investigations (HSI).
“The tragic loss of life in this case shows the very real risks that people face when they put their fate in the hands of a human smuggler,” said Moskowitz. “Smugglers place personal profit ahead of public safety and border protection. They are driven by greed with little regard for the health and well-being of their human cargo, and sadly, that can be a deadly combination.”
The indictment charged Garcia-Benitez with one count of conspiring to transport aliens, 14 counts of transporting an alien and one count of illegal re-entry after deportation. On Aug. 22, 2013, he entered a guilty plea to all counts as charged without a written plea agreement.
Today, U.S. District Judge Janis Graham Jack, who accepted the guilty plea, handed Garcia-Benitez a total sentence of 120 months in federal prison and ordered him to pay $2,161,529.16 in restitution. In handing down the sentence, Judge Jack noted the loss of life and monetary costs that resulted from the crime. As an illegal alien, he is expected to face deportation proceedings following his release from prison.
On March 20, 2013, at approximately 11:00 p.m., a Kingsville Police Department officer observed a pick-up truck violate state traffic law by disregarding a stop sign. The officer attempted to conduct a traffic stop on this vehicle, but the vehicle fled, leading to a brief pursuit.
The driver crashed into a vehicle barrier on General Cavazos Avenue in Kleberg County that had been deployed by the Kingsville Naval Air Station. A total of 15 illegal aliens were discovered at the scene. Of those, Garcia-Benitez was identified as the driver. Seven were killed.
Garcia-Benitez was arrested at the scene of the accident. He has been in custody since that time, where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The case is being investigated by HSI and prosecuted by Assistant United States Attorney Jeffrey S. Miller.
Another Houston Man Sentenced in Area Armored Car RobberiesRead the Press Release
HOUSTON – Hendrick Dwayne Lynn, 30, of Houston, has been ordered to federal prison following his conviction in the robbery and attempted robbery of two armored cars operating in and around Houston, announced United States Attorney Kenneth Magidson.
Today, U.S. District Judge Gray H. Miller handed Lynn a sentence of 60 months for his conviction of two counts of interference with commerce by robbery and one count of conspiracy to interfere with commerce by robbery. Lynn will be on supervised release for five years. Lynn will also be jointly and severally liable to pay back the money stolen from a Loomis Armored truck on Nov. 21, 2009.
Four others also charged in the case - Walter Keitric Freeman, 24, Chad Eric Haywood, 25, and Corinthians Lachell Phillips, 29, all of Houston, and Allen Moore Jr., 47, of Dallas – all previously also entered guilty pleas and were sentenced for their roles in the crimes. Haywood was convicted of two counts of interference with commerce by robbery and sentenced to 60 months in addition to a consecutive term of 120 months for discharging a firearm during a crime of violence for a total of 180 months. Freeman was sentenced to 57 months for his conviction of conspiracy to interfere with commerce by robbery as well as a consecutive sentence of 120 months for discharging of a firearm during the commission of a crime of violence for a total of 177 months. Phillips was convicted of the conspiracy charge and sentenced to 97 months. Moore, who was convicted of interference with commerce by robbery and discharging a firearm during a crime of violence will be sentenced in February 2014.
Loomis Armored US Inc., who operated the trucks during the alleged robbery and robbery attempt, maintains offices throughout the United States and was engaged in the business of secured armored transport of United States currency in interstate commerce and in picking up and delivering United States currency to financial institutions and check cashing businesses, both of which are industries which affect interstate commerce.
Lynn, Haywood and Moore were charged with their involvement in the Aug. 7, 2009, attempted robbery of a Loomis armored truck at the Bank of America at 3704 Old Spanish Trail in Houston. Lynn drove to the location, at which time Haywood and Moore, who were armed with Glock pistols, jumped out and shot at the guard. The guard, who has since recovered, had been filling an ATM machine, but it was already locked and, therefore, no money was obtained.
The second incident occurred on Nov. 21, 2009, at which time another guard was shot. On that date, Lynn drove Freeman and Haywood to Senor Check Cashing Store #2 located at 5950 S. Gessner Rd. in Houston. Freeman fired his pistol and shot in the direction of the guard. The guard was hit, but survived. On that same date, Phillips drove a second vehicle to the Gessner location and, following the robbery, switched vehicles with Haywood, Freeman and Lynn.
The case was investigated by the FBI’s Bank Robbery Task Force and is being prosecuted by Assistant United States Attorney Jennie Basile.
Victoria Man Sentenced for Producing Child PornographyRead the Press Release
VICTORIA, Texas – Vincent Tyler Jimenez, 32, has been ordered to prison for 25 years following his conviction of sexual exploitation of a child, more commonly referred to as production of child pornography, announced United States Attorney Kenneth Magidson. Jimenez previously pleaded guilty July 1, 2013.
Today, Senior U.S. District Judge John D. Rainey took into consideration testimony from the government and the victims in the case. Noting the need to protect the public and to reflect the seriousness of his crime, the court then handed down the 25-year sentence. In addition to the prison term, Jimenez will be required to serve 15 years of supervised release upon the completion of his prison term and will be required to register as a sex offender.
On July 3, 2012, law enforcement in Waller County conducted an investigation into a person pretending to be a child who was soliciting children to produce pornographic images of themselves. The investigation revealed that Jimenez, while pretending to be a female juvenile, used a cell phone to text a child. Jimenez was able to convince the child to produce nude images and then send those images to Jimenez.
Over time, Jimenez learned the identity of the child’s minor sibling and began communicating with that sibling as well. Jimenez was able to convince the second sibling to also produce nude images.
At some point, the first victim resisted demands for more nude images and Jimenez then began to blackmail the victim with threats to distribute the pictures online if Jimenez did not receive new images.
The criminal activity was discovered by a parent of the children and reported to law enforcement. A state search warrant was executed on his Victoria County home, at which time a cell phone was discovered containing some of the nude images.
Homeland Security Investigations investigated.
This case, prosecuted by Assistant United States Attorney Lance Duke, was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Victoria Man Pleads Guilty to Possession of Child PornographyRead the Press Release
VICTORIA, Texas – Joshua Almeida, 23, has entered a plea of guilty to one count of possession of child pornography, announced United States Attorney Kenneth Magidson.
During the hearing, Almeida stipulated to the facts as presented in court. On March 18, 2012, the Victoria County Sheriff’s Office conducted an undercover online investigation into person trading child pornography. A computer which ultimately traced back to Almeida was determined to be offering numerous images of child pornography for distribution. A state search warrant was executed on Almeida’s home in Victoria on Sept. 27, 2012, at which time several electronic storage devices were seized and identified as belonging to Almeida. A subsequent computer forensics search of those devices led to the discovery of numerous files containing child pornography.
Senior U.S. District Judge John D. Rainey, who accepted the guilty plea, has set sentencing for March 3, 2014. At that time, Almeida faces up to 10 years imprisonment. He was permitted to remain on bond pending that hearing.
This case, prosecuted by Assistant United States Attorney Lance Duke, was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Romanian Man Heads to Prison on 33 Counts of Wire FraudRead the Press Release
VICTORIA, Texas – Romanian national Doru Gabriel Trifu, 29, has been ordered to federal prison following his convictions on 33 counts of wire fraud in an Internet fraud scheme, announced United States Attorney Kenneth Magidson and Brian M. Moskowitz, special agent in charge of Homeland Security Investigations (HSI). A federal jury sitting in Victoria convicted Trifu following a four-day trial on Wednesday, Sept. 25, 2013.
Today, Senior U.S. District Judge John Rainey, who presided over the trial, sentenced Trifu to a total of 96 months in federal prison to be followed by three years supervised release. He was further ordered to pay $562,239.78 restitution. In handing down the sentence, Judge Rainey noted this was the most extensive fraud scheme he had ever seen and that the scheme played to someone’s allegiances and loyalties to the military. Not a U.S. citizen, Trifu is expected to face deportation proceedings following his release from prison.
Trifu, a Romanian non-immigrant residing in Orangevale, Calif., was part of the fraudulent scheme in which consumer items were listed for sale over the Internet. Individuals attempting to make purchases were instructed to send money via MoneyGram to an escrow agent who would accept the funds, complete the transaction and deliver the item. However, after the buyer electronically transferred the money, the item would never be delivered.
“This case serves as an important and timely ‘Cyber Monday’ reminder that consumers need to be careful when shopping online,” said Moskowitz.
During trial, the government presented videos and numerous surveillance photographs taken from Wal-Mart stores across Texas, Mississippi and Alabama where the fraudulent transactions occurred.
Testimony was provided by several victims who described how they were told they were purchasing the item from a U.S. serviceman who was about to deploy to the Middle East and were told to use a third party broker to complete the transaction.
An agent with Homeland Security Investigations (HSI) also testified and identified a pattern of approximately 230 fraudulent transactions between March 2011 and February 2012 using two fake U.S. passport numbers. Over the course of the scheme, the amount of identified fraud totaled more than $567,000.
Trifu has been in custody since his November 2012 arrest in California where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.The case was investigated by HSI. Assistant U.S. Attorney Lance Watt is prosecuting.
Lymphedema & Wound Care Institute Settle False Claims Act AllegationsRead the Press Release
HOUSTON - Susan Morgan, Erin Hamilton and Ryan Chuston, doing business as the Lymphedema & Wound Care Institute Inc., have paid the United States $4.3 million to settle claims they violated the Federal False Claims Act by submitting claims to the Medicare Program for physical therapy treatments provided by unqualified therapists, announced United States Attorney Kenneth Magidson. Additionally, under the terms of the settlement agreement, Morgan will be barred from participating in federal health benefit programs for a period of 10 years.
Morgan, Hamilton and Chuston conducted business in four locations throughout the Houston area as the Lymphedema & Wound Care Institute. The settlement announced today involved allegations that from Jan. 2, 2006 through Sept. 12, 2012, they billed the Medicare program for providing manual lymphatic drainage therapy to Medicare beneficiaries using massage therapists as opposed to physical therapists as required under the rules and regulations governing the Medicare program.
“Today’s settlement once again demonstrates our commitment to fight the fraud and abuse that threatens the financial health of our federal healthcare programs,” said Magidson. “In addition to yielding a substantial recovery for taxpayers, this settlement will prohibit Morgan from participating in the federal health benefit programs for several years, which should deter similar conduct in the future.”
By agreeing to a voluntary suspension from federal health benefit programs, Morgan will not be allowed to bill these programs for treating Medicare beneficiaries for 10 years.
Also as part of the agreement, Hamilton and Chuston have agreed to operate the Lymphedema & Wound Care Institute under a corporate integrity agreement to be monitored by the Office of Counsel to the Inspector General for the Department of Health and Human Services. The corporate integrity agreement will provide for increased monitoring of Lymphedema & Wound Care Institute’s billing practices.
The settlement resolves allegations made against Morgan, Hamilton and Chuston in a qui tam or whistleblower lawsuit filed in January 2011 in federal court by a physician who also provides manual lymphatic drainage treatments to patients with lymphedema. Under the False Claims Act, private citizens can bring suit on behalf of the government and share in any amounts that are obtained through that legal action. In this case, the whistleblower will receive 19% of the proceeds of the settlement.
The investigation was conducted by the Department of Health and Human Services - Office of Inspector General. Assistant United States Attorney Andrew A. Bobb is prosecuting the case.
Former Governor of State of Tamaulipas, Mexico, Indicted in the Southern District of TexasRead the Press Release
BROWNSVILLE, Texas – A federal indictment charging Tomas Yarrington Ruvalcaba, the former governor of the State of Tamaulipas, Mexico, has been unsealed.
The unsealing was announced by United States Attorneys Kenneth Magidson and Robert L. Pitman, of the Southern and Western Districts of Texas, respectively, along with Janice Ayala, special agent in charge, Homeland Security Investigations (HSI); Javier Peña, special agent in charge, Drug Enforcement Administration (DEA); Bernard Butler, acting special agent in charge, Internal Revenue Service - Criminal Investigation (IRS-CI); and Armando Fernandez, special agent in charge, FBI.
Following an investigation that spanned several years, the sealed indictment was returned in May 2013 by a federal grand jury sitting in Brownsville. The indictment charges Yarrington, 56, and Fernando Alejandro Cano Martinez, 57, the owner of a Mexican construction firm, with conspiring to violate the provisions of the Racketeer Influenced and Corrupt Organization (RICO) statute. The two men are also charged with conspiracy to launder money, conspiracy to defraud and conspiracy to make false statements to federally insured U.S. banks.
Yarrington is also separately charged with a conspiracy to violate the provisions of the Controlled Substances Act, two substantive bank fraud charges and a conspiracy to structure currency transactions at a domestic financial institution, while Cano is separately charged with three counts of bank fraud.
Yarrington served as governor of Tamaulipas from 1999 to 2004. Tamaulipas lies along the southern border between the United States and Mexico directly across from Brownsville and Laredo.
According to the indictment, beginning in approximately 1998, Yarrington received large bribes from major drug traffickers operating in the Mexican state of Tamaulipas, including the Gulf Cartel. In return, Yarrington allegedly allowed them to operate their large scale, multi-ton enterprises freely, which included the smuggling of large quantities of drugs to the United States for distribution. From 2007 to 2009, Yarrington allegedly became involved in the smuggling of large amounts of cocaine through the Port of Veracruz into the United States.
Yarrington also allegedly collected bribes from commercial operations in Mexico, according to the indictment. Cano operated Materiales y Construcciones Villa de Aguayo, S.A. de C.V., a construction firm in Tamaulipas that received significant public works contracts during Yarrington’s term as governor. The indictment alleges Cano, in turn, paid bribes to Yarrington to include the acquisition of real estate in front names for him.
The indictment further alleges Yarrington also received control over stolen public funds in the latter part of 2004. Portions of those funds were allegedly used to buy a Sabreliner 60 airplane in January 2005. As part of that purchase, $300,000 was transferred to a bank account in the United States. Another portion of the allegedly stolen funds, $5 million Mexican pesos, was transferred to Cano in the spring of 2005, according to the indictment.
The indictment further alleges that starting in approximately 1998, Yarrington, and later to include Cano, became involved in the acquisition of valuable assets in the United States, using front names and business entities established starting in 2005 to disguise the true ownership of the assets. The assets allegedly included bank accounts, residences, airplanes, vehicles and real estate in Bexar, Cameron, Hidalgo and Hays Counties, many of which were acquired via allegedly fraudulent loans from banks in Texas. According to the indictment, bank accounts established in front names at Texas banks were used to receive and disburse money to carry the ongoing costs of the assets, such as loan costs and condo fees.
The indictment identifies numerous specific front entities involved in the scheme, each of which allegedly applied for multi-million dollar fraudulent loans at Texas banks, which Cano allegedly personally guaranteed. The indictment details a total of more than $7 million in transfers into the U.S. accounts of the front entities.
Additional entities were created and used to apply for other loans to fund the purchase of still other assets, according to the indictment. Numerous currency transactions were allegedly conducted at First National Bank, headquartered in Edinburg, Texas, in a structured manner in amounts at or below $10,000 in order to evade the filing of Currency Transaction Reports by the bank.
Neither Yarrington nor Cano is in the custody of the United States and warrants remain outstanding for their arrests. Anyone with information about their whereabouts is asked to contact Homeland Security Investigations at 956-542-5811. Persons calling from Mexico should call 001-800-010-5237.
The RICO and money laundering charges each carry sentences of up to 20 years in prison, while conspiracy to commit bank fraud carries as possible punishment up to 30 years. The drug conspiracy charges carry a term of imprisonment of at least 10 years. The currency structuring charges carry a possible five-year-term of imprisonment.
The indictment also includes a notice of forfeiture. Some of the assets identified in the indictment already have been seized by the United States in civil forfeiture actions over the course of the investigation, to include approximately 46 acres in Bexar County, a condo on South Padre Island, a 2005 Pilatus airplane and residences in Hidalgo and Hays counties.
The investigation leading to the indictment has been conducted by the Organized Crime Drug Enforcement Task Force in Brownsville, San Antonio, Houston, Corpus Christi and New York and has included agents and officers with HSI, DEA, IRS-CI, FBI and the Texas Attorney General’s Office. The United States government also acknowledges with gratitude the significant assistance received from the government of Mexico in the course of this investigation, including through sharing evidence and expertise.
The case is being prosecuted by Assistant United States Attorneys Charles Lewis, Julie K. Hampton and Jody Young.
2 Houston Men Convicted of Humble Bank RobberyRead the Press Release
HOUSTON – Justin Devon Hayes, 23, and Demontray Ward, 21, both of Houston, have entered guilty pleas to aggravated bank robbery and brandishing a firearm during a crime of violence, announced United States Attorney Kenneth Magidson.
On April 26, 2013, Hayes, Ward and a third, now deceased man, robbed the Regions Bank at 7044 East FM 1960 in Humble. Ward was armed with a shotgun, while the other two had pistols. All of the weapons were loaded. The defendants demanded money, threatened the tellers and became agitated when they realized the vault was on a 10-minute timer.
A Houston police officer entered the bank, but was disarmed by Ward. Outside, another officer witnessed the three men leave the bank and enter an SUV. He attempted to confront them, but the vehicle drove towards him. Seeing a muzzle of a shotgun pointed at him, the officer fired and the driver was shot and killed. Ward and Hayes were then taken into custody.
U.S. District Judge Vanessa Gilmore, who accepted the guilty pleas, has set sentencing for Spring 2014, at which time they face up to 25 years for the bank robbery as well as a consecutive seven years for the firearms charge.
Both men will remain in custody pending their respective hearings.
The investigation was conducted by the FBI Bank Robbery Task Force, which is comprised of personnel from the FBI, Houston Police Department and Harris County Sheriff's Office. Assistant United States Attorney Jennie Basile is prosecuting the case.
Two Former Coahuila, Mexico, Politicians Indicted in the Southern District of TexasRead the Press Release
CORPUS CHRISTI, Texas - Two former Mexican politicians from the State of Coahuila have been indicted on charges of conspiring to launder monetary instruments, bank fraud, mail fraud and wire fraud, announced United States Attorney Kenneth Magidson.
The four-count sealed federal indictment was returned Nov. 20, 2013, and unsealed today. It charges Hector Javier Villarreal Hernandez, 42, former Secretary of Finance for the Mexican State of Coahuila, and Jorge Juan Torres Lopez, 59, former Interim Governor and Secretary of Finance for Coahuila with conspiring to launder monetary instruments and bank fraud. In addition, Villarreal Hernandez was also charged separately with mail fraud and Torres Lopez was charged with wire fraud.
Two previously filed civil forfeiture complaints allege Villarreal Hernandez and Torres Lopez sent more than $2 million each to offshore accounts in Bermuda after misrepresenting the source of the funds to a bank on multiple occasions. The complaints further indicate Villarreal Hernandez is facing charges in Mexico regarding an alleged false loan scheme to steal money from the federal government in Mexico. The documents allege there were several large transfers of money between the U.S. bank accounts of Torres Lopez and Villarreal Hernandez.
If convicted of the money laundering conspiracy, Villarreal Hernandez and Torres Lopez each face up to 20 years in federal prison as well as up to 30 years for bank fraud. Upon conviction of mail or wire fraud, respectively, Villarreal Hernandez and Torres Lopez further face another maximum 20-year-sentence. All charges also carry as possible punishment thousands of dollars in fines.
Neither man is in the custody of the United States and warrants remain outstanding for their arrests. Anyone with information about their whereabouts is asked to contact the Drug Enforcement Administration’s High Intensity Drug Trafficking Area Task Force office in San Antonio at 1-210-499-2900.
The investigation leading to the indictment was conducted through the Organized Crime Drug Enforcement Task Force in San Antonio, Brownsville, Houston and Corpus Christi by agents and officers of Internal Revenue Service - Criminal Investigation, Drug Enforcement Administration, Homeland Security Investigations and the Texas Attorney General’s Office.
The case is being prosecuted by Assistant United States Attorney Julie K. Hampton.
Three Subsidiaries of Weatherford International Limited Agree to Plead Guilty to FCPA and Export Control ViolationsRead the Press Release
Weatherford International and Subsidiaries Agree to Pay $252 Million in Penalties and Fines
HOUSTON – Three subsidiaries of Weatherford International Limited (Weatherford International), a Swiss oil services company that trades on the New York Stock Exchange, have agreed to plead guilty to export controls violations under the International Emergency Economic Powers Act (IEEPA) and the Trading with the Enemy Act (TWEA) and anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA). Weatherford International and its subsidiaries have also agreed to pay more than $252 million in penalties and fines.
U.S. Attorney Kenneth Magidson of the Southern District of Texas, Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office made the announcement.
Weatherford International and four of its subsidiaries today agreed to pay a combined $100 million to resolve a criminal and administrative export controls investigation conducted by the U.S. Attorney’s Office for the Southern District of Texas, the Department of Commerce’s Bureau of Industry and Security and the Department of the Treasury’s Office of Foreign Assets Control. As part of the resolution of that investigation, Weatherford International has agreed to enter into a deferred prosecution agreement for a term of two years and two of its subsidiaries have agreed to plead guilty to export controls charges.
“The resolution today of these criminal charges represents the seriousness that our office and the Department of Justice puts on enforcing the export control and sanctions laws,” said U.S. Attorney Magidson.
In a separate matter, Weatherford Services Limited (Weatherford Services), a subsidiary of Weatherford International, today agreed to plead guilty to violating the anti-bribery provisions of the FCPA. As part of a coordinated FCPA resolution, the department today also filed a criminal information in U.S. District Court for the Southern District of Texas charging Weatherford International with one count of violating the internal controls provisions of the FCPA. To resolve the charge, Weatherford International has agreed to pay an $87.2 million criminal penalty as part of a deferred prosecution agreement with the department.
“Effective internal accounting controls are not only good policy, they are required by law for publicly traded companies – and for good reason,” said Acting Assistant Attorney General Raman. “This case demonstrates how loose controls and an anemic compliance environment can foster foreign bribery and fraud by a company’s subsidiaries around the globe. Although Weatherford’s extensive remediation and its efforts to improve its compliance functions are positive signs, the corrupt conduct of Weatherford International’s subsidiaries allowed it to earn millions of dollars in illicit profits, for which it is now paying a significant price.”
“When business executives engage in bribery and pay-offs in order to obtain contracts, an uneven marketplace is created and honest competitor companies are put at a disadvantage,” said Assistant Director in Charge Parlave. “The FBI is committed to investigating corrupt backroom deals that influence contract procurement and threaten our global commerce.”
In a related FCPA matter, the U.S. Securities and Exchange Commission (SEC) filed a settlement today in which Weatherford International consented to the entry of a permanent injunction against FCPA violations and agreed to pay $65,612,360 in disgorgement, prejudgment interest and civil penalties. Weatherford International also agreed with the SEC to comply with certain undertakings regarding its FCPA compliance program, including the retention of an independent corporate compliance monitor.
The combined investigations resulted in the conviction of three Weatherford subsidiaries, the entry by Weatherford International into two deferred prosecution agreements and a civil settlement and the payment of a total of $252,690,606 in penalties and fines.
Export Control Violations
According to court documents filed today in a separate matter, between 1998 and 2007, Weatherford International and some its subsidiaries engaged in conduct that violated various U.S. export control and sanctions laws by exporting or re-exporting oil and gas drilling equipment to, and conducting Weatherford business operations in, sanctioned countries without the required U.S. government authorization. In addition to the involvement of employees of several Weatherford International subsidiaries, some Weatherford International executives, managers or employees on multiple occasions participated in, directed, approved and facilitated the transactions and the conduct of its various subsidiaries.
This conduct involved persons within the U.S.-based management structure of Weatherford International participating in conduct by Weatherford International foreign subsidiaries and the unlicensed export or re-export of U.S.-origin goods to Cuba, Iran, Sudan and Syria. Weatherford subsidiaries Precision Energy Services Colombia Ltd. (PESC) and Precision Energy Services Ltd. (PESL), both headquartered in Canada, conducted business in the country of Cuba. Weatherford’s subsidiary Weatherford Oil Tools Middle East (WOTME), headquartered in the United Arab Emirates (UAE), conducted business in the countries of Iran, Sudan and Syria. Weatherford’s subsidiary Weatherford Production Optimisation f/k/a eProduction Solutions U.K. Ltd. (eProd-U.K.), headquartered in the United Kingdom, conducted business in the country of Iran. Weatherford generated approximately $110 million in revenue from its illegal transactions in Cuba, Iran, Syria and Sudan.
To resolve these charges, Weatherford and its subsidiaries will pay a total penalty of $100 million, with a $48 million monetary penalty paid pursuant to a deferred prosecution agreement, $2 million paid in criminal fines pursuant to the two guilty pleas and a $50 million civil penalty paid pursuant to a Department of Commerce settlement agreement to resolve 174 violations charged by Commerce’s Bureau of Industry and Security. Weatherford International and certain of its affiliates are also signing a $91 million settlement agreement with the Department of the Treasury to resolve their civil liability arising out of the same underlying course of conduct, which will be deemed satisfied by the payments above.
FCPA Violations
According to court documents filed by the department, prior to 2008, Weatherford International knowingly failed to establish an effective system of internal accounting controls designed to detect and prevent corruption, including FCPA violations. The company failed to implement these internal controls despite operating in an industry with a substantial corruption risk profile and despite growing its global footprint in large part by purchasing existing companies, often themselves in countries with high corruption risks. As a result, a permissive and uncontrolled environment existed within which employees of certain of Weatherford International’s wholly owned subsidiaries in Africa and the Middle East were able to engage in corrupt conduct over the course of many years, including both bribery of foreign officials and fraudulent misuse of the United Nations’ Oil for Food Program.
Court documents state that Weatherford Services employees established and operated a joint venture in Africa with two local entities controlled by foreign officials and their relatives from 2004 through at least 2008. The foreign officials selected the entities with which Weatherford Services would partner, and Weatherford Services and Weatherford International employees knew that the members of the local entities included foreign officials’ relatives and associates. Notwithstanding the fact that the local entities did not contribute capital, expertise or labor to the joint venture, neither Weatherford Services nor Weatherford International investigated why the local entities were involved in the joint venture. The sole purpose of those local entities, in fact, was to serve as conduits through which Weatherford Services funneled hundreds of thousands of dollars in payments to the foreign officials controlling them. In exchange for the payments they received from Weatherford Services through the joint venture, the foreign officials awarded the joint venture lucrative contracts, gave Weatherford Services inside information about competitors’ pricing and took contracts away from Weatherford Services’ competitors and awarded them to the joint venture.
Additionally, Weatherford Services employees in Africa bribed a foreign official so that he would approve the renewal of an oil services contract, according to court documents. Weatherford Services funneled bribery payments to the foreign official through a freight forwarding agent it retained via a consultancy agreement in July 2006. Weatherford Services generated sham purchase orders for consulting services the freight forwarding agent never performed, and the freight forwarding agent, in turn, generated sham invoices for those same nonexistent services. When paid for those invoices, the freight forwarding agent passed at least some of those monies on to the foreign official with the authority to approve Weatherford Services’ contract renewal. In exchange for these payments, the foreign official awarded the renewal contract to Weatherford Services in 2006.
Further, according to court documents, in a third scheme in the Middle East, from 2005 through 2011, employees of Weatherford Oil Tools Middle East Limited (WOTME), another Weatherford International subsidiary, awarded improper “volume discounts” to a distributor who supplied Weatherford International products to a government-owned national oil company, believing that those discounts were being used to create a slush fund with which to make bribe payments to decision-makers at the national oil company. Between 2005 and 2011, WOTME paid approximately $15 million in volume discounts to the distributor.
Weatherford International’s failure to implement effective internal accounting controls also permitted corrupt conduct relating to the United Nations’ Oil for Food Program to occur, according to court documents. Between in or about February 2002 and in or about July 2002, WOTME paid approximately $1,470,128 in kickbacks to the government of Iraq on nine contracts with Iraq’s Ministry of Oil, as well as other ministries, to provide oil drilling and refining equipment. WOTME falsely recorded these kickbacks as other, seemingly legitimate, types of costs and fees. Further, WOTME concealed the kickbacks from the U.N. by inflating contract prices by 10 percent.
According to court documents, these corrupt transactions in Africa and the Middle East earned Weatherford International profits of $54,486,410, which were included in the consolidated financial statements that Weatherford International filed with the SEC.
In addition to the guilty plea by Weatherford Services, the deferred prosecution agreement entered into by Weatherford International and the Department requires the company to cooperate with law enforcement, retain an independent corporate compliance monitor for at least 18 months and continue to implement an enhanced compliance program and internal controls designed to prevent and detect future FCPA violations. The agreement acknowledges Weatherford International’s cooperation in this matter, including conducting a thorough internal investigation into bribery and related misconduct, and its extensive remediation and compliance improvement efforts.
The export case was investigated by the Department of Commerce’s Bureau of Industry and Security, Office of Export Enforcement and the Department of the Treasury’s Office of Foreign Assets Control. The case is being prosecuted by Assistant U.S. Attorney S. Mark McIntyre and was previously investigated by Assistant U.S. Attorney Jeff Vaden.
The FCPA case was investigated by the FBI’s Washington Field Office and its team of special agents dedicated to the investigation of foreign bribery cases. The case is being prosecuted by Trial Attorney Jason Linder of the Criminal Division’s Fraud Section, with the assistance of Assistant U.S. Attorney Mark McIntyre of the Southern District of Texas. The case was previously investigated by Fraud Section Trial Attorneys Kathleen Hamann and Allan Medina, with assistance from the Criminal Division’s Asset Forfeiture and Money Laundering Section. The Justice Department also acknowledges and expresses its appreciation for the significant assistance provided by the SEC’s FCPA Unit.
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.
Judge Sentences Woman in Smuggling Scheme That Left A Man DeadRead the Press Release
HOUSTON – Demi Mishel Muniz has been ordered to prison for more than seven years following her conviction of conspiracy to transport and harbor aliens resulting in the death of a 38-year-old illegal alien from Mexico, United States Attorney Kenneth Magidson announced today. A Houston federal jury returned a guilty verdict against Muniz following a three-day trial on Thursday, Jan. 31, 2013.
Today, U.S. District Judge Lee H. Rosenthal, who presided over the trial, handed the Los Angeles, Calif., resident a term of 85 months in federal prison. At the hearing, further evidence was provided including that had the victim received proper and timely medical care, he likely would have survived. The judge also found that the Muniz obstructed justice by lying about her role in the offense to federal agents and also to the jury during her trial testimony. Muniz will also serve a three-year-term of supervised release following completion of her prison term.
During trial, testimony revealed that on Aug. 18, 2010, the Oldham County Sheriff’s Office was notified there was a body on the side of Interstate 40 outside of Vega, approximately 20 miles west of Amarillo. The identity of the deceased was discovered following receipt of an inquiry from the alien’s son.
The deceased was in the process of being smuggled from Mexico into the United States, being transported from Houston to Los Angeles. During the course of the journey, Muniz contacted the wife of the deceased and provided a bank account number for the deposit of $650 in smuggling fees. Subsequently, Muniz contacted the wife again and informed her he was ill. The wife told Muniz her husband was a diabetic and required insulin and requested he be taken to a hospital. Muniz refused and stated she had other people in the van and had to keep moving. A few hours later, the wife was called and told not to deposit the money into the bank account because her husband had been “left behind.”
An autopsy on the body of the deceased determined he had died of a combination of pneumonia and diabetes. A co-defendant testified Muniz and others were heavily involved in alien smuggling and that during the course of the trip Muniz refused to provide help to the deceased.
The bank accounts of Muniz were extensively reviewed and it was determined that approximately $84,000 in the account was derived from unknown sources. Agents determined many of the deposits were from various other states and that this was a characteristic consistent with alien smuggling operations.
Although Muniz previously said she was not involved in the smuggling venture and was not in the van with the deceased, Muniz elected to testify in the trial and admitted to being in the van, but said she did not know the aliens were illegal. She further denied having talked to the widow and also denied being told the deceased was diabetic and required insulin. The jury disagreed and found her guilty.
The case was investigated by the Oldham County Sheriff’s Office, Texas Rangers, Texas Department of Public Safety and Homeland Security Investigations. Assistant United States Attorneys Julie Searle and Douglas Davis prosecuted the case.
Final Four Convicted in Operation Prison Cell Ordered to PrisonRead the Press Release
CORPUS CHRISTI, Texas – The final four people convicted in the large-scale racketeering case involving the McConnell Unit in Beeville have been ordered to federal prison, announced United States Attorney Kenneth Magidson along with Brian M. Moskowitz, special agent in charge of Homeland Security Investigations (HSI) in Houston.
With the exception of Juan Ledezma, who was convicted following a two-day trial, 28 others pleaded guilty to varying counts of racketeering or other charges. Senior U.S. District Judge Hayden Head, who accepted the guilty pleas and presided over the trial, handed down the final sentences against all convicted in the case at hearings that concluded late yesterday.
“’Operation Prison Cell’ is a very appropriate name for this investigation in that it describes where those responsible for the corruption, trafficking and violence uncovered in this case will spend a considerable portion of the rest of their lives,” said Moskowitz. “Unfortunately, while we expect convicted criminals to act like criminals, we will not tolerate those entrusted to serve the public to do the same, and these sentences send an unmistakable message to both the corrupted and their corruptors that we will catch you and punish you for your crimes.”
Considered “facilitators” in the case, Melissa Lozano, 29, of San Antonio, was convicted on one count of violating the Racketeer Influenced and Corrupt Organizations Act (RICO), while Craig Owens, 29, of Kileen, and Karla Sanchez, 26, of Houston, pleaded guilty to one count of money laundering. Yesterday, Lozano was ordered to serve 15 months in federal prison, and Owens and Sanchez received sentences of 60 and 24 months, respectively.
The remaining seven facilitators were sentenced last month. Yvonne Sandoval, 37, of Corpus Christi, Maria Fernanda Hidalgo, 32, of McAllen, and Lindsey Elaine Savage, 30, of Copperas Cove, were all also convicted of RICO and received sentences of 18 months, 12 months plus one day, and 38 months, respectively. The four others pleaded guilty to one count of money laundering. Juanita Beltran Mendez, 50, of Bishop, will be on probation for five years, while Nancy Star Onega, 27, and Donna Sorise, 57, both of Hialeah, Fla., and Maria Rose Rodriguez, 35, of Alamo, will serve sentences of 60, 71 and 66 months, respectively.
Four others charged in the case – Aaron Trevino, 37, of Lockhart, Christopher Karl Owens, 33, of Killeen, Christopher Smith, 28, of Chester, and Ledezma, 40, of Brownsville – were considered “inmates” in the overall scheme and were at one time or another in TDCJ custody during the conspiracy. Owens was sentenced yesterday to serve a total of 151 months in prison for the RICO conviction. Trevino also pleaded guilty to the RICO count and received a total of 198 months in federal prison, while Smith entered a plea to money laundering and received time served, approximately 10 months of incarceration. Ledezma, who was found guilty by a Corpus Christi federal jury of conspiracy to possess with the intent to distribute methamphetamine, cocaine and marijuana, will serve a total of 360 months in federal prison for the three counts of conviction.
The former McConnell Unit employees had already received their sentences. Former guards Stephanie Deming, 24, Lela Ysolde Hinojosa, 52, and Arturo Salas, 23, all of Beeville, Christy Nesloney, 27, of Cuero, James Randal Standlea, 25, of Mathis, Desiree Silguero, 43, of McAllen, Emmanuel Cotto, 32, of San Antonio, Megan Brook Morales, 24, of Bulverde, Lakeisha Jeanette Reid, 25, of Austin, Jaime Jorge Garza, 38, of Santa Elena, and Oscar Juraidini, 25, of Brownsville, were all convicted of one count of RICO as was contract mental health professional Kimberly Koenig, 32, of Victoria. Nesloney was previously sentenced to 28 months in federal prison, while Deming and Reid will respectively serve 27 and 24 months. Salas and Juraidini will each serve 22 months. Hinojosa and Morales each received 21-month terms of incarceration, while Garza will be in prison for 15 months. Silguero and Cotto will serve five months to be immediately followed by another five months on home confinement. Standlea and Koening will be on probation for three years.
Other McConnell Unit Guards Jamar Tremayne Green 30, of Refugio, Casey Simmons, 25, of Kenedy, and Justin Leonard, 24, of Cypress, were convicted of conspiracy to possess with the intent to distribute ecstasy, marijuana and cocaine, respectively. Simmons was sentenced to three years of probation, while Green and Leonard will serve five months in prison plus five months of home confinement.
There are still two fugitives in the case and warrants remain outstanding for their arrests.
The arrests came as a result of a joint effort between TDCJ-Office of Inspector General and federal authorities to attempt to break the “culture of corruption” that permeated the McConnell Unit Prison during a period between 2005 to the present. State and federal authorities worked together in a determined effort to disrupt and dismantle the violent criminal gangs who were profiting through the corruption of guards at the prison.
Correction officers assisted prisoners incarcerated in the TDCJ McConnell Unit Prison in Beeville by smuggling cellular telephones and drugs into the prison system. The drugs and phones were then sold inside the prison to other inmates. The phones were used by inmates to assist in their coordination of criminal activities outside the prison.
During Ledezma’s trial, the jury heard testimony that Ledezma acted as an intermediary between drug traffickers in south Texas and Mexico. He had connections to drug suppliers and, utilizing the illegally smuggled cell phones, coordinated with other prisoners to organize drug deals inside and outside the prison. Jurors heard that prisoners had made phone calls to Ledezma while in the McConnell Unit. In these calls, Ledezma agreed to help arrange for six pounds of methamphetamine to be purchased in Corpus Christi and distributed in Arkansas. The buyers of the methamphetamine were to pay more than $20,000 per pound of the drug.
The overall investigation was initiated in 2009 when several Aryan Circle Gang Members were apprehended attempting to transport stolen vehicles from Corpus Christi to Brownsville. The vehicles were destined to be smuggled across the border and sold to Mexico Cartel members. The operation was coordinated by inmates incarcerated at the McConnell Unit through the use of the illegal cell phones.
A subsequent investigation led to a December 2010 federal indictment charging 14 alleged members and associates of the Raza Unida Street and Prison Gang with committing violent acts to support racketeering (VICAR). These violent acts included home invasions, shootings and conspiracy to commit murder. During the course of the investigation, agents and officers seized approximately 13 pounds of crystal methamphetamine with an estimated street value of more than $300,000. Additionally, seven assault rifles, 14 pistols, five shotguns, five bullet proof vests and approximately 1,000 rounds of ammunition were seized from the gang. All were subsequently convicted, two of whom were sentenced to life imprisonment.
The overall case is the result of a four-year investigation conducted by the U.S. Attorney’s Office, Homeland Security Investigations, TDCJ-Office of Inspector General, Internal Revenue Service – Criminal Investigation, Bureau of Alcohol, Tobacco, Firearms and Explosives, Corpus Christi Police Department Gang and Organized Crime Units, U.S. Postal Inspection Service and the Bee County District Attorney’s office.
The case is being prosecuted by Assistant U.S. Attorneys Mark Patterson and Michael Hess.
Two South Texas Men Convicted of Trafficking Methamphetamine in HoustonRead the Press Release
HOUSTON - Two men from the South Texas area have pleaded guilty to trafficking approximately five kilograms of methamphetamine in Houston in May 2013, announced United States Attorney Kenneth Magidson. Roberto Carlos Garza, 23, and Alexander Chavez, 34, both of Rio Grande City, each pleaded guilty earlier today to conspiracy to possess with intent to distribute at least 50 grams of methamphetamine before U.S. District Judge Lynn N. Hughes.
At the hearing, both Garza and Chavez admitted to having set up a methamphetamine transaction between themselves and other persons on May 17, 2013, for approximately 22 pounds of methamphetamine at a price of $15,000 per pound. The following day, Garza and Chavez each agreed to bring the drugs to a parking lot near the Houstonian Hotel in Houston and deliver it to another person.
At approximately 12:58 p.m. on May 18, 2013, agents observed a gray Honda CR-V arrive at the location driven by Chavez with Garza riding as a passenger. Shortly after arrival, and while they were still in the vehicle, agents attempted to take Garza and Chavez into custody. Identifying themselves as law enforcement officers and wearing law enforcement identification, agents ordered them out of the vehicle. Chavez attempted to flee, driving in reverse and striking another vehicle, then driving forward and accelerating rapidly towards two agents who were on foot.
Fearing for his life, one of the agents fired two rounds from his service weapon toward Chavez while attempting to move out of the way and avoid being hit. The agent believed Chavez was attempting to run him over and had no choice but to fire his weapon toward the vehicle to avoid being run over and possibly killed. The rounds appeared to strike Chavez, and the CR-V veered to the side, struck two other vehicles and came to a stop.
Garza was then taken into custody and Chavez was treated at the scene until an ambulance arrived and transported him to a hospital for treatment. Agents subsequently seized three plastic containers containing methamphetamine from the rear area of the Honda CR-V. The methamphetamine had a net weight of 4.946 kilograms, was 90.1% pure and had been imported into the United States from Mexico.
Judge Hughes has set sentencing for Feb. 25, 2013, at which time they each face at least 10 years and up to life in prison as well as a possible $10 million fine. They have been and will remain in custody pending that hearing.
This case is the result of an investigation conducted by agents from the Drug Enforcement Administration with assistance from the Houston Police Department and is being prosecuted by Assistant United States Attorney Arthur R. Jones.
Three Individuals in Southern District of Texas to Receive Attorney General AwardRead the Press Release
HOUSTON - Attorney General Eric Holder announced today that 270 Justice Department employees and 53 individuals, including one former and two current Assistant United States Attorneys (AUSAs) in the Southern District of Texas, will receive an Attorney General Award. These annual awards recognize department employees and other individuals for their dedication to carrying out the Department of Justice’s mission.
“Despite significant challenges, evolving threats, and unprecedented budgetary difficulties, these dedicated employees have exemplified the very best of what it means to serve the American people,” said Holder. “Over the past year, each of them has gone above and beyond the call of duty to carry out the Justice Department’s critical mission and protect our fellow citizens. Some of these remarkable men and women have placed their own lives at great risk in order to save others. All of these employees and their families have made tremendous sacrifices in the name of public service. I am proud, and humbled, to count them as colleagues. And I congratulate them on this prestigious and well-deserved recognition.”
AUSAs Jason Varnado and Kristine Rollinson and former AUSA Gregg Costa (now a U.S. District Judge in the Southern District of Texas) will be honored with the John Marshall Award for Trial of Litigation.
“The prosecution efforts demonstrated by these three AUSAs exemplified the highest standards that all attorneys in the Department of Justice attempt to achieve,” said United States Attorney Kenneth Magidson. “It is a true demonstration of the high quality work of the United States Attorney’s Office for the Southern District of Texas.
TheJohn Marshall Awards are the Department of Justice’s highest awards offered to attorneys, for contributions and excellence in specialized areas of legal performance.
The John Marshall Award for Trial of Litigation is being presented to Varnado, Rollinson and Costa from the Southern District of Texas along with a team of attorneys from the Criminal Division and the U.S. Attorney’s Office of the District of Columbia for the successful prosecution of Allen Stanford, a perpetrator of one of the largest white collar crimes in history. The tenacity and skill of this team of attorneys directly led to a 110-year prison conviction for devastating the lives of more than 30,000 victims in a fraudulent scheme that cost the perpetrator’s investors more than $7 billion in losses. Over the course of two hard-fought jury trials, this team’s work ethic and meticulous attention to detail proved successful in finding justice for these victims.
Also being honored in this case are Trial Attorney Andrew H. Warren and Deputy Chiefs Jeffrey A. Goldbergand William J. Stellmach of the Fraud Section of the Department of Justice’s Criminal Division as well as Kondi Kleinman, AUSA in the District of Columbia and former Trial Attorney for the Criminal Division’s Asset Forfeiture and Money Laundering Section.
Mexican National Heads to Prison for Illegal Re-entry Despite Fraudulently Obtaining Texas Birth CertificateRead the Press Release
McALLEN, Texas – Mexican National Felipe Oviedo-Cerda, aka Felipe Telles-Sanchez or Mario Trevino-Leal, 55, has been ordered to prison for illegally re-entering the country, announced United States Attorney Kenneth Magidson. A federal jury in McAllen convicted Oviedo-Cerda on Aug. 27, 2013, following a two-day trial and approximately two hours of deliberations.
Today, Chief U.S. District Judge Ricardo H. Hinojosa, who presided over the trial, handed Oviedo-Cerda a 63-month sentence. At the hearing today, additional evidence was presented concerning the defendant’s lengthy criminal history. In handing down the sentence, Judge Hinojosa took this into consideration as well as his current conviction which resulted in an upward departure and a lengthy period of confinement. As an illegal alien, Oviedo-Cerda is expected to face deportation proceedings following his release from prison.
During trial, the government presented documentary evidence and witness testimony illustrating Oviedo-Cerda’s unlawful entry despite being an aggravated felon. Since his first deportation in 1984, the evidence showed he had relied upon numerous aliases and other false information to avoid detection by law enforcement and immigration authorities.
In 2002 and while in federal custody pending a similar indictment, Oviedo-Cerda fraudulently obtained a delayed birth certificate from the State of Texas reflecting that he was born in Rio Grande City in 1958. The Department of Vital Statistics later flagged this document only to re-issue the birth certificate in 2008 to him after had been released from federal prison, deported and provided additional false documentation. The evidence at trial indicated Oviedo-Cerda had resided in the United States since 2008 by relying upon this birth certificate and other false documents.
At trial, the government also relied upon expert fingerprint testimony to connect Oviedo-Cerda to his long history of aliases and false identities. Other witnesses with personal knowledge of the defendant testified that despite his birth in Zacatecas, Mexico, Oviedo-Cerda used forged, altered and fraudulent documents to obtain the delayed birth certificate under the name Felipe Telles. Based upon this evidence, the Texas Department of Vital Statistics has again flagged this birth certificate.
The defense attempted to convince the jury that the Texas delayed birth certificate proved he was born in Rio Grande City and/or proved the valid birth certificate at least gave him status to be in the country when apprehended. The jury disagreed and found him guilty as charged.
Oviedo-Cerda has been in custody since his arrest Sept. 23, 2011, where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
This case was investigated by Border Patrol and is being prosecuted by Assistant United States Attorney Grady J. Leupold.