Southern District of Texas

LAREDO, Texas – Rene Cardenas, 36, of Miami, Fla. Has pleaded guilty for his role in a conspiracy to transport five kilograms or more of cocaine, United States Attorney Kenneth Magidson announced today.

Cardenas was named in a sealed indictment returned by a grand jury on Aug. 28, 2012, which alleged a drug trafficking organization transported five kilograms or more of cocaine since 2008. The organization transported cocaine from Nuevo Laredo, Mexico, to Houston and Miami on a regular basis. Six others also charged are currently awaiting trial.

In the guilty plea, Cardenas admitted he was one of the individuals who further distributed the cocaine once it reached Miami and was also responsible for sending payment for the cocaine back to Laredo. One such shipment was recovered on May 25, 2010, when a truck driver was stopped with $422,001 and a drug ledger concealed in a compartment in the trailer’s rear axle.

Cardenas faces a mandatory minimum sentence of 10 years and up to life in prison and a $10 million fine. The United States is also seeking a money judgment in the amount of $2,408,204. U.S. Magistrate Judge J. Scott Hacker accepted the plea today and sentencing will occur on a date yet to be determined.

The case is the result of a two-year Organized Crime Drug Enforcement Task Force Investigation dubbed Silver Fox Hunt led by the Drug Enforcement Administration with the assistance of Homeland Security Investigations. Assistant United States Attorneys James Hepburn and Elizabeth Rabe are handling the case.

BROWNSVILLE, Texas – Domingo Quesada-Hernandez, 43, of Brownsville, has been convicted of bulk cash smuggling, United States Attorney Kenneth Magidson announced today.

Quesada-Hernandez pleaded guilty in federal court earlier today to evading a currency reporting requirement in his attempt to conceal $610,535 in a vehicle while trying to take the money into Mexico. The $610,535 has been preliminarily forfeited to the United States.

Quesada-Hernandez was arrested on May 21, 2012, after he approached the southbound inspection lanes at the Gateway International Port of Entry Bridge in Brownsville driving a Ford F150. Quezada-Hernandez was referred to secondary inspection after he and his two passengers appeared nervous, at which time Quesada-Hernandez denied possession of weapons and/or money in excess of $10,000 and did not complete the appropriate customs forms.

Quesada-Hernandez indicated he was the owner of the vehicle and further claimed that he had not done any type of work on it. A cursory inspection of the vehicle revealed fresh markings on the spare tire and agents also noticed the spare tire appeared to be bigger than the tires on the vehicle. The spare tire was removed and x-rayed, which revealed anomalies inside the tire. A search of the spare tire revealed 49 duck-taped bundles containing currency totaling $610,535.  

At his plea today, Quesada-Hernandez admitted he intended to evade the currency reporting requirement and that he concealed the currency within the spare tire of the vehicle. Quesada-Hernandez also admitted he intended to transport and transfer the currency from Brownsville to Mexico.

Quesada-Hernandez has been permitted to remain on bond pending his sentencing hearing, which U.S. District Judge Andrew S. Hanen has set for April 15, 2013. At that time, he faces up to five years in prison and a maximum fine of $250,000.

The investigation leading to the charges was conducted by Homeland Security Investigations. The case is being prosecuted by Assistant U.S. Attorney Angel Castro.

HOUSTON – Shirley M. Carrington has pleaded guilty to one count of willfully aiding and assisting in the preparation and presentation of a false U.S. Individual Income Tax Return, United States Attorney Kenneth Magidson announced today.

According to the written plea agreement filed in the record of the case, Carrington admitted she wilfully prepared a false income tax return for a husband and wife that included a claim for losses from an alleged janitorial service sole proprietorship that the taxpayers did not have. Carrington also admitted the return she prepared for the couple also claimed a false deduction for unreimbursed employee expenses and a false deduction for other miscellaneous deductions. Carrington stipulated the tax loss to the United States on the false tax return for which she was convicted was $10,962. 

Carrington further admitted in the plea agreement that the eight tax returns underlying the eight counts in the indictment in the case all claimed false losses from alleged janitorial sole proprietorships that none of the taxpayers had. Her relevant conduct, which is the total tax loss in the case, for purposes of sentencing was $199,472.00. 

U.S. District Judge Vanessa Gilmore, who accepted the plea today, has set sentencing for April 1, 2013, at which time she faces up to three years in prison and a $250,000 fine.
 
This matter was investigated by Internal Revenue Service - Criminal Investigation and is being prosecuted by Assistant U.S. Attorney Charles J. Escher.   

HOUSTON – Three men have each been ordered to federal prison for 96 months for their convictions in relation to Operation Total Exposure, the largest domestic sex trafficking case in the Southern District of Texas, United States Attorney Kenneth Magidson announced today. During the course of the investigation, at least one minor was rescued and other minors and several adults have been returned to their families.

Andre McDaniels, 42, and William Hornbeak, 36, entered guilty pleas Sept. 13, and 24, 2012, respectively, while John Butler, 51, Ronnie Presley, 38, and Jamine Lake, 30, pleaded guilty Oct. 4, 2012. The five men, all of Houston, pleaded guilty to conspiracy to commit sex trafficking. In addition to the conspiracy charge, Butler was convicted of one count of transportation. Lake was also convicted of one count of transportation as well as one count of coercion and enticement. Presley and Hornbeak were both also convicted of two counts of coercion and enticement, while Presley was also convicted of two counts of transportation. McDaniels was convicted of one count of coercion and enticement and two counts of transportation.

Today, U.S. District Judge Lynn Hughes sentenced McDaniels, Lake and Presley to 96-month-terms of federal imprisonment. They each received 60 months on the conspiracy charge and 96 months on each of their respective convictions, all to be served concurrently for a total sentence of 96 months for each defendant. They were all also ordered to serve a 10-year-term of supervised release following completion of their sentences and must each pay a $10,000 fine.

Butler and Hornbeak will be sentenced on Jan. 22.

At the hearing today, one of the victims testified about the emotional and physical abuse she suffered, noting one instance where a gun was placed in her mouth. She further discussed how she was branded with a large tattoo of a black panther on her back to mark her as property. 

Court records indicated that the defendants operated commercialized sex businesses often disguised as modeling studios, health spas, massage parlors and bikini bars in Houston. Further testimony proved they also utilized sexually oriented publications and websites to advertise their illicit business.

Evidence revealed the conspirators recruited women and minors as young as 16 to work as prostitutes and perform commercial sex acts. Members of the criminal enterprise transported women and minors to and from the Houston area and had ties to Kansas, Nevada, Arizona and Florida. The females were instructed to perform certain acts to insure that the customers to whom they were providing sex acts were not law enforcement officers.

The women were routinely beaten and threatened to instill fear in them and insure their obedience. Some of the co-conspirators also had sexual intercourse with the minor females. Any proceeds the women received as a result of their sexual encounters where taken by the members of the enterprise, rendering them dependent upon the defendants for basic necessities.

McDaniels was also convicted in a separate, but related case of nine counts of witness tampering and faces up to life in prison as a result. He will be sentenced by U.S. District Judge Lee H. Rosenthal March 22, 2013, at 9:00 a.m.

All the men have been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future. 

The investigation leading to the charges was conducted by the Innocence Lost Task Force of the FBI and the Houston Police Department as part of the Innocence Lost National Initiative. The initiative was founded in June 2003 to address criminal enterprises involved in the domestic sex trafficking of children and is a joint effort of the FBI, the Department of Justice’s Child Exploitation and Obscenity Section, the National Center for Missing and Exploited Children and the Texas Attorney General’s Office.

The case is being prosecuted by Assistant U.S. Attorney Sherri Zack and former Special Assistant U.S. Attorney Angela Goodwin.

HOUSTON - Kermit Woods has landed in federal prison following his conviction for willfully aiding and assisting in the preparation and presentation of a false U.S. Individual Income Tax Return, United States Attorney Kenneth Magidson announced today along with Lucy Cruz, special agent in charge of Internal Revenue Service – Criminal Investigation (IRS-CI). Woods pleaded guilty to the charge March 30, 2012, at which time he admitted he owned and operated an income tax preparation business in Houston, known as L&L Finance.

Today, U.S. District Judge Gray H. Miller, who accepted the guilty plea, sentenced Woods to a 24-month-term of federal imprisonment which will be followed by one year of supervised release. Woods had previously agreed to pay restitution to the United States in the amount of $362,340, which is the amount of the tax loss on false income tax returns he prepared at L&L Finance during years 2004 through 2008. At the hearing today, Woods proved he had paid almost all of this restitution toward the tax loss on the tax returns he had prepared for others and intends to pay the remainder shortly.

As part of his plea agreement, Woods agreed to never again aid or assist in the preparing or presenting of tax returns for any taxpayer except himself. Woods also agreed not to oppose any civil action brought by the United States seeking to enjoin Woods from preparing income tax returns for others.     

Woods also agreed that the relevant conduct the court will consider at sentencing should include an additional $346,479 that Woods did not report and pay with his own originally-filed income tax returns for years 2005 through 2008. The plea agreement notes that after Woods learned that he was under a criminal tax investigation, he filed amended his income tax returns for years 2005 through 2008 and paid the $346,479 in additional taxes for those years.

Woods further admitted in the plea agreement that in an attempt to conceal his income and assets from the IRS, he placed items he purchased in another’s name, including the home that he built for himself, his investment real estate, the title to his Jaguar automobile and the title to his boat. Woods admitted that he also had another person sign an assumed name certificate in Harris County, Texas, as though that person owned the income tax preparation business he operated.  
   
Previously released on bond, Woods was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.

This matter was investigated by IRS-CI and is being prosecuted by Assistant U.S. Attorney Charles J. Escher and by Department of Justice Tax Division Trial Attorney Tracy Gostyla.

HOUSTON – A local husband and wife have been sentenced to federal prison following their two convictions for defrauding the Federal Emergency Management Agency in relation to disaster assistance following Hurricane Ike, United States Attorney Kenneth Magidson announced today. LaCarsha, 40, and Andrew Goodman, 41, entered pleas of guilty on April 10 and May 17, 2012, respectively.

Today, U.S. District Judge Nancy Atlas, who accepted the guilty pleas for theft of government property and fraud In connection with major disasters, sentenced LaCarsha Goodman to a term of 27 months in prison. Andrew Goodman received a 24-month sentence on Sept. 7, 2012. Both were also ordered to pay $23,014 in restitution and serve two years of supervised release upon completion of their prison terms. 

The evidence showed Goodmans perpetrated an ongoing series of frauds against the government, reporting false addresses and damage to their home in connection with Hurricane Ike. The Goodmans reported multiple home addresses as their primary residence in order to receive these benefits. In each instance, the Goodmans falsely indicated that their primary residences were damaged by Hurricane Ike and that access into their homes was restricted. As a result of their claims, the Goodmans received $23,014 in disaster relief funds from FEMA.

The case was initiated after the Department of Homeland Security, Office of Inspector General received an allegation from U.S. Housing and Urban Development, Office of Inspector General alleging the Goodmans may have defrauded FEMA by submitting a false claim for disaster assistance following Hurricane Ike, which made landfall on Sept. 13, 2008.

A review of FEMA's National Emergency Management System revealed that between Sept. 18, 2008, and Oct. 21, 2008, Andre and LaCarsha Goodman submitted two separate claims for disaster assistance. LaCarsha used two distinct Social Security numbers and, along with Andre, claimed two different addresses on the 14500 block of Vantage Parkway as their primary residence in Houston. In each of the claims, the Goodmans indicated that their primary residence was damaged by Hurricane Ike and that access to their home was restricted. On the basis of one of the claims, FEMA awarded the Goodmans a total of $23,014 in disaster related assistance payments. The investigation revealed the Goodmans did not live, own or rent one of the residences they claimed with FEMA to be their primary residence.

Previously released on bond, LaCarsha was permitted to voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future, while Andre was ordered into custody following his sentencing hearing.

The case was prosecuted by Assistant United States Attorney Suzanne Elmilady.

The United States Attorney's Office for the Southern District of Texas is a member of the Department of Justice's Disaster Fraud Task Force, established to deter, detect and prosecute instances of fraud related to hurricanes and other types of disasters. Comprised of federal, state and local law enforcement investigating agencies, the Task Force combats all types of fraud relating to disasters and their aftermath, with an emphasis on charity fraud, emergency-benefit fraud, identity theft, insurance fraud and procurement fraud.

Anyone suspecting criminal activity involving disaster assistance programs can make an anonymous report by calling the toll-free fraud hotline, 1-866-720-5721 or contacting the Disaster Fraud Fax at 1-225-334-4707 or the Disaster Fraud e-mail at [email protected], 24 hours a day, seven days a week until further notice. Information can also be sent by surface mail, with as many details as possible, to: National Center for Disaster Fraud
Baton Rouge, LA 70821-4909

McALLEN, Texas - Jorge Luis Sandoval, 32, of Pharr, will soon be serving a federal prison sentence for smuggling two cellular telephones into the East Hidalgo Detention Center for an inmate, United States Attorney Kenneth Magidson announced today. Sandoval pleaded guilty to one count of bribery on July 3, 2012. 

Today, Chief U.S. District Judge Ricardo H. Hinojosa, who accepted the guilty plea, handed Sandoval a 12-month and one-day prison term which will be followed by two years of supervised release. In handing down the sentence, Judge Hinojosa found that Sandoval was a “public official” under the law and as defined within the United States Sentencing Guidelines.  The Judge noted that “by taking a bribe and facilitating the use of the phone” based on greed, Sandoval demonstrated “a total disrespect for the law.”  He further noted that “one of the worst damages that comes from a situation like this,” when someone takes on the responsibilities that come with this job (correctional officer), is that “it gives the public the impression that everyone who takes on this job is willing to do the same” and “it hurts the reputation of those that work for the government and law enforcement.” 

Sandoval pleaded guilty to the sole count of bribery, admitting to accepting a bribe while working as a corrections officer at the East Hildago Detention Center in La Villa under the authority of the U.S Marshals Service. Sandoval used his official position to enrich himself by accepting a cash payment from an individual acting on behalf of a federal inmate in exchange for smuggling a cellular telephone into the prison on two occasions.

Sandoval was allowed to self-surrender to the U.S. Marshals Service on January 28, 2013, to begin serving his sentence, pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The investigation leading to the charge in this case was conducted by the FBI and the U.S. Marshals Service. Assistant United States Attorney Casey N. MacDonald prosecuted the case. AUSA Linda Requenez handled the sentencing hearing today.