Southern District of Texas
Press releases recorded for this federal judicial district.
McAllen Area Durable Medical Equipment Company Owner Convicted of Health Care FraudRead the Press Release
McALLEN, Texas ‐ The owner of a durable medical equipment company has entered a guilty plea to defrauding Medicaid of more than $3 million, announced Acting U.S. Attorney Abe Martinez.
Anna Ramirez-Ambriz, 55, of McAllen, owned Compassionate Medical Supply located in Edinburg. As part of her plea today, she admitted she submitted false and fraudulent claims to Texas Medicaid in relation to incontinence supplies. Between 2007 and 2013, Ramirez-Ambriz billed Texas Medicaid for higher quantities and more costly incontinence products than were actually delivered to Texas Medicaid recipients.
As a result of her scheme, Medicaid suffered a loss of $3,143,149.41.
U.S. District Judge Randy Crane accepted the plea today and has set sentencing for June 13, 2017. At that time, Ramirez-Ambriz faces up to 10 years in federal prison and a possible $250,000 maximum fine. She will remain in custody pending that hearing.
The Texas Attorney General’s Medicaid Fraud Control Unit, FBI and the Department of Health and Human Services‐Office of Inspector General conducted the investigation. Assistant U.S. Attorneys Andrew Swartz and Michael Day are prosecuting the case.
Leaders of Clandestine Marijuana Grow House Organization Sentenced to Federal PrisonRead the Press Release
HOUSTON – The three leaders of a Houston area indoor marijuana grow house organization have been sentenced to lengthy prison terms, announced Acting United States Attorney Abe Martinez. Quang Nguyen, 50, pleaded guilty Aug. 15, 2016, while Phuc Tran, 44, and his wife, Thuy Tran, 44, pleaded guilty in July and October 2016, respectfully. All resided in Houston.
Today, U.S. District Judge Alfred H. Bennett handed Nguyen a sentence of 120 month in federal prison. Judge Bennett sentenced Phuc and Thuy Tran last week to respective terms of 87 and 72 months.
These three were held accountable as leaders of their respective clandestine marijuana grow cells working together to further the manufacture and distribution of high-grade hydroponic marijuana in a total of eight grow houses located in Houston area suburbs. The grow houses were identified during a year-long investigation into the organization, which began in March 2014. The investigation ultimately resulted in the seizure of more than 2600 thriving marijuana plants and approximately 80 pounds of harvested hydroponic marijuana buds from six of the grow houses over the course of five days in April 2015.
A pound of hydroponic marijuana sells in the Houston area for approximately $2500 per pound.
A total of nine defendants were charged in the case, most of whom were taken into custody as authorities executed search warrants at two of the six grow houses and found them engaged in harvesting mature marijuana plants. All nine eventually pleaded guilty for their respective roles to conspiracy to possess with intent to distribute 1000 or more marijuana plants. The other six defendants occupied roles in the conspiracy as marijuana grow house tenders, grow house owners and/or occasional harvest help personnel and were sentenced previously to terms ranging from 22 months to 37 months in federal prison.
Nguyen and the Trans have been and will remain will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
This case is the result of a multi-agency Organized Crime Drug Enforcement Task Force investigation dubbed Operation Green House Effect conducted by the Drug Enforcement Administration, Fort Bend County Sheriff’s Office Narcotics Task Force, Harris County Sheriff’s Office and Houston Police Department. Assistant U.S. Attorney Nancy G. Herrera prosecuted the case.
Jury Convicts Pharr Man in Absentia for Hostage Taking ConspiracyRead the Press Release
McALLEN, Texas – A 20-year-old Pharr man has been convicted of both conspiracy to commit hostage taking and conspiracy to transport undocumented aliens, announced Acting U.S. Attorney Abe Martinez. The federal jury sitting in McAllen convicted Luis Gerardo Betancourt in absentia following a five-day trial and less than three hours of deliberation.
Betancourt was present upon the jury’s selection, but failed to appear for trial and presentation of the evidence. He is considered a fugitive and a warrant remains outstanding for his arrest. Anyone with information about his whereabouts is asked to contact the United States Marshals Service in McAllen, Texas at (956) 618-8025.
The investigation began Dec. 4, 2015, when authorities learned of people in other states being forced to pay for the release of family members being held hostage at an undetermined location. Testimony at trial revealed that an individual had paid approximately $17,000 for such release. The jury heard that some family members received threats such as to cut off body parts and kill the hostages, one of whom was an eight-year-old victim, if monetary demands were not met. Further investigation revealed Betancourt’s involvement in the conspiracy. The jury heard that he was responsible for recruiting and transporting co-conspirators as well as the receipt of money sent by the victims’ family members.
The hostages held during the course of the conspiracy were eventually released Dec. 8, 2015.
U.S. District Judge Randy Crane presided over the trial and has set sentencing for June 8, 2017. At that time, Betancourt faces up to life in federal prison for conspiracy to commit hostage taking and up to 10 years for the alien transportation conspiracy.
The FBI Safe Streets Task Force conducted the investigation with assistance from Border Patrol, Customs and Border Protection, police departments in Pharr and Robstown Police Department and the Orange County, Florida, Sheriff’s Office. Assistant U.S. Attorneys David A. Lindenmuth and Roberto Lopez Jr. are prosecuting the case.
Home Health Agency Owner Pleads Guilty to Conspiring in $17 Million Medicaid Fraud SchemeRead the Press Release
The owner and operator of five Houston-area home health agencies pleaded guilty to conspiring to defraud Medicare and the State of Texas’s Medicaid-funded Home and Community-Based Service and Primary Home Care programs of more than $17 million. He also pleaded guilty to conspiring to launder money. These health care programs provided qualified individuals with in-home attendant and community-based services that are known commonly as “provider attendant services” (PAS). This case marks the largest PAS fraud case charged in Texas history.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney of the Southern District of Texas Abe Martinez, Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Office, Special Agent in Charge C.J. Porter of the Department of Health and Human Services Office of the Inspector General’s (HHS-OIG) Dallas Regional Office, Special Agent in Charge D. Richard Goss of the IRS Criminal Investigation’s (CI) Houston Field Office and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU) made the announcement.
Godwin Oriakhi, 61, of Houston, pleaded guilty before U.S. District Judge Sim Lake of the Southern District of Texas to two counts of conspiracy to commit health care fraud and one count of money laundering. He is scheduled to be sentenced by Judge Lake on June 22, 2017.
According to his plea, Godwin Oriakhi admitted that he, his daughter and co-defendant Idia Oriakhi, and other members of his family owned and operated: Aabraham Blessings LLC, Baptist Home Care Providers Inc., Community Wide Home Health Inc., Four Seasons Home Healthcare Inc. and Kis Med Concepts Inc., all of which were home health agencies in the Houston area. Godwin Oriakhi admitted that he, along with his daughter and co-conspirators, obtained patients for his home health agencies by paying illegal kickback payments to patient recruiters and his office employees for hundreds of patient referrals. Oriakhi also admitted that he, along with his daughter and co-conspirators, paid Medicare and Medicaid patients by cash, check, Western Union and Moneygram for receiving services from his family’s home health agencies in exchange for the ability to use their Medicare and Medicaid numbers to bill the programs for home healthcare and PAS services. Oriakhi admitted that he, his daughter and their co-conspirators also directly paid some of these patients for recruiting and referring other Medicare and Medicaid patients to his agencies.
Additionally, Oriakhi admitted that he, his daughter and other co-conspirators paid physicians illegal kickbacks payments, which Oriakhi and his co-conspirators called “copayments,” for referring and certifying Medicare and Medicaid patients for home health and PAS services.
Oriakhi further admitted that each time he submitted a claim predicated on an illegal kickback payment he knew he was submitting a fraudulent claim to Medicare or Medicaid based on his false representations that the claim and the underlying transaction complied with the federal Anti-Kickback Statute and other state and federal laws. Oriakhi further admitted that he knew that Medicare and Medicaid would not otherwise pay for the fraudulent claims, according to his plea.
In addition to the home healthcare and PAS services fraud scheme, Oriakhi admitted that he and his co-conspirators used the money fraudulently obtained from Medicare and Medicaid to pay illegal kickback payments to patient recruiters, employees, physicians and patients to promote the Medicare home health and Medicaid PAS fraud conspiracies, and ensure their successful continuation.
In total, Oriakhi admitted that he and his family submitted approximately $17,212,051 in fraudulent home healthcare and PAS claims to Medicare and Medicaid and received approximately $16,198,600 on those claims.
Oriakhi is the last member of the charged conspirators to plead guilty. Oriakhi’s co-defendants: Idia Oriakhi, his daughter; Charles Esechie, a registered nurse; and Jermaine Doleman, a patient recruiter, pleaded guilty and are awaiting sentencing.
The FBI, HHS-OIG, IRS-CI and MFCU are investigating the case, and brought by the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Texas. Senior Trial Attorney Jonathan T. Baum and Trial Attorneys Aleza S. Remis and William S.W. Chang of the Fraud Section are prosecuting the case.
The Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged over 3,000 defendants who collectively have billed the Medicare program for over $11 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Dinner Cruise Ship Captain Convicted of Using Stolen IdentityRead the Press Release
Galveston, Texas – A ship captain for Majestic Ventures, Majestic Dinner Cruises and Majestic Yacht Charters dinner cruise lines has entered a guilty plea to aggravated identity theft and making false statements in a passport application, announced Acting U.S. Attorney Abe Martinez.
Cynthia Lyerla, 53, of League City, admitted to obtaining the birth certificate of Christina White in 1992 and then using that identity to obtain a second Social Security number. She was also able to obtain driver’s licenses, passports, mariner licenses and Transportation Security Administration (TSA) documentation allowing her to enter secure port areas. Without a mariner license and TSA documentation, Lyerla would not be allowed to captain the ships for the dinner cruise companies.
The real Christina White died in 1965 on the same day she was born.
Cynthia Lynn Knox was born in 1964, later married Harold Lyerla and took his name. The marriage ended when Harold Lyerla was murdered in 1988 in Lompoc, California. Although another individual was convicted for that crime, Lyerla’s fingerprints were taken by the local police in the course of the investigation.
Since that time, Lyerla used the identity of Christina White, providing her date and place of birth, Social Security number and parents’ names in order to apply for and obtain various legal documentation.
Authorities discovered Lyerla’s true identity when her fingerprints were taken in connection with a mariner license application and compared to those taken in 1988 and 1989 during the investigation into the murder of her husband. Additionally, a retired California police detective, who investigated that murder, positively identified the defendant as Lyerla.
United States District Judge George C. Hanks accepted the plea and has set sentencing for June 7, 2017. At that time, Lyerla faces up to 10 years for making false statements in a passport application as well as a mandatory 24 months for the aggravated identity theft which must be served consecutively to any other prison term imposed.
She was permitted to remain on bond pending that hearing.
The Department of State - Diplomatic Security Service and U.S. Coast Guard Investigative Service conducted the investigation. Assistant U.S. Attorney Adam Goldman is prosecuting the case.
Cuban Man Sent to Prison for Selling Credit Card NumbersRead the Press Release
McALLEN, Texas – A Cuban citizen has been ordered to federal prison for conspiring to commit wire fraud, announced Acting U.S. Attorney Abe Martinez. Jorge Ernesto Blanco-Rodriguez, 43, a Cuban and Spanish citizen who resided in Havana, Cuba, pleaded guilty April 18, 2016.
Today, U.S. District Judge Randy Crane ordered he serve a total of 135 months in federal prison and to pay $602,864.13 in restitution. He is expected to face deportation proceedings following his release from prison.
Blanco-Rodriguez operated out of Cuba and was in the business of selling stolen credit and debit card numbers to various people over the Internet. The investigation began after authorities identified and arrested two Mexican nationals for credit card fraud. Information discovered following the execution of search warrants related to those arrests led to the identification of Blanco-Rodriguez as the individual selling the credit card information.
He was ultimately arrested as he traveled to Florida to visit family.
Authorities ultimately found more than 12,000 affected credit and debit card numbers in Blanco-Rodriguez’s possession for sale, many of which came from large data breaches. Approximately $788,000 in fraudulent transactions have been identified from the compromised accounts.
Blanco-Rodriguez will remain in custody pending his transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The Secret Service and McAllen Police Department conducted the investigation. Assistant U.S. Attorney Joseph Leonard prosecuted the case.
Brothers Sentenced to Federal Prison for Possessing Synthetic CannabinoidsRead the Press Release
CORPUS CHRISTI, Texas - Two brothers have been ordered to federal prison following their convictions of possession with intent to distribute a synthetic cannabinoid mixture or substance, announced Acting U.S. Attorney Abe Martinez. Roy Valent Jr., 31, and Arnold Ray Valent, 29, both of Corpus Christi, pleaded guilty Jan. 4, 2017.
Today, Senior U.S. District Judge Janis Graham Jack sentenced Roy Valent to serve 66 months in federal prison. His brother was determined to be a career offender and received a 110-month-term of imprisonment on March 15, 2017. At that hearing, a Drug Enforcement Administration (DEA) expert witness provided additional testimony including how the DEA handles newly emerging synthetic narcotics, the adverse effects of those substance and imminent hazards they present to public safety. In handing down the sentence, the court acknowledged the significant danger of synthetic narcotics, specifically their appeal to children. Both men will also serve three years of supervised release following completion of their sentences.
On Dec. 16, 2015, officers attempted to conduct a traffic stop of a vehicle leaving a residence, at which time Arnold Valent exited the vehicle and fled on foot. He was taken into custody after a short pursuit and officers discovered a backpack in the vehicle that contained 35 packages of synthetic cannabinoids, also known as “K2” or “Spice.”
When officers returned to the residence, they observed Roy Valent in a garage apartment with a firearm. Prohibited from possessing such, officers arrested him and also discovered 19 additional packages of synthetic cannabinoids. Laboratory analysis confirmed the presence of scheduled substances, AB-CHMINACA and XLR-11, and 5F-AMB, 5F-MDMB-PINACA, NM-2201, FUB-AMB, AB-CHMICA and PX-1 which are controlled under the Controlled Substance Analog Act.
The arrests and investigation were part of Operation City Shield that was a coordinated effort by federal, state and local law enforcement to identify violent offenders, stop gun violence and protect the community.
The Valent brothers will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be designated in the near future.
The Bureau of Alcohol, Tobacco, Firearms and Explosives, Drug Enforcement Administration and Corpus Christi Police Department conducted the investigation. Assistant U.S. Attorney Lance Watt prosecuted the case.
Laredoan Sent to Prison for Firearms ChargeRead the Press Release
LAREDO, Texas – A 31-year-old Laredo resident has been ordered to federal prison following his conviction of possession of a firearm by a convicted felon, announced Acting U.S. Attorney Abe Martinez. Anthony Tays pleaded guilty June 7, 2016.
Today, Senior U.S. District Judge George P. Kazen handed Tays a 50-month sentence to be immediately followed by three years of supervised release.
Tays was convicted in 2006 for criminally negligent homicide and, therefore, prohibited from possessing firearms or ammunition. On Sept. 15, 2015, law enforcement discovered and seized six firearms from his home.
Before handing down the sentence today, Judge Kazen noted that Tays had acquired a membership to a local firearm range in 2015, where he rented firearms and shooting lanes, purchased ammunition and practiced shooting personal and rented firearms during several visits.
Tays has been and will remain in federal custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation with the assistance of the Laredo Police Department and the Texas Department of Public Safety. Assistant U.S. Attorney Jose Homero Ramirez prosecuted this case.
Guard Guilty of Accepting Bribe to Smuggle Contraband into JailRead the Press Release
CORPUS CHRISTI, Texas – A 28-year-old former employee of the Costal Bend Detention Center has pleaded guilty to accepting a bribe as a public official, announced Acting U.S. Attorney Abe Martinez.
At today’s hearing, Misti Dawn Alva, of Corpus Christi, admitted she accepted money in exchange for delivering contraband to a federal inmate housed at the Costal Bend Detention Center in Robstown.
Avila was the warehouse supervisor and smuggled synthetic marijuana, also known as “K2” into the facility for inmates. During the course of the investigation, she met with an undercover agent and accepted cash to smuggle a package of synthetic marijuana to an inmate at the facility. Alva took the package, which she believed contained synthetic marijuana, and drove directly to the Costal Bend Detention Center. When she entered the facility, she was arrested and found in possession of the package.
Sentencing has been set for July 20, 2017, before U.S. District Judge Nelva Gonzales Ramos. At that time, Alva faces up to 15 years in federal prison and a possible $250,000 maximum fine.
This FBI conducted the investigation. Assistant U.S. Attorney Robert D. Thorpe Jr. is prosecuting the case.
Former IT Director and Wife Convicted for Embezzling More Than $1 Million from EmployerRead the Press Release
HOUSTON - Former director of Information Technology (IT) Services for Orion Real Estate Services Inc. and his wife have entered guilty pleas related to a conspiracy in which they stole more than $1 million, announced Acting U.S. Attorney Abe Martinez today.
Bradley David Freitas pleaded guilty to conspiracy to commit mail and wire fraud, while Loren Elizabeth Freitas, entered her plea last Friday to conspiracy to commit mail fraud. From approximately April 14, 2009 through Jan. 14, 2014, Bradley Freitas embezzled approximately $1,009,634.45 from Orion Real Estate Services Inc., at times with the help of his wife.
Orion is a full-service, multi-family residential real estate management company serving a wide variety of investors, ranging from institutions, private partnerships, foreign investors, individual owners and government housing organizations. Orion had more than over 665 employees and provides management for all types of multi-family properties, and had a growing portfolio of more than 25,000 apartment homes under management throughout the nation.
Bradley Freitas was hired as the Director IT services for Orion on March 5, 2009. Throughout his employment, he created false explanations on internal Orion company justification documents so that the unauthorized purchases were masked as IT related items. Bradley Freitas would miscode Orion justification documents to mask the unauthorized personal purchases for several years and made these unauthorized purchases with the company credit cards issued to him for IT purchases only. The merchandise was purchased from online retailers, such as Amazon, NewEgg and CDW, and mailed either to his office or home. Several of the items, such as a dining room table with chairs, a Gucci purse and wallet, home entertainment systems, televisions and more, were purchased for the Freitas’ own personal enrichment. Other items, such as ipads and laptops, were sold on eBay or to their own private customers in New York and elsewhere for them to obtain a profit. At times, Loren Freitas would direct her husband as to what to purchase and then mailed the various items to be sold to their customers via FedEx or UPS.
U.S. District Judge Sim Lake accepted the guilty pleas and has set sentencing for Mr. and Mrs. Freitas on July 21 and June 14, 2017, respectively. At that time, Bradley Freitas faces up to 20 years in federal prison, while Loren Freitas faces a maximum five-year-term of imprisonment. Both convictions also carry a maximum possible $250,000 fine. Both were permitted to remain on bond pending their sentencing hearings.
The FBI conducted the investigation. Assistant U.S. Attorneys Suzanne Elmilady and Melissa Annis are prosecuting the case.
Former Texas Congressman and Associate Indicted for Multi-Year Fraud SchemeRead the Press Release
HOUSTON - A former U.S. Congressman and one of his associates were indicted today for their roles in orchestrating a scheme to steal hundreds of thousands of dollars from charitable foundations and the individuals who ran those foundations. Some of the funds were used to illegally finance the politician’s campaigns for public office and to pay for his personal expenses and those of his associates. Acting U.S. Attorney Abe Martinez of the Southern District of Texas and Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division made the announcement along with Assistant Director in Charge Andrew W. Vale of the FBI's Washington Field Office and Special Agent in Charge D. Richard Goss of IRS - Criminal Investigation (CI), Houston Field Office.
Former U.S. Representative Stephen E. Stockman, 60, of Clear Lake, and the former director of special projects in Stockman’s congressional office, Jason Posey, 46, formerly of the Houston area, were charged in a 28-count superseding indictment with mail and wire fraud, conspiracy, making false statements to the Federal Election Commission (FEC), making excessive campaign contributions and money laundering. Stockman is also charged with filing a false tax return that concealed his receipt and personal use of the fraudulent proceeds, while Posey is charged with falsifying an affidavit in order to obstruct an FEC investigation. Thomas Dodd, a former special assistant in Stockman’s congressional office, pleaded guilty to his involvement in the scheme on March 20, 2017.
According to the superseding indictment, from May 2010 to October 2014, Stockman solicited approximately $1,250,000 in donations based on false pretenses. Specifically, the indictment alleges that in 2010, Stockman diverted a significant portion of $285,000 donated to charitable causes to pay for his and Dodd’s own personal expenses and to further Stockman’s own interests. The indictment further alleges that in 2011 and 2012, Stockman and Dodd received an additional $165,000 in charitable donations, much of which Stockman used to finance his 2012 congressional campaign.
Shortly after Stockman took office in the U.S. House of Representatives in 2013, he and Dodd allegedly used the name of a nonprofit entity to solicit and receive a $350,000 charitable donation. Stockman allegedly used this donation for a variety of personal and campaign expenses, including illegal conduit campaign contributions, a covert surveillance project targeting a perceived political opponent and payments associated with Stockman’s U.S. Senate campaign in early 2014.
The superseding indictment further alleges that in connection with Stockman’s Senate campaign, Posey used a nonprofit entity to secure a $450,571 donation in order to fund a mass-mailing project attacking Stockman’s opponent. Only approximately half of the donation was spent on the mail campaign, and Posey used a portion of the unspent balance to pay for expenses associated with Stockman’s Senate campaign and to fund personal expenses, according to the charges.
The FBI and IRS-CI conducted the investigation. Assistant U.S. Attorney Melissa Annis of the Southern District of Texas and Trial Attorneys Ryan J. Ellersick and Robert J. Heberle of the Criminal Division’s Public Integrity Section are prosecuting the case.
Former Texas Congressman and Associate Indicted for Multi-Year Fraud SchemeRead the Press Release
A former U.S. Congressman and one of his associates were indicted today for their roles in orchestrating a scheme to steal hundreds of thousands of dollars from charitable foundations and the individuals who ran those foundations. Some of the funds were allegedly used to illegally finance the politician’s campaigns for public office and to pay for his personal expenses and those of his associates.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney Abe Martinez of the Southern District of Texas, Assistant Director in Charge Andrew W. Vale of the FBI's Washington Field Office and Special Agent in Charge D. Richard Goss of IRS Criminal Investigation’s (CI) Houston Field Office made the announcement.
Former U.S. Representative Stephen E. Stockman, 60, of Clear Lake, Texas, and the former director of special projects in Stockman’s congressional office, Jason Posey, 46, formerly of the Houston, Texas, area, were charged in a 28-count superseding indictment with mail and wire fraud, conspiracy, making false statements to the Federal Election Commission (FEC), making excessive campaign contributions and money laundering. Stockman is also charged with filing a false tax return that concealed his receipt and personal use of the fraudulent proceeds, while Posey is charged with falsifying an affidavit in order to obstruct an FEC investigation. Thomas Dodd, a former special assistant in Stockman’s congressional office, pleaded guilty to his involvement in the scheme on March 20, 2017.
According to the superseding indictment, from May 2010 to October 2014, Stockman solicited approximately $1,250,000 in donations based on false pretenses. Specifically, the indictment alleges that in 2010, Stockman diverted a significant portion of $285,000 donated to charitable causes to pay for his and Dodd’s own personal expenses and to further Stockman’s own interests. The indictment further alleges that in 2011 and 2012, Stockman and Dodd received an additional $165,000 in charitable donations, much of which Stockman used to finance his 2012 congressional campaign.Shortly after Stockman took office in the U.S. House of Representatives in 2013, he and Dodd allegedly used the name of a nonprofit entity to solicit and receive a $350,000 charitable donation. Stockman allegedly used this donation for a variety of personal and campaign expenses, including illegal conduit campaign contributions, a covert surveillance project targeting a perceived political opponent and payments associated with Stockman’s U.S. Senate campaign in early 2014.
The superseding indictment further alleges that, in connection with Stockman’s Senate campaign, Posey used a nonprofit entity to secure a $450,571 donation in order to fund a mass-mailing project attacking Stockman’s opponent. Only approximately half of the donation was spent on the mail campaign, and Posey used a portion of the unspent balance to pay for expenses associated with Stockman’s Senate campaign and to fund personal expenses, according to the charges.
The charges and allegations contained in the superseding indictment are merely accusations. The defendants are presumed innocent until and unless proven guilty.
The FBI and IRS-CI conducted the investigation. Trial Attorneys Ryan J. Ellersick and Robert J. Heberle of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Melissa Annis of the Southern District of Texas are prosecuting the case.
Local Tax Preparer Sentenced to Federal Prison, AgainRead the Press Release
HOUSTON – A local tax return preparer has been ordered to federal prison for a second time for preparing false tax returns and obstructing the IRS in the enforcement of federal income tax laws, announced Acting U.S. Attorney Abe Martinez along with D. Richard Goss, special agent in charge of Internal Revenue Service-Criminal Investigation (CI). Cedric Keith Oliphant pleaded guilty Dec. 6, 2016.
On March 29, 2017, U.S. District Judge Keith Ellison handed Oliphant a 28-month sentence to be immediately followed by one year of supervised release. He was further ordered to pay restitution of $400,457.
According to the factual basis in support of this plea, Oliphant was previously charged and convicted of preparing dozens of false 2006-08 client tax returns though Oliphant Tax Services in Huntsville. He was released on bond in that case under a condition that he have no involvement in the preparation of tax returns other than his own. However, Oliphant resumed tax return preparation and continued to claim the same false deductions for unsuspecting clients while awaiting sentencing in the earlier case.
As part of his continuation of the scheme, Oliphant changed the name of his business to “Tax Services” to make it appear he had stopped preparing client tax returns and that someone else was the owner of his tax preparation business. Oliphant allegedly attributed the fees to the nominal owner of his tax office but manipulated those tax returns to make it appear the tax office had produced almost no taxable income.
Oliphant established a series of bank accounts in the names of others - including minors with custodians other than himself - so the fees could first be deposited to accounts in the names of the nominal owner of his tax office and others. He then transferred those fees through these intermediate accounts to accounts in his own name. This scheme enabled Oliphant to conceal his personal use of the fees generated by the business during the course of the prosecution on the first case according to the plea agreement.
While operating his tax preparation business under other names, Oliphant generated $2 million in fees and a total loss to the IRS of another $400,457. The losses from the false tax returns prosecuted in the earlier case exceeded $325,000.
Oliphant was sentenced to 33 months on the earlier case and was released from prison Aug. 26, 2016. He was denied bond upon his arrest in this case on Sept. 2, 2016, and remains in custody pending transfer again to a U.S. Bureau of Prisons facility to be determined in the near future.
Oliphant’s plea agreement requires that he surrender approximately $205,000 in bank accounts linked to the scheme, his personal residence and three automobiles valued at $32,600 as restitution to the IRS in both cases.
The investigation leading to these charges was conducted by IRS-CI. Assistant U.S. Attorney Jimmy Sledge Jr. has prosecuted both cases.
Jury Convicts Two Men in Pasadena Bank RobberyRead the Press Release
HOUSTON - A federal jury sitting in Houston has found two Houston men guilty for the attempted robbery and robbery of the Shared Resources Credit Union and for using and carrying a firearm during commission of the crimes, announced Acting U.S. Attorney Abe Martinez. The federal jury deliberated for less than five hours before convicting Raynard Gray, 33, and Sonny Pervis, 27, both of Houston, on all counts as charged following a three-day-trial.
A total of seven men met and planned the robbery of the credit union. The jury heard Gray was the leader of this robbery crew and acted as a lookout during the robberies, while Pervis was one of the men who entered the credit union and brandished and discharged a firearm.
They arrived at the bank first on Saturday, July 26, 2014, with the intention of committing the robbery. The jury heard that employees inside the bank observed the men with the firearms as they approached. However, the doors to the lobby were locked so the crew left, but returned two days later to complete the crime.
The men fled the scene after stealing the money on July 28. A civilian followed them in order to give police the vehicle information of the robbers, during which time Howard Glaze, 24, of Houston, and Pervis discharged their firearms in a neighborhood in his direction. The group then led officers on a high-speed chase from Pasadena to north Houston, where they abandoned their vehicle and fled on foot. Glaze was soon apprehended. The investigation later led to the discovery and arrest of the others.
During trial, the jury saw surveillance videos, photos and police dash camera footage of the high speed chase and heard testimony from 12 witnesses. They also heard from a sergeant with the Pasadena Police Department who collected cash, bank straps and clothing of the robbers from the abandoned vehicle. The officer was also able to lift a fingerprint off a trash bag found in that vehicle, which belonged to Pervis.
The defense did not dispute that the robberies occurred, but contended that Pervis and Gray were not involved. The jury was not convinced and convicted them on all charges.
U.S. District Judge Sim Lake presided over the trial and set sentencing for June 15, 2017. At that time, Pervis and Gray face up to 25 years for the attempted robbery and robbery of the credit union. They will also face a mandatory and consecutive five years for using a firearm in the attempted robbery and another mandatory 25 years for using a firearm during the actual robbery which must be served consecutively to the bank robbery conviction and to the other firearms charge. They will remain in custody pending sentencing.
The remaining five co-defendants - Chris Braziel, 29, Keith McGee,26, Glaze, Kwhun Johnson, 24, and Leroy Richardson, 36, all of Houston, previously pleaded guilty to their roles in the robberies and will also be sentenced on that date.
The FBI and police departments in Pasadena and Houston conducted the investigation. Assistant U.S. Attorneys Richard Hanes and Heather Winter are prosecuting the case.
Texas Business Owner Pleads Guilty to Not Paying Approximately $18 Million in Employment TaxesRead the Press Release
Kept Withholdings and Social Security and Medicare Contributions – Spent Funds on Personal Travel and Ranch
A Houston, Texas business owner pleaded guilty today to one count of failing to pay over employment taxes, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Abe Martinez for the Southern District of Texas.
According to documents filed with the court, Richard Floyd Tatum Jr., 57, owned Associated Marine & Industrial Staffing Inc. (AMI), an industrial staffing company that provided temporary labor to businesses in Texas and other states. Tatum employed approximately 1,000 people to include internal employees, who worked for AMI, and external employees, who AMI assigned to work on-site at client locations. Tatum was responsible for collecting, accounting for and paying over to the Internal Revenue Service (IRS) the payroll taxes withheld from AMI’s employees’ wages. Tatum exercised significant control over AMI’s finances to include entering into contracts, signing checks, to include payroll, and deciding which creditors to pay. Tatum also signed and filed AMI’s employment tax returns.
From March 2008 through December 2009, Tatum filed false and untimely employment tax returns for AMI that did not report AMI’s external employees. In May 2013, Tatum filed untimely returns for the quarters ending in March 2010 through December 2012, reporting AMI’s external employees but failing to make any payments. Tatum withheld approximately $12 million in payroll taxes from March 2008 through December 2012, which he did not pay over to the IRS. Tatum also failed to pay $6 million of AMI’s contributing share of social security and Medicare taxes during the same quarters. Instead, he used the money for his personal benefit, including making payments on his ranch and traveling to Las Vegas, Hawaii and France. Tatum admitted that he caused a tax loss of more than $18 million.
“Rather than pay over to the IRS his employees’ withholdings and social security and Medicare contributions, Richard Tatum diverted the funds to his personal benefit,” said Acting Deputy Assistant Attorney General Goldberg. “Employment taxes are not a source of funding for ranches or premium travel -- those who keep these funds and use them as a personal piggybank will be prosecuted and face incarceration.”
“Failure to pay over employment taxes taken from employee wages is a serious criminal offense,” said Chief Richard Weber of IRS Criminal Investigation. “It not only harms the employees’ future social security and Medicare benefits, it’s stealing from honest taxpayers and the U.S. Treasury. IRS Criminal Investigation will continue to track down those who collect these taxes and use the funds for personal gain.”
Sentencing is scheduled for June 1. Tatum faces a statutory maximum sentence of five years in prison, a period of supervised release, restitution and monetary penalties.
Acting Deputy Assistant Attorney General Goldberg and Acting U.S. Attorney Martinez commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorneys Grace Albinson and Mara Strier of the Tax Division, who are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Houston Fugitive Sought in Scheme to Defraud Federal ProgramRead the Press Release
HOUSTON – A 45-year-old woman has been indicted on multiple charges in a scheme to steal money from a local program funded with federal money designed to improve air quality in our area, announced Acting U.S. Attorney Abe Martinez.
Shonda Renee Stubblefield, of Houston, is considered a fugitive and a warrant remains outstanding for her arrest. Anyone with information about her whereabouts is asked to contact the Department of Transportation – Office of Inspector General at 1-800-424-9071 or via email at [email protected].
The 10-count indictment charges Stubblefield with theft of public money, two counts of mail fraud, four counts of wire fraud, two counts of money laundering by spending criminal proceeds and aggravated identity theft.
The Federal Highway Administration (FHWA) is an agency within of the Department of Transportation that supported state and local governments in the design, construction and maintenance of the nation’s highway system through financial and technical assistance. FHWA administered the Congestion Mitigation and Air Quality Improvement (CMAQ) program which provided funding to areas that faced challenges attaining and maintaining national ambient air quality standards for ozone, carbon monoxide and/or particulate matter.
The FHWA entered into a contract with the Texas Department of Transportation (TX DOT) to provide federal money to reduce traffic congestion and improve the air quality in Texas. TX DOT then contracted with the Houston-Galveston Area Council (H-GAC) which provided financial incentives to companies that participated in a regional telework program designed to improve air quality in our area by reducing traffic congestion through single vehicle travel.
The indictment alleges Stubblefield was the owner of World Corporation Inc. and participated in that federally-funded telework program. She allegedly stole approximately $126,000 from the CMAQ program by submitting invoices and employee timesheets that falsely documented her participation in the program. The indictment alleges Stubblefield provided false and fraudulent bank records, match documents and a fictitious client list to H-GAC as part of her fraud scheme.
The indictment includes a potential forfeiture and a money judgement for the $126,000.
If convicted of either theft of public money or money laundering by spending criminal proceeds, she faces up to 10 years in federal prison. The possible punishment for a conviction of mail fraud and wire fraud is a maximum of 20 years in prison. She also faces an additional mandatory and consecutive 24 months upon conviction of aggravated identity theft. All charges also carry a possible $250,000 maximum fine.
The Department of Transportation - Office of Inspector General conducted the investigation. Assistant U.S. Attorney Julie Redlinger is prosecuting the case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.
Child Pornographer Gets 30 Years After Sexually Exploiting MinorsRead the Press Release
HOUSTON – A 43-year-old former Navasota resident has been ordered to federal prison following his conviction of production and possession of child pornography, announced Acting U.S. Attorney Abe Martinez. John Allen Chumley pleaded guilty Sept. 13, 2016.
Today, U.S. District Judge David Hittner sentenced him to serve a total of 360 months in federal prison. At the hearing, Judge Hittner acknowledged the pain and suffering of the victims and their families that Chumley caused, specifically noting a letter written by one of the victims himself. The mother of the other victim also submitted a poignant letter to the court detailing the effects the abuse had on her child. Chumley will also have to register as a sex offender and serve life on supervised release following completion of his prison term, during which time he will have to comply with numerous requirements designed to restrict his access to children and the Internet.
Two victims were identified in this case that Chumley sexually exploited.
Chumley was a long-haul truck driver who transported child pornography across state lines and even travelled with one of his victims, now a 10-year-old boy. For some time, Chumley had access to this child and photographed him with a cellular telephone in lewd and lascivious poses in Houston and elsewhere. Chumley befriended a family member of the victim, gained the family’s trust and used his position to exploit the child.
In addition, Chumley produced child pornography of another child who resided in the Houston area to whom Chumley had regular access and whom he sexually molested.
The National Center for Missing and Exploited Children and FBI offices in Houston and Springfield, Illinois conducted the investigation. Assistant U.S. Attorney Sherri L. Zack of the Southern District of Texas prosecuted the case.
Kingsville Man Gets 10 Years for Alien SmugglingRead the Press Release
CORPUS CHRISTI, Texas – A 40-year-old Kingsville man has been ordered to federal prison for leading an alien smuggling conspiracy, announced Acting United States Attorney Abe Martinez announced today. Ryan Paul Turcotte pleaded guilty Jan. 3, 2017.
Today, Senior U.S. District Judge Janis Graham Jack ordered Turcotte to serve 120 months of federal imprisonment to be immediately followed by three years of supervised release. At the hearing, the court found Turcotte to be a leader, manager and organizer of the group and to have transported well in excess of 100 aliens during the course of the conspiracy.
Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) began investigating the Turcotte alien smuggling organization in Kleberg, Nueces and Kenedy counties in November 2014. The investigation revealed Turcotte worked with co-conspirators to facilitate the transportation of illegal aliens from the Sarita and Riviera areas to Houston, Austin and to other destinations throughout the United States. Turcotte and others participated in the conspiracy by transporting aliens, assisting in the transportation of aliens by acting as “scouts,” harboring aliens and facilitating the collection and transportation of the proceeds of alien smuggling, among other things.
HSI conducted the investigation. Assistant U.S. Attorney Amanda Gould prosecuted the case.
Liquid Methamphetamine Lands Brownsville Man in Federal PrisonRead the Press Release
CORPUS CHRISTI, Texas – A 20-year-old Brownsville man has been ordered to prison following his conviction of possessing with the intent to distribute more than 44 kilograms of liquid methamphetamine, announced Acting U.S. Attorney Abe Martinez. Steve Turrubiates pleaded guilty Dec. 29, 2016.
Today, Senior U.S. District Judge Janis Jack ordered Turrubiates to serve 70 months in federal prison to be immediately followed by five years of supervised release.
Turrubiates was arrested Oct. 25, 2016, at the United States Border Patrol checkpoint near Sarita. On that date, he entered the primary inspection lane where a canine alerted to the presence of narcotics. He and his vehicle were sent to secondary inspection, at which time agents noticed tool marks on the gas tank and the bolts which hold it to the underside of the vehicle. Agents used a fiber optic scope to examine the inside of the tank where they observed large plastic bags concealed within the fuel. The agents removed the fuel tank and recovered eight bags containing more than 44 kilograms of liquid methamphetamine.
The Drug Enforcement Administration conducted the investigation with the assistance of Border Patrol. Assistant U.S. Attorney Robert D. Thorpe Jr. prosecuted the case.
Houston-Area Registered Nurse Pleads Guilty to Conspiring to Defraud Medicare of More than $5 MillionRead the Press Release
A Houston-Area registered nurse pleaded guilty today for his role in a Medicare fraud scheme that resulted in losses to Medicare of more than $5 million.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney Abe Martinez of the Southern District of Texas, Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Office, Special Agent in Charge C.J. Porter of the Department of Health and Human Services Office of the Inspector General’s (HHS-OIG) Dallas Regional Office, Special Agent in Charge D. Richard Goss of Internal Revenue Service Criminal Investigation’s (IRS-CI) Houston Field Office and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU) made the announcement.
Charles Esechie, 47, of Katy, Texas, pleaded guilty before U.S. District Judge Sim Lake of the Southern District of Texas to one count of conspiracy to commit health care fraud. Esechie is scheduled to be sentenced by Judge Lake on Aug. 17, 2017
According to the plea, from 2008 through 2015, Esechie worked as a nurse for both Harris County, Texas, Hospital District (Harris County) and Baptist Home Care Providers Inc. (Baptist), one of five Houston-area home healthcare agencies owned by Godwin Oriakhi. Esechie admitted that while he worked at Baptist, he knew that Oriakhi obtained Medicare patients by paying illegal kickback payments to patient recruiters for referring patients to Baptist for home healthcare services that Esechie knew were medically unnecessary and often not provided. Esechie also admitted that he knew that some of patients referred by the patient recruiters were homeless, and that many patients stayed at Baptist in order to receive kickbacks from Oriakhi rather than actual healthcare.
Additionally, Esechie admitted that he engaged in a scheme to defraud Medicare through the submission of fraudulent claims for home health care services. Esechie admitted that he completed Baptist’s Medicare documents while working full time as a Harris County nurse, often claiming that he was evaluating patients for Baptist at times when his Harris County employment records showed that he was across town working at a Harris County hospital. To accommodate his fulltime work schedule at Harris County and to avoid actually having to travel to the homes of Baptist’s patients for evaluations, Esechie admitted that he copied patient and medical information from templates created for him by Orikahi and Baptist’s office staff onto Baptist’s Medicare documents. Esechie also admitted that he saw patients in groups at the home of one of Oriakhi’s patient recruiters and conducted perfunctory examinations that lasted approximately five to 10 minutes, but overbilled Medicare for comprehensive examinations.
In total, Esechie admitted that he, Oriakhi and others submitted approximately $5,099,970 in fraudulent home healthcare claims to Medicare, and received approximately $4,792,199 on those claims.
To date, Jermaine Doleman, a patient recruiter, and Idia Oriakhi, Oriakhi’s daughter and the administrator of several of his home healthcare agencies, have pleaded guilty and are awaiting sentencing for their roles in the scheme. Godwin Oriakhi is charged with conspiracy, health care fraud, paying illegal kickbacks and money laundering offenses for his alleged role in the schemes and is scheduled for trial on April 11, 2017. All defendants are presumed innocent unless and until convicted beyond a reasonable doubt in a court of law.
The FBI, HHS-OIG, IRS-CI and MFCU investigated the case, which was brought by the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Texas. Senior Trial Attorney Jonathan T. Baum and Trial Attorneys Aleza S. Remis and William S.W. Chang of the Fraud Section are prosecuting the case.
The Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged over 3,000 defendants who collectively have billed the Medicare program for over $11 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Houston Woman Admits to Accessing Computer of Former EmployerRead the Press Release
HOUSTON – A 54-year-old Houston resident has entered a guilty plea to accessing a protected computer without authorization, announced Acting U.S. Attorney Abe Martinez. Velvet Smith admitted she had accessed the password-protected website of Next Day Four Color (ND4C), her former employer, at least 20 times to steal information that she used to benefit a competitor.
Smith worked for ND4C for four years. Part of her duties included serving as ND4C’s office manager, in which she helped new employees create accounts for ND4C’s website and had access to their login credentials.
In approximately January 2015, she resigned from ND4C and started working for one of its competitors. She then repeatedly accessed ND4C’s password-protected website without authorization and obtained confidential information on pricing and client orders. Smith also intruded into ND4C’s password-protected website by using an employee’s login credentials without their knowledge or permission. As part of her plea today, she admitted this occurred approximately 20 times in 2016.
On one of those occasions, May 31, 2016, Smith used that employee’s credentials to intrude into ND4C’s website and view their client list. Smith sorted the list by location to focus on clients in Houston, Dallas and Louisiana, then sorted it by purchase size and downloaded the list. She subsequently combined this data with information about her then-employer’s existing customers. According to Smith, the combined list was used by her then-employer to send out promotional materials to at least 1,300 of ND4C’s clients.
Smith continued accessing ND4C’s website without authorization until at least July 2016.
According to information presented in court today, Smith accessed ND4C’s computers for the purpose of obtaining a commercial advantage and that her actions caused an actual loss of approximately $275,810.
Sentencing has been set for June 15, 2017, at which time Smith faces up to five years in federal prison and a $250,000 maximum fine.
The FBI Houston Area Cyber Task Force conducted the investigation. Assistant U.S. Attorney Michael Chu is prosecuting the case.
U.S. Attorney Magidson Announces His ResignationRead the Press Release
HOUSTON – United States Attorney Kenneth Magidson has announced that he will resign as chief law enforcement officer for the Southern District of Texas (SDTX) effective midnight March 10, 2017.
“It has been privilege and a honor to serve as the United States Attorney for the Southern District of Texas,” said Magidson. “It has been a hallmark of my administration to ensure that our office lived up to the ideals of justice. The ability to everyday protect the interests of the United States has truly been a great blessing and a hallmark of my career. I am confident that our office will continue to live up to these ideals.”
Magidson was nominated by former President Barack Obama in June 2011 and began serving as U.S. Attorney for the district on Sept. 30, 2011, following confirmation by the Senate. As the leader of one of the busiest districts in the nation, Magidson oversaw nearly 370 employees, including approximately 180 Assistant U.S. Attorneys in the 7th largest district in the country, covering 43,000 miles and representing 8.3 million people. His resignation today brings to a close nearly 35 years of federal law enforcement experience.
The Southern District of Texas saw a wide variety of issues due to the large metropolitan area of Houston and proximity to the border that Magidson equally considered a priority. In his five and a half years as U.S. Attorney, prosecutors in his office convicted nearly 40,000 defendants.
He believed in protecting this district and held national security as one of his primary concerns, recently securing the conviction of a 24-year-old man of attempting to provide material support to ISIL. Weeding out public corruption, civil rights and protecting people from the harms associated with illegal immigration and human smuggling were also considered paramount.
Magidson also combatted the proliferation of technology-facilitated sexual exploitation crimes against children with cases brought as a result of Project Safe Childhood. The SDTX actively supported this initiative through coordination of federal, state and local law enforcement efforts to prosecute predators and rescue child victims. Under his leadership, prosecutors fought to help bring criminals to justice and protect the most vulnerable members of our society. The SDTX convicted, on average, one defendant each week during his tenure.
Trafficking in persons is a form of modern-day slavery and a particular problem in the SDTX with its many miles of border with Mexico. Magidson placed a high emphasis on prosecuting those traffickers who often prey on the poor, frequently unemployed or underemployed and who may lack access to social safety nets. One such example was the conviction of 68-year-old woman behind a 14-defendant sex trafficking ring operating in Houston. This notable case is one of the most significant in scope and magnitude to be tried to a verdict of guilty on all counts, and one of the few in which as many as 12 victims of an international sex trafficking scheme came forward to testify at trial. The defendant later received life in prison.
Aggressively prosecuting drug traffickers through the Organized Crime Drug Enforcement Task Force (OCDETF) was also a top priority, as was the targeting of criminals involved in violent crime with significant prosecutions for bank and armored robberies as well as firearms offenses.
Finally, Magidson led the office in its fight to combat fraud throughout the district. Magidson believed in protecting the interests of the U.S. and the citizens of the district by targeting identity thieves, telemarketers, tax evaders and persons engaged in insurance fraud, bank fraud, wire fraud, mail fraud, mortgage fraud and fraud committed against federal agencies. Additionally, the SDTX consistently ranked as one of highest in terms of federal health care fraud prosecutions throughout the nation.
During his tenure, the office’s civil division also handled a large caseload of civil litigation in some of the most difficult and important cases the government faces, including resolution of the border fence issues, defending serious medical malpractice claims and recovering millions in criminal debt and civil fraud. In 2015, Magidson also established a new Civil Rights Section within its Civil Division that has the authority to investigate and to remedy civil rights violations within the district.
Prior to serving as U.S. Attorney, Magidson served as an Assistant U.S. Attorney (AUSA) in the SDTX since 1983. For most of that time, he was the OCDETF Regional Coordinator for the Southwest Region, which includes all of Texas, Oklahoma, New Mexico, Arizona and the Central and Southern Districts of California and encompasses 11 federal judicial districts. The OCDETF program targets the most significant drug trafficking and related money laundering organizations operating in the United States. Previously, as chief of the Narcotics Division, he supervised assigned AUSAs in addition to his regional OCDETF coordination duties.
In 2008, Magidson was called upon to serve as the Harris County District Attorney upon appointment of then Texas Governor Rick Perry. As the District Attorney of the third most populous county in the United States, he managed an office with more than 300 prosecutors and investigators.
Cognizant of his experience and accomplishments, the Department of Justice asked Magidson to serve under then Attorney General Janet Reno as the director for the Executive Office for OCDETF in Washington, D.C., from May 1996 through May 1997. In that role, he was responsible for a broad range of management, financial and administrative duties and supervised a staff consisting of professional and support staff deemed necessary for performing the duties of the office.
Prior to his federal career, Magidson served as an Assistant District Attorney in Harris County. During that time, he served as the chief felony prosecutor in the 177th District Court and was responsible for the prosecution of major felony crimes including capital murders, rapes, robberies, burglaries, kidnappings and more.
Magidson graduated from the University of Maryland and holds a Doctor of Jurisprudence degree from South Texas College of Law in Houston.
South Texas HPL Gang Members and Associates Indicted for Firearms and Drug TraffickingRead the Press Release
CORPUS CHRISTI, Texas – A total of 10 individuals and associates of the Hermandad de Pistoleros Latinos (HPL) gang are in custody following a coordinated round-up in multiple jurisdictions, announced U.S. Attorney Kenneth Magidson of the Southern District of Texas (SDTX) and U.S. Attorney Richard L. Durbin Jr. of the Western District of Texas (WDTX).
This three-year investigation focused on drug trafficking and members of the HPL and their associates in the Corpus Christi, Houston and San Antonio areas.
Taken into custody today as a result of indictments returned last week in Corpus Christi include HPL Lieutenant Pacino San Miguel aka “Abuelo,” 40, of Houston; HPL Lieutenant Jacob Gonzales aka “Orbit,” 27, Mario Alberto Ramirez, 30, HPL Lieutenant Oscar Pena aka “OP,” 55, Leroy Rocha aka “Tank,” 26, and Dorothy Babette Cuello aka “Tiny,” 55, all of Corpus Christi. With the exception of San Miguel who is expected to appear in Houston tomorrow morning, all of the defendants made their initial appearance in Corpus Christi today and were temporarily ordered into custody pending detentions hearings next week.
Miguel, Gonzales, Ramirez and Rocha are all charged with conspiracy to distribute methamphetamine, while Pena, and Cuello are charged with conspiracy to distribute heroin.
Also arrested today were HPL Lieutenant Ricardo Aguilar aka “Indio,” 38, Stephanie Pacheco, 31, Jesse Mendoza aka “Chivo,” 42, all of San Antonio. A federal grand jury in San Antonio indicted all three for conspiracy to distribute methamphetamine and possession with intent to distribute methamphetamine. Also charged in this case is Robert Hewitty aka “Looney,” 36, who was already in custody. He is charged with being a felon in possession of a firearm, possession with intent to distribute methamphetamine and possession of a firearm during a drug trafficking crime.
Aguilar, Pacheco, and Hewitty all face a minimum of 10 years and up to life in federal prison based on the amount of methamphetamine involved in the conspiracy, while Mendoza faces between five years and 40 years in federal prison. If convicted of their charges, the defendants charged in the SDTX face a 20-year-maximum term of imprisonment.
The Texas Department of Public Safety - Criminal Investigations Division and the FBI conducted the investigation together with police departments in San Antonio, Corpus Christi, Houston and Pasadena; Texas Department of Criminal Justice - Office of Inspector General; Harris County Sheriff’s Office; and the Bexar County District Attorney’s Office. Assistant U.S. Attorney (AUSA) Jeff Miller is prosecuting the SDTX case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.
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Jury Convicts Former Banker and Mortgage Broker of Defrauding California BankRead the Press Release
HOUSTON – A federal jury has handed down convictions against two Houston-area defendants on multiple counts to include conspiracy, bank fraud, false statements on credit applications, wire fraud and mail fraud, announced U.S. Attorney Kenneth Magidson. The jury deliberated for approximately seven hours before convicting Carlos Wydler, 45, and Leyla Wydler, 57, both of Houston,late yesterday in a trial that spanned four weeks.
Leyla Wydler was the owner of several Houston-area businesses including Globan Mortgage Company, Casa Milagro and First Milagro. In the spring 2007, Carlos Wydler went to work at a California bank as a vice-president in charge of the bank’s credit card department. Shortly thereafter, the Wydlers developed a scheme in which Leyla Wydler would send credit card applications to the bank for Carlos Wydler to approve. He approved the applications for high credit lines and then, calling them “balance transfers,” cash advanced the entire credit line to the borrower via wire or check with Leyla Wydler taking a fee from the borrowers’ loan proceeds.
During trial, the evidence demonstrated that the Wydlers were also developing a real estate project in Houston at the time and used the “balance transfer” program to finance investors in their project. The jury heard that the bank did not know or approve of the fee-sharing or real estate financing arrangements.
For approximately a year, hundreds of loan applications were faxed or emailed from Leyla Wydler’s business in Houston to Carlos Wydler at the bank in California. Many of these contained falsified income information and falsified supporting documents about borrowers’ employment, income and assets. Two eyewitnesses testified they saw Leyla Wydler routinely insert falsified income numbers, sometimes using white-out, on loan applications.
Leyla Wydler skimmed more than $1.4 million from loan proceeds, with Carlos Wydler approving approximately $600,000 more in unauthorized loans to family members. More than half of the Texas borrowers run through the Wydler-family business in Houston defaulted on their loans. The bank sustained a loss of more than $8 million.
The defense attempted to convince the jury that Carlos Wydler followed bank policy in his approval decisions. Leyla Wydler’s attorney argued that she did not know that the information she was sending contained falsified information.
The jury did not believe their claims and ultimately convicted both defendants of conspiracy, bank fraud, false statements on credit applications, wire fraud and mail fraud. Carlos Wydler was also found guilty on six counts of misapplication of bank funds.
Both face up to 30 years in federal prison and a possible $1 million maximum fine on each count of conviction. U.S. District Judge Melinda Harmon presided over the trial and has set sentencing for June 23, 2017. The Wydlers were taken into custody immediately after the verdict yesterday where they will remain pending that hearing.
The FBI, U.S. Postal Inspection Service and the Federal Deposit Insurance Corporation conducted the investigation. Assistant U.S. Attorneys Belinda Beek and John Lewis are prosecuting the case.
Former Postal Employee Convicted of Soliciting Bribes During ElectionRead the Press Release
McALLEN, Texas – A former U.S. Postal Service (USPS) carrier has entered a guilty plea to receiving bribe money in exchange for providing addresses of postal ballot recipients, announced U.S. Attorney Kenneth Magidson
Noe Olvera, a 43-year-old resident of Mission, admitted he accepted $1,000 for providing the addresses in relation to the Hidalgo County Sheriff’s race in 2014.
It is a violation of law and official duty for Postal Service employee to provide a list of postal patrons names and/or addresses to another person.
On or about Oct. 15, 2014, Olvera provided a list of names and addresses of postal patrons on his route in Mission who received ballots during the Democratic primary. He accepted the $1,000 payment while on duty in his official vehicle and in his postal carrier uniform.
U.S. District Judge Micaela Alvarez accepted the plea today and has set sentencing for May 25, 2017. At that time, he faces a maximum sentence of 15 years in prison and a possible $250,000 fine. He was permitted to remain on bond pending that hearing.
The USPS-Office of Inspector General conducted the investigation with assistance of the FBI. Assistant U.S. Attorneys David A. Lindenmuth and Roberto “Bobby” Lopez are prosecuting the case.
Former Federal Agent Convicted of Attempting to Entice a ChildRead the Press Release
LAREDO, Texas – A 50-year-old former Border Patrol (BP) agent has admitted he attempted to entice a minor to engage in sexual activity, announced U.S. Attorney Kenneth Magidson. Salvatore Contreras was a former agent stationed in Del Rio.
Contreras had been in contact with an undercover agent with Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) whom he believed was the parent of two daughters ages eight and 14. During the conversations, Contreras transmitted numerous images of child pornography. He then travelled from Del Rio to Cotulla believing that he would be engaging in sexual activity with both minor children.
Contreras was arrested upon his arrival in Cotulla on Dec. 2, 2016. Following his arrest, he resigned from BP.
Sentencing will be set a later date. At that hearing, Contreras faces a minimum of 10 years and up to life in federal prison and a possible $250,000 maximum fine.
Customs and Border Protection - Office of Inspector General and HSI conducted the investigation with the assistance of the U.S. Attorney’s Office (USAO) - Western District of Texas. Assistant U.S. Attorney Alfredo De La Rosa of the USAO - Southern District of Texas is prosecuting the case.
Laredoan Sentenced for Assaulting Federal Agent to Avoid ArrestRead the Press Release
LAREDO, Texas – A 40-year-old Laredo man has been ordered to prison following his conviction for assaulting a United States Border Patrol (BP) agent and possession with intent to distribute methamphetamine, announced U.S. Attorney Kenneth Magidson. A federal jury sitting in Laredo convicted Jorge Rocha after only 20 minutes of deliberation on July 18, 2016.
Today, U.S. District Judge Marina Garcia Marmolejo, who presided over the trial, ordered Quintanilla to serve a total of 235 months in federal prison to be immediately followed by five years of supervised release.
On Jan. 29, 2016, Rocha had been carrying a concealed bag when a BP agent approached him near the River Drive Mall. According to testimony presented to the jury at trial, Rocha fled when the agent approached and identified himself. The agent pursued Rocha, who discarded a bag concealed underneath his shirt. When the agent caught up to him, Rocha resisted arrest, striking the agent on the face and head. The agent suffered lacerations and bruises during Rocha’s attack. Rocha was forcibly subdued after other agents responded to the call for assistance.
After agents apprehended him, investigators retrieved the bag Rocha dropped while attempting to flee. According to testimony at trial, the bag contained approximately 5.9 pounds of methamphetamine, valued at $188,890.
Rocha will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
BP and the Drug Enforcement Administration conducted the investigation. Assistant U.S. Attorneys Mike Eaton and Julian Castaneda prosecuted the case.
Clinic Manager Heads to Prison for Health Care FraudRead the Press Release
HOUSTON – The 47-year-old owner and operator of Elite P. Care Medical Services has been sentenced for her role in a health care fraud conspiracy that billed Medicare and Medicaid for more than $1 million in fraudulent health care claims, announced U.S. Attorney Kenneth Magidson.
Verona Spicer, of Houston, pleaded guilty to conspiracy and health care fraud charges in October 2015. Today, she was ordered to federal prison for 33 months.
Spicer had clinics located on Harwin Drive in Houston and in Port Arthur. She submitted claims to Medicare and Medicaid that fraudulently billed for physician office visits not performed by a licensed physician, physical therapy services not provided or performed by a licensed physical therapist and medical diagnostic tests not ordered as medically necessary by a licensed physician.
Spicer paid Houston physician Dr. Jocelyn Pyles, 59, of Sugar Land, who formerly worked full-time as a physician for the City of Houston. After completing her work for the City of Houston, would go to Spicer’s clinics where she signed patient medical records for patients she had not seen or examined. Spicer and Pyles signed Medicare and Medicaid enrollment applications that enabled the fraudulent billing under Pyles’ Medicare and Medicaid provider numbers.
A foreign medical graduate who was not licensed to practice medicine in the United States was actually the person who saw the patients.
Pyles was also ordered to prison after a jury convicted her of 14 counts of health care fraud in November 2015.
Spicer and Pyles were both also ordered to pay Medicare and Medicaid $560,718.62 in restitution.
The Department of Health and Human Services – Office of Inspector General, FBI, Texas Attorney General’s Medicaid Fraud Control Unit conducted the investigation with assistance of Medicare Zone Program Integrity Contractor, Health Integrity LLC. Assistant U.S. Attorney Julie Redlinger prosecuted the case.
BP Imposter Sentenced for Fraud SchemeRead the Press Release
McALLEN, Texas – A legal permanent resident from Cuba who resided in Mission has been sentenced to federal prison for impersonating an officer of the United States, announced U.S. Attorney Kenneth Magidson. Eugene Agustin Munoz-Canellas, 55, pleaded guilty Nov. 16, 2016.
Today, U.S. District Judge Randy Crane sentenced Munoz-Canellas to 18 months in federal prison. Not a U.S. citizen, he is expected to face deportation proceedings following his release. In handing down the sentence, Judge Crane considered the defendant’s extensive criminal history of theft and fraud and noted the need to impose a sentence that protected the community and promoted respect for the law.
From July 2015 to Sept. 23, 2016, Munoz falsely claimed to be an U.S. Border Patrol agent. Using that position, Munoz illegally solicited bribe payments from multiple individuals seeking legal status in the United States.
Munoz-Canellas has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Immigration and Customs Enforcement’s Office of Professional Responsibility and Homeland Security Investigations conducted the investigation. Assistant U.S. Attorney Kristen Rees prosecuted the case.
Unlicensed Medical Professional Convicted for Role in $1.3 Million Medicare Fraud SchemeRead the Press Release
A federal jury in Houston convicted an unlicensed medical professional who was posing as a physician yesterday for his participation in a $1.3 million Medicare fraud scheme.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, U.S. Attorney Kenneth Magidson of the Southern District of Texas, Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Office and Special Agent in Charge C.J. Porter of the U.S. Department of Health and Human Services-Office of Inspector General’s (HHS-OIG) Dallas Regional Office made the announcement.
Rex Duruji, 56, of Houston, was convicted yesterday of one count of conspiracy to commit healthcare fraud, one count of conspiracy to pay healthcare kickbacks and one count of healthcare fraud following a four-day trial before U.S. District Judge Kenneth M. Hoyt of the Southern District of Texas. Duruji is scheduled to be sentenced on May 8, 2017.According to evidence presented at trial, from January 2012 until May 2015, Duruji engaged in a scheme to defraud Medicare by posing as a licensed physician, although he did not possess a medical license in the State of Texas. The evidence presented at trial showed that Duruji posed as a physician to induce Medicare beneficiaries to sign up for fraudulent home-health services with Koby Home Health (Koby) that were not actually provided and paid illegal cash kickbacks to the beneficiaries for those claims. According to evidence at trial, Medicare paid approximately $1.3 million in false and fraudulent claims for home-health services submitted by Koby.
The FBI and HHS-OIG investigated the case. Trial Attorneys Scott Armstrong and Kevin Lowell of the Criminal Division’s Fraud Section are prosecuting the case.
Leaders of Houston Heroin Distribution Cell Get Life ImprisonmentRead the Press Release
HOUSTON - Two Mexican nationals who resided in Houston have been ordered to prison for life following their convictions of conspiracy to possess with intent to distribute heroin, announced U.S. Attorney Kenneth Magidson. Pedro Herrara-Alvarado, 39, pleaded guilty May 13, 2016, while his brother - Jose Herrera-Alvarado, 33 – entered his plea Nov. 20, 2015.
Today, U.S. District Judge Melinda Harmon handed Pedro Herrara-Alvarado a sentence of life imprisonment. Jose Herrera-Alvarado received the same sentence in January 2017.
The court found that the brothers ran a large-scale heroin distribution network that spanned more than eight years. During that time, they distributed more than 30 kilograms of heroin to a large number of distributors based throughout Texas to include Houston, Galveston, Dallas and Ft. Worth. Judge Harmon also found the Herrera-Alvarado brothers were leaders of the drug trafficking organization and that both engaged in obstructive conduct by engaging in witness tampering of a co-defendant after their arrest. Further, various members of the organization possessed and used firearms during the course of the drug trafficking. Jose Herrera-Alvarado maintained a residence in Houston that he and his brother used to stash and process heroin.
Six other members of the Herrera-Alvarado drug trafficking organization have been sentenced to date. Demetrio Paz-Rodriguez, 54, of Houston, was also sentenced today to 151 months imprisonment. Judge Harmon previously ordered Henry Ortiz Jr., 53, Aaron Raul Cervantes, 23, Genaro Nunez, 30, all of Houston, to federal prison for 130, 38, and 72 months, respectively, while Marinette Woods, 71, of Galveston, received a 52-month-term of imprisonment. Jaime Telles-Santos, 34, a Mexican national who resided in Houston, was previously ordered to serve a 120-month-term of imprisonment.
The Drug Enforcement Administration conducted the investigation. Assistant U.S. Attorney Casey N. MacDonald is prosecuting the case.
Three Head to Prison in Large-Scale Drug and Money Laundering ConspiracyRead the Press Release
CORPUS CHRISTI, Texas - One man and two women, all of South Texas, have been ordered to federal prison following their guilty pleas to charges of conspiracy to possess with the intent to distribute cocaine and conspiracy to commit money laundering, announced U.S. Attorney Kenneth Magidson.
Efrain Cisneros-Reyes, 37, Mayra Alejandra Cervantes, 27, and Norma Argelia Ramirez, 43, all of McAllen; and Gabriela Martinez, 34, of Mission, all pleaded guilty to conspiracy to possess with the intent to distribute more than five kilograms of cocaine Jan. 7, 2016. Cisneros-Reyes, Cervantes and Ramirez also pleaded guilty to conspiracy to launder monetary instruments, while Cisneros-Reyes was also convicted of being a felon in possession of a firearm.
Today, U.S. District Judge Nelva Gonzales Ramos, who accepted all the pleas, ordered Cisneros-Reyes to serve a total of 157 months in federal prison. Cervantes received an 81-month sentence, while Ramirez was ordered to serve 90 months imprisonment. In handing down the sentence, Judge Ramos noted the extensiveness of the criminal organization and the fact that 19 funnel bank accounts were used in the money laundering conspiracy. Each were further ordered to serve five years of supervised release following completion of their prison terms.
Martinez is set for sentencing next month.
At the time of his plea, Cisneros-Reyes also agreed to the forfeiture of two firearms - a Cobra FS380, .380 caliber pistol and a Maverick Arms, Model 88, 12-gauge shotgun. Ramirez agreed to the forfeiture of a Wells Fargo bank account in her name.
The investigation identified the four defendants as leaders within this criminal organization. Law enforcement determined that the organization utilized many different methods of transportation to include, but not limited to, concealing cocaine in false compartments located inside passenger vehicles and tractor/trailers. Further, the investigation has revealed a total of 19 funnel bank accounts directly linked to members of the organization. These funnel bank accounts have been used to funnel illicit bulk currency from throughout the country to the Rio Grande Valley.
It is estimated that at least 100 kilograms of cocaine were trafficked during the course of the conspiracy and more than $1 million in currency was transported to South Texas.
The three sentenced today will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future. Martinez is also in custody pending her sentencing hearing.
The case is the result of an Organized Crime Drug Enforcement Task Force Operation dubbed “Operation Green-Eyed Tiger” conducted by the Drug Enforcement Administration, Internal Revenue Service - Criminal Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, Border Patrol, Homeland Security Investigations, police departments in Mission and McAllen as well as the U.S. Marshals Service. Assistant U.S. Attorney Julie K. Hampton is prosecuting the case.
Fraudster Heads to Prison for Counterfeit Money and Other ChargesRead the Press Release
CORPUS CHRISTI, Texas – A 43-year-old Corpus Christi man has been ordered to federal prison for counterfeiting U.S. currency, credit card fraud and aggravated identity theft, announced U.S. Attorney Kenneth Magidson. Arturo Garcia pleaded guilty Nov. 18, 2016.
At a sentencing hearing today, U.S. District Judge Nelva Gonzales Ramos ordered Garcia to serve a total of 24 months for each for the counterfeiting and credit card fraud convictions, to be served concurrently. In addition, he was ordered to serve a mandatory 24 months for the identity theft that must be served consecutively to the other sentence imposed. His total 48-month-term will be immediately followed by three years of supervised release. In determining Garcia’s sentence, Judge Ramos concluded that through his schemes, Garcia had victimized at least 128 people. Restitution will be determined at a later date.
During early 2015, a number of large apartment complexes in the Corpus Christi area were suffering from regular mail thefts at the community cluster mailboxes. Apartment residents reported that checks and credit cards were stolen from their mail were and used to defraud local merchants.
Authorities began an investigation and observed Garcia breaking into an apartment cluster mail box on April 17, 2015. The agent was unable to apprehend Garcia at that time, but recovered a firearm Garcia dropped as he fled. He was later identified on video surveillance at a pawn shop buying jewelry with a credit card in another person’s name which had been stolen from the mail.
On Feb. 29, 2016, authorities executed an arrest warrant for Garcia at a residence in Corpus Christi. At that time, they discovered a large quantity of stolen mail and a counterfeit currency printing operation within the residence. The investigation determined Garcia had been printing counterfeit money for more than six months and passing the fake bills in the Corpus Christi area.
The U.S. Postal Inspection Service and the Secret Service conducted the investigation with assistance of the U.S. Marshals Service and the Corpus Christi Police Department. Assistant U.S. Attorney Robert D. Thorpe Jr. is prosecuting the case.
Cocaine Smuggler Convicted on Federal ChargesRead the Press Release
CORPUS CHRISTI, Texas – A 44-year-old Brownsville man has entered a guilty plea in Corpus Christi federal court to possession with the intent to distribute 14 kilograms of cocaine, announced U.S. Attorney Kenneth Magidson.
Authorities arrested Luis Alberto Cisneros Dec. 9, 2016, at the Border Patrol (BP) checkpoint near Sarita. On that date, he approached the primary inspection lane where a canine alerted to the presence of narcotics. He and his vehicle were sent to secondary inspection, at which time agents noticed inconsistencies with the rear differential, which was cold and had visible tool marks. Upon further inspection, they located a black bundle. A total of 14 bundles were ultimately found concealed inside the rear axle containing a total of approximately 14 kilograms of cocaine.
At today’s hearing, Cisneros admitted he knew drugs were hidden in the vehicle and that he was going to be paid for delivering them to the Houston area.
U.S. District Judge Nelva Gonzales Ramos accepted the plea and has set sentencing for June 8, 2017. At that time, Cisneros faces a minimum of 10 years and up to life in federal prison as well as a possible $10 million fine.
The Drug Enforcement Administration conducted the investigation with the assistance of BP. Assistant U.S. Attorney Robert D. Thorpe Jr. is prosecuting the case.
All 12 Convicted in Health Care Fraud Conspiracy Involving Area Mental Health CentersRead the Press Release
HOUSTON – A federal jury has convicted the final defendant of 12 involved in a conspiracy to pay and receive kickbacks relating to the Medicare program, announced U.S. Attorney Kenneth Magidson. The jury deliberated for four hours following a three-day trial before convicting Cheryl Waller, 70, of Houston, of one count of conspiracy to pay and receive kickbacks and one count of receiving kickbacks.
The other 11 defendants had previously pled guilty for their respective roles in the conspiracy. David Edson, 68, of Palm Harbor, Florida, and Jeffery Parsons, 57, of Crockett, each pleaded guilty to conspiracy to pay and receive kickbacks as well as two counts of money laundering. Aretha Johnson, 64, of Wimberley, also pled to the conspiracy and to one count of money laundering, while Inger Michelle Pace, 54, of Missouri City, and Ronald Turner, 56, of Fresno, each pleaded guilty to the conspiracy and to one count of paying and receiving kickbacks. The remaining defendants - Deborah Davis, 54, of Atlanta, Georgia; James Bobino, 48, Ernestine Johnson, 58, Jackie Harris, 54, and Vermon Lacy III, 32, all of Houston; and Mary Browning, 68, of Beasley – were convicted of the conspiracy.
Edson and Parsons were the vice presidents of Development and Operations, respectively, for Continuum Healthcare LLC. which owned Westbury Community Hospital in Houston. Aretha Johnson, Pace, Bobino, Waller, Browning and Davis each owned personal care homes in Houston, while Ernestine Johnson, Harris, Lacy and Turner were marketers for Continuum.
During trial, the jury heard that Continuum owned and operated three community mental health centers in the Houston area known by their locations as Hornwood, Baytown and Missouri City. Each location operated a partial hospitalization program (PHP) which is supposed to be a treatment program for individuals with mental illness. A PHP was intended to closely resemble a highly structured, short-term hospital inpatient program but was a distinct and organized intensive treatment program that offered less than 24-hour daily care. In 2010, Continuum opened Westbury Community Hospital with Hornwood and Baytown becoming outpatient centers and continuing to operate their existing PHPs under the Westbury name. Westbury also opened a PHP.
Edson and Parsons were responsible for the day-to-day operation of Continuum/Westbury and were involved in the implementation of the various kickback programs. The vast majority of the people referred in exchange for payment did not qualify for PHP services either because they were not experiencing an acute psychotic episode or because they were suffering from mental retardation, dementia or Alzheimer’s.
At the trial, the jury heard that Waller owned several personal care homes which housed individuals with severe mental illnesses like schizophrenia. Waller was paid $132,000 by Continuum to send her residents to the Continuum PHP. Edson testified that Waller was paid $6,000 per month to send her patients to Continuum.
During their pleas, Edson and Parsons admitted to paying co-defendants to bring patients to Continuum. Ernestine Johnson, Aretha Johnson, Pace, Bobino, Harris, Lacy, Turner, Browning and Davis each admitted receiving payment to do so, receiving $498,000, $2.6 million, $329,000, $499,000, $328,000, $140,000, $447,000, $155,000 and $250,000, respectively. Edson admitted to causing Continuum to fraudulently bill Medicare $50.5 million and causing Medicare to pay $18.8 million based on the false and fraudulent claims associated with the patients the co-defendants delivered.
U.S. District Judge Gray Miller accepted the pleas and presided over the trial. He has set sentencing for all 12 defendants on June 16, 2017. Everyone was permitted to remain on bond pending those hearings. At that time, everyone faces up to five years in prison and a possible $250,000 fine for the underlying conspiracy charge. Pace and Turner also face an additional five years for paying and receiving kickbacks, while Edson, Parsons and Aretha Johnson could receive up to 10 years in a federal prison for each of the respective money laundering convictions.
The FBI, U.S. Department of Health and Human Services - Office of the Inspector General, Texas Attorney General's Medicaid Fraud Control Unit, Railroad Retirement Board - Office of Investigations and IRS - Criminal Investigation participated in the joint investigation. Assistant U.S. Attorneys Al Balboni and Tina Ansari are prosecuting the case.
Edinburg Couple Convicted in Sex Trafficking of Minors ConspiracyRead the Press Release
McALLEN, Texas – An Edinburg couple has been convicted for their roles in a sex trafficking of minors conspiracy in which two minor females engaged in commercial sex acts, announced U.S. Attorney Kenneth Magidson.
Abelardo Gomez, 37, and his girlfriend Cerena Ortiz, 25, pleaded guilty today to conspiring to commit sex trafficking of minors.
On March 25, 2016, Gomez drove to Louisiana to pick up two minor females, ages 14 and 15, and transported them back to a residence in Edinburg he shared with Ortiz. According to admissions made in connection with their guilty pleas, Gomez and Ortiz took revealing photographs of the minor females posing in a lascivious manner. The photos were then used to create advertisements on backpage.com promoting the prostitution of the minors.
Gomez and Ortiz admitted that during the two-week-period the females resided with them, the minors engaged in commercial sex acts with several adult males in the Edinburg residence, in motel rooms and in a vehicle belonging to Gomez. Eventually, on April 7, 2016, Gomez and Ortiz abandoned the minors at a local convenience store. The girls called 911 and reported the incident to local authorities.
U.S. District Judge Randy Crane accepted the pleas today and has set sentencing for May 16, 2017. At that time, Gomez and Ortiz face up to life in federal prison.
The FBI conducted the investigation along with the Edinburg Police Department.
This case, prosecuted by Assistant U.S. Attorney Alex Benavides, 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."
U.S. Man Indicted for Attempting to Smuggle Weapons to MexicoRead the Press Release
LAREDO, Texas – A U.S. citizen man residing in Nuevo Laredo has been charged with attempting to smuggle multiple firearms and ammunition magazines to Mexico, announced U.S. Attorney Kenneth Magidson along with Special Agent in Charge Shane Folden of Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) and Special Agent in Charge Fred Milanowski of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).
“Stopping the smuggling of weapons, ammunition and other related items is a top priority for HSI,” said Folden. "We will continue working with law enforcement partners in this effort.”
“Reducing border violence by interfering with the smuggling of firearms into Mexico provides an additional layer of safety for our community,” said Milanowski.
A grand jury returned an indictment against Iram Abel Buentello, 23, today. He was originally charged by criminal complaint and made an appearance before U.S. Magistrate Judge Diana Song Quiroga who ordered him into custody pending further criminal proceedings. He is expected to make his initial appearance on the indictment in the near future.
On Feb. 1, 2017, Buentello allegedly attempted to exit the U.S. in a pickup truck at the Lincoln Juarez Bridge II in downtown Laredo. According to the charges, he stated he came to Laredo to purchase cologne and was returning to his home in Nuevo Laredo. At the time, Buentello allegedly advised U.S. Customs and Border Protection (CBP) officers that he had no weapons to declare.
The charges allege a search of the truck he was driving revealed five rifles, six handguns, two shotguns, six ammunition magazines and four scopes under the truck’s bed.
Buentello is charged with one count of attempting to export firearms and components from the U.S. without a license. If convicted, he faces up to 10 years in prison and a possible $250,000 fine.
HSI and ATF conducted the investigation with the assistance of Customs and Border Protection. Assistant U.S. Attorney Chris Howard is prosecuting the case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.
Area Man Charged with Evading Income TaxesRead the Press Release
HOUSTON – A local man is set to make an appearance in federal court for willfully attempting to evade or defeat his 2012 income taxes, announced U.S. Attorney Kenneth Magidson along with Special Agent in Charge Rick Goss of IRS – Criminal Investigation (CI).
“Every person has a duty to pay their fair share of taxes,” said Goss. “This case represents IRS-CI's commitment to unravelling the most sophisticated ways that offenders try to evade paying their obligations.”
Daniel Bart Thedinger is charged by criminal information, filed Feb. 15, 2017. He is expected to make an initial appearance before U.S. Magistrate Judge Mary Milloy today at 10:00.
According to the charges, Thedinger reported joint taxable income of $355,322 for 2012, when the true amount was actually $649,613. Thedinger still owes a substantial additional income tax of $86,192 for 2012, according to the allegations.
If convicted, Thedinger faces up to five years in federal prison if convicted of tax evasion as well as a possible $250,000 maximum fine.
IRS-CI conducted the investigation. Assistant U.S. Attorney Charles J. Escher is prosecuting the case.
A criminal information is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.
San Antonio Man Charged with Kidnapping ChildRead the Press Release
BROWNSVILLE, Texas – A 36-year-old man has been arrested on charges of international parental kidnapping, announced U.S. Attorney Kenneth Magidson.
Ismail Khaleel Al Gebory was arrested in Mexico City, Mexico, on Feb. 24, 2017. He is set to make his initial appearance before U.S. Magistrate Judge Mary Milloy at 10:00 a.m. in Houston today.
The criminal complaint filed in Brownsville alleges Al Gebory had taken the child after a weekend visitation and fled to Mexico.
The mother had sole custody of the child, but Al Gebory had regular visitation. He would travel from his residence in San Antonio to Brownsville on Friday evenings and would return the child to the mother on Sundays, according to the charges. On Friday, Feb. 17, Al Gebory allegedly picked up the child but did not return her that weekend.
The mother contacted authorities and told them Al Gebory had relatives in Iraq, according to charges. The criminal complaint further alleges that while in Mexico, Al Gebory attempted to obtain an Iraqi passport for the minor child.
At the time of the arrest, the child was with him, but has since been returned to the mother.
The FBI, Department of State and the Brownsville Police Department conducted the investigation with the assistance of Mexican Customs. Assistant U.S. Attorney Jose A. Esquivel Jr. is prosecuting the case.
A criminal complaint is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.
South Texas Woman Lands in Federal Prison for Meth DistributionRead the Press Release
CORPUS CHRISTI, Texas – A 30-year-old woman from Harlingen has been ordered to prison following her conviction of conspiracy to possess with intent to distribute methamphetamine, announced U.S. Attorney Kenneth Magidson. Irma Matamoros-Santillan pleaded guilty Oct. 19, 2016.
Today, U.S. District Judge Nelva Gonzalez Ramos sentenced Matamoros-Santillan to 120 months imprisonment to be immediately followed by five years of supervised release.
On Aug. 10, 2016, a Greyhound bus entered the U.S. Border Patrol (BP) Checkpoint outside of Falfurrias for primary inspection. At that time, authorities identified Lisa Rustin, 18, of Ingleside, and discovered approximately 1.3 kilograms of marijuana concealed in her bags.
The follow up investigation revealed Matamoros-Santillan was seated a few rows behind her where authorities also discovered 480 grams of suspected methamphetamine in an unclaimed bag. It was determined the women were traveling together and responsible for the narcotics.
Laboratory analysis determined the methamphetamine had a purity of 94%, yielding 452 grams of actual methamphetamine.
Matamoros-Santillan will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Rustin also pleaded guilty and will be sentenced on a later date. She remains in custody.
The Drug Enforcement Administration and the Border Patrol conducted the investigation. Assistant U.S. Attorney Lance Watt is prosecuting the case.
Jury Convicts Rio Grande Valley Area Durable Medical Equipment Company Owner of Health Care FraudRead the Press Release
McALLEN, Texas ‐ A McAllen federal jury has convicted the owner of an area durable medical equipment (DME) company owner on all counts for her scheme to defraud Texas Medicaid through fraudulent billings, announced U.S. Attorney Kenneth Magidson. The jury deliberated for six hours following a seven-day trial before convicting Maria Garza, 41, of McAllen, on all 18 counts as charged.
Garza was an owner of the DME company Hacienda DME in McAllen.
She was found guilty of causing others to submit false and fraudulent claims to Texas Medicaid for incontinence supplies that were not provided and/or were not authorized by a physician. Garza and her co-conspirators forged and/or caused others to forge the signatures of physicians on the required prescription forms. She then billed or caused others to bill for larger, higher-paying sizes of pull-ups and diapers regardless of whether those sizes were needed or provided in order to receive higher reimbursements from Texas Medicaid.
The jury heard that from March 2008 through August 2013, Garza sent false and fraudulent claims totaling approximately $2,505,064.50 to Texas Medicaid for DME allegedly provided to Texas Medicaid recipients. The billings were false and fraudulent because the DME was not delivered and/or was not authorized as claimed. Texas Medicaid paid out $1,805,940.12 on the false and fraudulent claims. The jury also heard that Garza and her co-conspirators illegally used the identities of physicians in submitting the unlawful billings to Texas Medicaid.
Garza paid illegal kickbacks in the form of cash and/or checks in exchange for patient information, specifically, the patient Texas Medicaid numbers. Further, she and her co-conspirators bought back supplies that had previously been delivered to Texas Medicaid recipients so that they could utilize the same supplies again in a scheme to defraud Texas Medicaid.
- jury also convicted Garza of threatening the use of physical force and/or attempting to use intimidation against others charged in the conspiracy.
She faces up to 10 years in federal prison for conspiracy to commit health care fraud and each of the 11 counts of health care fraud. For the two counts of witness tampering, the punishment is a possible 20-year-maximum sentence. Further, she must face an additional and mandatory 24 months for the four counts of aggravated identity theft which must be served consecutively to the other sentences imposed.
The Texas Attorney General’s Medicaid Fraud Control Unit, FBI and the Department of Health and Human Services‐Office of Inspector General conducted the investigation. Assistant U.S. Attorneys Michael Day and Andrew Swartz are prosecuting the case.
Local Man Sentenced for Robbing Walgreens of Prescription DrugsRead the Press Release
CORPUS CHRISTI, Texas – A 25-year-old Corpus Christi resident has been ordered to federal prison for robbery, announced U.S. Attorney Kenneth Magidson. Mark Anthony Garcia pleaded guilty Nov. 14, 2016, to robbery involving controlled substances.
Today, Senior U.S. District Judge John Rainey ordered Garcia to serve 57 months in federal prison to be followed by three years of supervised release. The court also ordered Garcia to pay $2,994.81 in restitution.
On Sept. 11, 2016, Garcia entered a Walgreens drug store and approached the pharmacy counter. He had what appeared to be a black semi-automatic handgun and demanded all of the Xanax and Codeine. He left with four bottles of Xanax and two bottles of Codeine and was positively identified a short time later via store surveillance cameras.
At the time of his arrest, officers recovered some of the controlled substances and a realistic black BB gun that fit the description of the gun used in the robbery.
Garcia will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be designated in the near future.
The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Corpus Christi Police Department conducted the investigation. Assistant U.S. Attorney Lance Watt is prosecuting the case.
Texas Man Sentenced to Prison for Child Sex TraffickingRead the Press Release
A Houston man was sentenced to 220 months in prison today for sex trafficking of a minor, announced Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Deangelo Tate, 27, pleaded guilty to one count of sex trafficking of children on Dec. 16, 2016. Today, U.S. District Judge Gray H. Miller of the Southern District of Texas in Houston sentenced Tate and also ordered him to serve 10 years of supervised release and to pay $20,000 in restitution.
According to admissions made in connection with his guilty plea, between Jan. 13, 2015, and March 16, 2015, Tate posted classified advertisements on backpage.com promoting the prostitution of a 17-year-old minor female. Tate admitted that he also rented hotel rooms in Corpus Christi, Texas, and Houston to serve as the location for commercial sex acts between the minor female and male customers. Tate transported the minor female to the hotels, collected all of the money from the completed sex acts and became physically violent with the minor female if she did not follow Tate’s orders, he admitted. Tate was aware that the victim was a minor and stated in a conversation recorded by law enforcement that the girl had no credibility because of her age.
The FBI investigated this case with assistance from the Houston Police Department and the Corpus Christi Police Department. Trial Attorney Lauren Britsch of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Sherri L. Zack of the Southern District of Texas prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Texas Man Sentenced for Child Sex TraffickingRead the Press Release
HOUSTON – A Houston man was sentenced to more than 18 years in prison today for sex trafficking of a minor, announced U.S. Attorney Kenneth Magidson and Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division.
Deangelo Tate, 27, pleaded guilty to one count of sex trafficking of children on Dec. 16, 2016. Today, U.S. District Judge Gray H. Miller of the Southern District of Texas in Houston sentenced Tate to 220 months in prison and also ordered him to serve 10 years of supervised release and pay $20,000 in restitution.
According to admissions made in connection with his guilty plea, between Jan. 13, 2015, and March 16, 2015, Tate posted classified advertisements on backpage.com promoting the prostitution of a 17-year-old minor female. Tate admitted he also rented hotel rooms in Corpus Christi and Houston to serve as the location for commercial sex acts between the minor female and male customers. Tate transported the minor female to the hotels, collected all of the money from the completed sex acts and became physically violent with the minor female if she did not follow Tate’s orders. He was aware that the victim was a minor and stated in a conversation recorded by law enforcement that the girl had no credibility because of her age.
He will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The FBI investigated this case with assistance of police departments in Houston and Corpus Christi. Assistant U.S. Attorney Sherri L. Zack and Trial Attorney Lauren Britsch of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Houston Man Hammered with 80-Year Prison Sentence for Multiple Counts Involving Child PornographyRead the Press Release
HOUSTON – A 49-year-old man from Houston has received a massive sentence following his convictions of sexual exploitation of a child, distribution and possession of child pornography, announced U.S. Attorney Kenneth Magidson. William Lee Niver pleaded guilty June 14, 2016.
Today, U.S. District Judge Gray Miller handed Niver a sentence of 360 months for the sexual exploitation of a child, otherwise known as production of child pornography. He also received 240 months for each of two distribution charges as well as another 120 months for the possession of child pornography. The sentences will all run consecutively for a total of 960 months in federal prison. There is no parole in the federal system.
During the hearing, the court heard from the victim about how being sexually assaulted, psychologically abused and manipulated into situations to meet Niver’s deviant sexually-perverse needs has impacted her life. She indicated that from the time she was eight years old until the age of 14, the abuse consumed her life. “He touched every inch of my body, both with and without my consent, performed oral sex on me, coerced me into performing oral sex on him, engaged in vaginal and anal intercourse with me and encouraged me to have sex with a good female friend of mine. This man, who had been my hero since the day I was born, gave me innumerable excuses for his behavior, scrambled for proof of his intrinsic morality, told me how beautiful and intelligent I was and how I had to understand that I was impossible to resist.”
The government told the court that instead of receiving Barbie dolls and books, Niver gave the victim vibrators and showed her pornography.
In determining the sentence, Judge Miller noted the substantial harm done to victim and said this was one of the saddest cases ever to come before him.
Niver first came to the attention of law enforcement after he had sent images of child pornography, including the victim who appeared in court, to an undercover agent. Federal agents executed a search warrant at Niver’s residence and performed a forensic examination on his computer which resulted in the discovery of more than 6,000 images and 1,000 videos of young children engaged in sexually explicit conduct. The images included children under the age of 12, bondage and acts of violence. Some of the images are of known victims as identified through the National Center for Missing and Exploited Children.
At the time of the plea, Niver admitted to taking sexually explicit photographs and a video of a minor female relative and emailing them to others.
He will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation.
This case, prosecuted by Assistant U.S. Attorneys Kimberly Ann Leo and Carrie A. Wirsing, 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."
Brownsville Man Handed Significant Sentence for Hostage takingRead the Press Release
BROWNSVILLE, Texas – A 24-year-old Brownsville man has been ordered to prison for nearly 20 years following his conviction of human smuggling and hostage taking, announced U.S. Attorney Kenneth Magidson. Reynaldo Lerma-Pichardo pleaded guilty Oct. 25, 2016.
On Feb. 15, 2017, U.S. District Judge Rolando Olvera ordered he serve a total of 235 months in federal prison to be immediately followed by three years of supervised release.
On or about Nov. 22, 2015, the Brownsville Police Department (BPD) received a 911 call leading them to an apartment. There, Border Patrol (BP) agents discovered nine undocumented aliens being held against their will. The undocumented aliens reported that they were not allowed to leave the apartment unless they could pay additional monies to Lerma-Pichardo.
Lerma-Pichardo operated the alien smuggling operation along with Leticia Lerma-Pichardo, Juan Carlos Meza-Hinojosa and Cynthia Yadira Deantes out of their homes.
During the course of the investigation, Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) agents discovered that Lerma-Pichardohas sexually assaulted one of the illegal alien females held at the apartment.
Leticia Lerma Pichardo, 47, a legal permanent resident of Brownsville and Meza-Hinojosa, a 38-year-old Mexican citizen were previously sentenced to 37 and 22 months, respectively. Deantes, 23, is set for sentencing next week.
HSI conducted the investigation with the assistance of BP and BPD. Assistant U.S. Attorney Ana Cano is prosecuting the case.
Jury Finds Belizean Man Guilty of Attempted Illegal Re-Entry After DeportationRead the Press Release
LAREDO, Texas – A federal jury sitting in Laredo has convicted a 46-year-old Belizean man claiming to be a U.S. citizen guilty of attempting to illegally reenter the United States after deportation, announced U.S. Attorney Kenneth Magidson. The jury convicted Jerome Aristedes Martinez, of Belize City, Belize, late this afternoon following a two-day trial.
On Aug. 18, 2015, Martinez attempted to enter the United States at the Lincoln Juarez Bridge, claiming to be a U.S. citizen. At that time, he presented an Illinois Identification card and a Department of Homeland Security/Social Security Administration web-site print-out as proof of his citizenship. However, upon questioning, authorities discovered Martinez was actually a native and citizen of Belize who had been removed from the United States twice before. The jury heard that Martinez had never obtained the proper permission to return to the United States after his last removal.
Martinez admitted to having been previously convicted of illegal re-entry after making false claims to U.S. citizenship. However, he testified that after his most recent removal to Belize, he “became aware” that he had been born in the U.S. Virgin Islands and was, therefore, a U.S. citizen.
The jury heard that there is no record of Martinez having been born in the U.S. Virgin Islands and that the only birth record in existence is from Belize. The government also produced documents showing his prior statements acknowledging his Belizean citizenship.
U.S. District Judge Marina Garcia Marmolejo presided over the trial and has set sentencing for June 5, 2017. At that time, Martinez faces up to 20 years in prison and a possible $250,000 maximum fine. He will remain in custody pending that hearing.
Customs and Border Protection conducted the investigation. Assistant U.S. Attorneys Sarah M. Ellison and Giselle S. Guerra are prosecuting the case.
Identity Thief Gets Five Years in Federal Prison for RV SwindleRead the Press Release
CORPUS CHRISTI, Texas – A 41-year-old woman has been ordered to serve five years in federal prison for aggravated identity theft and fraudulent use of a Social Security number, announced U.S. Attorney Kenneth Magidson. Cecile Cole, of Atlanta, Georgia, pleaded guilty in Corpus Christi federal court Nov. 30, 2016.
Today, Senior U.S. District Judge Hayden Head ordered Cole to serve 36 months for fraudulently using a Social Security number plus a mandatory consecutive 24-month sentence for the identity theft. The total 60-month prison term will be immediately followed by three years of supervised release. Cole was also ordered to pay restitution totaling $97,254.03 for economic losses to the victims including losses on a fraudulent department store account, losses to a car dealership and the diminishment in value of a recovered motorhome. Judge Head additionally ordered Cole to reveal the location of a fraudulently-obtained SUV as part of her conditions of supervised release.
While working in the finance department of an East Texas car dealership, Cole illegally copied dozens of credit applications containing the identifying and credit information of customers. Using this stolen information, Cole opened a fraudulent department store credit account and made purchases in Beaumont and Lumberton. Cole then traveled to Memphis, Tennessee, where she used one of the stolen identities to purchase an Infinity FX 35 SUV on credit in late February 2016. Approximately two weeks later, Cole again used a stolen identity to purchase a Coachman Motorhome, valued at more than $82,000, on credit from an RV dealership in Corpus Christi.
Cole was later found and arrested in Atlanta, Georgia, still in possession of the fraudulently-obtained motorhome. A search of that motorhome revealed 41 additional stolen credit applications containing the identifying and credit information of other individuals.
The Secret Service conducted the investigation with the assistance of police departments in Corpus Christi, Atlanta, Memphis, and Payson, Arizona; and the Hardin County Sheriff’s Office. Assistant U.S. Attorney Robert D. Thorpe Jr. prosecuted the case.
Leader Sentenced in String of Violent Armed RobberiesRead the Press Release
HOUSTON – Four of five defendants involved in a string of violent armed robberies have been ordered to federal prison, announced U.S. Attorney Kenneth Magidson. The group was responsible for the armed robberies and attempted robbery of Jet Pawn, Cash America Pawn and Mad Dog Smoke Shop in January 2015.
Jerrieus Williams, 32, Alonzo Flowers, 24, Kye Rue, 23, Andre Coleman, 25, and Paul McCoy Jr., 24, all of Houston, pleaded guilty last year to two counts of aiding and abetting interference with commerce by robbery and one count of aiding and abetting use and carrying of a firearm during and in relation to a crime of violence.
Today, Chief U.S. District Judge Lee Rosenthal sentenced Williams to a total of 219 months in federal prison - 135 months for the robbery and a consecutive 84 months for the firearms conviction. He will also be required to serve three years of supervised release following completion of the prison term. In handing down the sentence, Judge Rosenthal noted the need for a substantial sentence based on the managerial role Williams played in the crimes. He was ultimately held accountable for the conduct of his co-defendants, which included the theft of 26 firearms, substantial monetary losses and abducting victims within the business by moving them at gunpoint to the safe and jewelry cases.
Williams was the leader and organizer of this armed robbery crew and sat outside of the robbery locations acting as a lookout while the others conducted the robberies. He also scouted the locations and provided the firearms to his co-defendants prior to each robbery. Flowers and McCoy each ran inside the business locations carrying guns and stole firearms, jewelry and cash.
During the attempted robbery of Mad Dog Smoke Shop, Flowers and Rue entered the store and pointed a gun at the lone employee. At that time, the employee retrieved his personal firearm and shot at the robbers, causing them to flee without getting away with any property. Flowers suffered a gunshot wound. As they were fleeing, they dropped a gun stolen from Jet Pawn.
Flowers and McCoy were sentenced earlier this year to 154 and 130 months, respectively. Rue was previously sentenced to 124 months based on his conduct during these three robberies, which included being a getaway driver and entering the Cash America Pawn and Mad Dog Smoke Shop with the intent to rob them.
The final defendant – Coleman - was also on the entry team and carried a gun during the Cash America Pawn and Jet Pawn robberies. He is scheduled for sentencing March 22, 2017.
All have been and will remain in custody.
The ATF conducted the investigation along with the Harris County Sheriff’s Office. Assistant U.S. Attorneys Heather Winter and Richard Hanes prosecuted the case.
Suburban Man Sentenced for Threatening Texas AG’s OfficeRead the Press Release
HOUSTON – A 55-year-old resident of Sugar Land has been ordered to federal prison for sending a threatening email to the Texas Attorney General’s Office (TXAG) and various employees with other state agencies, announced U.S. Attorney Kenneth Magidson. Syed Kaleem Razvi pleaded guilty Oct. 3, 2016.
Today U.S. District Judge Vanessa Gilmore sentenced Razvi to 24 months in federal prison immediately followed by two years of supervised release.
Razvi sent an email communication on June 8, 2015, to the Texas Attorney General’s Office, Child Support Division, as well as various employees with other Texas agencies. The subject line of the email said “Tell Atty General of Texas this.” The email threatened the Attorney General of Texas, as well as all those emailed that Razvi would “get up in arms against you all,” and that he wished “God burn your houses and burn the bodies of your own children and yourself.” The email also demanded that the Attorney General of Texas return his money or “FACE TERRORISM.”
Razvi will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The FBI conducted the investigation in conjunction with the Texas Attorney General’s Office - Criminal Investigations Division. Assistant U.S. Attorneys Ted Imperato, Alamdar Hamdani and Andrew Leuchtmann prosecuted the case.