Eastern District of Virginia
Press releases recorded for this federal judicial district.
CEO of Virginia Health Care Technology Company Pleads Guilty to $30 Million Shareholder Fraud and $7.5 Million Employment Tax FraudRead the Press Release
A medical doctor and entrepreneur pleaded guilty today to inducing interstate travel to commit a fraud and failing to account for and pay over employment taxes announced Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division, U.S. Attorney Dana J. Boente for the Eastern District of Virginia, Chief Richard Weber of the Internal Revenue Service-Criminal Investigation (IRS-CI) and Assistant Director in Charge Paul Abbate of the FBI’s Washington Field Office.
According to the plea agreement, statement of facts, and other court documents, in or about September 2000, Sreedhar Potarazu, 51, of Potomac, Maryland, an ophthalmic surgeon licensed in Maryland and Virginia, founded VitalSpring Technologies, Inc. (VitalSpring), a Delaware corporation. VitalSpring operated in McLean, Virginia and provided data analysis and services relating to health care expenditures. In or around the end of 2015, VitalSpring started doing business as Enziime LLC, a Delaware corporation. From its inception, Potarazu was VitalSpring’s Chief Executive Officer and President, and served on its Board of Directors.
As early as 2009, Potarazu provided materially false and misleading information to VitalSpring’s shareholders to induce more than $30 million in capital investments in the company. Potarazu represented on numerous occasions that the sale of VitalSpring was imminent, which would have resulted in profits for shareholders, and concealed that VitalSpring failed to account for and pay over more than $7.5 million in employment taxes to the IRS. For example, in 2014, Potarazu provided shareholders with a written summary of operating results that reflected VitalSpring’s 2013 revenues to be approximately $12.9 million when, in fact, the 2013 revenue was less than $1 million.
“Sreedhar Potarazu created a complex web of lies to deceive VitalSpring shareholders, using false documents, fictitious websites, and fake potential buyers to induce investments and conceal the precarious financial status of the company, including millions of dollars of employment tax that he diverted from the U.S. Treasury,” said Principal Deputy Assistant Attorney General Ciraolo. “Due to the extraordinary work of the prosecutors and agents on this case, we were able to unravel this multi-layered scheme and today hold Potarazu accountable for his criminal conduct.”
“For years Potarazu enriched himself by abusing the trust of his company’s many investors and stealing millions of dollars from them through a complex scheme of fraud and deceit, said U.S. Attorney Boente. “This case is a prime example of this office’s ongoing commitment to bringing white-collar criminals to justice.”
“Throughout nearly a decade of deceit, Sreedhar Potarazu not only defrauded his investors, but also the American tax system,” said IRS-CI Chief Weber. “Motivated by pure greed, Potarazu created an elaborate scheme to hide his stolen funds and evade paying his employment tax liability. Today’s plea should serve as a stark reminder that criminals, such as Potarazu, will be held accountable for their misdeeds.”
“The FBI’s investigation into Sreedhar Potarazu’s multi-million scheme to defraud VitalSpring’s shareholders serves as a continued affirmation of our commitment to investigate and expose financial fraud,” said Assistant Director in Charge Abbate. “The FBI and our law enforcement partners will continue to pursue and bring to justice those who engage in criminally deceitful business practices.”
Scheme to Defraud
From VitalSpring’s inception, but specifically from 2009 to the present, Potarazu solicited investments through in-person meetings, emails, telephone conference calls, webinars, and phone calls. From in or about 2009 through in or about 2016, Potarazu raised approximately $32 million from more than 160 victim investors.
Potarazu induced investments from shareholders by making false representations, concealing material facts, and telling deceptive half-truths about VitalSpring’s financial condition, tax compliance, and alleged imminent sale. Potarazu also caused someone to pose as a representative of a prospective buyer on shareholder conference calls to add legitimacy to his claims regarding VitalSpring’s imminent sale.
VitalSpring had not generated a profit since 2009. Nonetheless, Potarazu falsely represented to shareholders that VitalSpring’s financial position and profitability was improving from 2009 to 2015, and that VitalSpring had millions of dollars in cash reserves. To support his scheme, Potarazu presented fake bank statements to some shareholders that showed inflated balances.
Potarazu also concealed from shareholders that VitalSpring owed substantial employment tax to the IRS. Potarazu provided or caused to be provided false corporate income tax returns to some shareholders that overstated VitalSpring’s income and omitted the accruing employment tax liability.
In November 2014, Potarazu created a Special Review Committee (SRC) in response to a lawsuit filed in Delaware by shareholders that claimed Potarazu misled the victim investors about VitalSpring’s finances, the status of the impending sale, and Potarazu’s compensation. Potarazu provided the SRC with false financial records, fake tax returns, and fake bank statements to induce the SRC to believe that VitalSpring was financially healthy and to cause the SRC to make materially false representations to the Delaware court and victim investors. He also falsely represented that the alleged imminent sale would yield substantial returns to the shareholders, and used this to induce additional investments. Members of the SRC traveled interstate to the Eastern District of Virginia to attend meetings in which Potarazu presented false information for their review.
In truth, there was no imminent sale pending. Potarazu provided false financial records, including fake balance sheets, fabricated bank statements, and false tax returns, to several prospective buyers, financial advisors, and investment banks. In December 2014, when he was questioned by Prospective Buyer 1 as to the accuracy and authenticity of bank records provided, Potarazu presented false or misleading emails purporting to be from a bank employee to bolster the legitimacy of the false bank records. Potarazu also presented Prospective Buyer 1 with a link to a fake website that was made to look like a website for a major national bank, and which referred Prospective Buyer 1 to VitalSpring’s false bank statements, and used a shadow, secondary email account assigned to a VitalSpring employee to provide false information to Prospective Buyer 1, thereby creating the appearance that Potarazu had not provided the information.
In October 2014, Prospective Buyer 2 informed Potarazu that it was no longer interested in VitalSpring. Nevertheless, Potarazu continued to represent to shareholders for months thereafter that there was a deal pending with Prospective Buyer 2. In March 2015 and February 2016, Potarazu organized, or caused to be organized, conference calls with shareholders to discuss the alleged sale. In advance of the calls, Potarazu obtained questions from the shareholders and used them to prepare the individual who posed as a representative of Prospective Buyer 2 for each call.
From 2011 to 2015, in addition to his salary paid by VitalSpring, Potarazu diverted a portion of the investments from the victim investors for his own personal use.
Employment Tax Fraud
Potarazu admitted that from 2007 to 2016, VitalSpring accrued employment tax liabilities of more than $7.5 million. Potarazu withheld taxes from VitalSpring employees’ wages, but failed to fully pay over the amounts withheld to the IRS. As CEO and President of VitalSpring, Potarazu was a “responsible person” obligated to collect, truthfully account for, and pay over VitalSpring’s employment taxes. Ultimate and final decision-making authority regarding VitalSpring’s business activities rested with Potarazu.
Potarazu was aware of the employment tax liability as early as 2007 and, between 2007 and 2016, was frequently apprised of VitalSpring’s employment tax responsibilities by his employees. In addition, IRS special agents interviewed Potarazu in 2011 and informed him of the employment tax liability. In all but one quarter between the first quarter of 2007 and the last quarter of 2011, as well as the second and third quarters of 2015, Potarazu failed to file VitalSpring’s Employer’s Quarterly Federal Tax Return (Forms 941) with the IRS. Potarazu also failed to pay over any of the employment tax withheld from VitalSpring’s employees’ wages in all but one quarter between the second quarter of 2007 and the third quarter of 2011, as well as the third and fourth quarters of 2015.
Between 2008 and 2015, instead of paying over employment tax, Potarazu caused VitalSpring to make millions of dollars of expenditures, including thousands of dollars in transfers to himself and others, the publication of his book, “Get Off the Dime,” a sedan car service, and travel.
U.S. District Court Judge T.S. Ellis III scheduled sentencing for March 3, 2017. Potarazu faces a statutory maximum sentence of 10 years in prison for inducing interstate travel to commit a fraud and five years in prison for failing to account for and pay over employment taxes, as well as a period of supervised release, forfeiture, restitution and monetary penalties.
Principal Deputy Assistant Attorney General Ciraolo and U.S. Attorney Boente commended special agents of IRS-CI and the FBI, who conducted the investigation, and Assistant Chief Caryn Finley and Trial Attorney Jack Morgan of the Tax Division, and Assistant U.S. Attorney Jack Hanly, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
CEO of Virginia Health Care Technology Company Pleads Guilty to $30 Million Shareholder Fraud and $7.5 Million Employment Tax FraudRead the Press Release
ALEXANDRIA, Va. – Sreedhar Potarazu, 51, of Potomac, Maryland pleaded guilty today to charges of inducing interstate travel to commit a fraud and failing to account for and pay over employment taxes.
“For years Potarazu enriched himself by abusing the trust of his company’s many investors and stealing millions of dollars from them through a complex scheme of fraud and deceit, said Dana J. Boente, U.S. Attorney for the Eastern District of Virginia. “This case is a prime example of this office’s ongoing commitment to bringing white-collar criminals to justice.”
According to the statement of facts filed with the plea agreement, Potarazu was an ophthalmic surgeon who was licensed in Maryland and Virginia, founded in or about September 2000, VitalSpring Technologies Inc. (VitalSpring), a Delaware corporation. VitalSpring operated in McLean, Virginia and provided data analysis and services relating to health care expenditures. In or around the end of 2015, VitalSpring started doing business as Enziime, LLC, a Delaware corporation. From its inception, Potarazu was VitalSpring’s Chief Executive Officer, President, and served as a member of the Board of Directors.
Beginning in or around 2009, Potarazu provided materially false and misleading information to VitalSpring’s shareholders to induce more than $30 million in capital investments in the company. Potarazu represented to VitalSpring shareholders on numerous occasions that VitalSpring’s sale was imminent, which would have resulted in profits for shareholders, and also concealed from shareholders that VitalSpring failed to account for and pay over more than $7.5 million in employment taxes to the Internal Revenue Service (IRS).
“Sreedhar Potarazu viewed himself as above the law – deliberately defrauding investors and stealing from the U.S. Treasury – and with today’s guilty plea, he is held accountable for his criminal conduct,” said Principal Deputy Assistant Attorney General Ciraolo. “Like other individuals who willfully ignore their employment tax obligations, Potarazu faces incarceration and substantial monetary penalties. The department will continue to work with its partners within the IRS to identify and prosecute these offenders.”
Scheme to Defraud
From VitalSpring’s inception, but specifically from 2009 to the present, Potarazu solicited investments in VitalSpring from investors and shareholders by way of in-person meetings, emails, telephone conference calls, webinars, and phone calls. From in or about 2009 through in or about 2016, Potarazu raised approximately $32 million from more than 160 victim investors.
Potarazu induced investments from shareholders by making false representations, concealing material facts, and telling deceptive half-truths about VitalSpring’s financial condition, tax compliance, and alleged imminent sale.
Potarazu falsely represented to shareholders that VitalSpring’s financial position and profitability was improving from 2009 to 2015 and that VitalSpring had millions of dollars in cash reserves. Since 2009, VitalSpring never generated a profit. To substantiate the false statements concerning the bank account balances, Potarazu presented fake bank statements to some shareholders that showed inflated balances.
Potarazu also concealed from shareholders that VitalSpring owed substantial employment tax to the IRS. Potarazu provided or caused to be provided false corporate income tax returns to some shareholders that overstated VitalSpring’s income and omitted VitalSpring’s accruing employment tax liability.
In November 2014, Potarazu created a Special Review Committee (SRC) in response to a lawsuit filed by shareholders in Delaware that claimed Potarazu misled the victim investors about VitalSpring’s finances, the status of VitalSpring’s impending sale, and Potarazu’s compensation. Potarazu provided the SRC with false financial records, fake tax returns, and fake bank statements to induce the SRC to believe that VitalSpring was financially healthy and to cause the SRC to make materially false representations to the Delaware court and victim investors. Members of the SRC traveled interstate to the Eastern District of Virginia to attend meetings in which Potarazu presented false information for their review.
Potarazu also falsely represented to VitalSpring shareholders that the company was going to be sold imminently, and in at least one instance, that a deal was in place. Potarazu falsely represented that a sale of VitalSpring would yield substantial returns to its investors.
In truth, VitalSpring was never going to be imminently sold. Potarazu provided false financial records, including fake balance sheets, fabricated bank statements, and false tax returns to several prospective buyers, financial advisors, and investment banks. When Potarazu was questioned in December 2014 by Prospective Buyer 1 as to the accuracy and authenticity of bank records provided, Potarazu then presented Prospective Buyer 1 with false or misleading emails purporting to be from a bank employee in order to bolster the legitimacy of the false bank records. Potarazu also presented Prospective Buyer 1 with a fake website that was made to look like a website for a major national bank, and a link to this website, which referred Prospective Buyer 1 to VitalSpring’s false bank statements. Additionally, Potarazu used a shadow, secondary email account for one of VitalSpring’s legitimate employees, to provide false information to Prospective Buyer 1, thus creating the appearance that Potarazu himself had not provided the information.
In October 2014, Prospective Buyer 2 informed Potarazu that it was no longer interested in VitalSpring. Potarazu continued to represent to shareholders for months afterwards that there was a still a pending deal with Prospective Buyer 2. In March 2015 and February 2016, Potarazu organized, or caused to be organized, conference calls to confirm the existence of the sale of the company. A different shareholder spoke on each call with a purported representative of Prospective Buyer 2. In advance of the calls, Potarazu asked the shareholders to give him a list of questions they intended to ask the buyer. Potarazu caused an individual to pose as the purported representative of Prospective Buyer 2 on these conference calls.
From 2011 to 2015, in addition to his salary paid by VitalSpring, Potarazu diverted a portion of the investments from the victim investors for his own personal use.
Employment Tax Fraud
Potarazu admitted that from 2007 to 2016, VitalSpring accrued an employment tax liability of more than $7.5 million. As CEO and President of VitalSpring, Potarazu was a “responsible person” obligated to collect, truthfully account for, and pay over VitalSpring’s employment taxes. Ultimate and final decision-making authority regarding VitalSpring’s business activities rested with Potarazu.
Potarazu was aware of the employment tax liability as early as 2007 and, between 2007 and 2016, was frequently apprised of VitalSpring’s payroll tax responsibilities by his employees. In addition, IRS special agents interviewed Potarazu in 2011 and informed him of the employment tax liability. In all but one quarter between the first quarter of 2007 and the last quarter of 2011, as well as the second and third quarters of 2015, Potarazu failed to file VitalSpring’s Employer’s Quarterly Federal Tax Return (Forms 941) with the IRS. In all but one quarter between the second quarter of 2007 and the third quarter of 2011, as well as the third and fourth quarters of 2015, Potarazu failed to pay over any tax withheld from wages of VitalSpring’s employees.
Between 2008 and 2015, instead of paying over employment tax, Potarazu caused VitalSpring to make millions of dollars of expenditures, including thousands of dollars in transfers to himself and others, the publication of Potarazu’s book called, “Get Off the Dime,” a sedan car service, and travel.
Potarazu faces a maximum penalty of 10 years in prison sentenced on March 3, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Principal Deputy Assistant Attorney General Caroline D. Ciraolo, head of the Justice Department’s Tax Division, made the announcement after the plea was accepted by U.S. District Court Judge T.S. Ellis, III. Assistant U.S. Attorney Jack Hanly and Assistant Chief Caryn Finley and Trial Attorney Jack Morgan of the Tax Division are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-261.
Burke Woman Sentenced for Role in Multiple Armed RobberiesRead the Press Release
ALEXANDRIA, Va. – Ariel Monet-Viola Long, 22, of Burke, was sentenced today to 138 months in prison for robbery and discharging a firearm during a crime of violence.
Long pleaded guilty on July 19. According to court documents, from Dec. 24, 2015 to May 9, 2016, Long’s boyfriend, Larry Pyos, Jr., used a handgun to rob at least six commercial establishments in northern Virginia: Good Fortune Supermarket, Shri Krishna Grocery, Dollar Power Store, Ding How Carry-Out, Hong Kong Palace, and Subway, in addition to robbing a man on the street outside of the Laze Café in Falls Church. Long lived with Pyos, was aware he was committing armed robberies, and purchased the handguns Pyos used to commit each crime. On multiple occasions Long acted as Pyos’ getaway driver.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Paul M. Abbate, Assistant Director in Charge of the FBI's Washington Field Office; and Colonel Edwin C. Roessler Jr., Fairfax County Chief of Police, made the announcement after sentencing by U.S. District Judge Gerald Bruce Lee. Assistant U.S. Attorneys Michael Rich and Tyler McGaughey prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-150.
Jury Convicts New York Man of Drug TraffickingRead the Press Release
RICHMOND, Va. – Michael Pankey, 29, of Brooklyn, New York, was convicted late yesterday by a federal jury on charges of possession with intent to distribute cocaine hydrochloride and heroin.
According to court records and evidence presented at trial, Pankey was stopped for speeding in Mecklenburg County by the Virginia State Police. Pankey was the sole occupant in a car that was rented 12 days earlier in North Carolina. A probable cause search of the car revealed 598 grams of cocaine hydrochloride and 54 grams of heroin in Pankey’s bag. Pankey admitted he was delivering the drugs from New York to an individual in South Carolina.
Pankey faces a maximum penalty of 20 years in prison when sentenced on Feb. 9, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
This case was investigated by the Virginia State Police with assistance from Homeland Security Investigations and the Drug Enforcement Administration.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Colonel W. Steven Flaherty, Superintendent of Virginia State Police; Clark E. Settles, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington; and Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, made the announcement after the verdict was accepted by Senior U.S. District Judge Robert E. Payne. Assistant U.S. Attorney Olivia L. Norman is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:16-cr-179.
Company President Embezzled Money from Employee Pension FundRead the Press Release
NORFOLK, Va. – Harry Paul, Jr., 65, of Grandy, North Carolina, pleaded guilty today to charges of embezzling funds from an employee pension fund.
According to the statement of facts filed with the plea agreement, Paul is the owner and president of Freedom Mechanical, Inc., located in Virginia Beach. The company maintained an employee benefit retirement account plan known as the Freedom Mechanical Simple IRA Plan. The Plan was funded by employees who elected to contribute to the plan, as well as mandated matching contributions made by the employer. Between approximately April 2013 and June 2016, Paul, assisted by the company’s vice-president who acted at the Paul’s direction, embezzled and unlawfully converted the monetary contributions to the Plan made by nine employees, in the amount of $47,056. During that period, W-3 Wage and Tax Statements transmitted by the company to the IRS included an amount for “deferred compensation” that falsely represented that employee contributions to the company had been made. Also during that period, the defendant failed to make the employer contributions owed to the Plan. The contributions embezzled and unlawfully converted were used to cover the company’s operating costs during a period when the company experienced severe economic difficulties.
Paul waived indictment by a federal grand jury and pleaded guilty to a criminal information. Paul faces a maximum penalty of five years in prison when sentenced on March 7, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Robin Blake, Special Agent in Charge of the Washington, D.C. Regional Office, U.S. Department of Labor, Office of Inspector General, made the announcement after the plea was accepted by U.S. District Judge Mark S. Davis. Assistant U.S. Attorney Alan M. Salsbury is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:16-cr-150.
Owner of Chesapeake Barber College Pleads Guilty to $4.5 Million GI Bill FraudRead the Press Release
NORFOLK, Va. – William E. Grobes, IV, 45, of Chesapeake, pleaded guilty today to charges of conspiring to commit wire fraud and money laundering.
According to the statement of facts filed with the plea agreement, Grobes owns the College of Beauty and Barber Culture (CBBC), located in Chesapeake. CBBC was purportedly a barber and cosmetology school approved by the Department of Veterans Affairs to provide education and training to military veterans, including veterans who received tuition assistance under the Post-9/11 GI Bill. Grobes represented to the VA that CBBC provided full-time schooling to hundreds of veteran students beginning in October 2011. In reality, the school was a sham. Most veterans enrolled in CBBC courses received few, if any, hours of instruction from CBBC employees, and there were no tests, exams, or practical exercises given. Rather, students were directed to simply sign in and out of the school each day so that Grobes could report to the VA that they were enrolled and attending. In exchange, CBBC received Post-9/11 GI Bill tuition payments for each veteran from the VA. Based on Grobes’ provision of false information to the VA concerning the number of hours of instruction and the manner and quality of the instruction provided to veteran students, CBBC received over $4.5 million in Post-9/11 GI Bill tuition payments between October 2011 and September 2016.
Grobes was charged by criminal information on November 16, and faces a maximum penalty of 20 years in prison when sentenced on March 8, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Michael J. Missal, Inspector General, U.S. Department of Veterans Affairs; Andrew L. Traver, Director of the Naval Criminal Investigative Service (NCIS); and Thomas Jankowski, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI), made the announcement after the plea was accepted by U.S. Magistrate Judge Lawrence R. Leonard. Assistant U.S. Attorney V. Kathleen Dougherty is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:16-cr-154.
Medical Office Manager Sentenced for $200K Bank FraudRead the Press Release
RICHMOND, Va. – Pamela Minor-Chiles, 47, of Chesterfield, was sentenced today to one year in prison for misappropriating approximately $200,000 from a medical practice.
Minor-Chiles pleaded guilty to a criminal information on August 17. According to court documents, from 2007 through 2012, while the office manager of the Central Virginia OB/GYN Associates (CVOG), Minor-Chiles misappropriated approximately $200,000 from the practice. Minor-Chiles wrote numerous checks on the CVOG operating account at SunTrust Bank and fraudulently deposited them into her personal accounts at Bank of America. Minor-Chiles concealed the misappropriations by putting fraudulent entries on the check stubs to make it appear that the checks were written to outside vendors for legitimate expenses of the practice and then submitted the fraudulent check stubs to the outside accountants.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Douglas F. Mease, Special Agent in Charge of the U.S. Secret Service’s Richmond Field Office, made the announcement after sentencing by U.S. District Judge M. Hannah Lauck. Assistant U.S. Attorney David T. Maguire prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:16-cr-83.
Virginia Beach Man Pleads Guilty to Attempting to Entice a MinorRead the Press Release
NORFOLK, Va. – John Francis Aragon, 50, of Virginia Beach, pleaded guilty today to charges of coercion and enticement of a minor to engage in sexual activity.
According to the statement of facts filed with the plea agreement and other court documents, in May 2016, Aragon posted an ad on Craigslist seeking “fetish sex with young girl.” A detective with the Virginia Beach Police Department, in an undercover capacity, responded to the ad pretending to be a 14-year-old girl. The two chatted over a period of time, and the conversations became sexually explicit. Eventually, a special agent with Homeland Security Investigations took over the alleged 14-year-old’s role. On three occasions, Aragon left money under a rock at a local park in exchange for a pair of the girl’s underwear. Aragon also expressed his desire to meet the girl in person in order to engage in sexual activity and on August 16, Aragon showed up at the park in Virginia Beach to meet the girl and was then arrested.
Aragon was indicted by a federal grand jury on September 21, and faces a mandatory minimum of 10 years in prison and a maximum penalty of life in prison when sentenced on Feb. 24, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Michael K. Lamonea, Assistant Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Norfolk; and James A. Cervera, Chief of Virginia Beach Police, made the announcement after the plea was accepted by U.S. Magistrate Judge Douglas E. Miller. Assistant U.S. Attorney Elizabeth M. Yusi is prosecuting the case.
This investigation was a 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.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:16-cr-129.
Career Criminal Sentenced for Possession of a FirearmRead the Press Release
NORFOLK, Va. – Norman Baynard, Jr., 54, of Norfolk, was sentenced today to 235 months in prison for being a convicted felon in possession of a firearm.
Baynard pleaded guilty on May 11. According to court documents, Norfolk Police conducted a series of undercover purchases of heroin from Baynard. On the last scheduled controlled purchase, officers attempted to arrest Baynard and it resulted in a high speed chase. During the chase Baynard drove through a number of red-lights and almost hit a small child. After throwing a loaded handgun and drugs out of the car window, Baynard eventually pulled over and was arrested. Baynard’s criminal record consists of 43 convictions for various crimes, including drug dealing, voluntary manslaughter, arson, assaults and various firearm convictions.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Michael Boxler, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, made the announcement after sentencing by U.S. District Judge Davis. Assistant U.S. Attorney Bill Muhr prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:15-cr-136.
Virginia Man Sentenced to 17 Years in Prison for Production of Child PornographyRead the Press Release
A Virginia man was sentenced today to 204 months in prison for production of child pornography, enticing minors to engage in sexually-explicit conduct online and recording the acts.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; U.S. Attorney Dana J. Boente of the Eastern District of Virginia; Colonel Edwin C. Roessler Jr., Chief of the Fairfax County, Virginia, Police Department; and Special Agent in Charge Clark E. Settles of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) Washington, D.C., made the announcement.
Lucas Aronson, 31, of Alexandria, pleaded guilty on Aug. 23, 2016, and was sentenced today by U.S. District Judge Anthony J. Trenga of the Eastern District of Virginia, who also ordered Aronson to serve a lifetime of supervised release.
According to admissions made in connection with his plea, Aronson posed as a minor girl while using video and text chat websites to chat with minor girls online. Aronson engaged in sexually explicit chats and enticed some of the minors to engage in sexually explicit activity on web camera and recorded the videos, which he maintained on a thumb drive that was found in his residence. In January 2015, Aronson was arrested after streaming a video of a toddler-aged female engaged in sexually explicit conduct with an adult male on a chat website.
The Fairfax County Police and HSI investigated the case. Trial Attorney Lauren Britsch of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Jay V. Prabhu of the Eastern District of Virginia prosecuted the case.
This investigation was a 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.
Two Hampton Roads Residents Indicted for Heroin Related DeathRead the Press Release
NEWPORT NEWS, Va. – Robert Alan Durkee, 58, of Hampton, and Julie Rae Rock, 38, of Newport News, have been indicted by a federal grand jury on charges of distribution of heroin and fentanyl resulting in death.
According to the indictment, on or about Nov. 17, 2015, Durkee and Rock distributed heroin and fentanyl to E.H. in Newport News, and E.H. died as a result of using the heroin.
Durkee and Rock each face a maximum penalty of life in prison if convicted. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division; and Richard W. Myers, Chief of Newport News Police, made the announcement after initial appearances before U.S. Magistrate Judge Douglas E. Miller. Assistant U.S. Attorneys Lisa R. McKeel and Megan M. Cowles are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:16-cr-84.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
D.C. Heroin Dealer Sentenced for DistributionRead the Press Release
ALEXANDRIA, Va. – Anthony Taylor, 59, of Washington, D.C., was sentenced today to 42 months in prison for conspiracy to distribute heroin.
Taylor pleaded guilty on August 12. According to court documents, Taylor was a member of a crew that distributed heroin in and around the Washington, D.C. metropolitan area. The leader of the crew was Taylor’s cousin, Allen Christopher Morton, who has pleaded guilty to federal gun and drug charges. When customers drove to Morton’s residence in Washington, D.C., Taylor would walk outside, deliver heroin to the customers who were typically waiting in their vehicles and collect drug proceeds on Morton’s behalf. Taylor worked for Morton delivering heroin for approximately two-and-a-half years. During that time period, Taylor and his co-conspirators distributed between 700 grams and 1 kilogram of heroin.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Karl C. Colder, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Washing5ton Field Division, made the announcement after sentencing by U.S. District Judge T.S. Ellis, III. Assistant U.S. Attorney J. Tyler McGaughey prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-171.
Businessman Sentenced for Offering Millions to DoD Procurement OfficialRead the Press Release
ALEXANDRIA, Va. – Razak A. Dosunmu, 61, of Washington, D.C, was sentenced today to 15 months in prison for offering bribes to a procurement official with the U.S. Department of Defense (DoD), Defense Logistics Agency (DLA), while negotiating aviation fuel contracts worth over $1 billion.
Dosunmu was found guilty by a federal jury on August 18. According to court documents, Dosunmu was the owner and operator of United Globe Auto Body, LLC, a classic cars restoration and auto repair shop and international trade and business development company located in Takoma Park, Maryland. Beginning in mid-2014, on behalf of United Globe, Dosunmu solicited government contracts with DLA-Energy. DLA-Energy is responsible for the procurement of large volumes of aviation and marine diesel fuel for the military services. In May 2015, investigators received an allegation that Dosunmu, while negotiating for a supply contract with DLA-Energy, offered to buy a procurement official a house in exchange for awarding the contract to United Globe.
According to court documents, the procurement official cooperated with the investigation and over a six-month period recorded several conversations during which Dosunmu pursued two separate contracts worth hundreds of millions of dollars, including one to provide the aviation fuel needed by military forces in the Middle East. The recordings, documents, and the testimony of several witnesses confirmed the existence of the original offer and revealed that the defendant offered multi-million dollar payments for official acts by the procurement officer. In addition to offering a house, $2 million in cash, and percentage points on future contracts, Dosunmu explicitly discussed how to conceal the illicit relationship and payments.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Robert E. Craig, Special Agent in Charge for the Defense Criminal Investigative Service’s (DCIS) Mid-Atlantic Field Office; and Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after sentencing by U.S. District Judge Anthony J. Trenga. Assistant U.S. Attorney Jack Hanly and Special Assistant U.S. Attorney Edward P. Sullivan prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-54.
Arlington County Sheriff’s Office Agrees to Settle ADA ClaimRead the Press Release
ALEXANDRIA, Va. – Today the U.S. Attorney’s Office announced a $250,000 settlement agreement under the Americans with Disabilities Act (ADA) with the Arlington County Sheriff’s Office (ACSO) that it failed to provide appropriate auxiliary aids and services to an individual who is deaf.
The U.S. Attorney’s Office’s investigation began when it was made aware of allegations that during a 40-day incarceration at the Arlington County Detention Facility (ACDF), the ACSO, which operates ACDF, violated the ADA by failing to provide appropriate auxiliary aids and services, including sign language interpreter services, to a former detainee who is deaf during complex communications with the ACDF’s staff and its medical contractor. Further, the complainant, who is unable to read and write in English, alleged that the ACDF’s staff failed to furnish him with a telecommunication device that would ensure that he could communicate with individuals outside the detention facility, including his counsel.
“People who are deaf or hard of hearing must be able to communicate clearly with law enforcement officials,” said Tracy Doherty-McCormick, First Assistant U.S. Attorney for the Eastern District of Virginia. “Through this settlement agreement, the Arlington County Sheriff has taken important steps to ensure that the operations of the Arlington County Detention Facility are in compliance with the Americans with Disabilities Act.”
Under the settlement, the ACSO will pay $250,000 to the aggrieved individual. The settlement agreement also requires the ACSO to take remedial steps to bring itself into compliance with the ADA, including the appointment of an ADA Coordinator who is familiar with the ADA’s requirements; providing ADA training to its staff; adopting specific policies and procedures to ensure that auxiliary aids and services are provided promptly to individuals who are deaf or hard of hearing; procuring telecommunication devices usable by individuals who are deaf including videophones; providing hearing aid and cochlear implant processor batteries in the detention facility; ensuring that the ACSO responds promptly to disability related needs of its inmates; and adopting other policies consistent with the ADA. Significantly, the Arlington County Sheriff took several steps that improve the ADA compliance of the ACDF even before finalizing the settlement agreement.
This matter was handled by Assistant U.S. Attorney Steven Gordon, who is the Civil Rights Enforcement Coordinator for the U.S. Attorney’s Office.
The Department of Justice has a number of publications available to assist law enforcement agencies in complying with the ADA on its web site, including “Communicating with People Who Are Deaf or Hard of Hearing: ADA Guide for Law Enforcement Officers,” at http://www.ada.gov/lawenfcomm.pdf. For more information on the ADA and to access this publication, visit http://www.ada.gov or call the Justice Department’s toll-free ADA information Line at 800-514-0301 or 800-514-0383 (TDD).
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae.
Alexandria Man Sentenced to 17 Years for Production of Child PornographyRead the Press Release
ALEXANDRIA, Va. – Lucas Aronson, 31, of Alexandria, was sentenced today to 204 months in prison for production of child pornography, enticing minors to engage in sexually-explicit conduct online and recording the acts. Aronson was also ordered to serve a lifetime of supervised release, register as a sex offender upon release from prison, and to pay a total of $20,000 in restitution to his victims.
Aronson pleaded guilty on August 23. According to admissions made in connection with his plea, Aronson posed as a minor girl while using video and text chat websites to chat with minor girls online. Aronson engaged in sexually explicit chats and enticed some of the minors to engage in sexually explicit activity on web camera and recorded the videos, which he maintained on a thumb drive that was found in his residence. In January 2015, Aronson was arrested after streaming a video of an adult male engaged in sexually explicit conduct with a toddler-aged female on a chat website.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Leslie R. Caldwell, Assistant Attorney General of the Justice Department’s Criminal Division; Colonel Edwin C. Roessler Jr., Fairfax County Chief of Police; and Clark E. Settles, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) Washington, made the announcement after sentencing by U.S. District Judge Anthony J. Trenga. Assistant U.S. Attorney Jay V. Prabhu and Trial Attorney Lauren Britsch of the U.S. Department of Justice’s Child Exploitation and Obscenity Section (CEOS) prosecuted the case.
This investigation was a 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.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-138.
Drug Arrests Lead to Recovery of 119 Pounds of Cocaine and Stacks of CashRead the Press Release
NEWPORT NEWS, Va. – Four men were indicted here this morning for their involvement in a large-scale cocaine trafficking conspiracy. When the men were arrested law enforcement officers seized approximately 54 kilograms (119 pounds) of cocaine and 100 bundles of shrink wrapped cash containing $5,000 to $10,000 each.
Marvin O’Neal Carter, Sr., 49, of Newport News; Michael Stephen Kuna, 42, of Canada; Daniel Rodriguez, 49, and Hilario Rodriguez, 50, both of California; were charged with conspiracy to distribute and possess with intent to distribute five kilograms or more of cocaine. Carter was also charged with possession with intent to distribute 500 grams or more of cocaine, possession with intent to distribute heroin, possession of a firearm during a drug trafficking crime and maintaining a drug involved premises. In addition to the conspiracy charge, Daniel and Hilario Rodriguez were charged with interstate travel in aid of racketeering.
According to court documents, agents observed the arrival of a tractor trailer at a garage leased by Carter. The tractor trailer eventually off-loaded the trailer next to the garage, and agents observed Michael Kuna, and Daniel and Hilario Rodriguez arrive and park in Carter’s garage parking lot. The four men then allegedly worked together to unload cocaine from hidden compartments located underneath the trailer. A short time later, Kuna was observed loading two large duffel bags with green straps into a vehicle before leaving the area. Law enforcement agents conducted a traffic stop on Kuna and located the two duffle bags which emanated with the odor of wet currency.
According to court documents, as Kuna was being detained, agents executed two federal search warrants on the garage and trailer. During the search, approximately 54 kilograms of cocaine and 100 bundles of cash in $5,000 to $10,000 stacks were recovered. The search of the garage also led to the recovery of a firearm and a quantity of heroin, in addition to approximately $42,000 in cash from a safe.
Each defendant faces a mandatory minimum sentence of 10 years in prison and a maximum sentence of life in prison, if convicted. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division; Jonathan F. Trimble, Acting Special Agent in Charge of the FBI’s Norfolk Field Office; Richard W. Myers, Chief of Newport News Police; and Terry L. Sult, Chief of Hampton Police Division, made the announcement after the indictment was filed. Assistant U.S. Attorney Howard J. Zlotnick and Special Assistant U.S. Attorney Amy E. Cross are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:16-cr-76.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
Congressional Staffer Pleads Guilty to Failure to File Income Tax ReturnsRead the Press Release
ALEXANDRIA, Va. – Isaac Lanier Avant, of Arlington, a congressional staffer employed by the U.S. House of Representatives since 2000, pleaded guilty today to willfully failing to file an individual income tax return.
According to the statement of facts filed with the plea agreement, despite earning more than $165,000 each year from 2008 through 2013, Avant failed to timely file personal income tax returns for any of those years. Avant filed returns for tax years 2006 and 2007, but those returns each contained false deductions. In May 2005, Avant caused a form to be filed with his employer that falsely claimed he was exempt from federal income taxes. Avant did not have any federal tax withheld from his paycheck until the IRS mandated that his employer begin withholding in January 2013.
As part of his plea agreement, Avant agreed to pay restitution in the amount of $153,522 to the IRS, and faces a maximum penalty of one year in prison, a term of supervised release, and monetary penalties when sentenced on Jan. 17, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Caroline D. Ciraolo, Principal Deputy Assistant Attorney General of the Justice Department’s Tax Division, made the announcement after the plea was accepted by Magistrate Judge Theresa C. Buchanan. Assistant U.S. Attorney Jack Hanly and Assistant Chief Todd Ellinwood of the Tax Division are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-mj-385.
Felon Sentenced to 20 Years in Prison for Possession of AmmunitionRead the Press Release
NORFOLK, Va. – Wesley Paul Hadsell, 38, of Norfolk, was sentenced today to 240 months in prison for being a felon in possession of ammunition.
Hadsell pleaded guilty on Nov. 6, 2015. According to the statement of facts filed with the plea agreement, Hadsell admitted that on Dec. 23, 2013, he purchased ammunition at Bob’s Gun Shop in Norfolk and that on Dec. 31, 2013, he took that ammunition to a gun range in Chesapeake, where he and other individuals used some of the ammunition. Hadsell retained possession of approximately 80 rounds of ammunition after the trip to the range. Hadsell has at least 10 prior convictions for crimes ranging from burglary and bank robbery to felonious restraint. Hadsell’s prior convictions qualified him as an Armed Career Criminal, which subjected him to a 15-year mandatory minimum sentence.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Michael Boxler, Special Agent in Charge of the Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, and Michael Goldsmith, Chief of Norfolk Police, made the announcement after sentencing by U.S. District Judge Arenda Wright Allen. Assistant U.S. Attorney Andrew Bosse and Former Managing Assistant U.S. Attorney Benjamin L. Hatch prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:15-cr-116.
Serial Robber Sentenced to 7 Years in PrisonRead the Press Release
RICHMOND, Va. – Richard Charles Frey, 41, of East Moriches, New York, was sentenced yesterday to 84 months in prison for bank robbery. Frey was ordered to pay restitution of $4,785 to four bank victims.
Frey pleaded guilty on August 5. According to court documents, on March 9, Frey walked into a Wells Fargo Bank branch in Chesterfield, and passed a note to a teller demanding money. Understanding Frey’s intent to rob the bank, the teller turned over to him $780. As part of the statement of facts in support of his plea, Frey also acknowledged he robbed a Capital One Bank in Shirley, New York of $2,600 on February 24; a JP Morgan Chase Bank in, Holbrook, New York of $700 on February 29; and a BB&T Bank in Mount Airy, Maryland of $705 on March 14. He further admitted that he unsuccessfully attempted to rob a PNC Bank in Frederick, Maryland, on March 13.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Adam S. Lee, Special Agent in Charge of the FBI’s Richmond Field Office, made the announcement after sentencing by U.S. District Judge M. Hannah Lauck. Assistant U.S. Attorney Stephen W. Miller prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:16-cr-62.
Major Drug Courier Sentenced to 20 Years in PrisonRead the Press Release
NEWPORT NEWS, Va. – Juan Guzman, 43, of El Paso, Texas, was sentenced today to 240 months in prison for conspiracy to distribute more than five kilograms of cocaine and more than 100 kilograms of marijuana. The defendant was also sentenced to 120 months of supervised release following his term of imprisonment.
Guzman was found guilty on April 14, 2016. According to court documents and information presented at trial, Guzman was responsible for using tractor-trailers to transport multi-kilo loads of cocaine and marijuana from Texas and New Mexico to locations along the East Coast, including Georgia, Rhode Island and Virginia.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, made the announcement after sentencing by U.S. District Judge Arenda Wright Allen. Assistant U.S. Attorney Eric M. Hurt and Special Assistant U.S. Attorney Matthew Hoff of the Organized Crime and Gang Section of the Department of Justice prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:15-cr-34.
Heroin Dealer Sentenced to 30 Years in Prison for Overdose DeathRead the Press Release
NORFOLK, Va. – Carlos A. Brown, 46, of Suffolk, was sentenced today to 360 months in prison for distribution of heroin resulting in death.
According to court documents, Brown sold heroin from his Portsmouth residence from June 2015 to November 2015. On Nov. 18, 2015, Brown contacted one buyer describing the potency of his heroin as a “missile.” He was aware that several of his customers had overdosed, yet sought to obtain more of that same batch of heroin. Shortly thereafter, Brown distributed that heroin and in the early morning hours of Nov. 21, 2015, Ryan Wilson, 27, of Chesapeake, was found dead having used Brown’s heroin. Even after learning of the death of Ryan Wilson, Carlos Brown continued to sell heroin. The law enforcement team made four controlled purchases of heroin and fentanyl from Brown before they arrested him on April 21.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Mark R. Herring, Attorney General of Virginia; Martin Culbreath, Special Agent in Charge of the FBI’s Norfolk Field Office, Kelvin L. Wright, Chief of the Chesapeake Police Department; and Colonel W. Steven Flaherty, Superintendent of Virginia State Police, made the announcement after sentencing by U.S. District Judge Mark S. Davis. Virginia Assistant Attorney General and Special Assistant U.S. Attorney John F. Butler and Assistant U.S. Attorneys Andrew C. Bosse and Joseph E. DePadilla prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:16-cr-67.
Dental Office Manager Convicted of Fraudulently Obtaining over 100,000 Hydrocodone PillsRead the Press Release
NEWPORT NEWS, Va. – Donna Byrd Talley, 54, of Yorktown, was convicted yesterday by a federal jury on charges of acquiring or obtaining a controlled substance, possession with intent to distribute a controlled substance, and mail fraud.
According to court records and evidence presented at trial, Talley worked as a long-time office manager for Dr. Steven Becker, a Hampton dentist. Talley had control over Dr. Becker’s bank accounts and was responsible for all office administration. From 2002 through 2011, Talley used Dr. Becker’s DEA license to fraudulently obtain over 100,000 pills of hydrocodone from two dental supply companies. Talley distributed the hydrocodone to her husband and others and used it to feed her own addiction. In 2011, Talley made various cash deposits to bank accounts she owned or controlled in amounts over $7,000. On Aug. 18, 2011, investigators with the Virginia Department of Health Professions and the Virginia State Police interviewed Talley, who admitted to ordering hydrocodone. Later that same day, an investigator recovered a pill bottle containing hydrocodone from Talley’s residence, matching shipments of hydrocodone ordered by Talley and received by Dr. Becker’s office two days earlier.
Talley faces a maximum penalty of 10 years in prison when sentenced on Feb. 22, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of Talley will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division; and Ruth A. Carter, Diversion Program Manager (DEA), made the announcement after the verdict was accepted by U.S. District Judge Mark S. Davis. Assistant U.S. Attorneys Brian J. Samuels and Megan M. Cowles are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:16-cr-21.
Clear Brook Man Pleads Guilty to False Labeling of Animal Blood ExportsRead the Press Release
ALEXANDRIA, Va. – Phillip Lloyd, 57, of Clear Brook, pleaded guilty yesterday to making and submitting false labels for animal blood that was transported internationally.
According to the statement of facts filed with the plea agreement, Lloyd was the owner and manager of Biochemed Services, Inc., a broker of human blood and animal blood products based in Winchester. Biochemed would receive orders from biomedical research companies for specific quantities of human blood, animal blood and products, and would package and export products from the United States. To evade enforcement by the U.S. Fish and Wildlife Service, employees of Biochemed shipped animal blood products with documents that falsely described the contents of the packages as “human” blood products. The actual labels accurately describing the blood shipments as “animal” blood products would be sent in separate FedEx envelopes that would not be inspected by Fish and Wildlife Service or other law enforcement officials.
According to the statement of facts, from in or about January 2014 to in or about May 2016, Biochemed packaged and shipped internationally, products including blood of squirrel monkeys and other primates protected by the Convention on International Trade in Endangered Species of Wild Fauna and Flora (“CITES”). CITES is an international agreement that provides protection to fish, wildlife and plant populations that are or could be harmed as a result of trade and restricts the international trade and transport of species that are threatened with extinction.
According to the statement of facts, on Jan. 23, 2014, in response to a request for squirrel monkey blood for shipment to a company in Canada known as “Tropicus Research,” Lloyd emailed the customer to confirm shipment with human on the labels, stating the squirrel monkey labels should arrive at the same time in a FedEx letter package. Lloyd then engaged in a telephone conversation about the shipment of monkey blood with an individual claiming to be an employee of Tropicus Research, but who was an employee of the U.S. Fish and Wildlife Service acting in an undercover capacity. On multiple occasions in February 2014, Lloyd caused FedEx to pick up and deliver to Tropicus Research packages of squirrel monkey blood, falsely labeled as “Human Blood,” accompanied by a commercial invoice indicating that the shipment contained human blood.
Lloyd faces a maximum penalty of five years in prison when sentenced on Jan. 27, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia, made the announcement after the plea was accepted by U.S. District Judge District Judge Gerald Bruce Lee. Assistant U.S. Attorney Gordon D. Kromberg is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-226.
Army Lieutenant Colonel Sentenced to 20 Years in Prison for Production of Child Pornography Through Social Media and Instant Messaging AppsRead the Press Release
ALEXANDRIA, Va. – Steven Jon Frederiksen, 42, of Stafford, was sentenced today to 240 months in prison and twenty years of supervised release for production of child pornography and attempted coercion and enticement of a minor using social media and instant messaging apps.
Frederiksen pleaded guilty on Aug. 2, 2016. According to court documents, in November 2015, the FBI received notification that Frederiksen, at the time an employee of the Defense Intelligence Agency (DIA), was utilizing his government-issued laptop to engage in the production of child pornography. Frederiksen admitted in connection with his plea agreement that he used online chat programs, including Kik, to entice at least four minor girls, ranging in age from 14 to 17, to produce child pornography via the internet, which he then organized and saved in an online cloud storage account. He attempted to do this with at least two other minor girls. The defendant also possessed additional images of child pornography and exchanged child pornography with other individuals online.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; and Assistant Director in Charge Paul M. Abbate of the FBI’s Washington Field Office made the announcement after sentencing by U.S. District Judge Gerald Bruce Lee. The case was investigated by the Federal Bureau of Investigation with assistance from the Army Criminal Investigative Command in Fort Belvoir. Special Assistant U.S. Attorney James E. Burke IV and Criminal Division Trial Attorney Lauren Britsch, 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.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-96.
Army Lieutenant Colonel Sentenced to 20 Years in Prison for Production of Child Pornography Through Social Media and Instant Messaging AppsRead the Press Release
A Stafford, Virginia, man who serves as a lieutenant colonel in the U.S. Army was sentenced today to serve 240 months in prison for production of child pornography and attempted coercion and enticement of a minor using social media and instant messaging apps.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Dana J. Boente of the Eastern District of Virginia and Assistant Director in Charge Paul M. Abbate of the FBI’s Washington Field Office made the announcement.
Steven Jon Frederiksen, 42, was sentenced by U.S. District Judge Gerald Bruce Lee of the Eastern District of Virginia, who also ordered him to serve a 20 year term of supervised release. On Aug. 2, 2016, Frederiksen pleaded guilty to one count of production of child pornography and one count of attempted coercion and enticement of a minor.
In November 2015, the FBI received notification that Frederiksen, at the time an employee of the Defense Intelligence Agency (DIA), was utilizing his government-issued laptop to engage in the production of child pornography. Frederiksen admitted in connection with his plea agreement that he used online chat programs, including Kik, to entice at least four minor girls, ranging in age from 14 to 17, to produce child pornography via the internet, which he then organized and saved in an online cloud storage account. He attempted to do this with at least two other minor girls. The defendant also possessed additional images of child pornography and exchanged child pornography with other individuals online.
The FBI’s Washington Field Office investigated the case with assistance from the Army Criminal Investigative Command in Fort Belvoir. Trial Attorneys James E. Burke IV and 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.
Leader of Violent Sex Trafficking Ring Sentenced to 35 YearsRead the Press Release
ALEXANDRIA, Va. – Michael Lawrence Maynes, Jr., 34, of Spring Lake, North Carolina, was sentenced today to 420 months in prison for leading a violent sex trafficking ring responsible for prostituting women and girls in Alexandria, Richmond, Springfield, Chantilly, Charlottesville, Fredericksburg, and other locations.
Maynes was found guilty by a federal jury on May 19. According to court documents and evidence presented at trial, Maynes was the leader of a sex trafficking organization known as “Horse Block Pimpin.” From 2010 to 2013, Maynes prostituted countless women in and out of Virginia. Maynes convinced women to work for him by claiming he wanted a relationship or that they would be able to keep part of the profits from their work as prostitutes. At times, Maynes targeted women who had lost custody of their children and promised to help them stabilize their lives so they could regain custody. Maynes also recruited women who were homeless or were addicted to drugs. At times Maynes would isolate the women geographically and socially, use violence and drugs to control them, and would withhold access to their children until they reached a daily quota.
According to court documents and evidence presented at trial, Maynes recruited the mother of his child to work for him recruiting, posting advertisements, collecting proceeds, and transporting the women to various hotels. Maynes also recruited his cousin, Robert Bonner, Jr., and a pretend half-brother, Michael Randall, as co-conspirators in his sex trafficking organization. The men operated together by recruiting, harboring, and prostituting women and girls, as well as trading women back and forth and working the women together at the same hotel. The men used force, coercion, and drugs to keep the women prostituting and the victims were required to give the prostitution proceeds to Maynes and his co-conspirators. Bonner and Randall previously pleaded guilty and were sentenced to 30 years and 25 years in prison, respectively.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Clark E. Settles, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington made the announcement after sentencing by U.S. District Judge Liam O'Grady. Assistant U.S. Attorneys Patricia T. Giles and Whitney Dougherty Russell prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-cr-336.
Former U.S. Navy Sailor Sentenced for Transporting Stolen VehiclesRead the Press Release
NORFOLK, Va. – Genesis Calvin Moore, 25, of Hampton, was sentenced today to 18 months in prison for charges related to theft of government property, interstate transportation of stolen motor vehicles, and possession of stolen motor vehicles. Moore was also ordered to pay over $80,000 in restitution to the U.S. Navy.
Moore pleaded guilty on July 15. According to court documents, on May 4, 2015, Moore stole a trailer full of fitness equipment from the U.S. Navy Morale, Welfare, and Recreation department on Naval Station Norfolk, and on or about June 7, 2015, Moore stole a freightliner truck that was assigned to the USS Harry S. Truman aircraft carrier. Moore used the stolen freightliner truck to transport two stolen Bobcat construction vehicles to Loganville, Georgia, where he attempted to sell them via Craigslist. He was apprehended by law enforcement in Loganville before he could complete the sale of the Bobcats. One of the Bobcats was returned to its owner, and a month later Moore stole the same Bobcat construction vehicle and attempted to sell it via Craigslist a second time.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Timothy Quick, Special Agent in Charge, NCIS Norfolk Field Office, made the announcement after sentencing by U.S. District Judge Rebecca Beach Smith. Special Assistant U.S. Attorney Alyssa K. Nichol and Assistant U.S. Attorney Randy Stoker prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:16-cr-38.
Former Business Professor Pays $100 Million Penalty in Tax Fraud CaseRead the Press Release
ALEXANDRIA, Va. – Dan Horsky, 71, a citizen of the United States, the United Kingdom and Israel, pleaded guilty today to his role in a financial fraud conspiracy involving a foreign bank account containing more than $200 million. As part of his plea agreement, Horsky paid a civil penalty of $100 million to the U.S. Treasury for failing to file and filing false Foreign Bank and Financial Accounts.
“You can’t hide from the IRS,” said U.S. Attorney Boente. “Horsky went to great lengths to hide assets in secret accounts overseas in order to avoid paying his share of taxes to the IRS. Today’s plea shows that we will continue to prosecute those who engage in this criminal activity. I want to thank IRS-Criminal Investigation and our prosecutors for their work on this important case.”
According to the statement of facts filed with the plea agreement, Horsky was employed for over 30 years as a professor of business administration at a university in New York. In approximately 1995, Horsky began investing in numerous start-up businesses through financial accounts at various offshore banks, including one bank in Zurich, Switzerland. One of these start-up businesses was Company A. Horsky’s investments in Company A ultimately resulted in approximately $80 million in net proceeds from the sale of Company A’s stock. However, Horsky only disclosed and paid taxes on approximately $7 million. By 2008, Horsky’s account contained nearly $200 million. From 2008 through 2014, Horsky filed false individual income tax returns and failed to disclose his income from, beneficial interest in, and control over his Zurich-based bank accounts.
“Despite his extraordinary wealth, Mr. Horsky concealed funds offshore, failed to report substantial income, conspired to submit false expatriation documents to cover up his fraudulent scheme, and evaded paying his fair share of tax,” said Principal Deputy Assistant Attorney General Ciraolo. “The Department and its partners within the IRS are receiving a tremendous amount of information from a wide variety of sources, and we are using that information to pursue and prosecute individuals like Mr. Horsky, who violate our nation’s tax laws. Today’s guilty plea proves, once again, that taxpayers will pay a heavy price when they choose to secrete funds in foreign bank accounts and evade tax and reporting obligations.”
“Federal income tax compliance should be equally shared among all Americans,” said Thomas Jankowski, Special Agent in Charge, Washington D.C. Field Office, IRS-Criminal Investigation. “Conspiring to defraud the government with an elaborate scheme to underreport taxable income is unlawful. Mr. Horsky’s plea today serves as an important reminder that IRS-CI is committed to bringing to justice those who shirk their federal income tax responsibilities.”
Horsky faces a maximum penalty of five years in prison when sentenced on Feb. 10, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Caroline D. Ciraolo, Principal Deputy Assistant Attorney General of the Justice Department’s Tax Division; and Thomas Jankowski, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI), made the announcement after the plea was accepted by Senior U.S. District Judge T.S. Ellis, III. Assistant U.S. Attorney Mark Lytle, Senior Litigation Counsel Mark F. Daly and Trial Attorney Robert J. Boudreau of the Tax Division are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-224.
Richmond Heroin Trafficker Sentenced to 27 Years in PrisonRead the Press Release
RICHMOND, Va. – Sylvester R. Booker, 55, of Richmond, was sentenced today to 27 years in prison for conspiracy to distribute one kilogram or more of heroin.
Booker pleaded guilty on May 5. According to court documents, Booker was the leader of a large-scale drug trafficking organization, which was responsible for distributing dozens of kilograms of heroin from 2012 through 2015. Booker used various members of his organization to transport up to 30 kilograms of heroin from Brooklyn for distribution in the Richmond area. As part of the DEA investigation in November and December 2015, law enforcement obtained a court-ordered wiretap on Booker’s cellphone. The DEA intercepted numerous calls that implicated Booker and others in the heroin conspiracy. Federal and state law enforcement conducted surveillance of Booker’s various residences and corroborated his involvement in the conspiracy to distribute large amounts of heroin. Booker was previously convicted for essentially the same crime in 1999 in federal court and much of this conspiracy took place while Booker was on supervised release for his previous conviction.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, made the announcement after sentencing by U.S. District Judge James R. Spencer.
This case was investigated by the DEA, with assistance from the Henrico County Police Division, Richmond Police Department, Chesterfield County Police Department and the Virginia State Police, as part of the DEA Task Force. Assistant U.S. Attorney Peter S. Duffey is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:16-cr-23.
Richmond Actuary Pleads Guilty to Fraud ChargesRead the Press Release
RICHMOND, Va. – James M. DeGrandis, Jr., 54, of Fredericksburg, pleaded guilty to a criminal information charging him with making a false statement in relation to a document required by the Employee Retirement Income Security Act (ERISA).
According to the statement of facts filed with the plea agreement, DeGrandis was employed as an actuary by a regional actuarial firm located in Richmond but had not satisfied the appropriate legal standards and qualifications to be an enrolled actuary. Nevertheless, DeGrandis signed off as an enrolled actuary on a statement of accuracy and completeness on a Schedule SB for an Employee Retirement Account Plan and Trust in Baltimore. The Schedule SB is part of the IRS Form 5500 and is an actuarial report regarding the plan’s asset valuation, funding target, at-risk status, effective interest rate, and target normal cost.
DeGrandis faces a maximum penalty of five years in prison when sentenced on Feb. 14, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Michael Schloss, Regional Director for the Philadelphia Regional Office of the Employee Benefits Security Administration, made the announcement after the plea was accepted by U.S. District Judge M. Hannah Lauck. Assistant U.S. Attorney David T. Maguire is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:16-cr-134.
Former Veterans Hospital Nurse Pleads Guilty to Stealing MedicationRead the Press Release
RICHMOND, Va. – Allison Rulli, 34, of Mineral, pleaded guilty today to charges of obtaining controlled substances by misrepresentation, fraud, or deception.
According to the statement of facts filed with the plea agreement, Rulli was a registered nurse employed in the Spinal Cord Injury Ward at the Hunter Holmes McGuire Veterans Administration Medical Center in Richmond. From August 2015 to August 2016, Rulli fraudulently obtained 20 to 30 Oxycodone tablets from the medication dispensing cabinets for her own use. On occasion, Rulli removed the correct amount of Oxycodone prescribed for a patient but would only administer some of the tablets to the patient and would keep the remainder for herself. Rulli also fraudulently obtained eight to 10 Fentanyl patches, each 25-100 micrograms. Rulli used a scalpel to open the Fentanyl packaging and remove the patch, but would return the tampered packaging to the medication dispensing cabinet in order to hide the evidence. When confronted by law enforcement, Rulli admitted her wrongdoing.
Rulli waived indictment and pleaded guilty to a criminal information. Rulli faces a maximum penalty of four years in prison when sentenced on Feb. 4, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Richard J. Griffin, Acting Inspector General, Department of Veterans Affairs, made the announcement after the plea was accepted by U.S. District Judge John A. Gibney, Jr. Assistant U.S. Attorney Jessica D. Aber is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:16-cr-136.
Former Marine Corps Base Quantico Official Sentenced for FraudRead the Press Release
ALEXANDRIA, Va. – Rupert Granville Miller, 56, of Chester, was sentenced today to one year and one day in prison for engaging in a travel fraud scheme that cost the government over $197,000. Miller was also ordered to pay full restitution in the amount of $197,505.83.
“Miller’s fraud cost taxpayers nearly $200,000,” said Dana J. Boente, U.S. Attorney for the Eastern District of Virginia. “We take these crimes seriously and will investigate and prosecute individuals who engage in this activity. I want to thank our investigative partners at the Defense Criminal Investigative Service and the Naval Criminal Investigative Service for their terrific work on this case.”
According to court documents, from in or about January 2011 through November 2015, Miller was employed as a deputy inspector general with Training and Education Command and Training Command at Marine Corps Base Quantico. During this time, Miller used the Department of Defense electronic travel management system to submit travel claims for what he claimed to be official business. As part of his legitimate duties, Miller travelled to Marine Corps locations around the country to inspect their facilities and operations. However, Miller began adding illegitimate rendezvous to his official trips, claiming they were for official business, and then receiving reimbursements for the rendezvous. Miller also submitted claims to travel to various foreign locations including Japan, Germany, Singapore, and the Dominican Republic. In order to justify his claims for travel, Miller forged his supervisor’s signature and created false documents in order to have his travel approved.
“Due to his greed, Rupert Miller chose to commit criminal acts, which violated the public's trust and the very principles of the position he held as the Deputy Inspector General of the U.S. Marine Corps (USMC) Training and Education Command,” said DCIS Special Agent in Charge Robert E. Craig, Jr. “His actions are not reflective of those of active duty service members and civilian employees of the USMC who serve their country honorably and with great pride. Along with our law enforcement partners, DCIS will continue to aggressively pursue allegations of fraud and corruption impacting the Department of Defense.”
“Fraud drains money and resources from the nation's warfighters,” said Jeremy Gauthier, Special Agent in Charge of the NCIS Washington DC Field Office. “NCIS is committed to investigating fraud and helping hold accountable those who place their personal gain above the needs of the nation's military.”
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Robert E. Craig, Special Agent in Charge for the Defense Criminal Investigative Service’s (DCIS) Mid-Atlantic Field Office; and Jeremy Gauthier, Special Agent in Charge of the NCIS Washington, D.C. Field Office, made the announcement after sentencing by U.S. District Judge Liam O’Grady. Special Assistant U.S. Attorneys Sean K. Price and Angelissa D. Savino prosecuted the case along with former Assistant U.S. Attorney Paul J. Nathanson.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-71.
District Election Officers Appointed to Handle Potential Complaints of Election Fraud and Voting Rights AbuseRead the Press Release
ALEXANDRIA, Va. – Assistant U.S. Attorneys James P. Gillis, Randy Stoker, and L. Margaret Harker have been appointed to serve as District Election Officers (DEO) for the Eastern District of Virginia, and will lead the efforts of this office in connection with the Justice Department’s nationwide Election Day Program for the upcoming general elections.
District Election Officers are responsible for overseeing the district’s handling of complaints of election fraud and voting rights abuses in consultation with Justice Department Headquarters in Washington, D.C.
“Every citizen must be able to vote without interference or discrimination,” said U.S. Attorney Dana J. Boente. “They need to have that vote counted without it being stolen because of fraud. The Department of Justice will act promptly and aggressively to protect the integrity of the election process.”
The Department of Justice has an important role in deterring election fraud and discrimination at the polls, and combating these violations whenever and wherever they occur. The Department’s long-standing Election Day Program furthers these goals, and also seeks to ensure public confidence in the integrity of the election process by providing local points of contact within the Department for the public to report possible election fraud and voting rights violations while the polls are open on election day.
Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input. It also contains special protections for the rights of voters and provides that they can vote free from acts that intimidate or harass them. For example, actions of persons designed to interrupt or intimidate voters at polling places by questioning or challenging them, or by photographing or videotaping them, under the pretext that these are actions to uncover illegal voting may violate federal voting rights law. Further, federal law protects the right of voters to mark their own ballot or to be assisted by a person of their choice.
In order to respond to complaints of election fraud or voting rights abuses on November 8, the DEOs will be on duty while the polls are open.
From 6 a.m. to 8:30 a.m., and from 5 p.m. to 7 p.m., any calls should be directed to 703-299-3700. From 8:30 a.m. to 5 p.m., calls should be directed to the below phone numbers:
Alexandria - Assistant U.S. Attorney James P. Gillis, 703-299-3700
Norfolk and Newport News - Assistant U.S. Attorney Randy Stoker, 757-441-6331
Richmond - Assistant U.S. Attorney L. Margaret Harker, 804-819-5400
In addition, the FBI will have special agents available in each field office and resident agency throughout the country to receive allegations of election fraud and other election abuses on election day.
Complaints about possible violations of the federal voting rights laws can be made directly to the Civil Rights Division’s Voting Section in Washington, DC by phone at 1-800-253-3931 or (202) 307-2767, by fax at (202) 307-3961, by email to [email protected] or by complaint form at http://www.justice.gov/crt/complaint/votintake/index.php.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia.
Haymarket Woman Arrested for Alleged Identity Theft and Financial FraudRead the Press Release
ALEXANDRIA, Va. – Karen Holtz, 50, of Haymarket, was arrested today on charges related to her role in a financial fraud and identity theft scheme while working for JMS Ventures, Inc.
Holtz, who was indicted on October 26, is charged with wire fraud, aggravated identity theft, and filing false tax returns. The indictment was unsealed this morning after Holtz was arrested.
According to court documents and court proceedings, Holtz worked for JMS Ventures, Inc. (JMS), which does business as the Kenyan Collection, is a small business that imports and distributes handmade Kenyan goods. Between 2008 and 2013, Holtz allegedly fraudulently diverted funds from JMS, by writing herself unauthorized checks from the JMS bank account and using PayPal to transfer customer payments directly to her personal bank account. The indictment further alleges that Holtz defrauded JMS’s customers by using their personal identifying information, including names and credit card numbers, to make fraudulent charges to their credit cards. Holtz is alleged to have obtained at least $350,000 from the fraud scheme. Holtz is alleged to have filed false federal individual income tax returns for tax years 2010 through 2013, which failed to report all the income that Holtz received in those years. In an attempt to conceal the fraud, Holtz also allegedly altered and destroyed records, including evidence of the fraud.
Holtz faces a maximum penalty of 20 years in prison for each count of wire fraud, three years in prison for each count of filing false returns and a mandatory sentence of two years in prison for each count of aggravated identity theft, if convicted. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Caroline D. Ciraolo, Principal Deputy Assistant Attorney General, head of the Justice Department’s Tax Division; Michael L. Chapman, Loudoun County Sheriff; Brian J. Ebert, Special Agent in Charge of the U.S. Secret Service’s Washington Field Office; and Thomas Jankowski, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI), made the announcement after Holtz’s initial appearance before U.S. District Judge Anthony J. Trenga. Assistant U.S. Attorney Katherine L. Wong and Trial Attorney Kimberly G. Ang of the Tax Division are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 16-cr-244.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
Career Criminal Sentenced to 30 Years for Heroin and Gun CrimesRead the Press Release
RICHMOND, Va. – Elbrendel Edwards, 42, of Richmond, was sentenced today to 30 years in prison for possession with intent to distribute heroin and possession of firearms by a convicted felon.
Edwards pleaded guilty on July 22. According to court documents, Edwards distributed approximately 12 kilograms of cocaine and approximately 6 kilograms of heroin into the Richmond community in the one-year period leading up to his April 18 arrest. Court documents also indicate that some of the heroin Edwards distributed led to multiple overdoses. In addition to distributing multi-kilogram quantities of cocaine and heroin, Edwards was in possession of three firearms: A Smith and Wesson semi-automatic handgun; a Taurus .22 caliber revolver which he traded for with heroin; and a Raven Arms .25 caliber semi-automatic handgun. In April law enforcement agents executed a search warrant at two residences used by Edwards and recovered heroin, drug packaging materials, and the three firearms.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division; and Colonel Thierry Dupuis, Chesterfield County Police Department, made the announcement after sentencing by U.S. District Judge Henry E. Hudson. Assistant U.S. Attorney Angela Mastandrea-Miller prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:16-cr-64.
Arlington Man Pleads to Guilty Child Pornography ChargesRead the Press Release
ALEXANDRIA, Va. – James Jeffrey Schroeder, 50, of Arlington, a former teacher’s assistant at Sharyland High School in Mission, Texas, pleaded guilty today to charges of receiving and downloading child pornography.
According to the statement of facts filed with the plea agreement, from approximately 1997 to August 2015, Schroeder received and downloaded child pornography from the internet and from a family member. A forensic review of Schroeder’s electronic media revealed over 83,000 images and 400 videos of child pornography. Many of the images and videos were sadistic or masochistic in nature and depicted scenes of violence.
Schroeder faces a maximum penalty of 20 years in prison when sentenced on Feb 2, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Clark E. Settles, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington, made the announcement after the plea was accepted by U.S. District Judge T. S. Ellis, III. Assistant U.S. Attorney Whitney Dougherty Russell is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-242.
Former Army National Guard Member Pleads Guilty to Attempting to Provide Material Support to ISILRead the Press Release
Mohamed Bailor Jalloh, 27, of Sterling, Virginia, a former member of the Army National Guard, pleaded guilty today to charges of attempting to provide material support to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization.
Acting Assistant Attorney General for National Security Mary B. McCord, U.S. Attorney Dana J. Boente for the Eastern District of Virginia and Assistant Director in Charge Paul M. Abbate of the FBI’s Washington Field Office, made the announcement after the plea was accepted by U.S. District Judge Liam O’Grady.
“Jalloh attempted to provide material support to ISIL by transferring funds intended for use by ISIL, taking steps to join and assist others in joining ISIL, and attempting to obtain a weapon that he believed would be used in an attack on U.S. soil in the name of ISIL,” said McCord. “Counterterrorism remains our highest priority and we will continue to hold accountable those who attempt to provide material support to foreign terrorist organizations.”
“Attempting to provide material support to terrorists is a very serious crime,” said Boente. “Jalloh attempted to help facilitate what he believed would be a terrorist attack here in Virginia. The FBI once again displayed their investigative expertise and commitment to keeping our citizens and communities safe from violent extremists. National security remains the top priority of this office and we will continue to work with our law enforcement partners to investigate these cases and prosecute those involved to the fullest extent of the law.”
“Mohamed Bailor Jalloh purchased a weapon following multiple attempts to procure assault rifles and handguns, believing they would be used in an ISIL-directed attack on U.S. soil,” said Abbate. “Jalloh also provided money on multiple occasions to support ISIL after attempting to join the terrorist group. The FBI and our partners within the Joint Terrorism Task Force are dedicated to preventing any and all acts of terrorism and relentlessly pursuing and disrupting anyone who poses a risk of harm directly or by providing material support to a terrorist group.”
According to the statement of facts filed with the plea agreement, in March 2016, a now-deceased member of ISIL brokered an introduction between Jalloh and an individual in the U.S. who actually was an FBI confidential human source (CHS). The ISIL member was actively plotting an attack in the U.S. and believed the attack would be carried out with the assistance of Jalloh and the CHS. Jalloh met with the CHS on two occasions and told the CHS that he was a former member of the Virginia Army National Guard, but that he had decided not to re-enlist after listening to online lectures by Anwar al-Awlaki, a deceased leader of Al-Qaeda in the Arabian Peninsula (AQAP). Jalloh had recently taken a six-month trip to Africa, where he had met with an ISIL facilitator in Nigeria and first began communicating online with the ISIL member who later brokered his introduction to the CHS. During their meeting, Jalloh also told the CHS that he thought about conducting an attack all the time, and that he was close to doing so at one point. Jalloh claimed he knew how to shoot guns and praised the gunman who killed five U.S. military members in a terrorist attack in Chattanooga, Tennessee, in July 2015. Jalloh also stated that he had been thinking about conducting an attack similar to the November 2009, attack at Ft. Hood, Texas, which killed 13 people and wounded 32 others.
According to the statement of facts filed with the plea agreement, during the May 2016 meeting, Jalloh asked the CHS about the timeline for an operation and commented that it was better to plan an attack operation for the month of Ramadan, and stated that such operations are, “100 percent the right thing.” Jalloh also asked if the CHS could assist him in providing a donation to ISIL. Ultimately, Jalloh provided a a $50 gift card and a prepaid cash transfer of $500 intended for use by ISIL to a contact of the CHS that Jalloh believed was a member of ISIL, but who was in fact an undercover FBI employee.
According to the statement of facts filed with the plea agreement, in June 2016, Jalloh travelled to North Carolina to obtain firearms. On July 2, Jalloh went to a gun dealership in northern Virginia, where he test-fired and purchased an assault rifle. Unbeknownst to Jalloh, the rifle had been rendered inoperable before he took custody of it. Jalloh was arrested the following day and the FBI seized the rifle.
Jalloh faces a maximum penalty of 20 years in prison when sentenced on February 10, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Assistant U.S. Attorney John T. Gibbs and Special Assistant U.S. Attorney Brandon Van Grack are prosecuting the case, with the assistance of Trial Attorney Jolie Zimmerman of the National Security Division’s Counterterrorism Section.
Former Army National Guard Member Pleads Guilty to Attempting to Provide Material Support to ISILRead the Press Release
ALEXANDRIA, Va. – Mohamed Bailor Jalloh, 27, of Sterling, a former member of the Army National Guard, pleaded guilty today to charges of attempting to provide material support to a designated foreign terrorist organization, namely the Islamic State of Iraq and the Levant (ISIL).
“Attempting to provide material support to terrorists is a very serious crime,” said Dana J. Boente, U.S. Attorney for the Eastern District of Virginia. “Jalloh attempted to help facilitate what he believed would be a terrorist attack here in Virginia. The FBI once again displayed their investigative expertise and commitment to keeping our citizens and communities safe from violent extremists. National security remains the top priority of this office and we will continue to work with our law enforcement partners to investigate these cases and prosecute those involved to the fullest extent of the law.”
According to the statement of facts filed with the plea agreement, in March 2016, a now-deceased member of ISIL brokered an introduction between Jalloh and an individual in the United States who was actually an FBI confidential human source (CHS). The ISIL member was actively plotting an attack in the United States and believed the attack would be carried out with the assistance of Jalloh and the CHS. Jalloh met with the CHS on two occasions and told the CHS he was a former member of the Virginia Army National Guard, but that he decided not to re-enlist after listening to online lectures by Anwar al-Awlaki, a deceased leader of Al-Qaeda in the Arabian Peninsula. Jalloh had recently taken a six-month trip to Africa where he had met with ISIL members in Nigeria and first began communicating online with the ISIL member who later brokered his introduction to the CHS. During their meeting, Jalloh also told the CHS he thought about conducting an attack all the time, and that he was close to doing so at one point. Jalloh claimed to know how to shoot guns and praised the gunman who killed five U.S. military members in a terrorist attack in Chattanooga, Tennessee, in July 2015. Jalloh also stated he had been thinking about conducting an attack similar to the attack at Ft. Hood, Texas, in November 2009, which killed 13 people and wounded 32 others.
“Mohamed Bailor Jalloh purchased a weapon following multiple attempts to procure assault rifles and handguns, believing they would be used in an ISIL-directed attack on U.S. soil,” said Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office. “Jalloh also provided money on multiple occasions to support ISIL after attempting to join the terrorist group. The FBI and our partners within the Joint Terrorism Task Force are dedicated to preventing any and all acts of terrorism and relentlessly pursuing and disrupting anyone who poses a risk of harm directly or by providing material support to a terrorist group.”
According to the statement of facts filed with the plea agreement, during the May 2016 meeting, Jalloh asked the CHS about the timeline for an operation and commented that it was better to plan an attack operation for the month of Ramadan, and stated that such operations are, “100 percent the right thing.” Jalloh also asked if the CHS could assist him in providing a donation to ISIL. Ultimately, Jalloh provided a prepaid cash transfer of $500 to a contact of the CHS that Jalloh believed was a member of ISIL, but who was in fact an undercover FBI employee.
“Jalloh attempted to provide material support to ISIL by transferring funds intended for use by ISIL, taking steps to join and assist others in joining ISIL, and attempting to obtain a weapon that he believed would be used in an attack on U.S. soil in the name of ISIL,” said Mary B. McCord, Acting Assistant Attorney General for National Security. “Counterterrorism remains our highest priority and we will continue to hold accountable those who attempt to provide material support to foreign terrorist organizations.”
According to the statement of facts filed with the plea agreement, in June 2016, Jalloh travelled to North Carolina to obtain firearms. On July 2, Jalloh went to a gun dealership in northern Virginia, where he test-fired and purchased an assault rifle. Unbeknownst to Jalloh, the rifle was rendered inoperable before he left the dealership with the weapon. Jalloh was arrested the following day and the FBI seized the rifle.
Jalloh faces a maximum penalty of 20 years in prison when sentenced on Feb. 10, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office; and Mary B. McCord, Acting Assistant Attorney General for National Security, made the announcement after the plea was accepted by U.S. District Judge Liam O’Grady. Assistant U.S. Attorney John T. Gibbs and Special Assistant U.S. Attorney Brandon L. Van Grack are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-mj-296.
Two Women Found Guilty of Providing Material Support to TerroristsRead the Press Release
ALEXANDRIA, Va. – Two women were convicted today of terrorism crimes related to their material support of al-Shabaab, a designated foreign terrorist organization.
Muna Osman Jama, 36, of Reston, and Hinda Osman Dhirane, 46, of Kent, Washington, were found guilty of conspiracy to provide material support to a foreign terrorist organization, and providing material support to a foreign terrorist organization after a bench trial in front of U.S. District Judge Anthony J. Trenga.
“Providing material support to foreign terrorist organizations is a very serious crime,” said Dana J. Boente, U.S. Attorney for the Eastern District of Virginia. “These women funneled money to a terrorist organization which was conducting a violent insurgency campaign in Somalia. National security is the top priority in this office and we will continue to work closely with our law enforcement partners to investigate and prosecute those who provide material support to terrorists.”
“In addition to money they transferred in direct support of al-Shabaab, these subjects recruited, solicited, and advised an online group located in multiple countries as to how and where to transfer funds to this terrorist organization,” said Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office. “In coordination of the group, these subjects would then track and facilitate donations to ensure the money was received by their co-conspirators located in Nairobi and Somaliland. Today's guilty verdicts send a message that facilitation of financial support to a designated terrorist organization equates to terrorist activity itself.”
According to court records and evidence presented at trial, Jama and Dhirane sent money to financiers of al-Shabaab in Somalia and Kenya, which they referred to respectively as the “Hargeisa side” and the “Nairobi side.” The defendants also organized what was called a “Group of Fifteen,” which included women from Somalia, Kenya, Egypt, the Netherlands, Sweden, the United Kingdom, and Canada, as well as Minneapolis, Minnesota. The “Group of Fifteen” met regularly in a private chatroom that Jama established to organize and track monthly payment of money to the “Hargeisa side,” which was used to finance al-Shabaab military operations in the Golis Mountains in northern Somalia, and the “Nairobi side,” which was used to fund two al-Shabaab safehouses. One of the safehouses was used by al-Shabaab to store weapons and to prepare for attacks. The other was used to treat al-Shabaab fighters who had been wounded in battle.
A substantial part of the government’s case consisted of recorded telephone calls and other communications among the “Group of Fifteen.” These recordings demonstrated that the women had close connections with al-Shabaab leadership and were privy to non-public, inside information concerning al-Shabaab activities. Jama and Dhirane were recorded as they laughed as the carnage at the Westgate Mall in Nairobi was still taking place. Dhirane and co-conspirator were also recorded as they laughed at the Boston Marathon Bombing before it became known who committed the attack.
Jama and Dhirane each face a maximum penalty of 15 years in prison when sentenced on January 19, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office; and Jay S. Tabb, Jr., Special Agent in Charge of the FBI’s Seattle Field Office, made the announcement after the verdict was announced. Assistant U.S. Attorneys James P. Gillis and Danya E. Atiyeh are prosecuting the case. The U.S. Attorney’s Office for the District of Minnesota also provided assistance with the case.
This case was investigated by the FBI’s Washington, D.C. and Seattle Field Offices. The Justice Department’s Office of International Affairs also played an essential role in coordinating the arrests and searches with foreign authorities.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:14-cr-230.
Pastor and Wife Indicted for $1.2 Million Fraud Targeting Church MembersRead the Press Release
ALEXANDRIA, Va. – The senior pastor of Victorious Life Church in Alexandria, along with his wife, were arrested yesterday for their alleged involvement in a $1.2 million fraud scheme that victimized members of their congregation.
Terry Wayne Millender, 52, his wife Brenda Millender, 56, both of Alexandria, and Grenetta Wells, 55, also of Alexandria, were indicted by a federal grand jury on October 20, on charges of conspiracy to commit wire fraud and money laundering conspiracy. The charges were unsealed today after Wells was arrested.
According to the indictment, the defendants operated a company called Micro-Enterprise Management Group (MEMG), a Virginia company that alleged to help poor people in developing countries by providing small, short-term loans to start or expand existing businesses by working with a network of established micro-finance institutions. Terry Millender and Brenda Millender were founding members of MEMG, while Terry Millender served as chief executive officer and Wells served as chief operating officer. The defendants recruited investors by emphasizing its Christian mission and use of the funds to help the poor, promising guaranteed rates of return, assuring investors that the loans’ principal was safe and backed by the assets of MEMG. The indictment alleges that these representations were false and fraudulent, and that the money was actually used by the defendants to conduct risky trading on the foreign exchange currency market, options trading, payments towards the purchase of a $1.75 million residence for Terry and Brenda Millender, and other personal expenses for the defendants. To conceal how they had actually used the money, the defendants are alleged to have falsely assured investors that they would get their money back and blamed delays in repaying investors on the 2008 financial crisis, among other things.
The defendants will make their initial appearances this afternoon at 2 p.m. at the federal courthouse in Alexandria in front of Magistrate Judge Theresa C. Buchanan.
Each defendant faces a maximum penalty of 20 years in prison, if convicted. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Thomas Jankowski, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI), and Terrence P. McKeown, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, made the announcement. Assistant U.S. Attorney Katherine L. Wong is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-239.
D.C. Man Pleads Guilty to $1.9 Million Investment Fraud SchemeRead the Press Release
ALEXANDRIA, Va. – Homayoon Daneshvar, 63, a resident of Washington, D.C., pleaded guilty today to charges related to a $1.9 million investment fraud scheme.
According to the statement of facts filed with the plea agreement, from in or about April 2009 to January 2013, Daneshvar lied and made false promises to eight victim investors to persuade them to give him approximately $1.9 million. Daneshvar told the victim investors the money would be used for bridge financing to purchase foreclosed property that would be “flipped,” or quickly resold for profit. Daneshvar promised a monthly return on their investments, but in reality Daneshvar used the money to invest in the stock market, pay “returns” on the investments back to the investors, and to pay for his own personal expenses.
Daneshvar will be sentenced on Feb. 10, 2017, and faces a maximum penalty of 20 years in prison for wire fraud. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after the plea was accepted by U.S. District Judge Claude M. Hilton. Assistant U.S. Attorney Grace L. Hill is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-231.
Owner of Offshore Brokerage Firm Guilty of Money Laundering ConspiracyRead the Press Release
ALEXANDRIA, Va. – Michael J. Randles, 49, a Canadian citizen and permanent resident of Costa Rica, pleaded guilty today to charges of conspiracy to commit money laundering.
According to the statement of facts filed with the plea agreement, Randles controlled and operated Moneyline Brokers, later known as Trinity Asset Services, with his co-conspirator Harold Bailey Gallison II. Moneyline was an offshore brokerage company located in San Jose, Costa Rica, that did business under the names of various shell companies, including Sandias Azucaradas CR, S.A., Vanilla Sky, Inc., Bastille Advisors, Inc., and Jurojin, Inc. The purpose of Moneyline was to trade securities, primarily microcap or “penny stocks,” through United States and offshore accounts, often in connection with market manipulation or “pump-and-dump” and “boiler room” securities fraud schemes. Randles’ managed Moneyline’s office in Costa Rica, operated Moneyline’s unregistered securities business in Europe, and exercised authority over banking and financial transactions. Randles opened United States and offshore brokerage and bank accounts, including in Panama and in Europe that were used to facilitate pump-and-dump and boiler room schemes. Three of Randles’ co-conspirators, Harold Bailey Gallison II, Ann Marie Hiskey, and Roger G. Coleman, have previously pleaded guilty in the case. Gallison was sentenced to 216 months, and Hiskey and Coleman were each sentenced to two years’ probation.
Randles faces a maximum penalty of five years in prison when sentenced on Jan. 25, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after the plea was accepted by U.S. District Judge Anthony J. Trenga. Assistant U.S. Attorney Grace L. Hill and Special Assistant U.S. Attorneys N. Nathan Dimock and Michael O’Neill are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:15-cr-178.
Nigerian Man Pleads Guilty to $1.5 Million Fraud of DoD ContractorsRead the Press Release
ALEXANDRIA, Va. – Babatunde Aniyi, 33, of Lagos, Nigeria pleaded guilty today to charges of conspiracy to defraud U.S. defense contractors and impersonation of U.S. officers.
According to the statement of facts filed with the plea agreement, Aniyi and a co-conspirator in Nigeria, impersonated U.S. Department of Defense (U.S. DoD) officials using fake U.S. DoD email accounts and websites. The U.S. based co-conspirators would order computers and smart phones in the name of U.S. DoD officials and divert the packages to Nigeria. Two of the U.S.-based co-conspirators, Solomon Oyesanya and Oludayo Edgal, pleaded guilty to conspiracy charges and were sentenced to sixty and twenty-seven months in prison, respectively. According to court documents, losses caused by the conspiracy exceed $1.5 million.
Aniyi was indicted by a federal grand jury on Sept. 11, 2014, and was arrested in India in November 2015, while visiting to attend a course on computer hacking. Aniyi was extradited to the United States in July 2016. Aniyi faces a maximum penalty of eight years in prison when sentenced on February 3, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Jeffery Thorpe, Special Agent in Charge of the Defense Criminal Investigative Service Cyber Field Office; and Gordon B. Johnson, Special Agent in Charge of the FBI’s Baltimore Field Office, made the announcement after the plea was accepted by U.S. District Judge Claude M. Hilton. Assistant U.S. Attorneys Maya D. Song and Kellen S. Dwyer are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:14-cr-311.
Guatemalan Man Sentenced for Illegal Reentry into the United StatesRead the Press Release
ALEXANDRIA, Va. – Juan Abel Belteton-Barrios, 46, a citizen of Guatemala, was sentenced today to 14 months in prison for illegal reentry into the United States. Belteton-Barrios was also sentenced to three years of supervised release.
“Illegal reentry into the United States is a serious offense,” said Dana J. Boente, U.S. Attorney for the Eastern District of Virginia. “Unlawful reentry after deportation or removal is an offense with significant cost to law enforcement that erodes the lawful immigration process. It is my hope that this sentence will promote respect for the law, provide just punishment, and serve to deter similar criminal conduct.”
Belteton-Barrios pleaded guilty on August 5. According to court documents, Belteton-Barrios first entered the United States in 1991 and applied for asylum in 1993. After being denied asylum in 1998, Belteton-Barrios was ordered to voluntarily deport, however, he failed to follow the court order and remained in the United States undetected until his arrest for felony driving while intoxicated in June 2008. After serving a prison sentence, Belteton-Barrios was deported back to Guatemala in October 2008. He returned to the United States approximately seven months later, in May 2009, and remained undetected until his arrest by U.S. Border Patrol agents in May 2015. Belteton-Barrios was again deported back to Guatemala in September 2015. Three months later, in December 2015, Belteton-Barrios entered the United States illegally for the third time. He was immediately detected at the border and deported. Approximately one month later, he again returned to the United States and was detected by Border Patrol agents and immediately returned. In April 2016, Belteton-Barrios again illegally re-entered the United States and remained undetected until his arrest in May 2016.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Clark E. Settles, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington, made the announcement after sentencing by U.S. District Judge T.S. Ellis, III. Special Assistant U.S. Attorney Rachel E. Nonaka prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-139.
Drug Arrests Lead to Recovery of 119 Pounds of Cocaine and Stacks of CashRead the Press Release
NEWPORT NEWS, Va. – Criminal charges were filed this morning in Newport News against four men for their alleged involvement in a large-scale cocaine trafficking conspiracy. When the men were arrested on Thursday law enforcement officers seized approximately 54 kilograms (119 pounds) of cocaine and 100 bundles of shrink wrapped cash containing $5,000 to $10,000 each.
Marvin O’Neal Carter, Sr., 49, of Newport News; Daniel Rodriguez, aka Daniel Lopez-Rodriguez, 49, of California; Hilario Rodriguez, aka Hilario Lopez-Rodriguez, 50, of California; and Michael Stephen Kuna, 42, of Canada, were charged by criminal complaint with conspiracy to distribute and possess with intent to distribute five kilograms or more of cocaine. The men are scheduled to make their initial appearances today at 4 p.m. at the federal courthouse in Norfolk.
According to the affidavit on support of the criminal complaint, yesterday agents observed the arrival of a tractor trailer at a garage leased by Carter. The tractor trailer eventually off-loaded the trailer next to the garage, and shortly thereafter agents observed Michael Kuna, and Daniel and Hilario Rodriguez arrive and park in Carter’s garage parking lot. The four men then allegedly worked together to unload cocaine from hidden compartments located underneath the trailer. A short time later, Kuna was observed loading two large duffel bags with green straps into a vehicle before leaving the area. Law enforcement agents conducted a traffic stop on Kuna and located the two duffle bags which emanated with the odor of wet currency.
According to the affidavit on support of the criminal complaint, as Kuna was being detained, members of the DEA, FBI, and Newport News Police executed two federal search warrants on the garage and on the trailer. During the search, agents recovered approximately 54 kilograms of cocaine and 100 bundles of cash in $5,000 to $10,000 stacks. The search of the garage also led to the recovery of a firearm and a quantity of heroin, in addition to approximately $42,000 in cash from a safe.
Each defendant faces a mandatory minimum sentence of 10 years in prison and a maximum sentence of life in prison, if convicted. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division; Jonathan F. Trimble, Acting Special Agent in Charge of the FBI’s Norfolk Field Office; Richard W. Myers, Chief of Newport News Police; and Terry L. Sult, Chief of Hampton Police Division, made the announcement after the charges were filed. Assistant U.S. Attorney Howard J. Zlotnick and Special Assistant U.S. Attorney Amy E. Cross are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:16-mj-200.
A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
Burke Resident Convicted of Multiple Armed RobberiesRead the Press Release
ALEXANDRIA, Va. – Larry Pyos, Jr., of Burke, was convicted late yesterday by a federal jury on charges related to multiple armed robberies of businesses in Fairfax County and Falls Church. Pyos will be sentenced on Jan. 13, 2017.
On August 11, 2016, Pyos was charged in an indictment with conspiracy, armed robbery, using firearms in committing those robberies and being a felon in possession of firearms. In two of the robberies he fired shots at employees. According to court records and evidence presented at trial, Pyos’ crime spree started on Christmas Eve 2015, when he robbed the Good Fortune Supermarket in Falls Church. Pyos, who was armed with a handgun, fired at a store employee who followed him as he fled. Pyos later robbed the Shri Krishna grocery store, the Dollar Power store, and the Ding How Carryout all in Springfield. Pyos next robbed the Hong Kong Palace Restaurant in Falls Church on April 26, 2016, and was again armed with a handgun that he fired at a pursuing employee as he fled. Pyos’ final robbery was of a Subway sandwich shop in McLean on May 9, 2016. Pyos was arrested on May 11, 2016, and has been in custody since that date. The two handguns Pyos used in committing these robberies were purchased by his girlfriend and co-conspirator, who previously pleaded guilty to charges arising from these robberies and testified at Pyos’ trial.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Paul M. Abbate, Assistant Director in Charge of the FBI's Washington Field Office; and Colonel Edwin C. Roessler Jr., Fairfax County Chief of Police, made the announcement after the verdict was accepted by U.S. District Judge Gerald Bruce Lee. Assistant U.S. Attorneys Tyler McGaughey and Michael Rich are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-178.
Thieves Sentenced for Stealing 30 Firearms in BurglaryRead the Press Release
NEWPORT NEWS, Va. – Four residents of Newport News have been sentenced for stealing more than 30 firearms from Southern Police Equipment, a federally licensed firearms dealer in Chesterfield County, during a break-in on Aug. 7, 2015.
Xavier Greene, 21, Deshawn Shields, 20, Mariah Walker, 20, and Endyia Washington, 26, all pleaded guilty to the burglary. Greene, the final defendant to plead guilty, was sentenced today to 10 years in prison and, along with his co-defendants, was ordered to pay restitution of $26,582.76 to the victims in this case.
According to court documents, on Aug. 7, 2015, Greene, Shields, Walker and Washington drove from Newport News to Richmond with a plan to steal firearms from a pawn shop. The group abandoned one location due to heavy police presence and went to Southern Police Equipment on Midlothian Turnpike. Washington and Walker dropped off Greene and Shields behind the building while Greene and Shields attempted to disable security measures by ripping the power box off the building. Greene and Shields entered the store causing thousands of dollars in damage and gathered over 30 firearms, including rifles, handguns and a shotgun. Walker and Washington picked the men up and drove back to Newport News. Upon their return, Greene invited multiple gang members from 36th Street Bang Squad to come to Washington’s home to pick up firearms. Additional firearms were given to another 36th Street Bang Squad member in Hampton to sell. The 36th Street Bang Squad is a hybrid criminal street gang on the peninsula responsible for shootings, murders, robberies and other violent crimes, of which Greene was a member. Stolen firearms in this case have been recovered in Hampton, Newport News and Virginia Beach in other jurisdictions.
All four defendants have entered guilty pleas and been sentenced.
Name
Date of Sentencing
Sentence
Endyia Washington
April 20
60 months
Deshawn Shields
April 20
96 months
Mariah Walker
May 6
65 months
Xavier Greene
May 20
120 months
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Michael B. Boxler, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division; Terry Sult, Chief of Hampton Police Division; and Richard Myers, Chief of Newport News Police Department, made the announcement after sentencing by U.S. District Judge Arenda Wright Allen. Special Assistant U.S. Attorney Amy E. Cross prosecuted the case.
The case was investigated by the ATF’s Norfolk and Richmond divisions, with significant assistance from the Hampton Police Division, the Newport News Police Department, and Chesterfield Police Department.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:15-cr-76.
Former Employee of Realty Company Indicted for $250K FraudRead the Press Release
NORFOLK, Va. – Lindsay Kneff, 36, of Virginia Beach, was indicted by a federal grand jury today on six counts of wire fraud, six counts of mail fraud, one count of falsely altering Postal Service money orders and three counts of engaging in monetary transactions in criminally derived property.
According to the indictment, Kneff was employed in the Virginia Beach office of Rose & Womble Realty Company in a managerial position and was responsible for overseeing the processing of commissions and accounts payable. Between January 2014 and August 2015, Kneff is alleged to have written checks on the Rose & Womble operating account to pay her personal expenses. Kneff made unauthorized wire transfers into her own accounts and altered Rose & Womble money orders by writing in her own name as the payee, resulting in a $255,147.20 loss for the company.
Kneff faces a maximum penalty of 20 years in prison on each of the wire and mail fraud counts, five years on the count charging false alteration of Postal Service money orders, and 10 years on each of the counts for engaging in monetary transactions in criminally derived property, if convicted. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Brian J. Ebert, Special Agent in Charge of the U.S. Secret Service’s Washington Field Office, made the announcement after Kneff’s’s initial appearance before U.S. Magistrate Judge Robert J. Krask. Assistant U.S. Attorney Alan M. Salsbury is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:16-cr-139.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
Five Members of Portsmouth Based Heroin & Fentanyl Trafficking Organization Plead GuiltyRead the Press Release
NORFOLK, Va. – Nathaniel Powell, 33, Ernest Cross, 38, Detuan Gordon, 25, Valerie Wilson, 55, and Marque Wilson, 33, all of Portsmouth, have pleaded guilty to charges related to their role in a heroin and fentanyl drug trafficking conspiracy.
According to court records, from March 2012 through July 2016, members of this organization conspired to manufacture and distribute heroin in excess of 1,000 grams. The group’s primary source of supply for heroin and fentanyl came from Baltimore. The narcotics were transported to Hampton Roads and repackaged using a hydraulic press machine and gel capsules for retail sales. This organization further disseminated their drugs and served as a source of supply for other individuals in the Outer Banks of North Carolina.
On Dec. 22, 2015, police executed a search warrant on Gordon’s residence and recovered opiates, scales, drug paraphernalia, and firearms. During the conspiracy Gordon, a convicted felon, possessed an AK-47-style rifle as well as a Taurus handgun. When Gordon was arrested on June 8, police recovered nearly $50,000 in cash, a firearm, heroin, and fentanyl. Valerie Wilson was arrested on June 2, in Moyock, North Carolina, after selling five grams of heroin. Wilson’s six-year-old grandson was in her vehicle when she distributed the heroin.
Two members of the group led police on two separate vehicle pursuits. Marque Wilson, who was in possession of heroin and cocaine, was arrested on June 10, after attempting to elude police. Powell led police on a high speed chase through residential neighborhoods of Portsmouth before he crashed into another driver. Powell, who is a paraplegic from a gunshot wound, used a cane to drive during the pursuit. Police recovered seven grams of fentanyl from Powell. After Powell’s arrest, he threatened to kill an individual he believed was working with police.
Name
Date of Guilty Plea
Date of Sentencing
Nathaniel Powell
October 20
Feb. 17, 2017
Ernest Cross
September 23
Jan. 20, 2017
Detuan Gordon
September 20
Jan. 26, 2017
Valerie Wilson
September 16
Jan. 20, 2017
Marque Wilson
October 18
Jan. 27, 2017
A federal grand jury charged the Portsmouth based heroin and fentanyl drug trafficking group with a 20 count indictment on July 20. Charges included, but were not limited to, Conspiracy to Manufacture, Distribute, and Possess with Intent to Distribute Heroin, Distribution of Heroin and Fentanyl, Felon in Possession of a Firearm, and Possession of Firearms in Furtherance of a Drug Trafficking Crime.
Gordon faces a mandatory minimum sentence of 15 years in prison and a maximum penalty of life. Cross and Powell face mandatory minimum sentences of five years and a maximum penalty of 40 years in prison. The Wilsons face a maximum sentence of 20 years in prison. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Mark R. Herring, Attorney General of Virginia; Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, Kelvin L. Wright, Chief of the Chesapeake Police Department, and Tonya D. Chapman, Chief of the Portsmouth Police Department, made the announcement after Powell’s guilty plea was accepted by U.S. Magistrate Judge Lawrence Leonard. Special Assistant U.S. Attorney John F. Butler, and Assistant U.S. Attorneys Joseph E. DePadilla and Andrew C. Bosse prosecuted the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:16-cr-97.
Williamsburg Man Pleads Guilty to Child Pornography ChargesRead the Press Release
NEWPORT NEWS, Va. – Edward Joseph Matish III, 25, of Williamsburg, pleaded guilty yesterday to charges of accessing with intent to view child pornography involving a prepubescent minor.
According to the statement of facts filed with the plea agreement, Matish was a member of Playpen, a hidden website dedicated to the sharing of child pornography that operated on the Tor network from August 2014 until March 2015. Between October 2014 and March 2015, Matish logged into Playpen and viewed content depicting the sexual exploitation of children. In December 2014, Matish wrote on the site that he used it to control his attraction to young girls, encouraging others like him to “[l]eave the touching to the brave souls willing to risk everything for our relief.”
Matish was indicted by a federal grand jury on February 8 and faces a maximum penalty of 20 years in prison when sentenced on Jan. 30, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Jonathan F. Trimble, Acting Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement after the plea was accepted by U.S. District Judge Henry Coke Morgan, Jr. Assistant U.S. Attorney Kaitlin C. Gratton is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:16cr16.