Eastern District of Virginia
Press releases recorded for this federal judicial district.
Two Former Chesapeake, Virginia, Subcontractors Sentenced for Bribery, ConspiracyRead the Press Release
WASHINGTON – Dwayne A. Hardman, 44, co-founder of two government contracting companies that sought business from the United States Navy Military Sealift Command (MSC), and Adam C. White, 40, former vice president and co-owner of one of Hardman’s government contracting companies, were sentenced for bribery and conspiracy. On July 9, 2014, Hardman was sentenced to 96 months in prison, followed by three years of supervised release. White was sentenced today to serve 24 months in prison, followed by three years of supervised release. Hardman was ordered to forfeit $144,000, and White was ordered to forfeit $57,000.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, United States Attorney Dana J. Boente for the Eastern District of Virginia, Special Agent in Charge Royce E. Curtin of the FBI’s Norfolk Office, Acting Executive Assistant Director Charles T. May Jr. of the Naval Criminal Investigative Service (NCIS) and Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office made the announcement today after sentencing by United States Chief Judge Rebecca Beach Smith of the Eastern District of Virginia.
According to court documents, Hardman and White participated in a five-year bribery scheme in which they and several co-conspirators provided more than $265,000 in cash bribes, among other things, to two public officials working for MSC, in an illegal effort to influence those public officials to provide favorable treatment to Hardman and White’s companies in connection with United States government contracting work.
On Feb. 18, 2014, Hardman pleaded guilty to a criminal information charging him with bribery. According to the plea documents, Hardman was the co-founder of two government contracting companies, referred to as Company A and Company B, located in Chesapeake, Virginia that sought contracting business from MSC, which is the leading provider of transportation for the United States Navy. At his plea hearing, Hardman admitted that beginning in March 2005, he and other Company A employees, provided approximately $3,000 in cash bribes per month to two MSC public officials, Kenny E. Toy, the former Afloat Programs Manager for the MSC’s N6 Command, Control, Communication, and Computer Systems Directorate, and Scott B. Miserendino Sr., a former government contractor who performed work for the MSC. Those Company A employees included Roderic J. Smith, the former president, co-owner and co-founder of Company A; Adam C. White, a former vice president and co-owner of Company A; and Michael P. McPhail a former project manager and co-owner of Company A. Hardman also admitted that in May 2009, he and Timothy S. Miller, co-founder of Company B, provided $50,000 in cash bribes to Toy and Miserendino. In addition to the cash bribes, Hardman stated that he and his co-conspirators provided Toy and Miserendino flat screen televisions, a paid vacation to Nags Head in North Carolina, a personal loan and installation of hardwood floors in Toy’s residence.
In exchange for these bribes, Toy and Miserendino provided favorable treatment in connection with MSC-related business to both Company A and Company B. During the bribery scheme, Company A received approximately $3 million in MSC-related business, and Company B received approximately $2.4 million in MSC-related business.
As part of his guilty plea, Hardman also admitted that, in approximately November or December 2010, Hardman threatened to report the bribery activities to law enforcement authorities if his co-conspirators did not provide him money. In total, Hardman admitted that he received approximately $85,000 from his co-conspirators, including Smith, Toy and Miserendino, in exchange for not reporting the bribery scheme to law enforcement authorities.
On April 4, 2014, White pleaded guilty to a criminal information charging him with conspiracy to commit bribery. At his plea hearing, White admitted that from approximately April 2005 until approximately March 2006, he personally contributed approximately $26,000 in cash bribe payments for Toy and Miserendino, and White was aware that other co-conspirators, including Hardman, Smith and McPhail, were also contributing cash and other things of value to be provided to Toy and Miserendino in exchange for their official assistance in providing MSC-related business.
Earlier this year, three other individuals pleaded guilty in connection with the bribery scheme. On Feb. 12, 2014, Toy, the former Afloat Programs Manager, pleaded guilty to accepting bribes from Hardman, White, and others. On Feb. 19, 2014, McPhail pleaded guilty to conspiracy to commit bribery. On March 5, 2014, Smith pleaded guilty to conspiracy to bribe public officials.
On June 23, 2014, United States District Judge Henry Coke Morgan of the Eastern District of Virginia sentenced Smith to 48 months in prison followed by 1 year of supervised release and ordered him to forfeit $175,000.
On May 23, 2014, a grand jury in the Eastern District of Virginia indicted Miserendino and Miller. The indictment charges Miserendino with one count of conspiracy to commit bribery, one count of bribery, one count of conspiracy to commit obstruction of criminal investigations and to commit tampering with a witness, and one count of obstruction of criminal investigations. The indictment charges Miller with one count of conspiracy to commit bribery and two counts of bribery. Trial is set for Sept. 30, 2014, before Chief Judge Rebecca Beach Smith of the Eastern District of Virginia.
The charges in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
The case was investigated by Special Agents of the FBI, NCIS, and DCIS. The case is being prosecuted by Trial Attorney Emily Rae Woods of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Stephen W. Haynie of the Eastern District of Virginia.Tweet
Former Government Employee Pleads Guilty to Accessing Government Website Servers Without AuthorizationRead the Press Release
ALEXANDRIA, Va. – Sathish Kumar Chandhun Rajendran, 36, of Sterling, Virginia, pleaded guilty yesterday to engaging in unauthorized access to government servers that hosted a Fannie Mae website used to support federal mortgage loan modification programs.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Michael P. Stephens, Acting Inspector General for the Federal Housing Finance Agency (FHFA-OIG); and Christy Romero, Special Inspector General for the Troubled Asset Relief Program (SIGTARP), made the announcement after the plea was accepted by U.S. District Judge T.S. Ellis, III.Rajendran pleaded guilty to a one-count criminal information charging him with unauthorized access to a protected computer causing damage. Rajendran faces a maximum penalty of five years in prison when he is sentenced on October 3, 2014. In the plea agreement, Rajendran also agreed, for a period of three years following his conviction, to refrain from participating as an employee, contractor or subcontractor in any government contract requiring clearance.
According to a statement of facts filed with the plea agreement, Rajendran worked at Fannie Mae as an Information Technology term employee and was assigned to the development of the CheckMyNPV.com website. This website was established under the Dodd-Frank Wall Street Reform and Consumer Protection Act by the Department of the Treasury and the Department of Housing and Urban Development in conjunction with the government’s Making Home Affordable (MHA) Program. The online tool on this website, operated by Fannie Mae under the auspices of the MHA, allowed citizens to determine the net present value of their homes and check their eligibility to participate in the Home Affordable Modification Program (HAMP), a federal program designed to avoid mass foreclosures.
After being terminated from employment in August 2013, Rajendran repeatedly used administrator credentials to log into government servers and make unauthorized changes to the CheckMyNPV website, including disabling the website’s online tool for checking HAMP eligibility. As a result of these actions, Rajendran caused damage and loss to the website in the amount of $30,000 to $70,000.
This case was investigated by the FHFA-OIG and SIGTARP. Assistant U.S. Attorney Alexander T.H. Nguyen 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. 1:14-cr-233.Tweet
Caribbean-Based Investment Advisors and Attorney Plead Guilty to Using Offshore Accounts to Launder and Conceal FundsRead the Press Release
WASHINGTON - Joshua Vandyk, a U.S. citizen, and Eric St-Cyr and Patrick Poulin, Canadian citizens, have each pleaded guilty to conspiring to launder monetary instruments, the Justice Department and Internal Revenue Service (IRS) announced today.
Patrick Poulin, 41, pleaded guilty today, Vandyk, 34, pleaded guilty on June 12, and St-Cyr, 50, pleaded guilty on June 27. The three defendants were indicted by a grand jury in the U.S. District Court for the Eastern District of Virginia on March 6, and the indictment was unsealed on March 12 after the defendants were arrested in Miami.
According to the plea agreements and statements of facts, Vandyk, St-Cyr and Poulin conspired to conceal and disguise the nature, location, source, ownership and control of property believed to be the proceeds of bank fraud, specifically $2 million. Vandyk, St-Cyr and Poulin assisted undercover law enforcement agents posing as U.S. clients in laundering purported criminal proceeds through an offshore structure designed to conceal the true identity of the proceeds’ owners. Vandyk and St-Cyr invested the laundered funds on the clients’ behalf and represented that the funds would not be reported to the U.S. government.
“This investigation highlights the Justice Department’s commitment to worldwide enforcement of federal laws designed to ensure that U.S. taxpayers fully disclose and report all foreign income and assets,” said Deputy Assistant Attorney General Ronald A. Cimino of the Justice Department's Tax Division. “The Tax Division is committed to using every tool available to hold these wrongdoers accountable.”
“These three defendants played a shell game by creating offshore entities designed to help their U.S. clients evade taxes and other legal requirements, and they used that same shell game to launder purported criminal proceeds,” said U.S. Attorney Dana J. Boente for the Eastern District of Virginia. “We are committed to working with our law enforcement partners to penetrate and combat these schemes wherever they occur.”
“Individuals who assist others in laundering criminal proceeds will be held accountable for their own criminal actions,” said IRS-Criminal Investigation Chief Richard Weber. “The defendants in this investigation had a blatant disrespect for the laws and laundered purported criminal proceeds through offshore structures to conceal the identity of the proceeds’ owners. IRS Criminal Investigation has ramped up its presence in the international arena and will aggressively pursue those who commit financial crimes.”
According to court documents, Vandyk and St-Cyr lived in the Cayman Islands and worked for an investment firm based in the Cayman Islands. St-Cyr was the founder and head of the investment firm, whose clientele included numerous U.S. citizens. Poulin, an attorney at a law firm based in Turks and Caicos, worked and resided in Canada as well as the Turks and Caicos. His clientele also included numerous U.S. citizens. Vandyk, St-Cyr and Poulin solicited U.S. citizens to use their services to hide assets from the U.S. government, including the IRS. Vandyk and St-Cyr directed the undercover agents posing as U.S. clients to create an offshore corporation with the assistance of Poulin and others because they and the investment firm did not want to appear to deal with U.S. clients. Vandyk, St-Cyr and Poulin used the offshore entity to move money into the Cayman Islands and used Poulin as a nominee intermediary for the transactions.
According to court documents, Poulin established an offshore corporation called Zero Exposure Inc. for the undercover agents posing as U.S. clients and served as a nominal board member in lieu of the clients. Poulin transferred approximately $200,000 that Poulin, St-Cyr and Vandyk believed to be the proceeds of bank fraud from the offshore corporation to the Cayman Islands, where Vandyk and St-Cyr invested those funds outside of the United States in the name of the offshore corporation. The investment firm represented that it would neither disclose the investments or any investment gains to the U.S. government, nor would it provide monthly statements or other investment statements to the clients. Clients were able to monitor their investments online through the use of anonymous, numeric passcodes. Upon request from the U.S. client, Vandyk and St-Cyr liquidated investments and transfer money, through Poulin, back to the United States. According to Vandyk and St-Cyr, the investment firm would charge clients higher fees to launder criminal proceeds than to assist them in tax evasion.
The case was investigated by special agents of the IRS-Criminal Investigation. Trial Attorneys Todd Ellinwood and Caryn Finley of the department’s Tax Division and Assistant U.S. Attorney Kosta Stojilkovic of the U.S. Attorney’s Office for the Eastern District of Virginia are prosecuting the case. The Justice Department and the IRS would like to thank the Royal Canadian Mounted Police, the Royal Cayman Islands Police Service and the Royal Turks and Caicos Islands Police Force for their assistance in this investigation.
Additional information about the Tax Division and its enforcement efforts may be found at the division website.Tweet
Two Leaders of Sophisticated, Violent Fraudulent Document Ring Sentenced for Racketeering, Attempted Robbery, and Money LaunderingRead the Press Release
RICHMOND, Va. – On July 7, 2014, Ivan Patino Sanchez , 35, a Mexican National who resided in Richmond, Virginia was sentenced to 96 months’ imprisonment, and on July 8, 2014, Felipe Alvarado Gonzalez, 46, a Mexican National who resided in Pawtucket, Rhode Island, was sentenced to 60 months’ imprisonment for their respective roles in a violent criminal organization that specialized in manufacturing and distributing fraudulent identifications. Both Patino Sanchez and Alvarado Gonzalez previously pleaded guilty to Conspiracy to Engage in Racketeering and Conspiracy to Launder Money. Patino Sanchez had also pleaded guilty to Interference with Commerce by Robbery. Because both defendants are illegally within the United States, they face deportation following the service of their prison sentences.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Clark E. Settles, Special Agent in Charge for U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), made the announcement after the sentences were handed down by Senior United States District Judge James R. Spencer. In both cases, Judge Spencer granted the United States’ request for an upward variance, and sentenced the defendants above the calculated guideline ranges.
According to court papers, these defendants were connected to a Fraudulent Document Enterprise (FDE) previously prosecuted in the Eastern District of Virginia in United States v. Israel Cruz Millan, Case No. 3:10CR308. The FDE originally operated in the United States beginning prior to 2008 and continuing through November 18, 2010, and had cells in Richmond, Norfolk, Virginia Beach, and Manassas, Virginia; Fayetteville and Little Rock, Arkansas; New Haven, Connecticut; Mishawaka, Indiana; Lexington and Louisville, Kentucky; Chelsea, Massachusetts; St. Louis, Missouri; Chapel Hill, Greensboro, Raleigh, and Wilmington, North Carolina; Cincinnati, Ohio; Providence, Rhode Island; and, Nashville, Tennessee. The criminal enterprise was dismantled within the United States on November 18, 2010.
On February 16, 2012, United States District Judge James R. Spencer sentenced the overall leader, Israel Cruz Millan, to 300 months’ imprisonment. On March 2, 2012, United States District Judge Henry E. Hudson sentenced Oliverez-Jiminez to two consecutive life terms in prison, for racketeering, murder, kidnapping, conspiracy to commit money laundering, and conspiracy to produce and transfer false identification documents.
In connection with their previous guilty pleas, Patino Sanchez and Alvarado Gonzalez admitted to their respective roles in helping the FDE restart its criminal activities in the United States following the 2010 arrests described above. Beginning at some point prior to February 2012, Manuel Hidalgo Flores, also known as “Chino,” “Chimuelo” and “Julio,” began managing the organization’s operations in the United States, supervising operations in Richmond, Virginia; Springdale, Arkansas; Boston, Massachusetts; Raleigh, North Carolina; Cincinnati, Ohio; and Pawtucket, Rhode Island. As in the previous case, the FDE produced high-quality false identification cards for distribution to illegal aliens. In most cities where the organization operated, Hidalgo Flores placed a cell manager to supervise a number of “runners,” the lower level members of the organization who distributed business cards advertising the organization’s services and helped facilitate transactions with customers.
Beneath Hidalgo Flores, Patino Sanchez served as the manager of the Richmond, Virginia cell, and Alvarado Gonzalez managed the Pawtucket, Rhode Island cell. In general, within each cell, the manager was responsible for distributing the fraudulent documents using information obtained from clients by “runners.” The runners would recruit illegal alien clients who wished to obtain false identification documents, including counterfeit Permanent Resident Alien Cards (also known as “Green Cards”), Social Security Cards, out-of-state identification cards, and various international documents. Upon identifying a specific client, a runner would relay identifying information and photographs from the client to the printer via cellular telephone or other method. The printer would, in turn, use a computer and printer to create fraudulent identification documents for the client, depending on the nature of the order received from the client. Once the documents were complete, the runner would usually provide the documents to the client in exchange for United States currency. A client would generally pay approximately $150 for a set of fraudulent identification documents (such as a Permanent Resident Alien Card and Social Security Card). Each cell maintained detailed sales records and divided the proceeds between the runner, the cell manager, and the upper level managers in Mexico. In addition, the FDE used Western Union and MoneyGram to funnel criminal proceeds to Mexico.
The evidence during the Oliverez-Jiminez trial detailed how members of the organization sought to drive competitors from their territory by posing as customers in search of fraudulent documents and then attacking the competitors when they arrived to make a sale. In the current case, Patino Sanchez admitted to his role in targeting a competitor in the Richmond, Virginia area on October 6, 2013. This defendant, along with others, identified a competitor (referred to as “L.G.”) who was selling fraudulent documents in competition with the Richmond cell. A co-defendant posed as a customer and contacted L.G. about setting up a fraudulent documents transaction. L.G. then met with the co-defendant at a designated location. At the same time, Patino Sanchez, along with other FDE members, was surveilling the transaction. The defendants planned to follow competitor L.G. after the transaction to find where he (L.G.) produced fraudulent identification documents. The group intended to assault L.G. and steal L.G.’s printing equipment by means of actual and threatened force, violence, and fear of injury. Through this planned conduct, FDE members hoped to stop L.G. from selling fraudulent identification documents and to enhance the FDE’s control of the Richmond area fraudulent document market. Unbeknownst to the FDE members, law enforcement officers were also surveilling the October 6, 2013 transaction. Due to law enforcement intervention, competitor L.G. was detained during a traffic stop and the FDE members fled the area. According to his plea documents, Patino Sanchez admitted that absent law enforcement intervention, he and his cohorts would have carried out their plan against L.G.
To date, 42 members of this organization charged in the Richmond, Virginia federal cases have been convicted. In the current case, 9 defendants are awaiting sentencing, with their hearings scheduled before Judge Spencer over the next two months.
The case was investigated by the Richmond and Norfolk offices of ICE’s Homeland Security Investigations (HSI), which falls under the Washington, D.C., office. ICE HSI received assistance from the Virginia State Police, Chesterfield County Police Department, and Henrico County Police Department. Assistant United States Attorney Michael Gill and Trial Attorney Maria Gonzalez Calvet, of the Criminal Division's Fraud Section, are prosecuting the case on behalf of the United States
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Tweet
Toray Chemical Korea Resolves Attempted Theft of Trade Secrets Investigation and Agrees to Pay over $2 Million PenaltyRead the Press Release
RICHMOND, Va. – Toray Chemical Korea, Inc., formerly doing business as Woongjin Chemical Co., Ltd., a South Korean chemical company, agreed to pay a criminal penalty of over $2 million to resolve an attempted theft of trade secrets investigation, announced Dana J. Boente, U.S. Attorney for the Eastern District of Virginia.
The U.S. Attorney’s Office filed a criminal information today against Toray Chemical and a two-year deferred prosecution agreement in the U.S. District Court for the Eastern District of Virginia. The one-count information charges Toray Chemical with attempted theft of trade secrets. As part of the deferred prosecution agreement, Toray Chemical agreed to pay a $2,058,000 penalty for its illegal activity, implement an enhanced compliance and ethics program, continue to cooperate with the government’s investigation and remediate past problems.
“These criminal charges reflect the Eastern District of Virginia’s continued commitment to protecting one of this country’s greatest assets—the innovation and ingenuity of the American people,” said U.S. Attorney Boente. “The terms of the deferred prosecution agreement in this case should send a strong message to businesses in the United States and around the world that substantial cooperation with law enforcement is one of the most effective ways to demonstrate that a company is truly committed to addressing the criminal conduct of its executives and ensuring that such conduct does not occur in the future.”
According to court documents, Toray Chemical, formerly doing business as Woongjin Chemical, endeavored to develop Arawin®, a meta-aramid fiber designed to compete with a product called Nomex®. Meta-aramid fibers are used in a variety of applications, including protective fabrics, electrical insulation and lightweight structural support for commercial aircraft. Nomex is produced by E. I. du Pont de Nemours and Company (DuPont), one of the largest chemical companies in the United States.
From January 2011 through November 2011, Woongjin Chemical sought to improve its Arawin product by hiring and attempting to hire as consultants former DuPont employees with knowledge of Nomex technology, in particular the process for manufacturing Nomex paper. To that end, two former DuPont employees met with Woongjin Chemical executives in South Korea. During this visit, Woongjin Chemical engineers repeatedly asked the former DuPont employees to disclose aspects of the Nomex manufacturing process, including details about the short-cut fiber, known as floc, used to make Nomex paper.
One of the former DuPont employees offered to confirm the specific length and conditions used to produce floc by speaking with a current DuPont employee when he returned to the United States. Although the former DuPont employee did not obtain the information Woongjin Chemical requested when he returned to the United States, the company continued to seek information about DuPont’s process for manufacturing Nomex paper. Indeed, a Woongjin Chemical executive directed another employee to obtain a sample of Nomex floc from a DuPont distributor or customer by legal or illegal means. Shortly thereafter, Woongjin Chemical executives learned that FBI agents interviewed the two former DuPont employees regarding the potential theft of DuPont trade secrets.
The deferred prosecution agreement acknowledges Toray Chemical’s extraordinary cooperation with the government’s investigation, including an extensive, thorough and swift internal investigation, producing relevant documents from outside the United States, and collecting, analyzing, organizing and, in many instances, translating voluminous evidence and information for the United States. In addition, the agreement highlights that Toray Chemical has already undertaken remedial measures, including suspension of and ultimate refusal to renew contracts with certain consultants and implementation of new policies and procedures for key employees.
This case was investigated by the FBI’s Richmond Field Office. Assistant U.S. Attorneys Katherine Lee Martin and Michael S. Dry 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. 3:14-cr-93.Tweet
North Carolina Drug Supplier to Henrico Drug Dealers Sentenced to 24 Years in PrisonRead the Press Release
RICHMOND, Va. – Carlos A. Cooke, age 38, of High Point, North Carolina, Virginia, was sentenced to 24 years in prison on his guilty plea to conspiring to distribute more than 5 kilograms of cocaine.
Dana J. Boente, United States Attorney for the Eastern District of Virginia, Shannon L. Taylor, Commonwealth Attorney for Henrico County; Special Agent in Charge Karl C. Colder of the Drug Enforcement Administration, Washington Field Division and Douglas A. Middleton, Chief of Henrico Police Division, made the announcement after the sentencing before United States District Judge Henry E. Hudson.In the Statement of Facts signed as part of his guilty plea, Cooke admitted that from 2007 to 2013 he distributed between 5 and 15 kilograms of cocaine from North Carolina to dealers in Henrico and Urbanna, Virginia. He would negotiate on the telephone to supply those dealers with distribution quantities of cocaine, typically as high as 375 grams at a time. Tomeka Wimbush, age 36, of Martinsville, Virginia, would transport the drugs to the Virginia dealers, and then return with the proceeds, which she gave to Cooke. Wimbush was sentenced on August 5, 2014 to 51 months in prison.
This case is part of an 18-month OCDETF investigation, Operation Carolina and Back, that targeted Cooke and his Virginia customers. In addition to Cooke and Wimbush, 8 Henrico dealers and 1 Urbanna dealer have pled guilty to drug trafficking charges. Darryl Delaney, a Henrico dealer, was sentenced to 156 months’ imprisonment; Gordon Shelton, also a Henrico dealer, was sentenced to 120 months’ imprisonment. The other Henrico dealers, Stevenson Silencieux, Charles Kates, Kevin Lee, Kelley Brown, Eric Wingate and Donte Beard, are awaiting sentencing. Charles Epps, the Urbanna dealer, is also awaiting sentencing.
This case was investigated by the Henrico County Commonwealth Attorney’s Office, the Drug Enforcement Administration, and the Henrico Police Division. David T. Maguire, Assistant United States Attorney and Matthew C. Ackley, Special Assistant United States Attorney and Henrico County Regional Drug Prosecutor, are prosecuting the case on behalf of the United States.
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. 3:14-cr-030.Tweet
Large-Scale Distributor of Unapproved Foreign Prescription Drugs IndictedRead the Press Release
ALEXANDRIA, Va. – James Quinn, 73, of Surrey, United Kingdom, was indicted yesterday by a federal grand jury for his alleged involvement in the illegal shipments of non-FDA approved prescription drugs to co-conspirators in the United States. Quinn, along with two companies in the United Kingdom and Switzerland that he controls, were charged with five felony counts and he is due to appear before U.S. District Court Judge Liam O’Grady for arraignment on Aug. 18, 2014.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Antoinette V. Henry, Special Agent in Charge of FDA’s Office of Criminal Investigations (OCI); Clark Settles, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Washington; Gary Barksdale, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service; Karl C. Colder, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Washington Field Division; and M. Douglas Scott, Arlington County Chief of Police, made the announcement.
According to the indictment, Quinn served as a supplier of non-FDA-approved drugs through his Switzerland-based company, Atlantic Pharmaceuticals AG, and he served as a trans-shipper of non-FDA-approved drugs through his United Kingdom-based company, World Medical Limited. The indictment alleges that, as a trans-shipper, Quinn received non-FDA-approved drugs from countries such as India and the United Arab Emirates, broke those shipments into smaller packages, affixed false customs declarations and sent the packages to the United States on behalf of co-conspirators who sold non-FDA-approved drugs to medical practices across the United States. Quinn’s co-conspirators are alleged to have included Gallant Pharma International Inc., which pleaded guilty in the Eastern District of Virginia to 12 felony offenses on Dec. 2, 2013, and Pharmalogical Inc. (d/b/a Medical Device King), whose co-owners, William Scully and Shahrad Rodi Lameh, are awaiting trial on a 73-count indictment in the Eastern District of New York.
Quinn and his companies, World Medical Limited and Atlantic Pharmaceuticals AG, were charged in the Eastern District of Virginia with the following offenses: conspiracy, which is punishable by a maximum penalty of five years in prison; importation contrary to law, which is punishable by a maximum term of 20 years in prison; two counts of felony introduction of misbranded drugs into interstate commerce, each of which are punishable by a maximum term of three years; two counts of misdemeanor introduction of misbranded drugs into interstate commerce, each of which are punishable by a maximum term of one year; and unlicensed medical wholesaling, which is punishable by a maximum term of ten years.
The investigation was conducted by FDA-OCI, DEA’s Group 33 Diversion Task Force, ICE-HSI and the U.S. Postal Inspection Service, with assistance from the Arlington County Police Department. Assistant U.S. Attorneys Lindsay A. Kelly, Maya Song and Jay Prabhuare prosecuting the case.
Criminal indictments are only charges and not evidence of guilt. A defendant is presumed to be innocent until and unless proven guilty.
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-277.
Alexandria Man Pleads Guilty to Million-Dollar Investment Fraud SchemeRead the Press Release
ALEXANDRIA, Va. – Christopher Cunningham, 46, of Alexandria, Virginia, pleaded guilty today to a wire fraud scheme in which Cunningham solicited investments, typically from elderly clients, based on fraudulent promises and representations.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Kathy A. Michalko, Special Agent in Charge of the U.S. Secret Service’s Washington Field Office, made the announcement after the plea was accepted by U.S. District Judge Leonie M. Brinkema.
In a statement of facts filed with the plea agreement, Cunningham admitted to conducting an investment fraud scheme from approximately 2005 to 2011. During that time, Cunningham worked as an investment adviser, and in that position, he solicited investments from clients, who typically were elderly. Among other things, Cunningham promised these clients guaranteed returns and made certain false representations, including that he was not being personally compensated in connection with their investments and the money could be paid back in a single day if needed. Once he obtained the money from these clients, however, Cunningham used it to fund his private companies and for his personal use. Cunningham repaid very little of his clients’ investments, and as a result of his fraud, investors lost more than $1,000,000.
Cunninghamfaces a maximum penalty of twenty years in prison when he is sentenced on October 3, 2014.
This case was investigated by the U.S. Secret Service with the assistance of the Virginia State Corporation Commission’s Division of Securities and Retail Franchising. Assistant U.S. Attorney Chad Golder 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. 1:14-cr-225.
Seven Colombian Nationals Charged in Connection with the Murder of A DEA Agent Extradited to the United StatesRead the Press Release
ALEXANDRIA, Va. – Seven Colombian nationals were extradited to the United States to face charges relating to the kidnapping and murder of Drug Enforcement Administration (DEA) Special Agent James Terry Watson.
Attorney General Eric H. Holder, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Dana J. Boente for the Eastern District of Virginia, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, DEA Administrator Michele M. Leonhart and Director Bill A. Miller of the State Department’s Diplomatic Security Service (DSS) made the announcement.
“With the extradition of these suspects, we are one step closer to ensuring that justice is served for the kidnapping and murder of an American hero,” said Attorney General Holder. “Special Agent Watson gave his life in the service of his country. We owe him, and his family, a debt of gratitude we can never fully repay. The Justice Department will never waver in our commitment to ensure that those who commit acts of violence against our best and bravest can be caught and held accountable.”
“DEA Special Agent James ‘Terry’ Watson was a brave and talented special agent who represented everything good about federal law enforcement and our DEA family,” said DEA Administrator Leonhart. “We will never forget Terry’s sacrifice on behalf of the American people during his 13 years of service, nor will DEA ever forget the outstanding work of the Colombian National Police and our other law enforcement partners. Their efforts quickly led to the arrest and extradition of those accused of committing this heinous act.”
All of the defendants were indicted by a grand jury in the Eastern District of Virginia on July 18, 2013. Gerardo Figueroa Sepulveda, 39; Omar Fabian Valdes Gualtero, 27; Edgar Javier Bello Murillo, 27; Hector Leonardo Lopez, 34; Julio Estiven Gracia Ramirez, 31; and Andrés Alvaro Oviedo-Garcia, 22, were each charged with two counts of second degree murder, one count of kidnapping and one count of conspiracy to kidnap. Oviedo-Garcia was also charged with two counts of assault. Additionally, the grand jury indicted Wilson Daniel Peralta-Bocachica, 31, also a Colombian national, for his alleged efforts to destroy evidence associated with the murder of Special Agent Watson.
The defendants arrived in the United States on July 1, 2014, and made their initial appearance in federal court in Alexandria, Virginia, today before United States Magistrate Judge Thomas Rawles Jones Jr. A detention hearing is scheduled for July 9, 2014, before United States Magistrate Judge Ivan D. Davis.
According to the indictment, Figueroa, Valdes, Bello, Lopez, Gracia and Oviedo-Garcia were part of a kidnapping and robbery conspiracy that utilized taxi cabs in Bogotà, Colombia, to lure victims into a position where they could be attacked and robbed. Once an intended victim entered a taxi cab, the driver of the taxi cab would signal other conspirators to commence the robbery and kidnapping operation.
The indictment alleges that on June 20, 2013, while he was working for the U.S. Mission in Colombia, Special Agent Watson entered a taxi cab operated by one of the defendants. Special Agent Watson was then allegedly attacked by two other defendants – one who stunned Special Agent Watson with a stun gun and another who stabbed Special Agent Watson with a knife, resulting in his death.
On July 1, 2014, the Government of Colombia extradited the defendants to the United States.
This case was investigated by the FBI, DEA and DSS, including the Office of Special Investigations and the Regional Security Office at Embassy Bogatà, in close cooperation with Colombian authorities, and with assistance from INTERPOL and the Justice Department’s Office of International Affairs. The case is being prosecuted by Special Counsel Stacy Luck of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Michael P. Ben’Ary from the U.S. Attorney’s Office for the Eastern District of Virginia.
The Department of Justice gratefully acknowledges the Colombian Attorney General’s Office, Colombian National Police, Colombian Directorate of Criminal Investigation and Interpol (DIJIN), DIJIN Special Investigative Unit, Bogotà Metropolitan Police, Bogotà Police Intelligence Body (CIPOL) Unit and Colombian Technical Investigation Team for their extraordinary efforts, support and professionalism in responding to this incident.
The charges in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.Tweet
Former Kellogg Salesman Pleads Guilty to Wire Fraud ChargesRead the Press Release
RICHMOND, Va. – John Morrell Palmer, III, 55, of Fredericksburg, Virginia, pleaded guilty today to Conspiring to Commit Wire Fraud.
Dana J. Boente, United States Attorney for the Eastern District of Virginia;Colonel W. Steven Flaherty, Virginia State Police Superintendent; Gary Barksdale, Inspector in Charge of the Washington Division of the United States Postal Inspection Service; and Adam S. Lee, Special Agent in Charge of the FBI’s Richmond Field Office, made the announcement after the plea was accepted by United States District Judge M. Hannah Lauck.
Palmer faces a maximum penalty of 20 years in prison when he is sentenced on October 2, 2014, by Senior United States District Judge Robert E. Payne.
In a statement of facts filed with the plea agreement, Palmer admitted that from 2009 through 2013, he conspired with an unindicted co-conspirator, the President of an unnamed grocery retail chain, to submit fraudulent documents to The Kellogg Company and SuperValu, a grocery wholesaler through which Kellogg sold product to retailers. SuperValu awarded the grocery retail chain approximately $1.8 million in deductions against its running account with SuperValu as a result of the fraudulent submissions. Kellogg reimbursed SuperValu for the awarded deductions. The unindicted co-conspirator paid cash to Palmer in the total amount of approximately half the value of the fraudulently obtained deductions.
This case was investigated by the Virginia State Police, the United States Postal Inspection Service, and Federal Bureau of Investigation. Assistant U.S. Attorney Michael C. Moore is prosecuting the case on behalf of the United States.
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. 3:14-cr-85.Tweet
U.S. Leader of Sophisticated, Violent Fraudulent Document Ring Sentenced to More Than 11 Years for Racketeering, Attempted Robbery, and Money LaunderingRead the Press Release
RICHMOND, Va. – Manuel Hidalgo Flores, 40, a Mexican National who resided in Pawtucket, Rhode Island was sentenced earlier today to 135 months’ imprisonment for his role in a violent criminal organization that specialized in manufacturing and distributing fraudulent identifications. Hidalgo Flores previously pleaded guilty to Conspiracy to Engage in Racketeering, Interference with Commerce by Robbery, and Conspiracy to Launder Money. Further, the defendant is illegally within the United States and faces deportation following the service of his prison sentences.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Clark Settles, Special Agent in Charge for U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), made the announcement after the 135 month sentence was handed down by Senior United States District Judge James R. Spencer.
According to court papers, this defendant is connected to a Fraudulent Document Enterprise (FDE) previously prosecuted in the Eastern District of Virginia in United States v. Israel Cruz Millan, Case No. 3:10CR308. The FDE which originally operated in the United States beginning prior to 2008 and continuing through November 18, 2010, had cells in Richmond, Norfolk, Virginia Beach, and Manassas, Virginia; Fayetteville and Little Rock, Arkansas; New Haven, Connecticut; Mishawaka, Indiana; Lexington and Louisville, Kentucky; Chelsea, Massachusetts; St. Louis, Missouri; Chapel Hill, Greensboro, Raleigh, and Wilmington, North Carolina; Cincinnati, Ohio; Providence, Rhode Island; and, Nashville, Tennessee. The criminal enterprise was dismantled within the United States on November 18, 2010. In the prior case and connected prosecutions, a total of 30 defendants were convicted. On February 16, 2012, United States District Judge James R. Spencer sentenced the overall leader, Israel Cruz Millan to 300 months’ imprisonment. On March 2, 2012, United States District Judge Henry E. Hudson sentenced Oliverez-Jiminez to two consecutive life terms in prison, after his conviction by a jury for racketeering, murder, kidnapping, conspiracy to commit money laundering, and conspiracy to produce and transfer false identification documents.
In connection with his previous guilty plea, Hidalgo Flores admitted to his role in restarting and leading the FDE’s continued criminal activities in the United States following the 2010 arrests described above. Beginning at some point prior to February 2012, Hidalgo Flores, also known as “Chino,” “Chimuelo” and “Julio,” began managing the organization’s operations in the United States, supervising operations in Richmond, Virginia; Springdale, Arkansas; Boston, Massachusetts; Raleigh, North Carolina; Cincinnati, Ohio; and Pawtucket, Rhode Island. As in the previous case, the FDE produced high-quality false identification cards for distribution to illegal aliens. In most cities where the organization operated, Hidalgo Flores placed a cell manager to supervise a number of “runners,” the lower level members of the organization who distributed business cards advertising the organization’s services and helped facilitate transactions with customers.
Within each cell supervised by Hidalgo Flores, the cell manager was responsible for distributing the fraudulent documents using information obtained from clients by “runners.” The runners would recruit illegal alien clients who wished to obtain false identification documents, including counterfeit Permanent Resident Alien Cards (also known as “Green Cards”), Social Security Cards, out-of-state identification cards, and various international documents. Upon identifying a specific client, a runner would relay identifying information and photographs from the client to the printer via cellular telephone or other method. The printer would, in turn, use a computer and printer to create fraudulent identification documents for the client, depending on the nature of the order received from the client. Once the documents were complete, the runner would usually provide the documents to the client in exchange for United States currency. A client would generally pay approximately $150 for a set of fraudulent identification documents (such as a Permanent Resident Alien Card and Social Security Card). Each cell maintained detailed sales records and divided the proceeds between the runner, the cell manager, and the upper level managers in Mexico. In addition, the FDE used Western Union and MoneyGram to funnel criminal proceeds to Mexico.
The evidence during the Oliverez-Jiminez trial detailed how members of the organization sought to drive competitors from their territory by posing as customers in search of fraudulent documents and then attacking the competitors when they arrived to make a sale. In the current case, Hidalgo Flores admitted to his role in targeting a competitor in the Richmond, Virginia area on October 6, 2013. This defendant, along with others, identified a competitor (referred to as “L.G.”) who was selling fraudulent documents in competition with the Richmond cell. A co-defendant posed as a customer and contacted L.G. about setting up a fraudulent documents transaction. L.G. then met with the co-defendant at a designated location. At the same time, Hidalgo Flores, along with other FDE members, were surveilling the transaction. The defendants planned to follow competitor L.G. after the transaction to find where he (L.G.) produced fraudulent identification documents. The group intended to assault L.G. and steal L.G.’s printing equipment by means of actual and threatened force, violence, and fear of injury. Through this planned conduct, FDE members hoped to stop L.G. from selling fraudulent identification documents and to enhance the FDE’s control of the Richmond area fraudulent document market. Unbeknownst to the FDE members, law enforcement officers were also surveilling the October 6, 2013 transaction. Due to law enforcement intervention, competitor L.G. was detained during a traffic stop and the FDE members fled the area. According to his plea documents, Hidalgo Flores admitted that absent law enforcement intervention, he and his cohorts would have carried out their plan against L.G.
To date, 42 members of this organization charged in the Richmond, Virginia federal cases have been convicted. In the current case, 11 defendants are awaiting sentencing, with their hearings scheduled before Judge Spencer over the next two months.
The case was investigated by the Richmond and Norfolk offices of ICE’s Homeland Security Investigations (HSI), which falls under the Washington, D.C., office. ICE HSI received assistance from the Virginia State Police, Chesterfield County Police Department, and Henrico County Police Department. Assistant United States Attorney Michael Gill and Trial Attorney Maria Gonzalez Calvet, of the Criminal Division's Fraud Section, are prosecuting the case on behalf of the United States
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
Norfolk Man and Portsmouth Woman Sentenced in Bank Fraud and Identity Theft SchemeRead the Press Release
NORFOLK, Va. – Cameron Allen, 27, of Norfolk, Va., was sentenced today to 46 months in prison, followed by 5 years of supervised release, for conspiracy to commit bank fraud. Dymond Chappelle, 19, of Portsmouth, Va., was also sentenced today to 20months in prison, followed by 5 years of supervised release, for conspiracy to commit bank fraud.
Dana J. Boente, United States Attorney for the Eastern District of Virginia, and Charles May, Acting Executive Assistant Director for Atlantic Operations, Naval Criminal Investigative Service, made the announcement after sentencing by Chief United States District Judge Rebecca Beach Smith.
Chappelle pled guilty on May 12, 2014, and Allen pled guilty on May 13, 2014. According to court documents, from January 2013 to March 2013, Allen, Chappelle, and three co-conspirators executed a fraud and identity theft scheme through which they stole approximately $87,000 from Navy Federal Credit Union. A co-conspirator illegally obtained 291apartment lease applications, each of which contained the applicant’s personal information such as name, date of birth, social security number, and bank account information. Using this personal information, Chappelle and Allen were able to gain access to their accounts. They persuaded other individuals with NFCU accounts to serve as “hosts” for fraudulent transactions often by telling them that they lost their ATM card and needed help getting cash. Chappelle, Allen or one of their co-conspirators called NFCU under a victim’s identity and requested electronic funds transfers to the host accounts. The hosts then withdrew the money and provided it to Chappelle, Allen or a co-conspirator. The members of the scheme accessed the accounts of 21 individuals.
This case was investigated by the Naval Criminal Investigative Service and the Norfolk Police Department. Assistant United States Attorney Randy Stoker prosecuted the case on behalf of the United States.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
Mexican Man Pleads Guilty to Sex Trafficking 16-Year-Old GirlRead the Press Release
RICHMOND, Va. – Javier Flores Mendez, 24, of Tenancingo, Mexico, pleaded guilty today to sex trafficking a 16-year-old girl and transporting her into the United States for prostitution.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; and Clark E. Settles, Special Agent in Charge for U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington, made the announcement after the guilty plea was accepted by U.S. Magistrate Judge David J. Novak.
Flores was indicted on April 1, 2014 by a federal grand jury on charges of transportation of a minor for illegal sexual activity and sex trafficking of a child. Flores faces a mandatory minimum sentence of ten years in prison on the transportation charge and a 15-year mandatory minimum term on the sex trafficking charge. Both offenses carry a potential maximum penalty of life in prison. Flores will be sentenced on Nov. 5, 2014 by U.S. District Judge James R. Spencer.
As outlined in court records, the defendant’s hometown of Tenancingo is known inside and outside of Mexico for having a widely accepted culture of pimping and prostitution. Every year, residents of Tenancingo put on a festival known as “Carnaval,” which celebrates the pimp and prostitute lifestyle. Tenancingo’s pimps and their associates have for years been responsible for moving prostitutes to other towns and cities in Mexico, as well as locations in the United States. A primary destination for victims who are being trafficked from Tenancingo is Queens, New York.
According to a statement of facts filed with his plea agreement, in March 2013, Flores approached a then 15-year-old girl who was selling roasted corn at a food stand in Puebla, Mexico. After striking up a conversation with the girl, Flores bought her a cell phone and programmed his number in it. Over the next several weeks, Flores and the girl communicated using that telephone, and they later went on several dates. In May 2013, Flores persuaded the girl to come live with him in Tenancingo, which is approximately three hours away by car from Puebla. Flores took the girl on a shopping trip to buy her clothes, shoes, makeup, jewelry and undergarments. At first, Flores treated the victim well, though he always controlled her movements and activities and did not give her a key for the hotel room where they initially lived. After about a week, however, Flores began threatening that he would kill the girl if she did not do what he said or attempted to run away.
In July 2013, Flores planned a trip to illegally enter the United States and travel to New York. Flores admitted to forcing the victim to travel with him by threatening that he would kill her and her family if she did not go. Flores and the girl were apprehended on July 4 in McAllen, Texas, after wading across the Rio Grande River with the assistance of “coyotes,” who are individuals paid to help smuggle migrants across the U.S.-Mexico border. Flores and the girl were returned to Mexico, and the girl went back to live with her family in Puebla. Flores and the victim had no contact for several months.
In September 2013, Flores re-established contact with the girl, starting a pattern of conversations in which he repeatedly apologized for his prior behavior and asked for forgiveness. After multiple conversations, the girl agreed to leave her home in Puebla and live with Flores in Tenancingo. Flores again started off treating the girl well, but after about a week, Flores controlled her movements and access to people, and repeated the same threats that he would kill her if she did not do what he said or attempted to leave.
In late October 2013, Flores told the girl that she would have to start working as a prostitute at various bars in and around Tenancingo and Puebla. Flores forced the victim to work as a prostitute every night for a week, during which time she serviced ten or more men a night and as many as a total of 100. Flores also told the girl that they would again cross the border into the United States and travel to Queens, New York, where she would also work as a prostitute.
In or around late October or early November 2013, Flores and the victim successfully crossed the Mexico-U.S. border and for several days stayed in various safe houses in the Houston, Texas area. On November 2, they departed Houston in a Ford Excursion with nine other illegal aliens traveling to various points in the northeast United States. In the early morning hours of November 4, the vehicle was stopped for speeding by a Henrico County police officer in Richmond. At that time, Flores and the minor were put into immigration detention and this investigation followed.
This case was investigated by ICE-HSI. Assistant U.S. Attorneys Brian R. Hood and Heather L. Hart 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. 3:14-cr-40.Falls Church Grocery Store Owners Convicted of Insurance FraudRead the Press Release
Defendants filed false insurance claims for over $100,000 after 2009 fire destroyed business
ALEXANDRIA, Va. – Suzanne DeLyon, 65, of McLean, Virginia, and Byoung Kyung Kim, 53, of Centreville, Virginia were convicted yesterday by a federal jury on one count of conspiracy to commit wire fraud and six counts of wire fraud.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; and Thomas J. Kelly, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI), made the announcement after the verdict was accepted by U.S. District Judge Claude M. Hilton.
DeLyon and Kimface a maximum penalty of 20 years in prison when they are sentenced on Oct. 3, 2014.
DeLyon and Kim were indicted on Jan. 30, 2014 by a federal grand jury. According to court records and evidence at trial, DeLyon and Kim were partners in an international grocery store in Falls Church, Virginia that was destroyed by a fire on Jan. 19, 2009. In the course of claiming insurance reimbursements from Travelers Insurance, DeLyon and Kim conspired to falsify payroll documents and records, and they made false representations to Travelers to get over $100,000 more than what they were legally owed.
This case was investigated by the FBI’s Washington Field Office and IRS-CI. Assistant U.S. Attorneys Maya D. Song and Gene Rossi and Special Assistant U.S. Attorney Alison L. Anderson 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-32.
Newport News Gang Member Sentenced to Life in Prison for MurderRead the Press Release
NEWPORT NEWS, Va. – Kevin L. Ashby, 25, of Newport News, Virginia, was sentenced today to life in prison for participating in a May 2009 murder, along with a concurrent sentence of 40 years for participating in the Thug Relations gang, which engaged in narcotics distribution, weapons violations and multiple acts of violence, including several murders, in the Newport News area.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division; Royce E. Curtin, Special Agent in Charge of the FBI’s Norfolk Field Office; and Richard W. Myers, Chief of Newport News Police, made the announcement after sentencing by U.S. District Judge Raymond A. Jackson.According to court documents, Ashby, and his co-defendant Antonio Fuller, were part of a criminal organization known locally as “Thug Relations.” Ashby pleaded guilty on March 12, 2014, and admitted to participating in a criminal enterprise that engaged in murders, attempted murder, witness intimidation, robberies and narcotics distribution. Specifically, Ashby admitted to participating in the murders of Andre Horton and Andre Julius Johnson on May 17, 2009, the murder and robbery of Lafayette Bailey on Dec. 15, 2009, and the murder and robbery of Lloyd Robinson on Jan. 8, 2010.
The Thug Relations gang is alternatively known as “the Duct,” “Warwick Lawnz,” “TR,” and “from the Duct to the Lawnz,” and it operates as a neighborhood gang in the Aqueduct Apartments, St. Michael’s Apartments, Mariner’s Landing Apartments and Heritage Trace Apartments, as well as the Warwick Lawns, Warwick Town Home, Sharon Drive and Savage Drive areas of Newport News.
Ashby’s co-defendant, Antonio Fuller, is set to begin trial on July 1, 2014. Ashby’s conviction raises to 44 the total number of Thug Relations gang members convicted in the Eastern District of Virginia for gang-related murder, narcotics distribution and other violence.
This investigation was led by FBI and the Safe Streets Task Force, with assistance from the Newport News Police and the Virginia State Police. Assistant U.S. Attorneys Howard J. Zlotnick and Lisa R. McKeel, and Trial Attorney Jonathan A. Ophardt of the Organized Crime and Gang Section in the Justice Department’s Criminal 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. 4:13-cr-72.
Indianapolis Man Pleads Guilty to Defrauding Investors in Ponzi Scheme Involving Fictitious Online Credit UnionRead the Press Release
ALEXANDRIA, Va. – Timothy J. Coughlin, 63, of Indianapolis, Indiana, pleaded guilty today to committing wire fraud and impersonating an Internal Revenue Service official while operating the Oxford International Credit Union (OICU), which Coughlin used to solicit online investments.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; Andrew Ceresney, Director, Division of Enforcement, U.S. Securities and Exchange Commission (SEC); and J. Russell George, Treasury Inspector General for Tax Administration (TIGTA), made the announcement after the plea was accepted by U.S. District Judge Leonie M. Brinkema.According to a statement of facts filed with the plea agreement, from around 2006 through March 2014, Coughlin operated OICU and anotheronline investment vehicle known as the Oxford International Cooperative Union. Investors paid annual dues to participate in the Oxford entities and made investments in OICU through online payment processors. As part of the scheme, Coughlin created a website through which he posted false information to investors’ online accounts indicating that their deposits were earning significant daily returns, which averaged 0.471% each trading day from January 2007 through December 2009 (equivalent to a 356% approximate rate of return over that time period). To further the fraud, Coughlin posted a fake certificate stating that OICU was an insured credit union, and he also made audio recordings in which he falsely claimed that members were earning significant returns on their investments.
By the end of 2009, Coughlin had ceased approving requests for account withdrawals from investors, claiming that taxing authorities in the United States and Canada were freezing Oxford’s assets abroad. In January 2012, Coughlin falsely announced to investors that he had reached an agreement to resolve the tax issues, and he created a fictitious agreement on which he forged the signatures of an actual IRS employee in Washington, DC and a lawyer based in New York.
During the course of this fraudulent scheme, Coughlin received nearly $15 million from almost 5,000 people for investments and members’ annual dues. Before December 2009, Coughlin approved about $4.4 million in withdrawal requests by investors.
Coughlin faces a maximum penalty of 23 years in prison when he is sentenced on Sept. 26, 2014.This case was investigated by the FBI’s Washington Field Office, SEC, and TIGTA. Assistant U.S. Attorney Jack Hanly 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. 1:14-cr-221.Clinton, Maryland Man Convicted of Transporting A Minor Across State Lines for ProstitutionRead the Press Release
RICHMOND, Va. – Mustafa Muhammad, 36, of Clinton, Maryland, was convicted yesterday by a federal jury of transportation of a minor across state lines for the purpose of prostitution.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Adam S. Lee, Special Agent in Charge, Federal Bureau of Investigation’s Richmond Field Office; and Clark E. Settles, Special Agent in Charge for U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), made the announcement after the verdict was accepted by U.S. District Judge Robert E. Payne.
Muhammad faces a maximum penalty of life in prison with a mandatory-minimum term of 10 years in prison when he is sentenced on September 11, 2014.Muhammad was indicted on April 15, 2014, by a federal grand jury fortransportation of a minor in interstate commerce for the purpose of prostitution. According to evidence at trial, Muhammad met a 16-year old runaway online in February 2014, and then began communicating with her via text message. Later that month, Muhammad and the juvenile met in person in Maryland, and Muhammad posted an advertisement on backpage.com featuring the juvenile and offering her for prostitution. The juvenile provided Muhammad some of the money she made from prostitution. In March 2014,
Muhammad suggested that they travel to Virginia for the juvenile to work in prostitution, and, so, on March 14, 2014, Muhammad drove the juvenile from Maryland to a Holiday Inn in Fredericksburg, Virginia. Muhammad then posted another advertisement on backpage.com in Fredericksburg, advertising the juvenile for prostitution. A Stafford Sheriff’s deputy was looking for possible prostitution activity on backpage.com and discovered the juvenile’s ad. He then arranged to meet the juvenile and discovered that she was a 16-year old runaway.
This case was investigated by the Federal Bureau of Investigation, the Department of Homeland Security, Stafford County Sheriff’s Office, and Spotsylvania County Sheriff’s Office. Assistant U.S. Attorney Heather L. Hart is prosecuting the case on behalf of the United States.
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. 3:14-cr-055.
Former Chesapeake, Virginia Subcontractor Sentenced for Conspiracy to Commit BriberyRead the Press Release
WASHINGTON– Roderic J. Smith, 50, the co-founder and former president of a government contracting company, was sentenced yesterday to 48 months in prison, followed by 1 year of supervised release, for conspiracy to bribe public officials. Smith was ordered to forfeit $175,000.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, United States Attorney Dana J. Boente, for the Eastern District of Virginia, Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office, Acting Executive Assistant Director Charles T. May, Jr., of the Naval Criminal Investigative Service (NCIS) Atlantic Operations Royce E. Curtin and Special Agent in Charge Royce E. Curtin of the FBI’s Norfolk Field Office made the announcement today after sentencing by Senior United States District Judge Henry Coke Morgan, Jr. of the Eastern District of Virginia.
On March 5, 2014, Smith pleaded guilty to a criminal information. According to court documents, Smith was the co-founder and the president of a contracting company located in Chesapeake, Virginia, that sought contracting business from the United States Navy Military Sealift Command. In approximately November 2004, Smith joined an extensive bribery conspiracy that spanned four years, involved multiple co-conspirators, including two different companies, and resulted in the payment of more than $265,000 in cash bribes, among other things of value, to two public officials performing work for the Military Sealift Command, Kenny E. Toy and Scott B. Miserendino, Sr. In exchange for the bribe payments, Smith’s business, referred to as Company A in court documents, received lucrative business from the Military Sealift Command that amounted to approximately $3 million in task orders during the time period of the conspiracy.As part of his guilty plea, Smith also admitted to engaging in a scheme to conceal his criminal activity that involved Smith and others paying a co-conspirator money. According to the plea agreement, Smith admitted to paying more than $85,000 to his business partner, Dwayne A. Hardman, in an attempt to prevent Hardman from reporting the bribery scheme to law enforcement authorities.
Earlier this year, four other individuals pleaded guilty in connection with the bribery scheme. On Feb. 12, 2014, Kenny Toy, the former Afloat Programs Manager for the Military Sealift Command’s N6 Command, Control, Communication, and Computer Systems Directorate, pleaded guilty to accepting bribes from Smith and others. On Feb. 18, 2014, Smith’s business partner, Dwayne A. Hardman, pleaded guilty to bribery. On Feb. 19, 2014, Smith’s associate, Michael P. McPhail, pleaded guilty to conspiracy to commit bribery. On April 4, 2014, Smith’s associate, Adam C. White, pleaded guilty to conspiracy to commit bribery.
On May 23, 2014, a grand jury in the Eastern District of Virginia indicted two defendants in connection with the bribery scheme, Scott B. Miserendino, Sr., a former government contractor who performed work for the Military Sealift Command and Timothy S. Miller, a businessman whose company sought contracting business from the Military Sealift Command. The indictment charges Miserendino with one count of conspiracy to commit bribery, one count of bribery, one count of conspiracy to commit obstruction of criminal investigations and to commit tampering with a witness, and one count of obstruction of criminal investigations. The indictment charges Miller with one count of conspiracy to commit bribery and two counts of bribery. Trial is set for Sept. 30, 2014, before Chief Judge Rebecca Beach Smith.
The case was investigated by the FBI, NCIS and DCIS. The case was prosecuted by Trial Attorney Emily Rae Woods of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Stephen W. Haynie of the U.S. Attorney’s Office for the Eastern District of Virginia.Virginia Man Pleads Guilty to Using Facebook to Entice Minors from Across the Country to Produce Child PornographyRead the Press Release
RICHMOND, Va. – Cameron Scot Bivins-Breeden, 21, of King George County, Va., pleaded guilty today to production of child pornography and enticement of a minor.
Dana J. Boente, United States 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 the plea was accepted by United States District Judge John A. Gibney.
Bivins-Breeden was indicted on April 15, 2014, by a federal grand jury on production of child pornography, in violation of 18 U.S.C. § 2251, and enticement of a minor, in violation of 18 U.S.C. § 2422. He faces a maximum penalty of life imprisonment when he is sentenced on September 22, 2014.
In a statement of facts filed with his plea agreement, Bivins-Breeden admitted to enticing 38 juvenile females located across the country, ranging from 11 to 17 years old, to produce child pornography. As part of the scheme, Bivins-Breeden contacted the victims via Facebook on his iPhone posing as a juvenile female and enticed them to produce child pornography. After the juvenile victims produced the pornographic images, they sent them to Bivins-Breeden over the internet. When the victims refused to produce additional child pornography images, Bivins-Breeden threatened to send the previously obtained images to the victims’ friends, family, and schoolmates on Facebook. In total, Bivins-Breeden admitted to sending 95 child pornography images in an effort to convince victims he was, in fact, a juvenile female and causing victims to produce 45 child pornography images.
This case was investigated by the Federal Bureau of Investigation. Assistant United States Attorney Erik S. Siebert and Commonwealth of Virginia, Office of the Attorney General, Assistant Attorney General and Special United States Attorney Samuel Fishel are prosecuting the case on behalf of the United States.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
Portsmouth Man Sentenced for His Participation in Bank FraudRead the Press Release
NEWPORT NEWS, Va. – Dominique Avery, 20, of Portsmouth, Va., was sentenced today to eight-seven months in prison and ordered to pay in excess of $197,000 in restitution, for his participation in a conspiracy to commit bank fraud and aggravated identity theft.
Dana J. Boente, United States Attorney for the Eastern District of Virginia made the announcement after sentencing by United States District Judge Arenda Wright Allen.
According to court documents, Avery was involved in a yearlong conspiracy targeting at least five financial institutions, including ABNB Federal Credit Union and Navy Federal Credit Union, and over two dozen individuals and businesses. The defendant and others stole and/or purchased identities and applied for checking and savings accounts via online portals with minimal amounts. The conspirators then caused a third party check issuing service to send dozens of fraudulent checks to various vendors and individuals. Avery was arrested in August, 2012, while attempting to purchase two vehicles with fraudulent ABNB checks. The total intended losses exceed $737,000.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
This case was investigated by the United States Secret Service and the United States Postal Inspectors Service. Assistant United States Attorney Brian J. Samuels prosecuted the case on behalf of the United States.Baltimore Woman Sentenced for Role in Credit Card Fraud Scheme Targeting Accountholders and Area RetailersRead the Press Release
ALEXANDRIA, VA. – Rameesha Smith, 30, of Baltimore, Maryland, was sentenced today to 38 months in prison, followed by three years of supervised release, for her role in a wide-ranging credit card fraud conspiracy that victimized credit card holders nationwide, as well as various retailers in northern Virginia and elsewhere. Smith also was ordered to pay $143,832.51 in restitution.
United States Attorney Dana J. Boente for the Eastern District of Virginia, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office made the announcement.
Smith pleaded guilty on March 10, 2014. According to court documents, from at least as early as September 2010 through at least October 2012, Smith conspired with others to purchase stolen credit card data on the Internet or through other means. This stolen data was then unlawfully loaded onto gift cards or unlawfully encoded onto other credit or debit cards through the use of device-making equipment, such as credit card encoders. The counterfeit credit cards often were embossed with aliases belonging to the members of the conspiracy.
Smith and her co-conspirators then took trips, sometimes together, to use the re-encoded gift, credit or debit cards to buy gift cards and other merchandise at legitimate merchant locations like Giant, Rite-Aid and Nordstrom. Smith often presented counterfeit driver’s licenses displaying various aliases when requested by store clerks. Smith and the conspirators then returned the merchandise they purchased in order to convert the stolen data to cash. The actions of Smith and her co-conspirators involved more than 250 victims, and resulted in at least $200,000 in actual and intended losses.
This case was investigated by the FBI’s Washington Field Office. Assistant U.S. Attorney Jasmine H. Yoon and Trial Attorney William A. Hall, Jr. of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) prosecuted the case.Richmond Man Previously Convicted of Aggravated Sex Crimes of A Juvenile Sentenced for Distribution of Child PornographyRead the Press Release
RICHMOND, Va. – Robert Cole Johnson, 55, of Richmond, Virginia, was sentenced to 180 months’ imprisonment on June 18, 2014, in U.S. District Court for distributing child pornography. Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Mark Herring, Attorney General of Virginia, made the announcement after the defendant was sentenced by United States District Judge John A. Gibney.
The defendant pled guilty on March 10, 2014, to distributing child pornography. According to court documents, the defendant was identified during an undercover investigation by law-enforcement officers into the trading of child pornography over the Internet. In April 2013, an officer downloaded four files depicting child pornography from a computer that was later tracked to the defendant’s residence in Richmond, Virginia. Based on this information, officers obtained a search warrant for the defendant’s residence, which was executed in May 2013. During the execution of the warrant, the defendant admitted searching for and downloading child pornography from the Internet. He also admitted allowing other users to download files from his computer. The defendant has prior convictions for rape, sodomy, and aggravated sexual battery of a ten-year-old female in 1985 and for failing to register properly with the Virginia Sex Offender and Crimes Against Minors Registry in 2013.
The case was investigated by the Southern Virginia Internet Crimes Against Children Task Force and the Federal Bureau of Investigation. Special Assistant United States Attorney Tommy Johnstone of the Virginia Attorney General’s Office prosecuted the case on behalf of the United States.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Third Defendant Pleads Guilty in Procurement Fraud Scheme Involving Service-Disabled Veteran-Owned Small BusinessesRead the Press Release
ALEXANDRIA, Va. – A former service contractor for U.S. Customs and Border Protection (CBP) pleaded guilty today for his role in accepting over $350,000 in connection with the awarding of a $24 million contract by CBP.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; John Roth, Inspector General for the Department of Homeland Security (DHS); Robert C. Erickson, Jr., Acting Inspector General, General Services Administration (GSA); Peggy E. Gustafson, Small Business Administration (SBA) Inspector General; and Richard J. Griffin, Acting Inspector General, Department of Veterans Affairs (VA), made the announcement after the plea was accepted by U.S. District Judge Anthony J. Trenga.
Chancellor Ellis, 37, of Manassas, Virginia, pleaded guilty to conspiracy to obtain illegal gratuities and to violate the procurement integrity act. Ellis faces a maximum penalty of five years in prison when he is sentenced on September, 12, 2014. He will also pay restitution and forfeiture in the amount of $351,176.60, representing the total amount of illicit payments sought and accepted by Ellis in connection with the procurement fraud scheme.
In a statement of facts filed with the plea agreement, Ellis admitted that, throughout the conspiracy, he worked for CBP as a service contractor. Among other duties and responsibilities at CBP, Ellis worked as a technical advisor on a procurement for a Wide Area Network (WAN) optimization project. The procurement resulted in an award to a service-disabled veteran-owned small business, identified in the statement of facts as Company T, at a contract price of approximately $24 million.
Prior to the award to Company T, Ellis—who was actively working for CBP on the procurement—requested that Company T agree to pay ten percent of any profits from the WAN optimization contract to a company co-owned by Ellis. Shortly after reaching this agreement with Company T, Ellis provided nonpublic source selection information related to the WAN optimization procurement, including independent government cost estimates, to Company T employee Anthony Bilby. Bilby and other co-conspirators used the source selection information in crafting the winning bid on behalf of Company T. Bilby and other conspirators also caused nominal competitors of Company T to submit rigged bids on the contract in excess of the amount of Company T’s bid. After Company T won the contract, it paid $351,176.60—approximately ten percent of its profits—to Ellis’s company.
As part of his plea agreement, Ellis has agreed to cooperate in the investigation of others involved in the conspiracy. Two other co-conspirators, Anthony Bilby and Thomas Flynn, have previously pleaded guilty and have been sentenced for their roles in the conspiracy.
This case was investigated by the Offices of the Inspector General for DHS, GSA, SBA, and the VA, with assistance from DHS’s Office of the Chief Security Officer, Cyber Forensic Branch. Assistant U.S. Attorney Kosta S. Stojilkovic 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. 1:14-cr-205.Gloucester Woman Pleads Guilty to Making A False Distress CallRead the Press Release
NEWPORT NEWS, Va. – Ashley Strum-Smith, age 29, of Gloucester, Va., pleaded guilty yesterday to Making a False Distress Call.
Dana J. Boente, United States Attorney for the Eastern District of Virginia, and Rear Admiral Stephen Metruck, District Commander of the Fifth Coast Guard District, made the announcement after the plea was accepted by United States District Judge Robert G. Doumar.
Strum-Smith pleaded guilty to a criminal information filed in United States District Court on May 27, 2014. Strum-Smith faces a maximum penalty of six years imprisonment, a fine of $250,000 and $82,764 in restitution when she is sentenced on October 20, 2014 in Norfolk, Va..
According to a statement of facts filed with the plea agreement, on August 13, 2012, Strum-Smith called in a false report of a ship taking on water in the Severn River. Multiple rescue vehicles from the Abingdon Volunteer Fire and Rescue Squad, Gloucester Fire Department, York County Fire Department, Mathews Fire Department and the United States Coast Guard were dispatched to locate and aid the foundering vehicle. After a two hour search costing over $82,000 it was determined that the call was a hoax. Strum-Smith admitted making the false report.
This case was investigated by the Coast Guard Criminal Investigative Service and the Gloucester County Sheriff’s Department Assistant United States Attorney Eric M. Hurt is prosecuting the case on behalf of the United States.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Reston Man Sentenced for Exporting Unlicensed High-Tech Goods to IranRead the Press Release
ALEXANDRIA, Va. – Vahid Hosseini, 62, of Reston, Virginia, was sentenced today to 30 months in prison, followed by 2 years of supervised release, for exporting various high-tech unlicensed goods to Iran, in violation of the International Emergency Economic Powers Act (IEEPA), and for laundering money wired to him from multiple overseas accounts. Hosseini agreed to forfeit $50,000 as part of his guilty plea in this case.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after sentencing by U.S. District Judge Liam O’Grady.
Hosseini pleaded guilty on March 6, 2014. According to court documents, from at least as early as January 2008 to July 2013, Hosseini operated a business known as Sabern Instruments from his residence in Reston. Through this business, Hosseini procured over $250,000 worth of goods from over 60 American manufacturers, which he then repackaged and shipped to entities in Iran. The list of high-tech goods included tachometers, power supply instruments, high-temperature probes, ammonia test tubes, valves and machinery parts, all of which are used in a variety of commercial applications, including power plants. Some of the items Hosseini sent to Iran were found to be capable of adding value to a nuclear weapons program and to other nuclear related applications and research areas.
Hosseini routed his shipments through the United Arab Emirates (UAE) in an attempt to disguise the fact that the items were destined for Iran. Such exports are prohibited without a license issued by the Treasury Department’s Office of Foreign Assets Control. In a related money laundering scheme, Hosseini had over $700,000 wired into his company business account from entities in Iran and the UAE, much of which was derived from his illegal export business.
This case was investigated by the FBI’s Washington Field Office. Assistant U.S. Attorney Neil Hammerstrom 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 at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Registered Sex Offender Sentenced to 40 Mos. for Returning to the United States After Being DeportedRead the Press Release
ALEXANDRIA, Va. – A registered sex offender, who previously was convicted in North Carolina of taking indecent liberties with a minor child, was sentenced today in federal court to 40months in prison to be followed by 2 years of supervised release for returning to the United States after he was ordered removed in immigration proceedings.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and M. Yvonne Evans, Field Office Director of Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations (ERO), Washington Field Office, made the announcement after sentencing by U.S. District Judge Claude M. Hilton.
Jose Santiago Hernandez-Lopez, 36, of Gainesville, Virginia, was found guilty after a federal bench trial on March 24, 2014 for illegally re-entering the United States after being convicted of an aggravated felony. According to court documents and evidence presented at trial, Hernandez-Lopez first entered the United States as an immigrant on Sept. 8, 1991. While in the United States, Hernandez-Lopez was convicted in 1998 by the Superior Court of Alamance County, North Carolina for taking indecent liberties with a minor child.
Hernandez-Lopez was registered as a convicted sex offender and was placed into immigration proceedings after he finished serving his North Carolina sentence. Hernandez-Lopez was removed from the United States on Nov. 23, 1999, but he later returned without the permission of the U.S. Attorney General or the Department of Homeland Security.
This case was investigated by ICE ERO. Assistant U.S. Attorney Gene Rossi and Special Assistant U.S. Attorneys Jason Jones and Catherine Ahn 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 at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Leader of Fraudulent UniRush Double Loading Scheme SentencedRead the Press Release
NEWPORT NEWS, Va. – Jamal Greene, 27, of Newport News, Va. was sentenced on June 11, 2014, to forty eight months in prison, following his guilty plea for his participation, with others, in a scheme to defraud Unirush, LLC, a provider of prepaid stored value cards. Greene was ordered to pay restitution in excess of $817,000.
Dana J. Boente, United States Attorney for the Eastern District of Virginia, William G. Frantzen, Special Agent in Charge of the United States Secret Service’s Richmond Field Office, Gary Barksdale, Inspector in Charge of the Washington Division of the United States Postal Inspection Service, and, Richard W. Myers, Chief of Newport News Police, made the announcement after sentencing by United States District Judge Raymond A. Jackson.
Greene, along with three others, Almira Dobson, Sam McGill, and Knhesha Strickland, pled guilty to their participation in the scheme to defraud. According to the statements of facts entered in support of the guilty pleas and other publicly filed documents, from in or about at least October 2010, and continuing until in or about at least March 2012, the defendants and others engaged in a fraudulent scheme to obtain funds from UniRush, LLC, doing business as UniRush Financial Services (“UniRush”). Unirush provided prepaid Visa debit cards in the United States (referred to as Visa “RushCards”). Its prepaid debit cards were used to deposit money, withdraw cash, make purchases, shop online, and pay bills. Through its RushCard program, UniRush allowed customers to “reload” the RushCards in a number of ways, including direct deposit, through MoneyGram locations and through various online means. Individuals could obtain a maximum of four RushCard accounts. These accounts were tracked according to individuals’ Social Security Numbers.
Green Dot Corporation (“Green Dot”) was a business that offered prepaid debit or credit cards that worked similarly to a RushCard. Green Dot also offered a product called a “MoneyPak” that could be purchased for a set amount (ranging from $20 to $500 at most retailers and up to $1,000 at Walmart stores). Individuals who purchased RushCards could use Green Dot MoneyPaks to “reload” Money onto their RushCard. In or about March 2012, the Peninsula area of the Eastern District of Virginia experienced a surge in the purchase of Green Dot MoneyPaks from local retailers, including Walgreen’s, Rite Aids and 7-Eleven stores.
In or about April 2012, UniRush detected an error in its computer accounting system that allowed customers to make multiple fraudulent loads to their RushCard using the same MoneyPak. In this way, certain customers obtained double the value of their MoneyPak. The total loss to UniRush resulting from the fraudulent conduct was approximately $5.5 million from 2010 through March 2012, with the majority of the losses occurring from December 2011 through March 2012. In this time period, approximately $4.5 million in losses resulted from fraudulent uploading associated with account holders residing in the Peninsula area of the Eastern District of Virginia.
In or about October 2010, defendant Greene learned of the aforementioned fraudulent uploading scheme through an internet website. Greene began to engage the fraudulent uploading activity and demonstrated such activity to other conspirators. Greene recruited and instructed others how to execute the Unirush scheme, provided startup money for their participation, obtained identities (including that of his mentally disabled sister) to use in opening additional accounts and transferred funds between various accounts to further and conceal the scheme.
The four individuals named here, join four others who were all previously convicted in connection with the Unirush scheme (Andre Banks, Steven Banks, Erika Greene, Javon Whitaker).
This case is being investigated by special agents and officers of the United States Secret Service, the United States Postal Inspection Service and the Newport News Police Department. Assistant U.S Attorney Brian Samuels is prosecuting the case.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Sixteenth Member of Colombian Cocaine Trafficking Organization Pleads Guilty in Connection with Attempt to Import 7,000 Kilos of CocaineRead the Press Release
Drug traffickers used hidden compartments in trucks and shipping containers, bribed customs officials and worked with Mexican drug cartels
ALEXANDRIA, Va. – Manuel Salas, 62, of Barranquilla, Colombia, pleaded guilty today to charges relating to his participation in a large-scale Colombian cocaine trafficking organization that bought, stored and transported several tons of cocaine for importation into the United States.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Derek S. Maltz, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Special Operations Division, made the announcement after the plea was accepted by U.S. District Judge Liam O’Grady. Salas is the sixteenth defendant to plead guilty in this case.
Salaswas indicted on Aug. 24, 2011, by a federal grand jury on charges of conspiracy to manufacture and distribute five kilograms or more of cocaine for unlawful importation into the United States, along with four counts of distributing five kilograms or more of cocaine for unlawful importation into the United States. Salasfaces a maximum penalty of life in prison when he is sentenced on September, 19, 2014.
In a statement of facts filed with the plea agreement, along with other court records, Salas admitted that he was part of a large-scale Colombian cocaine trafficking organization that purchased cocaine in Colombia for eventual sale in the United States. The group bought several tons of cocaine from a lab in Colombia’s interior. From there, the group controlled trucks with hidden compartments to transport the cocaine to Colombian ports, including Cartagena and Barranquilla, where the group controlled warehouses. In those warehouses, the cocaine was offloaded from the trucks and loaded into hidden compartments that members of the group constructed in 40-foot maritime shipping containers.
Once the cocaine shipments, consisting of 1,000 to 3,000 kilograms, were loaded into the hidden shipping compartments, those containers were taken to the port, where members of the conspiracy bribed customs officials to allow the containers to pass inspection. Other conspirators created shell companies in Colombia and Honduras, along with falsified export documents, to make the shipments appear legitimate. Once the cocaine arrived in Honduras, other members of the conspiracy worked with Mexican drug cartels to transport the cocaine over land to the United States, where it was sold for huge profits.
Law enforcement in Colombia seized approximately 7,000 kilograms of cocaine associated with this organization. Salas controlled a warehouse in Barranquilla and hired members to construct the hidden compartments and guard the warehouse while the cocaine was being loaded into the shipping containers.
This case was investigated by the DEA’s Special Operations Division, with assistance from the Colombian National Police and the U.S. Justice Department’s Office of International Affairs. Assistant U.S. Attorneys Michael P. Ben’Ary and Lynn E. Haaland are prosecuting the case on behalf of the United States.
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 at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Romanian National “Guccifer” Charged with Hacking into Personal Email AccountsRead the Press Release
ALEXANDRIA, Va. – Marcel Lehel Lazar, 42, of Arad, Romania, also known as the hacker “Guccifer,” was indicted by a federal grand jury today on charges of wire fraud, unauthorized access to a protected computer, aggravated identity theft, cyberstalking and obstruction of justice
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Special Agent in Charge Edward Lowery of the United States Secret Service Criminal Investigative Division, Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office and Principal Deputy Assistant Secretary Bill A. Miller of the U.S. Department of State Bureau of Diplomatic Security made the announcement.
According to the indictment, from December 2012 to January 2014, Lazar hacked into the email and social media accounts of high-profile victims, including a family member of two former U.S. presidents, a former U.S. Cabinet member, a former member of the U.S. Joint Chiefs of Staff and a former presidential advisor. After gaining unauthorized access to their email and social media accounts, Lazar publicly released his victims’ private email correspondence, medical and financial information, and personal photographs. The indictment also alleges that in July and August 2013, Lazar impersonated a victim after compromising the victim’s account.
If convicted of wire fraud or obstruction of justice, Lazar faces a maximum of 20 years of incarceration, and if convicted of unauthorized access of a protected computer or cyberstalking, he faces a maximum of 5 years of incarceration. He also faces a mandatory additional 2 years of incarceration if convicted of aggravated identity theft.
An indictment is merely an allegation and the defendant is presumed innocent unless and until proven guilty.
This case was investigated by United States Secret Service, the FBI’s Washington Field Office and the U.S. Department of State Bureau of Diplomatic Security, with assistance from the Romanian National Police. The case is being prosecuted by Trial Attorney Peter V. Roman of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Ryan K. Dickey of the Eastern District of Virginia. The Criminal Division’s Office of International Affairs provided assistance.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Romanian National “Guccifer” Charged with Hacking into Personal Email AccountsRead the Press Release
ALEXANDRIA, Va. – Marcel Lehel Lazar, 42, of Arad, Romania, also known as the hacker “Guccifer,” was indicted by a federal grand jury today on charges of wire fraud, unauthorized access to a protected computer, aggravated identity theft, cyberstalking and obstruction of justice
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Special Agent in Charge Edward Lowery of the United States Secret Service Criminal Investigative Division, Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office and Principal Deputy Assistant Secretary Bill A. Miller of the U.S. Department of State Bureau of Diplomatic Security made the announcement.
According to the indictment, from December 2012 to January 2014, Lazar hacked into the email and social media accounts of high-profile victims, including a family member of two former U.S. presidents, a former U.S. Cabinet member, a former member of the U.S. Joint Chiefs of Staff and a former presidential advisor. After gaining unauthorized access to their email and social media accounts, Lazar publicly released his victims’ private email correspondence, medical and financial information, and personal photographs. The indictment also alleges that in July and August 2013, Lazar impersonated a victim after compromising the victim’s account.
If convicted of wire fraud or obstruction of justice, Lazar faces a maximum of 20 years of incarceration, and if convicted of unauthorized access of a protected computer or cyberstalking, he faces a maximum of 5 years of incarceration. He also faces a mandatory additional 2 years of incarceration if convicted of aggravated identity theft.
An indictment is merely an allegation and the defendant is presumed innocent unless and until proven guilty.
This case was investigated by United States Secret Service, the FBI’s Washington Field Office and the U.S. Department of State Bureau of Diplomatic Security, with assistance from the Romanian National Police. The case is being prosecuted by Trial Attorney Peter V. Roman of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Ryan K. Dickey of the Eastern District of Virginia. The Criminal Division’s Office of International Affairs provided assistance.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Physician-Businessman Convicted of Mortgage Loan FraudRead the Press Release
NORFOLK, Va. – Irfan M. Jameel, 51, of Virginia Beach, Va., was convicted today by a federal jury on charges of wire fraud, bank fraud, and use of a false social security number.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia, and Special Agent in Charge Royce E. Curtin of the FBI’s Norfolk Field Office, made the announcement after the jury returned its verdict. Senior United States District Judge Henry Coke Morgan, Jr., presided over the trial.
Jameel faces a maximum penalty of thirty years on each of counts one through three, and a maximum penalty of five years on count four, when he is sentenced on October 16, 2014.
Jameel was indicted on July 25, 2013 by a federal grand jury on one count of wire fraud affecting a financial institution, two counts of financial institution fraud, and one count of using a false social security number. According to court records and evidence at trial, Jameel defrauded several lenders by misrepresenting the status and nature of his business and income in the US and Canada and by misrepresenting his medical career and accomplishments. Among other things, Jameel claimed to be the chief scientist of an international biotechnology company, Biocer, and reported that it paid him approximately $8,000,000 in 2005 and 2006. As a result of these and other misrepresentations, Jameel obtained $3 million in loans from SunTrust to buy an 8 acre waterfront estate, $2.375 million in loans from Gateway Bank, and a $46,000 car loan from a local credit union. Although he used a portion of the loan proceeds to extinguish some of this debt, Jameel later defaulted upon all of these loans. After obtaining such loans, Jameel also used a false social security number when seeking the preparation of three years of federal income tax returns by an accounting firm.
This case was investigated by the Federal Bureau of Investigation’s Norfolk Field Office. Assistant United States Attorneys Robert Krask and Stephen Haynie are prosecuting the case on behalf of the United States.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Fourth Grade Teacher Pleads Guilty to Coercing and Enticing A 15-Year-Old Girl in Sexually Explicit Online ChatsRead the Press Release
ALEXANDRIA, Va. – Corey Schock, 44, of Charlottesville, Virginia, pleaded guilty today to a federal crime relating to his participation in sexually explicit online chats with a 15-year-old girl.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; Colonel Edwin C. Roessler Jr., Fairfax County Chief of Police; Chief Timothy J. Longo, Charlottesville Police Department and Stephan M. Hudson, Prince William County Chief of Police made the announcement after the plea was accepted by U.S. District Judge Claude M. Hilton.
Schock was indicted on May 29, 2014, by a federal grand jury for online coercion and enticement of a minor. Schock faces a mandatory minimum sentence of 10 years in prison and a maximum penalty of life in prison when he is sentenced on August 29, 2014.
In a statement of facts filed with the plea agreement, Schock admitted that he engaged in sexually explicit online chats with a 15-year-old girl who lived in Woodbridge, Virginia. In those online chats, Schock sent the victim several sexually explicit pictures of himself, and he requested that the victim send him sexually explicit pictures. In response, the female sent Schock pictures and videos of herself engaging in sexually explicit behavior. Based on information in other court documents, Schock engaged in similar conduct with numerous other minors over a two-year period.
This case was investigated by the FBI’s Washington Field Office, Fairfax County Police Department, Charlottesville Police Department and Prince William County Police Department. Assistant U.S. Attorney Matt J. Gardner is prosecuting the case.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Virginia Businessman Pleads Guilty to Employment Tax Fraud and Theft from Employee Benefit PlanRead the Press Release
WASHINGTON – William P. Danielczyk Jr., formerly of Oakton, Virginia, pleaded guilty to one count of willful failure to collect and pay over employment taxes for the quarter ending Sept. 30, 2010, and one count of theft or embezzlement from an employee benefit plan for the calendar year 2010, the Department of Justice and Internal Revenue Service (IRS) announced today.
According to court documents, from March 2009 until December 2011, Danielczyk was the executive chairman of Innolog Holdings Corporation, a company that acquired Innovative Logistics Technology Inc. in March 2009. Innovative operated in the government services industry and provided technology-supported logistics services to the U.S. military and various defense organizations. The principal offices for Innovative and Innolog were located in McLean, Virginia, and later in Fairfax, Virginia.
For the third calendar quarter of 2009 through the last calendar quarter of 2011, Danielczyk was the person responsible for collecting, accounting for and paying appropriate payroll tax amounts to the IRS. Although payroll taxes were withheld from the wages of Innovative’s employees, Danielczyk failed to pay both the employee withholdings amounts and the employer’s matching portions to the IRS. The total tax loss for all quarters is $2,232,781.
According to court documents, Innovative employees were permitted to contribute to a qualified pension plan that was administered by an asset custodian, and pursuant to this plan, Innovative withheld participants’ elected contribution amounts from their regular paychecks. The total sum of employee withholdings was to be sent to the asset custodian on a bi-weekly basis. Although Danielczyk was the person responsible for authorizing payments to the asset custodian, he failed to send these payments. The total loss amount associated with this conduct, for 2009 through 2011, is $186,263.
Instead of paying Innovative’s employment taxes and remitting employee withholdings to the asset custodian of the company’s qualified pension plan, Danielczyk made purchases that included $505,871 for the use of a Washington, D.C., football stadium executive suite and $40,000 for the sponsorship of a horse race in Virginia.
Sentencing in this case has been set forSept. 11, 2014. For the employment tax charge, Danielczyk faces a statutory maximum sentence of five years in prison and a maximum fine of $250,000. Danielczyk faces a statutory maximum sentence of five years in prison and a fine of $250,000 for the theft from employee benefit plan charge.
The case was investigated by IRS-Criminal Investigation and the U.S. Department of Labor, Employee Benefits Security Administration, Philadelphia Regional Office. Trial Attorney Tracy L. Gostyla of the Tax Division and Assistant U.S. Attorney Mark D. Lytle for the Eastern District of Virginia are prosecuting the case.
Virginia Beach Concert Promoter Pleads Guilty in Fraud SchemeRead the Press Release
RICHMOND, Va. – Kensey Lamonte Wright, 42, of Virginia Beach, Virginia, pleaded guilty today to wire fraud.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Joseph D. Morrison, Assistant Special Agent in Charge of the United States Secret Service’s Richmond Field Office, made the announcement after the plea was accepted by Magistrate Judge David J. Novak.
Wright was indicted on May 6, 2014, by a federal grand jury on a superseding indictment charging eight counts of wire fraud. He faces a maximum penalty of 20 years’ imprisonment, full restitution, and a fine of $250,000 when he is sentenced on September 9, 2014, by Senior United States District Judge James R. Spencer.According to the statement of facts filed with the plea agreement, between January 2007 and December 2013, Wright acted as a representative of Fifth Degree Tours #1, Inc., Fifth Degree Records, Inc., and Turnwright Enterprises, Inc. In that capacity, Wright solicited investors in Virginia and elsewhere to invest in concerts, tours, and similar entertainment events to be held at various locations throughout the United States. Wright represented to investors that the investment funds would be used to produce, promote, or otherwise administer proposed entertainment events, to include events featuring the artists Prince, Beyoncé, Jay Z, R Kelly, and TLC. To solicit investments, Wright promised returns as high as 100% within time periods as short as two weeks to two months. Wright admitted that he knowingly and intentionally misrepresented to investors that their funds would be used to produce or promote the proposed entertainment events, and that he used the vast majority of the funds for his own personal use and benefit, including for gambling and other expenses at various casinos.
As a result of Wright’s ongoing scheme to defraud, investors lost between $750,000 and $1,000,000. The final loss amount will be determined at sentencing and Wright will be ordered to pay that same amount to investors for restitution.
This case was investigated by the United States Secret Service. Assistant United States Attorneys Dominick S. Gerace and Michael Gill are prosecuting the case on behalf of the United States.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
Former Arlington County Employee Sentenced for Taking BribesRead the Press Release
ALEXANDRIA, Va. – Francisco Samayoa Hernandez (“Samayoa”), 33, of Silver Spring, Maryland, was sentenced today to 24 months in prison, followed by three years of supervised release, for receiving bribes in connection with his work as a tax assessor supervisor at the Arlington County Department of Motor Vehicles (DMV) Select office. Samayoa also was ordered to pay approximately $21,000 in restitution to the DMV and to forfeit $11,480 in bribe payments to the government.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after sentencing by U.S. District Judge Leonie M. Brinkema.Samayoa pleaded guilty on March 18, 2014. According to court documents, from July 2012 through November 2013, Samayoa received $11,480 in bribes from a vehicle exporter in exchange for providing vehicle titles and falsifying DMV paperwork that allowed the exporter to avoid paying state motor vehicle sales and use tax in connection with the registration and titling of various luxury automobiles. In exchange for the bribes, Samayoa enabled the exporter to avoid paying approximately $25,000 due to the Commonwealth of Virginia for the registration and titling of a Lamborghini and multiple Ferraris, Porsches and Mercedes. Samayoa also enabled another individual to avoid paying approximately $16,536 in state motor vehicle sales and use tax in connection with the registration and titling of twoLamborghinis.
Samayoa was an Arlington County employee, and the Arlington County Commissioner of Revenue contracts with the DMV to provide vehicle-related services at its local office.Samayoa also served as a straw buyer for the exporter and purchased three BMWs in his name. In connection with these transactions, Samayoa falsely certified to a dealership that he was not purchasing the vehicle for export, and the dealership relied on that certification in making the sale.
This case was investigated jointly by the FBI’s Washington Field Office and the Virginia DMV Office of Enforcement and Compliance, Law Enforcement Division. Assistant U.S. Attorney Paul J. Nathanson prosecuted the case.
Any person who believes they may have information regarding public corruption in the northern Virginia area is encouraged to call the FBI’s Northern Virginia Public Corruption Hotline at 703-686-6225 or send an email to [email protected].
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 at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
Supplier of Non-FDA-Approved Chemotherapy and Cosmetic Drugs Sentenced to 15 MonthsRead the Press Release
ALEXANDRIA, Va. – Mirwaiss Aminzada, 44, of Montreal, Quebec, and Dubai, United Arab Emirates (UAE), was sentenced today to 15 months in prison, 1 year of supervised release and restitution of $586,798. On Dec. 19, 2013, Aminzada pleaded guilty to introducing misbranded drugs into the United States.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Antoinette V. Henry, Special Agent in Charge of the Food and Drug Administration’s (FDA) Office of Criminal Investigations; Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division; Clark Settles, Special Agent in Charge of U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), Washington; Gary Barksdale, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service; and M. Douglas Scott, Arlington County Chief of Police, made the announcement after sentencing by U.S. District Judge Claude M. Hilton.
According to court documents, Aminzada, a U.S. citizen, was the owner and operator of several companies based in Canada, the UAE and Afghanistan. Through these companies, Aminzada obtained chemotherapy and cosmetic drugs intended for Middle Eastern markets and sold those drugs to Gallant Pharma, an unlicensed wholesale drug distributor based in Arlington, Virginia, for resale in the United States. Aminzada used an employee in Pakistan to alter the drugs’ packaging and hide evidence of their foreign source. In one e-mail exchange with Aminzada, the employee complained he was unable to keep “cold chain” chemotherapy drugs refrigerated—which is required to protect drug efficacy and patient health and safety—because the electricity in Peshawar, Pakistan kept going out.
Aminzada also was the source of vials of tampered Botox that were missing safety caps, contained an unusual jelly-like substance and bore mismatched lot numbers and expiration dates. The tampered Botox entered the U.S. supply chain through Gallant Pharma, and some was administered to patients in New England.
To date, twelve defendants associated with Gallant Pharma have been convicted. Two additional defendants named in the indictment, Robert Wachna and Munajj Rochelle, remain fugitives and are believed to be in Canada.
This case was investigated by FDA’s Office of Criminal Investigations, DEA’s Group 33 Diversion Task Force, ICE-HSI and the U.S. Postal Inspection Service, with assistance from the Arlington County Police Department and Interpol. Assistant U.S. Attorneys Lindsay Kelly, Maya Song and Jay Prabhu 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 at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Guatemalan Pseudoephedrine Trafficker Enters Guilty PleaRead the Press Release
ALEXANDRIA, Va. – Erick Estrada Reyes, 31, of Guatemala, pleaded guilty today to conspiring to distribute pseudoephedrine for unlawful importation into the United States and to aiding and abetting the manufacture of methamphetamine.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Derek Maltz, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Special Operations Division, made the announcement after the plea was accepted by U.S. District Judge T.S. Ellis, III.
In a statement of facts filed with his plea agreement, Estrada Reyes admitted to being involved in the sale of nearly 5,000 pseudoephedrine pills to a person he believed was involved in a methamphetamine production operation based in Houston, Texas. This individual was, in reality, a DEA cooperating witness. Estrada Reyes, along with his father, Edgar Estrada Morales, and his cousin, Victor Estrada Paredes, negotiated the sale of equipment used to extract pseudoephedrine from pill form for use in the manufacture of methamphetamine. They also discussed working for the DEA cooperator’s fictitious U.S.-based methamphetamine trafficking organization. According to the indictment, Estrada Reyes worked for his father’s operation, which sold pseudoephedrine to groups that sold methamphetamine in the United States, including the “La Familia” Mexican drug cartel.
Estrada Reyes, along with his father and cousin, were indicted on Feb. 3, 2011 by a federal grand jury for their involvement in this operation. Edgar Estrada Morales was sentenced to 14 years in prison on Aug. 2, 2013, and Victor Estrada Paredes was sentenced to 11 years in prison on July 19, 2013. Erick Estrada Reyes faces a maximum penalty of life in prison when he is sentenced on September 5, 2014.
This case was investigated by the DEA’s Special Operations Division. Assistant U.S. Attorney Michael P. Ben’Ary 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 at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Richmond Developer Pleads Guilty to Unlawful Transfer of A False Identification Document and Aggravated Identity TheftRead the Press Release
RICHMOND, Va. – Billy Gene Jefferson, Jr., 52, of Richmond, Va., pleaded guilty today to Unlawful Transfer of a False Identification Document and to Aggravated Identity Theft. He faces a maximum penalty of 15 years’ imprisonment on the Unlawful Transfer charge, to be followed by a mandatory 2 year consecutive sentence for the Aggravated Identity Theft. He also faces a fine of up to $500,000 and 3 years of supervised release at the time of sentencing. In the plea documents, the United States also reserved the right to argue for an upward variance or departure at sentencing based on the defendant’s obstruction of justice and related conduct that formed the basis for the allegations in Count One of the indictment.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Mark R. Herring, Attorney General of Virginia; Thomas J. Kelly, Special Agent in Charge of the Internal Revenue Service Criminal Investigation’s Washington, D.C., Field Office; Adam S. Lee, Special Agent in Charge of the FBI’s Richmond Field Office; Gary Barksdale, Inspector in Charge of the United States Postal Inspection Service, Washington, D.C. Division; and Colonel W. Steven Flaherty, Superintendent of Virginia State Police, made the announcement after the plea was accepted by United States District Judge John A. Gibney, Jr.
At this time, Jefferson is also awaiting sentencing on Case No. 3:13CR221. In that case on December 19, 2013, Jefferson pleaded guilty to Major Fraud Against the United States and Engaging in Unlawful Monetary Transactions. For those charges, he faces a maximum penalty of 20 years in prison, restitution to the victims, a fine of up to $500,000, and three years of supervised release when he is sentenced on September 9, 2014. In supplemental plea documents filed in that case today, the parties removed a previous provision that called for an agreed sentencing recommendation to the Court. The United States also reserved the right to argue for an upward departure or variance for the defendant’s conduct that formed the basis for the United States’ Motion for Hearing Regarding Defendant’s Breach of Plea Agreement. The parties revised procedures to determine the final restitution amount depending on the final resolution of an IRS audit on a portion of the federal losses.
In the Statement of Facts filed in connection with today’s guilty plea, Jefferson admitted that on October 26, 2013, he created and transferred a false identification document, namely an Arkansas Driver’s License in the name of “Actual Person” (the individual referenced in the pending indictment is Jefferson’s brother, J.W.J.) with the defendant’s photograph, knowing that the document was produced without lawful authority. The defendant agreed that the Arkansas Driver’s License was of the type intended and commonly accepted for identifying an individual that was not issued under the authority of the State of Arkansas. Jefferson, posing as the “Actual Person” (referring to J.W.J.) on the fraudulent Arkansas Driver’s License, caused the email transfer of the identification and other documents to representatives from Aircraft Management Group, Inc. (AMG Jets). The transfer was in relation to the defendant’s attempt to charter a one-way flight to Cranfield, England, with a scheduled departure date of November 2, 2013. In connection with the Aggravated Identity Theft portion of the plea, the defendant admitted that he transferred, possessed, and used “Actual Person’s” (referring to J.W.J.) name and date of birth in connection with attempting to secure the charger flight. The defendant admitted that he did not have the “Actual Person’s” authority or permission to use the name and date of birth for these purposes.
This case was investigated by the Internal Revenue Service Criminal Investigation Division, Federal Bureau of Investigation Richmond Office, the United States Postal Inspection Service, and the Virginia State Police. The Virginia Department of Historic Resources also assisted law enforcement in the investigation. Assistant United States Attorneys Michael Gill and Wingate Grant and Special Assistant United States Attorney Patrick Dorgan are prosecuting the case on behalf of the United States.
This investigation has been coordinated by the Virginia Financial and Securities Fraud Task Force, an unprecedented partnership between criminal investigators and civil regulators to investigate and prosecute complex financial fraud cases in the nation and in Virginia. The task force is comprised of several federal and state agencies, including the Virginia Attorney General’s Office. The task force is an investigative arm of the President’s Financial Fraud Enforcement Task Force (FFETF), an interagency national task force.
The FFETF was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Miami Man Pleads Guilty to Identity Theft and Tax Refund Fraud ChargesRead the Press Release
RICHMOND, Va. – Junior Jean Merilia, 33, of Miami, Florida, pleaded guilty today to conspiracy to commit mail and wire fraud and aggravated identity theft.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Thomas J. Kelly, Special Agent in Charge of Internal Revenue Service, Washington Field Office, made the announcement after the plea was accepted by U.S. District Judge Henry E. Hudson.Merilia was indicted on June 4, 2014 by a federal grand jury on a single count of conspiracy to commit mail and wire fraud. He faces a maximum penalty of twenty-two years in prison when he is sentenced on November 21, 2014.
According to the statement of facts in support of the plea and other court documents, Merilia is a co-conspirator of Ramoth Jean, who has already been prosecuted in connection with this matter. Jean was stopped by Henrico County Police in August 2012 as he removed items from a storage unit that had been rented in the name of a Florida resident without that person’s knowledge or authorization. A search of the unit yielded hundreds of cards bearing the personal identifying information of persons around the United States, pre-paid debit cards, and laptop computers used in this scheme. The pre-paid debit cards were issued in connection with tax refunds from tax returns filed on-line using stolen personal identifying information. Many of those returns were filed from hotels in the Richmond area.
Papers linked with Merilia were found in the storage unit. Merilia acknowledged in the statement of facts that he hired a website designer who created websites through which personal identifying information was stolen, via sham employment postings, for use in connection with the scheme. In addition, Merilia made ATM withdrawals in the Miami area using debit cards connected with some fraudulently filed tax returns.
On January 9, 2014, Judge Hudson sentenced Ramoth Jean to a 114 month term of incarceration following his guilty pleas to conspiracy and aggravated identity theft charges.
This case was investigated by the Internal Revenue Service—Criminal Investigations, the U.S. Postal Inspection Service, Social Security Administration—Office of Inspector General, and the Henrico County Police Department as members of the Metro-Richmond Identity Theft Task Force. Prosecutions for the Task Force are handled by the United States Attorney’s Office and the Office of the Attorney General for the Commonwealth of Virginia. Assistant U.S. Attorney Michael C. Moore 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. 3:14-cr-73.
Locust Grove Man Pleads Guilty to Oxycodone ConspiracyRead the Press Release
Defendant sold drugs outside Dumfries day care center that was owned and operated by his wife
ALEXANDRIA, Va. – Ralph Caldwell, 38, of Locust Grove, Virginia, pleaded guilty today to conspiring to distribute oxycodone.
Dana J. Boente, United States Attorney for the Eastern District of Virginia, and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after the plea was accepted by U.S. District Judge Liam O’Grady.
Caldwell was indicted on May 8, 2014, by a federal grand jury on charges of conspiracy to distribute oxycodone and distribution of oxycodone. Caldwell faces a maximum penalty of 20 years in prison and a $1 million fine when he is sentenced on September 5, 2014 at 9:00 a.m.
According to court records, from January 2011 to March 2014, Caldwell distributed oxycodone to customers throughout Prince William County, Virginia. As part of the conspiracy, Caldwell and others used the area near the Little Angels Day Care, a children’s day care center in Dumfries, Virginia, to sell oxycodone and arrange transactions. Caldwell told one of his co-conspirators—who was both the parent of a child being supervised at the day care and one of Caldwell’s suppliers—that payment for childcare services could be rendered in the form of a negotiated amount of oxycodone. Caldwell’s wife owned and operated the day care.
As part of the statement of facts entered with the plea, Caldwell admitted that he conspired to distribute oxycodone and that he sold oxycodone to a confidential informant on three separate occasions in February 2014 at locations within Dumfries and Triangle, Virginia.
This case was investigated by the FBI’s Washington Field Office, with assistance from the Prince William County Police Department. Special Assistant U.S. Attorney Kevin Lowell and Assistant U.S. Attorney Gene Rossi 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 at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Washington, D.C. Hospital Worker Pleads Guilty to Identity TheftRead the Press Release
ALEXANDRIA, Va. – Detrius Elliott, 43, of Clinton, Maryland, pleaded guilty today to identity theft for stealing at least 78 identities belonging to financial guarantors of patients at a Washington, D.C. hospital, as part of a large identity theft ring operating in the area.
Dana J. Boente, United States Attorney for the Eastern District of Virginia, and Kathy A. Michalko, Special Agent in Charge of the U.S. Secret Service’s Washington Field Office, made the announcement after the plea was accepted by U.S. District Judge Claude M. Hilton.
In a statement of facts filed with the plea agreement, Elliott admitted to stealing names, addresses, dates of birth, and Social Security numbers from the billing database of the Washington hospital where she worked as a credit and collections representative. Elliott provided the identities to co-conspirator Jenaro Blalock and another member of the identity theft ring, who used the identities to obtain fraudulent driver’s licenses and open instant lines of credit and rent vehicles under the victims’ names. The victims whose identities were stolen from the hospital database suffered approximately $102,000 in losses.
Elliott is the tenth member of the identity theft ring to plead guilty. Co-leaders Christopher Bush, 40, of District Heights, Maryland, and Blalock, 31, of Clinton, Maryland, were previously sentenced to 10 and 12 years in prison, respectively, for leading the ring, which resulted in approximately $1 million in total losses to victims.
Elliott faces a maximum penalty of 15 years in prison when she is sentenced on July 25, 2014.
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 at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
This case was investigated by the U.S. Secret Service. Assistant U.S. Attorney Lindsay Kelly is prosecuting the case.Man Sentenced to More Than 15 Years for Child Sex Trafficking in RichmondRead the Press Release
RICHMOND, Va. – Troy Parker, 41, was sentenced today to 188 months in prison, followed by 10 years of supervised release, for child sex trafficking.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Adam S. Lee, Special Agent in Charge, Federal Bureau of Investigation’s Richmond Field Office; and Clark E. Settles, Special Agent in Charge for U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), made the announcement after sentencing by United States District Judge Robert E. Payne.
Parker pleaded guilty on February 12, 2014, to one count of child sex trafficking. According to court documents, Parker met a minor in Richmond, Virginia and took her to the Travel Inn. He then used his cellular telephone to post an advertisement on Backpage.com containing pictures of the minor and offering her for sexual acts in exchange for money. Parker also provided transportation and a hotel room for the minor to perform those sexual acts. The minor then provided Parker with money she was paid by her customers. On May 28, 2013, an agent with the Federal Bureau of Investigation, acting in an undercover capacity, spoke to Parker and arranged through him to meet the minor for purported sexual activities. At the time of the meeting, agents were able to secure the minor and take Parker into custody.
This case was investigated by the Federal Bureau of Investigation, the Department of Homeland Security, and the Richmond Police Department. Assistant United States Attorney Heather L. Hart prosecuted the case on behalf of the United States.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Final Defendant in Sophisticated, Violent Fraudulent Document Ring Pleads Guilty to Racketeering and Money LaunderingRead the Press Release
RICHMOND, Va. – Freddy David Santos Campuzano, 32, a Mexican National who resided in Cincinnati, Ohio, pleaded guilty today to Conspiracy to Engage in Racketeering and Conspiracy to Launder Money. Santos Campuzano faces a maximum of 40 years’ imprisonment, a fine of $750,000, and three years of supervised release when he is sentenced on September 10, 2014, by United States District Court Judge James R. Spencer. Further, the defendant is illegally within the United States and faces deportation following the service of his prison sentences.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Clark E. Settles, Special Agent in Charge for U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), made the announcement after the guilty plea was accepted by Magistrate Judge M. Hannah Lauck.
According to court papers, this defendant is connected to a Fraudulent Document Enterprise (FDE) previously prosecuted in the Eastern District of Virginia in United States v. Israel Cruz Millan, Case No. 3:10CR308. The FDE, which originally operated in the United States beginning prior to 2008 and continuing through November 18, 2010, had cells in Richmond, Norfolk, Virginia Beach, and Manassas, Virginia; Fayetteville and Little Rock, Arkansas; New Haven, Connecticut; Mishawaka, Indiana; Lexington and Louisville, Kentucky; Chelsea, Massachusetts; St. Louis, Missouri; Chapel Hill, Greensboro, Raleigh, and Wilmington, North Carolina; Cincinnati, Ohio; Providence, Rhode Island; and, Nashville, Tennessee. The criminal enterprise was dismantled within the United States on November 18, 2010. In the prior case and connected prosecutions, a total of 30 defendants were convicted. On February 16, 2012, United States District Judge James R. Spencer sentenced the overall leader, Israel Cruz Millan to 300 months’ imprisonment. On March 2, 2012, United States District Judge Henry E. Hudson sentenced Oliverez-Jiminez to two consecutive life terms in prison, after his conviction by a jury for racketeering, murder, kidnapping, conspiracy to commit money laundering, and conspiracy to produce and transfer false identification documents.
According to court filings, the FDE restarted its operations while the Israel Cruz Millan, et al. case was still pending. Beginning at some point prior to February 2012, Manuel Hidalgo Flores, also known as “Chino,” “Chimuelo” and “Julio,” began managing the organization’s operations in the United States, supervising operations in Richmond, Virginia; Springdale, Arkansas; Boston, Massachusetts; Raleigh, North Carolina; Cincinnati, Ohio; and Pawtucket, Rhode Island. As in the previous case, the FDE produced high-quality false identification cards for distribution to illegal aliens. In most cities where the organization operated, Hidalgo Flores placed a cell manager to supervise a number of “runners,” the lower level members of the organization who distributed business cards advertising the organization’s services and helped facilitate transactions with customers.
In his sworn Statement of Facts, Freddy David Santos Campuzano, also known as “Chaparro,” admitted that, he operated in the Cincinnati, Ohio cell under the supervision of Hidalgo Flores. Within that cell, Santos Campuzano, along with others, were responsible for distributing the fraudulent documents using information obtained from clients by “runners.” The runners would recruit illegal alien clients who wished to obtain false identification documents, including counterfeit Permanent Resident Alien Cards (also known as “Green Cards”), Social Security Cards, out-of-state identification cards, and various international documents. Upon identifying a specific client, a runner would relay identifying information and photographs from the client to the printer via cellular telephone or other method. The printer would, in turn, use a computer and printer to create fraudulent identification documents for the client, depending on the nature of the order received from the client. Once the documents were complete, the runner would usually provide the documents to the client in exchange for United States currency. A client would generally pay approximately $150 for a set of fraudulent identification documents (such as a Permanent Resident Alien Card and Social Security Card). Each cell maintained detailed sales records and divided the proceeds between the runner, the cell manager, and the upper level managers in Mexico. In addition, the FDE used Western Union and MoneyGram to funnel criminal proceeds to Mexico.
The evidence during the Oliverez-Jiminez trial detailed how members of the organization sought to drive competitors from their territory by posing as customers in search of fraudulent documents and then attacking the competitors when they arrived to make a sale. According to court filings, the FDE continued those tactics in 2013. The First Superseding Indictment charges four FDE members, including Manuel Hidalgo Flores, with targeting a competitor in the Richmond, Virginia area on October 6, 2013. That planned attack was thwarted, however, by law enforcement intervention.
Counting this guilty plea, 42 members of this organization charged in the Richmond, Virginia federal cases have been convicted. Santos Campuzano is the final defendant to plead guilty in the case.
The case was investigated by the Richmond and Norfolk offices of ICE’s Homeland Security Investigations (HSI), which falls under the Washington, D.C., office. ICE HSI received assistance from the Virginia State Police, Chesterfield County Police Department, and Henrico County Police Department. Assistant United States Attorney Michael Gill and Trial Attorney Maria Gonzalez Calvet, of the Criminal Division's Fraud Section, are prosecuting the case on behalf of the United States
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Head of Annandale Settlement Company Pleads Guilty to over $2 Million Short Sale Mortgage FraudRead the Press Release
ALEXANDRIA, Va. – Jose Marinay, 52, of Annandale, Virginia, pleaded guilty today to conspiracy to commit wire fraud for his involvement in a short sale mortgage fraud conspiracy.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, and Thomas J. Kelly, Special Agent in Charge, Washington D.C. Field Office, IRS-Criminal Investigation, made the announcement after the plea was accepted by U.S. District Judge Claude M. Hilton.
Marinay was indicted on April 15, 2014 by a federal grand jury on multiple charges, including conspiracy to commit wire fraud. Marinay faces a maximum penalty of 20 years in prison when he is sentenced on Sept.26, 2014.
According to court documents, Marinay operated a settlement company in Annandale named Virginia Smart Choice Settlements (which is now SCS Title & Escrow). Marinay helped prepare settlement statements that contained false information relating to liens, realtor commissions, title search fees, attorneys’ fees, title insurance, recording fees and taxes. Marinay caused the settlement statements to be sent to mortgage lenders, and in some instances, he shredded the statements to conceal evidence of the fraudulent transactions.
According to the statement of facts filed with Marinay’s plea agreement, a co-conspirator used the settlement statements to fraudulently induce mortgage lenders to execute short sales—real estate transactions in which the mortgage lender agrees to accept a price less than the amount owed on the property—on at least seven occasions. Immediately after the short sale, the co-conspirator sold the property to a new buyer in violation of representations and agreements made with the short sale mortgage lender. As a result of this scheme, the affected financial institutions suffered losses of over $2 million.
This case was investigated by theFBI’s Washington Field Office and IRS-Criminal Investigation. Assistant U.S. Attorney Uzo Asonye and Trial Attorney Todd Ellinwood of the Justice Department’s 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 at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Newport News Man Sentenced to Thirty Years for His Involvement in Hampton ShootoutRead the Press Release
NEWPORT NEWS, Va. – Ryan Fultz, 33, of Newport News, Va., was sentenced yesterday to a total of 30 years in prison following his convictions for possessing and discharging a firearm during a drug trafficking crime, possession with intent to distribute cocaine, and felon in possession of a firearm.
Dana J. Boente, United States Attorney for the Eastern District of Virginia, Charles E. Smith, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, and, Terry L. Sult Hampton Police Chief, made the announcement after sentencing by United States District Judge Henry C. Morgan, Jr.
Fultz was indicted on March 13, 2013, on charges of possession with intent to distribute cocaine base, commonly known as “crack” cocaine, possession, brandishing and discharging a firearm during a drug trafficking crime, and felon in possession of a firearm. On February 7, 2014, a jury convicted him on all charges following a four day jury trial.
According to court records, and evidence at trial, on December 27, 2011, Fultz was present during a planned drug deal in the Wal Mart parking lot located at Cunningham Drive, Hampton, Va. Fultz provided back-up to a drug dealer and when a dispute arose, he participated in a shootout with two other individuals. Fultz discharged a Bushmaster AR-15 high powered rifle during the shooting in which more than 30 shots were exchanged as evidenced by shell casings recovered at the scene. Fultz is the third participant federally prosecuted as a result of this incident.
This case was investigated by the FBI Safe Streets Task Force, Hampton Police Division and ATF’s Washington Field Division. Special Assistant United States Attorney Timothy R. Murphy prosecuted the case on behalf of the United States.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Military Sealift Command Contractor and Local Businessman Charged with Bribery and Obstruction of Justice SchemesRead the Press Release
Norfolk, Va. – Scott B. Miserendino, Sr., 55, of Stafford, Va., and Timothy S. Miller, 57, of Chesapeake, Va., were charged today with conspiracy, bribery, and obstruction of criminal investigations.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Acting Assistant Attorney General David A. O’Neil of the Justice Department’s Criminal Division; Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service Mid-Atlantic Field Office (DCIS); Acting Executive Assistant Director Charles T. May Jr. of the Naval Criminal Investigative Service (NCIS) Atlantic Operations; and Special Agent in Charge Royce E. Curtin of the FBI’s Norfolk Field Office.
A federal grand jury returned a six-count indictment that charges Miserendino with one count of conspiracy to commit bribery, one count of bribery, one count of conspiracy to commit obstruction of criminal investigations and to commit tampering with a witness, and one count of obstruction of criminal investigations. The indictment charges Miller with one count of conspiracy to commit bribery and two counts of bribery of a public official.
According to the indictment, Miserendino was a government contractor at MSC, the leading provider of transportation for the United States Navy. The indictment alleges that Miserendino worked closely with another MSC public official, Kenny E. Toy, in managing MSC’s telecommunications projects and in influencing the award of United States government contracts, subcontracts, and task orders.
The indictment alleges that Miserendino solicited and accepted bribes, in the form of cash payments and other things of value, in exchange for providing favorable treatment to two defense contractors in connection with United States government contracts.
Between March 2005 and 2007, Miserendino allegedly accepted cash payments of approximately $3,000 per month from agents of Company A, a corporation that sought contracting business from MSC.
In addition, the indictment alleges that, in February 2009, Miller and his business partner Dwayne A. Hardman established Company B, a government contracting corporation located in Chesapeake, Va., to provide support to MSC on various telecommunications projects. Shortly thereafter, in May 2009, Miller and Hardman paid cash bribes to Miserendino and Toy, another MSC public official with whom Miserendino worked, in exchange for favorable treatment in connection with U.S. government contracts, subcontracts, and task orders. Miserendino allegedly accepted approximately $25,000 in cash from Miller and Hardman. According to the indictment, Miller provided the $25,000 cash bribe to Miserendino at Company B’s offices and also provided a $25,000 cash bribe to Toy, the MSC public official with whom Miserendino worked.In addition, according to the indictment, Miserendino obstructed justice and tampered with a witness by causing $85,000 to be paid to a businessman who had provided bribes, Dwayne A. Hardman, in an attempt to prevent or delay Hardman from reporting the bribery scheme to law enforcement authorities.
The case is being prosecuted by Assistant United States Attorney Stephen W. Haynie of the U.S. Attorney’s Office for the Eastern District of Virginia and Trial Attorney Emily Rae Woods, of the Public Integrity Section, Criminal Division, of the Department of Justice. The case was investigated by the FBI, the NCIS, and the DCIS.
Criminal indictments are only charges and not evidence of guilt. Defendants are presumed to be innocent until and unless proven guilty.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.First MS-13 Member Extradited from El Salvador to United States Sentenced to 35 Years for Role in Attempted Murder of Two IndividualsRead the Press Release
One of the Seriously Wounded Victims Was Pregnant
ALEXANDRIA, Va. – Edgar Benitez Hernandez, also known as “Shadow,” 26, of the District of San Miguel, El Salvador, was sentenced today to 35 years in prison on two counts of using and discharging a firearm during or in relation to an attempted murder in aid of racketeering. Benitez Hernandez was extradited from El Salvador to the United States on Dec. 18, 2013, and had been indicted previously by an Eastern District of Virginia grand jury on June 13, 2010, on multiple racketeering charges, including attempted murder.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; Michael L. Chapman, Loudoun County Sheriff; and Maggie DeBoard, Town of Herndon Chief of Police, made the announcement after the sentencing before U.S. District Judge Claude M. Hilton.
Benitez Hernandez pleaded guilty on Feb. 12, 2014. According to court documents, Benitez Hernandez, a soldier in the notoriously violent transnational street gang Mara Salvatrucha 13 (“MS-13”), attempted to murder two individuals on Sept. 13, 2008, in Loudoun County, Va. On that date, Benitez Hernandez concealed himself behind some shrubs and when the male and pregnant female victims were within range, he fired multiple shots while yelling “Mara Salvatrucha Cabrones.” Both of the victims were critically injured and likely would have died were it not for immediate surgical intervention. The unborn baby also survived the wounding. Benitez Hernandez committed the double shooting to increase his position within MS-13’s criminal enterprise.
On May 22, 2013, Benitez Hernandez was apprehended in El Salvador by an elite Salvadoran investigative unit known as the Transnational Anti-Gang (TAG) Task Force. This extradition marks the first time in recent history that a Salvadoran citizen has been extradited to the United States to be held accountable for gang-related crimes committed in the United States.
This case was investigated by the Federal Bureau of Investigation, Loudoun County Sheriff’s Office and the Northern Virginia Gang Task Force, with assistance from the Town of Herndon Police Department. The U.S. law enforcement partners involved in the investigation and prosecution of Benitez Hernandez would like to thank the Salvadoran National Police for their outstanding assistance in bringing this fugitive to justice. U.S. Attorney Dana J. Boente also thanked the FBI’s Legal Attaché Office in El Salvador, the Government of El Salvador and the U.S. Department of Justice’s Office of International Affairs, each of which were critical in securing the custody and extradition of Benitez Hernandez. Assistant U.S. Attorneys Zach Terwilliger and Patricia Haynes prosecuted the case on behalf of the United States.
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 at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Former Piedmont Jail Supervisor Found Guilty of Conspiracy, False Tax Returns, and Bank FraudRead the Press Release
RICHMOND, Va. – William A. Coles, Jr., 49, of Pamplin, Va., was convicted by a federal jury today on seven counts involving conspiracy with his wife, Sybil Coles, to defraud the United States, assisting in the preparation and filing of false tax returns, and bank fraud. Coles faces a maximum penalty of 48 years of incarceration when he is sentenced by United States District Judge Henry E. Hudson on August 21, 2014.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; Mark R. Herring, Attorney General of Virginia; Thomas J. Kelly, Special Agent in Charge, IRS Criminal Investigation, Washington D.C. Field Office; and Kathryn Keneally, Assistant Attorney General of the Justice Department's Tax Division, made the announcement after the verdict was announced.
The indictment alleged that William Coles and his wife, who was sentenced on May 12, 2014, in a related case to five years’ imprisonment, engaged in a false tax return conspiracy from at least 2008 through 2012. At trial, several of William Coles’ co-workers at the Piedmont Regional Jail testified that Coles claimed his wife knew of secret law enforcement loopholes to get larger tax refunds and took their tax documents and collected fees for his wife to prepare false tax returns unbeknownst to his co-workers.The evidence at trial also showed that William and Sybil Coles electronically deposited checks generated from fraudulent federal and State of Virginia returns filed on their behalf and on behalf of numerous other individuals, along with thousands of dollars in United States currency, into student bank accounts in the name of their college-age daughter. The Coles spent this money on personal living expenses, including mortgage and car loan payments and family vacations. William Coles was interviewed by Special Agents with the Internal Revenue Service Criminal Investigation and failed to disclose the use of the multiple bank accounts where tax refunds and cash were deposited, but admitted that he knew his wife was filing false tax returns and that he had solicited clients from the Jail.
In addition, the trial evidence included multiple sworn claims by William Coles of inflated income and corroborating false documents, including false W-2s and paystubs for him and his wife, that were submitted to the Bank of America and finance companies to obtain a home refinance loan and two car loans.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
The case is being prosecuted by Department of Justice, Tax Division Trial Attorney and Special Assistant United States Attorney, Rebecca Perlmutter, and Assistant Attorney General and Special Assistant United States Attorney Michael Jagels. IRS-Criminal Investigation in Richmond, Virginia investigated the case.Credit Suisse Pleads Guilty to Conspiracy to Aid and Assist U.S. Taxpayers in Filing False ReturnsRead the Press Release
Bank Admits to Helping U.S. Taxpayers Hide Offshore Accounts from IRS; Agrees to Pay $2.6 Billion, Highest Ever Payment in a Criminal Tax Case
Investigation Has Also Led To Indictment of Eight Credit Suisse Employees Since 2011WASHINGTON – Credit Suisse AG pleaded guilty today to conspiracy to aid and assist U.S. taxpayers in filing false income tax returns and other documents with the Internal Revenue Service (IRS). The guilty plea by the Swiss corporation is the result of a years-long investigation by U.S. law enforcement authorities that has also produced indictments of eight Credit Suisse executives since 2011; two of those individuals have pleaded guilty so far.
The plea agreement, along with agreements made with state and federal partners, provides that Credit Suisse will pay a total of $2.6 billion - $1.8 billion to the Department of Justice for the U.S. Treasury, $100 million to the Federal Reserve, and $715 million to the New York State Department of Financial Services. The plea agreement was filed in the Eastern District of Virginia today. Earlier this year, Credit Suisse paid approximately $196 million in disgorgement, interest and penalties to the Securities and Exchange Commission (SEC) for violating the federal securities laws by providing cross-border brokerage and investment advisory services to U.S. clients without first registering with the SEC. That settlement with the SEC is also reflected in today’s plea agreement. Together, these actions by U.S. law enforcement and state and federal partners appropriately punish Credit Suisse for its past behavior in these matters.
The announcement was made by Attorney General Eric H. Holder, Deputy Attorney General James M. Cole, Assistant Attorney General Kathryn Keneally for the Justice Department’s Tax Division, U.S. Attorney Dana J. Boente for the Eastern District of Virginia, and Commissioner John Koskinen of the IRS.
“This case shows that no financial institution, no matter its size or global reach, is above the law,” said Attorney General Holder. “Credit Suisse conspired to help U.S. citizens hide assets in offshore accounts in order to evade paying taxes. When a bank engages in misconduct this brazen, it should expect that the Justice Department will pursue criminal prosecution to the fullest extent possible, as has happened here.”
As part of the plea agreement, Credit Suisse acknowledged that, for decades prior to and through 2009, it operated an illegal cross-border banking business that knowingly and willfully aided and assisted thousands of U.S. clients in opening and maintaining undeclared accounts and concealing their offshore assets and income from the IRS.
“Credit Suisse’s guilty plea is just the latest effort by the department to slam the door shut on undeclared bank accounts, phony trusts and other foreign schemes used by U.S. taxpayers to evade taxes,” said Deputy Attorney General Cole. “We will continue to hold to account the bankers, the brokers and other professionals in Switzerland and around the world as well as the institutions that trained and directed them to use bank secrecy laws to protect U.S. tax cheats.”
According to the statement of facts filed with the plea agreement, Credit Suisse employed a variety of means to assist U.S. clients in concealing their undeclared accounts, including by:
- assisting clients in using sham entities to hide undeclared accounts;
- soliciting IRS forms that falsely stated, under penalties of perjury, that the sham entities were the beneficial owners of the assets in the accounts;
- failing to maintain in the United States records related to the accounts;
- destroying account records sent to the United States for client review;
- using Credit Suisse managers and employees as unregistered investment advisors on undeclared accounts;
- facilitating withdrawals of funds from the undeclared accounts by either providing hand-delivered cash in the United States or using Credit Suisse’s correspondent bank accounts in the United States;
- structuring transfers of funds to evade currency transaction reporting requirements; and
- providing offshore credit and debit cards to repatriate funds in the undeclared accounts.
As part of the plea agreement, Credit Suisse further agreed to make a complete disclosure of its cross-border activities, cooperate in treaty requests for account information, provide detailed information as to other banks that transferred funds into secret accounts or that accepted funds when secret accounts were closed, and to close accounts of account holders who fail to come into compliance with U.S. reporting obligations. Credit Suisse has also agreed to implement programs to ensure its compliance with U.S. laws, including its reporting obligations under the Foreign Account Tax Compliance Act and relevant tax treaties, in all its current and future dealings with U.S. customers.
“Today’s plea by Credit Suisse is a significant step in our global enforcement against those who would avoid their tax obligations by hiding their assets in foreign bank accounts, and those financial institutions, bankers, and other professionals who facilitate this conduct,” said Assistant Attorney General Keneally for the Tax Division. “Credit Suisse has also changed its business operations to ensure that U.S. taxpayers will no longer be able to hide their assets at Credit Suisse, and provided the government with valuable information that will further our investigations.”
“This prosecution and plea should serve notice that secret accounts and assisting the evasion of income taxes has a high cost,” said U.S. Attorney Boente. “Concealing financial accounts from the U.S. government is not a legitimate part of wealth management or private banking services.”
“Pursuing international tax evasion is a priority area for IRS Criminal Investigation, and we will continue to follow the money here in the United States and around the world” said IRS Commissioner Koskinen. “I want to commend the special agents in IRS-Criminal Investigation for all of their hard work in this area and the close cooperation with the Department of Justice. Today's guilty plea is another important milestone in ongoing law enforcement efforts to investigate the use of offshore accounts to evade taxes. People should no longer feel comfortable hiding their assets and income from the IRS.”
The Board of Governors of the Federal Reserve System is also announcing today that it has reached a resolution with Credit Suisse, by which Credit Suisse has agreed to a cease and desist order, certain remedial steps to ensure its compliance with U.S. law in its ongoing operations, and a civil monetary penalty of $100 million. Additionally, the New York State Department of Financial Services is announcing a similar resolution by which Credit Suisse has agreed to a cease and desist order and a monetary penalty of $715 million.
On Feb. 23, 2011, a grand jury in the Eastern District of Virginia returned an indictment charging four Credit Suisse employees - Marco Parenti Adami, a former Credit Suisse manager; Emanuel Agustino, a former Credit Suisse banker; Michele Bergantino. a former Credit Suisse banker; and Roger Schaerer, Credit Suisse’s former Representative Officer in its Representative Office in New York - with conspiring with other Swiss bankers and U.S. taxpayers to defraud the United States. On July 21, 2011, the grand jury returned a superseding indictment adding four additional defendants charged with the conspiracy to defraud the United States. The four new defendants were: Markus Walder, the former head of North America Offshore Banking at Credit Suisse; Süsanne D. Rüegg Meier, a former Credit Suisse manager; Andreas Bachmann, a former banker at Credit Suisse Fides, a subsidiary of Credit Suisse; and Josef Dörig, a former Credit Suisse Fides employee and owner/operator of a trust company. On March 12, 2014, Bachmann pleaded guilty to the superseding indictment in connection with his work as a banker at Credit Suisse Fides. On April 30, 2014, Dörig pleaded guilty to conspiring to defraud the IRS in connection with his role managing offshore entities used by U.S. taxpayers to conceal their accounts at Credit Suisse. Those pleas were accepted by U.S. District Judge Gerald Bruce Lee. Bachmann and Dörig each face maximum penalties of five years in prison when they are sentenced on Aug. 8, 2014.
This case was prosecuted by Assistant U.S. Attorney Mark D. Lytle and Trial Attorneys Mark F. Daly and Nanette L. Davis of the Tax Division. The case was investigated by IRS-Criminal Investigation.
The Department of Justice expressed gratitude to the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of New York, the U.S. Securities and Exchange Commission, and the New York State Department of Financial Services for their significant and valuable assistance.Nine Trey Gangster Member Sentenced to 30 Years in Federal PrisonRead the Press Release
RICHMOND Va. – Clyde Maurice Neblett, III, 23, of Richmond, Virginia, a member of the Nine Trey Gangsters, was sentenced today on three firearms offenses. A jury convicted Neblett in January of possession of three firearms by a felon and also, in a separate incident, of possessing a fourth gun while a felon. He was sentenced today to ten years on each of those two counts, with the sentences to run consecutively. In addition, Neblett pled guilty today to discharging a firearm during an attempted robbery in April 2013, and received an additional ten year sentence, consecutive to the earlier firearms charges, for a total sentence of 30 years. In the Statement of Facts filed with the Court in conjunction with his plea today, Neblett admitted that he also engaged in two additional home-invasion style robberies in Richmond and Chesterfield County between December 2012 and January 2013.
Dana J. Boente, United States Attorney for the Eastern District of Virginia; and Adam S. Lee, Special Agent in Charge, Federal Bureau of Investigation’s Richmond Field Office; Charles E. Smith, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division; and Chief Douglas A. Middleton, Henrico County Police Division, made the announcement today after the sentence was imposed by United States District Court Judge Henry E. Hudson.
Neblett was a high-ranking officer in the Nine Trey Gangsters (“NTG”) and is one of nearly four dozen members of that gang to be convicted on federal charges since 2012. NTG is part of the United Blood Nation (UBN), the first unified Blood gang alliance on the East Coast. The gang started on Riker’s Island in the New York City jail system. Since its inception, NTG has been one of the most active East Coast Blood gang sets, and has spread across the eastern United States. The FBI and numerous dedicated gang task forces have undertaken a long-term investigation of NTG activities in Virginia and neighboring states.
This case was initiated and investigated by the Federal Bureau of Investigation as part of its Organized Crime Drug Enforcement Task Force (OCDETF) investigation, dubbed Full Blooded Ink. Assistant United States Attorney Angela Mastandrea-Miller prosecuted the case on behalf of the United States.
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. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.