Eastern District of Washington
Press releases recorded for this federal judicial district.
Hanford DOE Subcontractor Agrees to Pay $2.0 Million to Settle Allegations of Small Business FraudRead the Press Release
Spokane – Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Federal Engineers & Constructors (FE&C), a subcontractor at the Department of Energy’s (DOE) Hanford Site, has agreed to pay $2 Million ($2,000,000) to resolve allegations that it violated the False Claims Act (FCA) in connection with a number small business subcontracts with DOE at its Hanford nuclear site.
Between 2005 and 2016, Washington Closure Hanford, LLC (WCH), a jointly owned by AECOM, Bechtel National Inc., and CH2M Hill Companies Ltd., was a DOE prime contractor that was awarded a multi-billion dollar River Corridor Closure Contract (RCC) at DOE’s Hanford Site. WCH was responsible for environmental remediation on Hanford's River Corridor. WCH workers were responsible for cleaning up waste sites at Hanford, decontaminating and decommissioning former plutonium production nuclear reactors and surplus facilities, and disposing of contaminated waste. The RCC required WCH to award a certain percentage of subcontracts to small and disadvantaged businesses, including woman-owned small businesses. Pursuant to its contract, DOE fully reimbursed WCH for hundreds of millions of dollars in subcontracts WCH awarded to qualified small, disadvantaged businesses, including women-owned small businesses.
The case originally arose out of a whistleblower complaint filed in U.S. District Court by Savage Logistics LLC, a Hanford-area small business, and Salina Savage, its owner. In December 2013, the United States filed a Complaint intervening in the lawsuit, alleging that WCH, FE&C, Sage Tec LLC (purported to be a small, disadvantaged business) and Laura Shikashio, the owner of Sage Tec, violated the False Claims Act (FCA) with respect to two multi-million dollar subcontracts arranged between WCH and Sage Tec. The Complaint alleges that WCH, FE&C, Sage Tec and Ms. Sikashio knowingly misrepresented Sage Tec to be a qualified disadvantaged small business in order to be eligible for two multi-million dollar subcontracts that were designated for truly qualified small disadvantaged businesses. The Complaint further alleges that Sage Tec was not a legitimate small, disadvantaged business; rather it was a pass-through front company for FE&C, which performed substantially all of the work on WHC’s improperly awarded subcontracts.
FE&C’s settlement with the DOJ resolves its liability for the misconduct alleged and set forth in the United States’ Complaint. The United States’ case against WCH, Sage Tec, and Ms. Shikashio continues to be prosecuted and the remaining defendants still deny liability.
Joseph H. Harrington said, “Small business fraud not only harms the taxpayers and the vital cleanup mission at Hanford, but legitimate small, disadvantaged businesses that do not have the opportunity to fairly compete for and perform subcontracts. I want to commend the Department of Energy Office of Inspector General (DOE-OIG) and the Small Business Administration Office of Inspector General (SBA-OIG) for the outstanding efforts investigating and uncovering the scheme perpetrated here. The United States Attorney’s Office for the Eastern District of Washington, together with the Office’s law enforcement partners, will continue to pursue vigorously large and small business fraud at Hanford.”
“The false statements in this case were intended to deceive the government into believing that a woman-owned small, disadvantaged business was performing valuable work as a government subcontractor,” said Small Business Administration Acting Inspector General Hannibal “Mike” Ware. “OIG will aggressively pursue parties that, through fraud, gain access to SBA’s small business contracting programs. I want to thank the U.S. Attorney’s Office for their dedication to enforcing compliance in SBA’s contracting programs.”
Department of Energy Acting Inspector General April G. Stephenson said, “The Department of Energy Office of Inspector General is committed to ensuring the integrity of Departmental contracts and financial expenditures. We will continue to investigate allegations of fraudulent diversion of tax dollars throughout DOE programs. This settlement is a result of our staff’s dedicated work to ensure public funds are properly used for the mission-related purposes for which they are intended. We appreciate the support of Department of Justice’s and Department of Energy’s attorneys in these matters.”
The Savage whistleblowers will receive approximately $470,000 of the $2.0 Million settlement DOJ reached with FE&C due to their private efforts in exposing – reporting the described scheme to the DOE and DOJ.
DOE-OIG and SBA-OIG conducted the investigation on the Relators’ whistleblower complaint. The DOJ’s lawsuit is being prosecuted by Tyler H.L. Tornabene, Vanessa R.Waldref, and Daniel Fruchter, Assistant United States Attorneys for the Eastern District of Washington.
This case is captioned United States of America ex rel. Salina Savage, Savage Logistics LLC, vs. Washington Closure Hanford LLC, Federal Engineers and Constructors, Inc., Sage Tec LLC, and Laura Shikashio, CV-10-5051-SMJ.
Benton City Man Sentenced to 20 Years in Federal Prison for Production of Child PornographyRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Robert Cody Cameron Genoway, of Benton City, Washington, was sentenced after previously having plead guilty on July 26, 2017, to production of child pornography. United States District Judge Stanley A. Bastian sentenced Genoway to a 20-year term of imprisonment, to be followed by a 30-year term of court supervision after he is released from federal prison. Genoway will also be required to register as a sex offender.
According to information disclosed during court proceedings, in July of 2016, a detective with the Southeast Regional Internet Crimes Against Children Task Force (SER-ICAC) and Homeland Security Investigations (HSI) observed an ad on a well-known website seeking a “petite young teeny bopper” for sexual acts. The detective responded to the ad posing as a thirteen (13) year old minor female. During the course of the communications, Genoway described in graphic detail the manner in which he wished to have sexual intercourse with the purported child, including choking the child for his own sexual pleasure, and made multiple attempts to meet the purported child to commit the described sexual acts in Kennewick, Washington. Genoway communicated with the undercover detective for a number of months via text message and e-mail, despite the detective advising that the purported thirteen (13) year old was actually eleven (11) years old.
Genoway was subsequently arrested, and during the course of a post arrest interview, admitted that he sought to meet the purported minor for the purpose of sexual intercourse. Genoway also admitted to engaging in sexual intercourse with another minor female, and to producing child pornography images and videos depicting these acts. Genoway further described that he choked that minor child during the course of his sexual interactions with her.
Through subsequent investigation, law enforcement officers with the SER-ICAC and HSI located the minor victim and learned that Genoway began producing child pornography images of the minor victim when she thirteen (13) years old, and continued to engage in sexual acts with her for a three year period. These images and videos were located among other child pornography images during the course of a forensic examination on Genoway’s electronic devices. Law enforcement officials also learned that Genoway had distributed the child pornography images and sought other adult males to have sexual intercourse with the minor victim.
During the sentencing hearing, Judge Bastian stated that the acts perpetrated by Genoway were “very concerning because it indicates that you were forcible, violent, and dangerous in your sex [acts with the] 13 year old victim.” Judge Bastian further characterized Genoway’s conduct as “egregious,” and advised that Genoway’s “interest in young girls was ongoing and ultimately…led to [Genoway’s] downfall in the undercover enticement investigation.”
Joseph H. Harrington said, “I commend the officers working with Homeland Security Investigations and the Southeast Regional Internet Crimes Against Children Task Force for their outstanding work in the investigation of this case. This case is yet another example of the remarkable results that local and federal law enforcement officers can accomplished when they work together in partnership. The sentence imposed reflects how egregious Genoway’s criminal conduct was.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Homeland Security Investigations and the Southeast Regional Internet Crimes Against Children Task Force conducted the investigation of this matter. The case was prosecuted by Laurel J. Holland, an Assistant United States Attorney for the Eastern District of Washington.
Alaska Department of Health and Social Services to Pay Nearly $2.5 Million to Resolve Alleged False Claims for SNAP FundsRead the Press Release
The Alaska Department of Health and Social Services (ADHSS) has agreed to pay the United States $2,489,999 to resolve allegations that it violated the False Claims Act in its administration of the Supplemental Nutrition Assistance Program (SNAP), the Department of Justice announced today. Until 2008, SNAP was known as the Food Stamp Program.
Under SNAP, the U.S. Department of Agriculture (USDA) provides eligible low-income individuals and families with financial assistance to buy nutritious food. Since 2010, SNAP has served on average more than 45 million Americans per month, and provided more than $71 billion annually.
“This settlement reflects the Justice Department’s commitment to ensuring that taxpayer funds are spent appropriately so that the public can have confidence in the integrity of programs like SNAP,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division.
Although the federal government funds SNAP benefits, it relies on the states to determine whether applicants are eligible for benefits, to administer those benefits, and to perform quality control to ensure that eligibility decisions are accurate. USDA requires that the states’ quality control processes ensure that benefits are correctly awarded, are free from bias, and accurately report states’ error rates in making eligibility decisions. The USDA reimburses states for a portion of their administrative expenses in administering SNAP, including expenses for providing quality control. The USDA also pays performance bonuses to states that report the lowest and the most improved error rates each year, and can impose monetary sanctions on states with high error rates that do not show improvement.
The settlement resolves allegations that ADHSS, beginning in late 2009, contracted with a consultant known as Julie Osnes Consulting LLC (Osnes Consulting) to provide advice and recommendations designed to lower its SNAP quality control error rate. The United States alleged that Osnes Consulting’s recommendations, as implemented by ADHSS, injected bias into ADHSS’s quality control process and resulted in ADHSS submitting inaccurate quality control data and information to USDA and receiving performance bonuses for fiscal years 2010, 2011, 2012, and 2013, that it should not have received.
This is the third settlement with a state agency resolving allegations that implementation of recommendations by Osnes Consulting resulted in states submitting inaccurate SNAP quality control findings, and claiming performance bonuses they had not earned. Through these settlements, the United States will recover over $16.5 million. On April 7, the Virginia Department of Social Services agreed to pay over $7 million to resolve its liability associated with the use of Julie Osnes Consulting to improperly reduce its reported error rate. On April 12, the Wisconsin Department of Health Services agreed to pay nearly $7 million to resolve its liability associated with its use of Julie Osnes Consulting for quality control.
“While I am deeply troubled that these actions happened within a state agency entrusted with assisting vulnerable and needy residents, I am heartened that ADHSS has resolved its liability and cooperated with our investigation,” said Acting U.S. Attorney Joseph H. Harrington for the Eastern District of Washington. “Together with our partners in the Civil Division and the USDA, we will continue to investigate and hold accountable entities, including government entities, that misuse and wrongfully obtain SNAP funding.”
“We appreciate the commitment and investigative assistance provided by our partners at the Department of Justice’s Civil Division and the U.S. Attorney’s Office throughout this multi-state investigation,” said Special Agent-in-Charge Bethanne M. Dinkins of the USDA Office of Inspector General (OIG). “We also wish to note the technical assistance provided by our colleagues in the Office of Audit at OIG. During the investigation, conducted by OIG’s Northeast Regional Office, we worked together to address the concerns of employees of multiple states and others who alleged that the integrity of the SNAP quality control process was weakened by third-party consultants. These concerned individuals reported that cases were not being treated in a consistent manner, and that certain advice from consultants resulted in identified errors being diminished rather than used to improve eligibility determinations. The settlements reached to date send a strong message regarding the Government’s commitment to work across agency lines to protect the integrity of SNAP.”
The settlement was the result of a joint investigation conducted by the USDA Office of Inspector General, Investigations; the Civil Division’s Commercial Litigation Branch and the U.S. Attorney’s Office for the Eastern District of Washington, with the assistance of USDA-OIG-Audit based on the results of their nationwide audit of SNAP QC processes.
Kennewick Man Sentenced to 15 Years in Federal Prison for Production of Child PornographyRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Peter J. Adams, age 40, of Kennewick, Washington, was sentenced today for Production of Child Pornography. United States District Judge Salvador Mendoza, Jr. sentenced Adams to a 180-month term of imprisonment, to be followed by a lifetime of court supervision after he is released from federal prison. Adams will also be required to register as a Sex Offender.
According to information disclosed during the court proceedings, the investigation of Adams originated when a Task Force Officer with Homeland Security Investigations in Richland, Washington, received a CyberTip. CyberTips are reports to National Center for Missing and Exploited Children (NCMEC) of illegal actions taken against children. In this case, the CyberTip pertained to Adams’s use of his e-mail account to distribute child pornography. The tip was associated with several other tips, all of which involved the same account.
Law enforcement officers obtained a search warrant and executed it at Adams’ residence. Adams was interviewed and admitted possession of child pornography, chatting online about having sex with a given minor (which he maintained was fantasy only), and having some “sexual chat and picture exchange” with a teenage child. With regard to the teenage child, Adams admitted he requested nude pictures. The images in question were recovered from Adams’s electronic devices and were found to be child pornography.
Adams was charged with Production of Child Pornography and, on June 9, 2017, pleaded guilty to the crime. At today’s sentencing hearing, Adams apologized the victims of his crimes. Judge Mendoza told Adams, “When I read the facts, when I look at the conduct here, I'm appalled.” Judge Mendoza acknowledged Adams’s fourteen years in the Navy and remarked that given his military service and complete lack of criminal history, “one would be surprised [by the misconduct], I am surprised. . . and disappointed." Judge Mendoza remarked, “If we leave someone like you out in the community, the danger to the community is quite high, frankly.”
Joseph H. Harrington said, “Today’s sentence should serve as a warning to those who use social networking to send, receive, or produce child pornography – such crimes will be actively pursued by federal and state law enforcement officers. This case is a fine example of the great work that can be accomplished when state and federal law enforcement officers work together. The United States Attorney’s Office will, in turn, aggressively prosecute child pornography crimes that occur in the Eastern District of Washington.”
“This sentencing should serve as a stern reminder about the consequences facing those who prey upon and sexually exploit children,” said Brad Bench, Special Agent in Charge for Homeland Security Investigations in Seattle, Washington. “Every time a sexually explicit image of a minor is produced, transmitted, or viewed, a child is victimized,” SAC Bench stated.
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
The Kennewick Police Department, Benton County Sheriff’s Office, Homeland Security Investigations, and the Southeast Regional ICAC conducted the investigation of this matter. The case was prosecuted by Alison L. Gregoire and Laurel J. Holland, Assistant United States Attorneys for the Eastern District of Washington.
Moses Lake Man Sentenced to Nine Years in Federal Prison for Receipt of Child PornographyRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced today that Daniel Lee Vadnais, age 53, of Moses Lake, Washington, was sentenced, after having previously pleaded guilty on May 25, 2017, to Receipt of Child Pornography. Chief United States District Judge Thomas O. Rice sentenced Vadnais to a nine-year term of imprisonment, to be followed by a twenty- year term of court supervision after he is released from Federal prison. In addition, Vadnais agreed to forfeit to the United States the computers he used to receive child pornography images and videos. Upon release from prison, Vadnais will be required to register as a Sex Offender.
According to information disclosed during the court proceedings, between January 3, 2016 and April 6, 2016, an officer working undercover for the FBI in Rochester, New York, discovered that Vadnais was using peer to peer (P2P) file sharing to download images of child pornography over the internet. Special Agents from FBI obtained a federal search warrant that was executed on April 6, 2016 at Vadnais’s residence in Moses Lake, Washington. During the execution of the search warrant, Vadnais advised law enforcement that he had been using P2P software to download child pornography files. Law enforcement discovered Vadnais’ HP desktop computer contained over 300 child pornography images of child pornography.
Harrington said, “Prosecuting offenders who receive and possess child pornography is one of the priorities of the United States Attorney’s Office for the Eastern District of Washington. This Office will continue to prosecute aggressively and seek appropriate punishment for child pornography crimes. I commend the excellent work of the FBI Special Agents who investigated this case.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
This investigation was conducted by the Federal Bureau of Investigations. The case was prosecuted by Stephanie J. Lister, an Assistant United States Attorney and PSC Coordinator for the Eastern District of Washington.
Local Man Sentenced to 60 Months for Failing to Register as a Sex OffenderRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Daniel Herrera Gonzales was sentenced after having previously pleaded guilty on May 17, 2017 to the charge of failing to register as a sex offender. Senior United States District Judge Wm. Fremming Nielsen sentenced Gonzales to a five-year term of imprisonment, to be followed by a five-year term of court supervision after he is released from Federal prison. Upon release from prison, Gonzales will continue to be required to register as a sex offender.
According to information disclosed during the court proceedings, Gonzales was required to register as a sex offender because of a 2011 conviction for third degree assault (sexual motivation) in Douglas County, Washington. That conviction was his third for sexually assaulting children. Gonzales absconded from Washington State Department of Corrections supervision in May 2016. Deputy U.S. Marshals tracked down Gonzales in Wellpinit, Washington last November.
At today’s sentencing hearing, Senior Judge Nielsen found that Gonzales’ criminal history was under-represented by the Sentencing Guidelines. For this reason, the Judge departed upward from the Guidelines and imposed the 60-month sentence.
Acting United States Attorney Harrington said, “The sentence handed down today provides just punishment for this offense. The United States Attorney’s Office for the Eastern District of Washington prosecutes the crime of failure to register as a sex offender with great fervour, particularly when an offender’s prior sex conviction(s) involves vulnerable young victims.” Harrington went on to add, “This case is an outstanding example of the dedication and tireless efforts exhibited by the U.S. Marshals Service day in and day out.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
The United States Marshals Service conducted this investigation. Scott T. Jones, an Assistant United States Attorney for the Eastern District of Washington, prosecuted the case.
Yakima Man Sentenced to Thirty Years Imprisonment for Soliciting Murder for Hire and Methamphetamine ConspiracyRead the Press Release
Yakima – Today, Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that United States District Judge Salvador Mendoza, Jr. sentenced
Gerardo Maderos Loreto, age 32, of Yakima, Washington, to a thirty-year term of imprisonment for attempting to hire a person to murder his ex-girlfriend, and for attempting to pay for the murder with a pound of methamphetamine.
According to information disclosed during court proceedings, in March, 2016, Loreto was serving a state prison sentence for violating a protective order relating to his ex-girlfriend. While in prison Loreto, who is a Norteno gang member, continued to violate the protective order by contacting his ex-girlfriend, more frequently after he learned that she was pregnant with another man’s child. Loreto’s intent towards his ex-girlfriend became more violent, and he attempted to hire someone to kill her. He mailed a letter to an individual from the state prison facility detailing the ex-girlfriend’s name, where to find her, and why he wanted her murdered. In the letter Loreto also explained that he would pay a pound of methamphetamine in return for the murder.
Detectives with the Yakima Police Department Gang Unit obtained the letter before any harm came to the ex-girlfriend. On July 12, 2016, a federal Indictment was filed charging Loreto with use of the mail to commit murder for hire. Loreto was arrested on this charge on the day he completed his state prison sentence. Following his arrest, Loreto was detained at the Yakima County Jail. While there, he continued to use his gang connections to try to hire someone to murder his ex-girlfriend. Law enforcement agents were again able to foil Loreto’s plans before any physical harm came to his ex-girlfriend. A superseding federal Indictment was filed on January 10, 2017, charging Loreto with use of the mail to commit murder for hire, use of a telephone to commit murder for hire, conspiracy to possess methamphetamine with intent to distribute, and attempt to possess methamphetamine with intent to distribute.
On May 22, 2017, a trial commenced and on May 24, 2017, a jury found Loreto guilty of all the charges.
Joseph H. Harrington said, “The United States Attorney’s Office and our law enforcement partners are committed to ensuring the safety of our community and aggressively prosecuting perpetrators of violence against women. The United States Attorney’s Office will continue to seek lengthy sentences to remove dangerous gang members from our streets. In this case, the Yakima Police Department Gang Unit and Washington Department of Corrections worked together to identify the Loreto as a threat to public safety. The Federal Bureau of Investigation, Homeland Security Investigations, and Yakima Police Department followed through with completing this important investigation in a thorough and professional manner.”
The investigation was conducted by the Federal Bureau of Investigation, the Yakima Police Department, Homeland Security Investigations, the Washington Department of Corrections, Yakima County Department of Corrections, and the Washington State Patrol Crime Lab. The case was prosecuted by Benjamin D. Seal, an Assistant United States Attorney for the Eastern District of Washington.
Federal Judge Dismisses Negligence Case Brought Against the United StatesRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that, on August 16, 2017, District Judge Rosanna Malouf Peterson dismissed a lawsuit brought by a logging truck driver injured in a motor vehicle accident on the Yakama Indian Reservation.
According to information disclosed during the court proceedings, on January 27, 2014, Plaintiff Jose Vera was driving a logging truck on the Signal Peak Road on the Yakama Indian Reservation when he failed to negotiate a curve and his logging truck went off the road and down an embankment. A passenger in the logging truck was killed in the accident. Vera alleged that the United States, through the Bureau of Indian Affairs, improperly designed the road, failed to maintain the road, and failed to properly erect warning signs or guardrails.
The United States asked the Court to dismiss the case, arguing that the United States had no duty to maintain a road that was located in the Closed Area of the Yakama Indian Reservation. Court records showed that the area where the accident occurred had been closed by the Yakama Nation since at least the early 1990’s and that since the mid-1990’s, the Yakama Nation had taken over complete control of the roads in the Closed Area of the Reservation.
Judge Peterson found that despite the fact that the land on which the accident occurred is owned by the Federal Government and held in trust for the Yakama Nation, control of the Signal Peak Road had been turned over to the Yakama Nation. Judge Peterson concluded “ownership of the land under the circumstances present here does not amount to control or any responsibility for the relevant roadway, or give rise to the duties that Plaintiff alleges.”
This case was defended by Rudy J. Verschoor, Assistant United States Attorney in the Civil Division of the United States Attorney’s Office for the Eastern District of Washington.
Spokane Man Sentenced to 60 Months in Federal Prison for Possessing Firearm and AmmunitionRead the Press Release
Spokane – Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Cody P. Kiehn, age 35, of Spokane, Washington, was sentenced today for being a previously convicted felon in possession of a firearm and ammunition. United States District Judge Rosanna Malouf Petersen sentenced Kiehn to a 60-month term of imprisonment and a three-year term of court supervision following release from Federal prison.
According to information disclosed during court proceedings, a Spokane Police Department Officer initiated a traffic stop on Kiehn for negligent driving and failure to yield. During the stop, the officer noticed a loose round of .45 caliber ammunition near Kiehn’s left foot, and Kiehn admitted possessing a firearm and being a previously convicted felon. Kiehn told the officer that he was a “Sureno” gang member and he possessed the firearm for protection from rival gang members because he had spray-painted over a rival gang’s markings. After obtaining Kiehn’s consent to search his vehicle, the officer found an unloaded .45 caliber Sig Sauer, model P220, semi-automatic pistol and magazine containing six rounds of .45 caliber ammunition. Kiehn was charged with being a previously convicted felon in possession of a firearm and ammunition and he pleaded guilty to that crime on May 9, 2017.
Joseph H. Harrington said, “Prosecuting firearms-related crimes continues to be a priority for the United States Attorney’s Office for the Eastern District of Washington. Previously convicted felons should be aware that there are serious criminal penalties connected with possessing a firearm and ammunition and that this Office is committed to prosecuting aggressively firearm-related cases in the Eastern District of Washington.”
This case was investigated by the Spokane Police Department PACT and the Spokane Resident Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives. This case was prosecuted by George J.C. Jacobs, III and Patrick J. Cashman, Assistant United States Attorneys for the Eastern District of Washington.
The Ninth Circuit Court Appeals Affirms the Denial of a Preliminary Injunction Seeking to Stop an Ecosystem Restoration Project in the Colville National ForestRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that, on August 1, 2017, the Ninth Circuit Court of Appeals affirmed United States District Judge Rosanna Malouf Peterson’s order denying a preliminary injunction in the Alliance of the Wild Rockies’ (AWR) challenge to the Colville National Forest’s North Fork Mill Creek A to Z Project.
According to information disclosed during court proceedings, AWR filed a lawsuit in August of 2016 challenging the Colville National Forest’s decision to approve the North Fork Mill Creek A to Z Project. That project was carefully designed through a multi-entity cooperation between the Forest Service, the timber industry and a variety of environmental organizations that formed the Northeast Washington Forestry Coalition (NWFC). The project is designed to provide ecosystem restoration through the rebuilding of roads, fish habitat improvements, thinning of overstocked tree stands, pre-commercial thinning of congested young trees, and some aspen restoration in the North Mill Creek drainage of the Three Rivers Ranger District in the Colville National Forest. Forest Supervisor Rodney Smoldon approved the project in June of 2016.
AWR sued the Forest Service in 2016 claiming that the Forest Service violated the National Forest Management Act (NFMA) by allowing local Colville lumber operators, Vaagen Brothers Lumber Company, to arrange for a private contractor to conduct the environmental analysis and the writing of an environmental assessment (EA) for the proposed project. AWR also claimed that the project violated the National Environmental Policy Act (NEPA) and the Administrative Procedures Act (APA) because the EA allegedly did not properly: address the cumulative effects of the North Fork Project in connection with other projects planned in adjacent watersheds; failed to protect habitat for fisher and pine marten animals (two small forest furbearers) under the NFMA; failed to protect snow-intercept cover used by deer and elk on the winter range; and increased sediment production that allegedly could injure local fish species.
AWR sought a preliminary injunction from the district court, arguing its lawsuit would likely succeed on the merits and that serious questions existed going to the merits of the Forest Service’s NFMA and NEPA compliance. AWR also argued that allowing the first phase of the three-phase project to continue forward would cause irreparable harm and damage in the Mill Creek area, which did not serve the public’s interest. Judge Peterson rejected AWR’s position and denied the request for a preliminary injunction.
The case was appealed to the Ninth Circuit Court of Appeals. Following briefing, Rudy J. Verschoor, an Assistant United States Attorney for the Eastern District of Washington, argued the case on June 13, 2017. Both the reforestation project and AWR’s challenge to the project have drawn significant local interest. The Ninth Circuit argument was attended by Pend Oreille County Commissioner Karen Skoog, Brian Todd of The Nature Conservancy, Russ Vaagen and Josh Anderson of Vaagen Brothers and others.
Writing for a unanimous panel, Judge Milan D. Smith, Jr., found that AWR “had not demonstrated serious questions, much less a likelihood of success, with respect to the merits of any of its NFMA and NEPA claims.” The panel found that the Alliance had not shown a likelihood of success on the issues related to fisher and pine marten, wildlife cover in winter range, road density in winter range, or sediment projection in streams as a result of the proposed activities.
The case will now continue in the District Court for further proceedings before Judge Peterson, where AWR and the Forest Service will brief the remaining claims in the case. A schedule for that briefing has not yet been announced.
This case is being defended by Rudy J. Verschoor and Vanessa R. Waldref, Assistant United States Attorneys in the Civil Division of the United States Attorney’s Office for the Eastern District of Washington.
Habitual Domestic Violence Offender Sentenced to 41 MonthsRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Tyson Heath, age 41, of Wellpinit, Washington, was sentenced today after having pleaded guilty on March 14, 2017, to the crime of Domestic Assault by a Habitual Offender. Senior United States District Judge Wm. Fremming Nielsen sentenced Heath to a 41-month term of imprisonment, to be followed by a three-year term of court supervision after he is released from federal prison. Of note, Heath stands over 6’5” and weighs close to 250 pounds.
According to information disclosed during the court proceedings, in January, 2017, within the boundaries of the Spokane Tribe of Indians Reservation, Heath assaulted a domestic partner. The victim was discovered after the assault with a large amount of bruising and swelling around her right eye and orbital bone. In addition, the victim’s right cheek displayed red and purple bruising in what appeared to be the shape of four fingers, as if someone had slapped or backhanded her very hard. The victim also suffered a ruptured eardrum. This case involved yet another domestic violence assault – Heath’s third such offense -- making him a habitual offender.
At the time of this assault, Heath had previously been convicted of Fourth Degree Assault (Domestic Violence) and Second Degree Assault (Domestic Violence) in the Spokane County Superior Court in 2010 and 2011 respectively. Heath’s 2010 domestic violence assault conviction stemmed from an argument with his girlfriend. The argument became physical and Heath began throwing his girlfriend around, ultimately throwing her into a bedroom wall face first and then refusing to let her leave the apartment. Heath’s 2011 assault conviction also involved a domestic partner. Heath had gone to his ex-girlfriend’s place of employment, in violation of a restraining order. She told him to leave; he did not and ultimately hit her in the face with a rock. The victim was found in a pool of blood on the floor. Heath was sentenced to four months in jail for the 2010 offense and three months in jail for the 2011 offense.
At sentencing, today Heath indicated he wished to apologize to the victim of the most recent assault. Judge Nielsen told Heath that when he drank alcohol he was a danger to the public and that society will not and cannot tolerate it. Judge Nielson then announced the 41-month sentence.
Joseph H. Harrington stated, “The United States Attorney’s Office for the Eastern District of Washington is, and will continue to be, committed to prosecuting aggressively domestic violence crimes that occur in this District over which federal jurisdiction exists, including Indian Country. I commend the excellent work of the Spokane Tribal Police and the FBI. Domestic violence in Indian Country demands the attention of law enforcement, families, social service programs, and the community at large.”
This investigation was conducted by the Federal Bureau of Investigation and the Spokane Tribal Police. The case was prosecuted by Alison L. Gregoire an Assistant United States Attorney for the Eastern District of Washington.
Child Rapist Sentenced to Ten Years in Federal Prison for Possession of Child PornographyRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Larry Joseph Fraley, age 58, of Spokane, Washington, was sentenced after having previously pleaded guilty on April 13, 2017 to Possession of Child Pornography. Chief United States District Judge Thomas O. Rice sentenced Fraley to a ten-year term of imprisonment, to be followed by a twenty-year term of court supervision after he is released from Federal prison. In addition, Fraley agreed to forfeit to the United States the computer he used to possess child pornography images. Upon release from prison, Fraley will be required to register as a Sex Offender.
According to information disclosed during the court proceedings, at all times relevant to the investigation of this case Fraley was on supervision with the Washington State Department of Corrections (“DOC”) as a result of his 1991 conviction for First Degree Rape of a Child in King County Washington. On August 29, 2016, DOC officers were conducting a review of Fraley at a halfway house on Dean Ave. in Spokane. The officers observed Fraley looking at images on his computer of prepubescent boys engaged in sexual activity. DOC officer contacted the Federal Bureau of Investigation. The FBI interviewed Fraley and he admitted searching the internet for child pornography images of young boys. The FBI seized Fraley’s computer and forensically examined it. Forensic examination revealed Fraley had approximately 287 images of child pornography on his computer. The child pornography images included photographs of minors under the age of twelve years and involved material that portrayed sadistic or masochist images.
Joseph H. Harrington stated, “The sentence handed down in this case provides just punishment for this offense and I commend the excellent work of the law enforcement officers with the Washington State Department of Corrections and the FBI. Prosecuting offenders who possess child pornography is one of the priorities of the United States Attorney’s Office for the Eastern District of Washington. This Office will continue to prosecute aggressively and seek appropriate punishment for child pornography crimes.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals, who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
This investigation was conducted by the Washington State Department of Corrections and the Federal Bureau of Investigations. The case was prosecuted by Stephanie J. Lister, an Assistant United States Attorney and PSC Coordinator for the Eastern District of Washington.
Spokane Man Sentenced to 72 Months in Federal Prison for Possessing Firearm and AmmunitionRead the Press Release
Spokane – Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that William Lee Taylor, age 53, of Spokane, Washington, was sentenced for being a previously convicted felon in possession of a firearm and ammunition. Senior United States District Judge Justin L. Quackenbush sentenced Taylor to a 72-month term of imprisonment and a three-year term of court supervision following release from Federal prison.
According to information disclosed during court proceedings, members of the Spokane Police Department Patrol Anti-Crime Team (PACT) attempted to contact Taylor while investigating an unrelated matter in the East 2100 block of Cataldo Avenue in Spokane, Washington. Taylor, who is a previously convicted felon, took flight and a foot pursuit ensued. While pursuing Taylor an officer observed him reaching into his waistband. Taylor jumped a fence, fell to the ground and was apprehended. During a search of Taylor, officers discovered a .22 caliber, H. Schmidt (Ostheim), Model 21 S, 22 Magnum revolver. The revolver was loaded with five rounds of .22 caliber ammunition.
Joseph H. Harrington said, “Previously convicted felons should be aware that there are serious criminal penalties associated with possessing any firearm or ammunition. Together with the ATF, and in partnership with local law enforcement partners such as the Spokane Police Department, prosecuting firearms-related crimes continues to be a priority for the United States Attorney’s Office for the Eastern District of Washington.”
This case was investigated by the Spokane Police Department PACT and the Spokane Resident Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives. This case was prosecuted by Patrick J. Cashman, an Assistant United States Attorney for the Eastern District of Washington.
West Richland Man Sentenced to 11 Years in Federal Prison for Receipt of Child PornographyRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Darrin Lee Ruddell, of West Richland, Washington, was sentenced after previously having pled guilty on March 1, 2017, to receipt of child pornography. Senior United States District Judge Edward F. Shea, sentenced Ruddell to an 11-year term of imprisonment, to be followed by a 30-year term of court supervision after he is released from federal prison. Ruddell will also be required to register as a sex offender.
According to information disclosed during court proceedings, in the fall of 2015, the Benton County Sheriff’s Office received three CyberTips from the National Center for Missing and Exploited Children. The CyberTips originated with a cloud storage company associated with Verizon Wireless, and contained child pornography images. The cloud storage account at issue was associated with a Verizon Wireless account, which was later determined to belong to Ruddell. Further investigation revealed that Ruddell was employed as a nurse at Kadlec Regional Medical Center.
Officers with the Benton County Sheriff’s Office obtained and executed a search warrant at Ruddell’s residence in West Richland in February of 2016. During the course of the search warrant, officers seized multiple computers, electronic storage devices, and cellular phones, including the cellular phone associated with the Verizon Wireless cloud storage account referenced in the CyberTip.
Forensic examinations were subsequently conducted on the various devices seized from Ruddell’s residence. Thousands of child pornography images were located on the computers, cellular phones and electronic storage devices belonging to Ruddell, including depictions of children who were under the age of twelve.
Acting United States Attorney Harrington said, “The sentence handed down provides just punishment for this offense.” He further stated, “This investigation is yet another example of the dedication of law enforcement officers and their willingness to ferret out those who intend to victimize children through the receipt of child pornography.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals, who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
The investigation of this matter was conducted by the Benton County Sheriff’s Office, Homeland Security Investigations, and the Southeast Regional Internet Crimes Against Children Task Force. The case was prosecuted by Laurel J. Holland, an Assistant United States Attorney for the Eastern District of Washington.
Kennewick Drug Trafficker Sentenced to 15 Years in Federal PrisonRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Anthony Joseph Cortinas, age 49, of Kennewick, Washington, was sentenced after previously having pled guilty on February 21, 2017, to Possession with Intent to Distribute Methamphetamine. Senior United States District Judge Edward F. Shea, sentenced Cortinas to a 15-year term of imprisonment, to be followed by a 5-year term of court supervision after he is released from federal prison.
According to information disclosed during court proceedings, in the early morning hours of May 29, 2015, officers with the Kennewick Police Department conducted a stop of a vehicle pursuant to a traffic violation. During the course of the stop, law enforcement officers obtained consent from the driver to search the vehicle. Both Cortinas and the driver of the vehicle disclaimed possession and ownership of multiple bags located in the rear passenger seat. One of the bags contained a safe disguised as a dictionary. Inside the safe, officers located a distribution quantity of methamphetamine. Cortinas was later identified as the owner of the safe and its contents. Cortinas was subsequently charged in Benton County Superior Court, and after posting bail, was released from the Benton County jail.
On September 9, 2015, officers with the Kennewick Police Department again encountered Cortinas during a vehicle stop for a traffic violation. Cortinas, the passenger, was arrested on an unrelated matter. The driver, a different individual than the driver of the vehicle during the prior contact, disavowed knowledge of a bag in the vehicle located behind the seat where Cortinas had been sitting. After further investigation, officers obtained a search warrant for the vehicle and located another safe, later determined to belong to Cortinas, containing a distribution quantity of methamphetamine.
At sentencing, Senior Judge Shea noted Cortinas’ lengthy history of drug distribution offenses, and the impact such crimes have on the local community.
Acting United States Attorney Harrington said, “I commend the Kennewick Police Department officers and the FBI Special Agents for their efforts in investigating this drug trafficking case. Their strong working partnership is reflected by the successful resolution of this case. Federal and local law enforcement officers in the Eastern District of Washington continue to work together to root out the scourge of drug trafficking in this District. With their assistance, the United States Attorney’s Office for the Eastern District of Washington is committed to prosecuting aggressively and seeking appropriate punishment for traffickers distributing controlled substances in our communities.”
The Federal Bureau of Investigation (Richland, Washington) and the Kennewick Police Department conducted the investigation of this matter. The case was prosecuted by Laurel J. Holland, an Assistant United States Attorney for the Eastern District of Washington.
Medical Malpractice Suit Against the Spokane Veterans Administration Medical Center DismissedRead the Press Release
06-15-17_civil_dismissal_order_1.pdf Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that, on June 14, 2017, Chief United States District Judge Thomas O. Rice entered an Order dismissing a medical malpractice lawsuit filed against the Veterans Administration by the children of a Navy veteran. See Order (attached hereto).According to information disclosed during the court proceedings, Steven Wright presented himself to the Mann-Grandstaff VA Medical Center (VAMC) in Spokane, Washington a week after falling at home and injuring his knee and ankle. VAMC Emergency Department doctors examined his injuries and performed imaging to rule out further injury or the presence of a blood clot. Once the results of the imaging were reviewed, Mr. Wright was discharged. Upon discharge, VAMC nurses offered, on three occasions, to transport him via wheelchair to his transportation outside the medical center. Mr. Wright, however, refused transport assistance and left the VAMC on his own. Shortly after leaving, Mr. Wright fell outside on the pavement and suffered minor scrapes to his head.
VAMC employees provided emergency assistance and brought Mr. Wright back into the Emergency Department for further evaluation / treatment. Mr. Wright was examined by a VA nurse, who was assessed by an independently-contracted-physician with expertise in emergency medicine. After conducting another examination and neurological assessment, and at his request, Mr. Wright was discharged and he left the VAMC with a friend. Tragically, Mr. Wright was found deceased the following morning at his home, purportedly because of an internal head injury.
Mr. Wright’s two adult children and his Estate (collectively Plaintiffs) sued the Veterans Administration and the independently-contracted-physician. Plaintiffs claimed that the emergency department physician should have ordered a CT scan of Mr. Wright’s head injury when he was brought back to the Emergency Department and should have admitted him for overnight observation. Plaintiffs also claimed that the VA nurses should have insisted upon Mr. Wright that he be taken outside in a wheelchair and should have advocated harder against the physician’s assessment for a CT scan and admission of Mr. Wright for observation.
In dismissing the case against the Veterans Administration, Chief Judge Rice found that Plaintiffs could not prove the VA nurses owed a duty to insist that Mr. Wright be transported and further found that even if such duty existed, the VA nurses did not breach that duty or any of the alleged duties. Under Washington law, a plaintiff in a medical malpractice suit must support any medical negligence claim with competent medical expert testimony establishing a duty, a breach, causation, and injury. Proof of these elements for a claim against the VA was absent in this case. Because the independently-contracted-physician was not a VA employee, Chief Judge Rice ruled that Plaintiffs could pursue their case against him, remanding that claim to state court.
This case was defended by Rudy J. Verschoor and Joseph P. Derrig, Assistant United States Attorneys in the Civil Division of the United States Attorney’s Office for the Eastern District of Washington.
Burbank Man Sentenced to 15 Years in Federal Prison for Production of Child PornographyRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Jesse Allen Shandy, of Burbank, Washington, was sentenced today after having previously pled guilty on February 28, 2017 to production of child pornography. Senior United States District Judge Edward F. Shea sentenced Shandy to a 15-year term of imprisonment, to be followed by a 22-year term of court supervision after he is released from federal prison. Shandy will also be required to register as a sex offender.
According to information disclosed during court proceedings, an investigation began in September of 2015 when a concerned mother contacted local law enforcement officials in Michigan after finding explicit images of her eight-year-old child on a social networking application on the child’s phone. Further investigation revealed that the child had provided the images on the social networking application after being instructed to do so by another user on the application. The user represented himself to be a minor in the conversations with the eight-year-old child; however, a detective in Michigan subsequently identified the user to be 24-year-old Jesse Allen Shandy, of Burbank, Washington.
Officers with Homeland Security Investigations and the Southeast Regional Internet Crimes Against Children Task Force located and contacted Shandy in Burbank, Washington. During the course of an interview with law enforcement officers, Shandy admitted that he had been communicating with multiple minor girls utilizing the social networking application Kik, and had represented himself to be a similarly aged boy in said communications. Shandy further advised that he obtained explicit images from the minor girls during the course of his communications.
Joseph H. Harrington said, “This case is a fine example of the great work that can be accomplished when state and federal law enforcement officers work together. Today’s sentence should serve as a warning to those who use social networking to send, receive, or produce child pornography – such crimes will be actively pursued by federal and state law enforcement officers. The United States Attorney’s Office will, in turn, aggressively prosecute child pornography crimes that occur in the Eastern District of Washington.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Homeland Security Investigations, the Grand Rapids Police Department, and the Southeast Regional Internet Crimes Against Children Task Force conducted the investigation of this matter. The case was prosecuted by Laurel J. Holland, an Assistant United States Attorney for the Eastern District of Washington.
Spokane Valley Man Sentenced to Five Years in Federal Prison for Distribution of Child PornographyRead the Press Release
Spokane – Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Thomas J. Montieth, age 65, of Spokane Valley, Washington, was sentenced today after previously pleading guilty on April 4, 2017 to Distribution of Child Pornography. Senior United States District Judge Justin L. Quackenbush sentenced Monthieth to a five-year term of imprisonment, to be followed by a ten-year term of court supervision after he is released from Federal prison. In addition, Monthieth agreed to forfeit to the United States a computer and related equipment that he used to distribute and possess child pornography images and videos. Upon release from prison, Montieth will be required to register as a sex offender.
According to information disclosed during the court proceedings, between July 22 and August 5, 2016, a Homeland Security officer working undercover in Spokane, Washington discovered that Monthieth was using peer to peer (P2P) file sharing to distribute images of child pornography over the internet. Special Agents from Homeland Security obtained a federal search warrant for Montieth’s residence in Spokane Valley, Washington. They executed the search warrant on September 7, 2016. During the execution of the search warrant, Montieth advised the Special Agents that he had been using P2P software to distribute and collect child pornography files. Law enforcement officers discovered approximately 21,244 child pornography images and 394 videos of child pornography on Mothieth’s desktop computer and a flash drive.
Joseph H. Harrington stated, “Prosecuting offenders who possess and distribute child pornography is a priority for the United States Attorney’s Office for the Eastern District of Washington. The United States Attorney’s Office is, and will continue to be, committed to prosecuting aggressively and seeking appropriate punishment for child pornography crimes.”
"The ceaseless efforts of our HSI Special Agents to identify criminals who target youth for sexual gratification are critical steps in making Washington communities safer," said Brad Bench, Special Agent in Charge of Homeland Security Investigations Seattle. "This case is an example of how HSI,
in partnership with the Department of Justice, will continue to track, investigate and prosecute predators to the fullest extent of the law."
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May, 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc.
For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
This investigation was conducted by Homeland Security Investigations. The case was prosecuted by Stephanie J. Lister, an Assistant United States Attorney and PSC Coordinator for the Eastern District of Washington.
Wapato Man Sentenced to 15 Years in Federal Prison for Abusive Sexual Contact Sexual Contact with a MinorRead the Press Release
Spokane – Today, Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that United States District Judge Stanley A. Bastian sentenced Numa Jay Speedis, age 64, of the Yakama Nation Indian Reservation, for Abusive Sexual Contact with a Minor. Speedis pled guilty to the offense on March 2, 2017. Judge Bastian sentenced him to a 15-year term of imprisonment, to be followed by a life-term of court supervision after he is released from federal prison. Speedis will be required to register as a sex offender.
According to information disclosed during the court proceedings, on December 18, 2016, Speedis engaged in sexual contact with a minor. The Yakama Nation Tribal Police Department and the Federal Bureau of Investigation conducted an expedient and thorough investigation. As the investigation progressed, law enforcement learned that Speedis had molested another child approximately five years ago, and had molested a third victim approximately 20 years ago.
Harrington said, “I commend the victim for her courage in disclosing the traumatic events related to Speedis’ appalling acts. I also commend the victim’s family for their unwavering support of her and the prosecution of this case. I acknowledge the thorough investigation of this case and exemplary working relationship demonstrated by the Yakama Nation Police Department and the Federal Bureau of Investigation. The United States Attorney’s Office and our law enforcement partners understand the profound importance of protecting the children who live within the Eastern District of Washington. The United States Attorney’s Office will continue to prosecute and seek lengthy sentences to remove dangerous sex offenders from our communities.”
This investigation was conducted by the FBI and the Yakama Nation Tribal Police Department. The case was prosecuted by Tom Hanlon, an Assistance United States Attorney for the Eastern District of Washington.
Pasco Man Sentenced to over 8 Years for Conspiring to Defraud the Government and to Commit Wire FraudRead the Press Release
Spokane, WA – Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Scott Johnson, age 43, of Pasco, Washington, was sentenced, after having previously pled guilty on November 24, 2015, to Conspiracy to Defraud the Government and Conspiracy to Commit Wire Fraud. United States District Judge Salvador Mendoza, Jr. sentenced Johnson to a 97-month term of imprisonment, to be followed by a three-year term of court supervision after he is released from Federal prison. In addition, Judge Mendoza ordered Johnson to pay $9,517,412.50 in restitution to the United States taxpayers and an additional $6,175,929.17 in restitution to the victims of his fraud.
According to information disclosed during the court proceedings, Johnson was a member of a conspiracy involving Gen-X Energy Group, Inc. (Gen-X), a renewable energy company formerly located in Pasco and Moses Lake, Washington. Between October of 2012 and April of 2015, Johnson and his co-conspirators falsely claimed the production of more than 72,000,000 marketable renewable energy credits, which they then sold for more than $57,000,000, and filed false claims with the IRS for $9,517, 412.50 in excise credit refunds. Throughout this period, much of the renewable fuel claimed to be produced at the Gen-X facilities was either not produced or re-processed multiple times.
Acting United States Attorney Harrington stated, “The United States Attorney’s Office for the Eastern District of Washington is, and will continue to be, committed to prosecuting aggressively and seeking appropriate punishment for white collar crimes.
I commend the tenacious and thorough efforts of the IRS-Criminal Investigation and the Environmental Protection Agency’s Criminal Investigation Division."
“American taxpayers and the biofuels industry were defrauded more than $65 million as a result of this massive and elaborate scheme,” said Jeanne M. Proctor, Special Agent in Charge of EPA’s criminal program in Washington State. Proctor went on to state: “EPA is committed to ensuring a level playing field for biofuels companies that play by the rules and pursuing those that blatantly disregard the law.”
"This is a classic case of an individual who allowed his own unfettered greed to guide his duplicitous actions," stated Special Agent in Charge Darrell Waldon of IRS Criminal Investigation. Waldon also commented that: "When that greed turns into fraud to the degree perpetrated by Scott Johnson and his co-conspirators, IRS CI stands ready with our law enforcement partners to serve as the guardians of economic equity and social justice."
This investigation was conducted by the Internal Revenue Service-Criminal Investigation, the Environmental Protection Agency’s Criminal Investigation Division, and the United States Secret Service, with assistance from the Washington State Patrol.
The case was prosecuted by Scott T. Jones, an Assistant United States Attorney for the Eastern District of Washington; Karla G. Perrin, EPA Regional Criminal Enforcement Counsel and Special Assistant United States Attorney for the Eastern District of Washington; and Adam Cullman and Thomas Franzinger, Trial Attorneys, Environmental Crimes Section, United States Department of Justice.
Aren Perryman Sentenced to Thirty Years after Pleas of Guilty to Drug Trafficking, Firearms Offenses and Threatening WitnessesRead the Press Release
Spokane - Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that today Chief United States District Court Judge Thomas O. Rice sentenced Aren Lee Perryman, aka Filthy, age 32, of Spokane, Washington, to a 30-year term of imprisonment after pleading guilty to Trafficking in Methamphetamine and Heroin; Possessing and Using Firearms in Connection with Drug Trafficking; and Intimidating and Threatening Witnesses. Chief Judge Rice accepted the agreed upon sentence presented by the parties which included 10 years of supervised release to follow his 30-year term of incarceration.
In September 2015, Perryman, the leader/organizer of a drug conspiracy responsible for trafficking large quantities of methamphetamine and heroin from Arizona into the Eastern District of Washington, was arrested with several co-defendants. The investigation resulted in the seizure of over 35 pounds of methamphetamine, 8 pounds of heroin, and multiple firearms. Perryman was also directly tied to a number of drive-by shootings that occurred in Spokane in the summer of 2015 and linked to a local overdose death in 2015. After Perryman was arrested, he attempted to retaliate against the local law enforcement officer he deemed responsible for his arrest.
At sentencing, Chief Judge Rice noted the damaging impact of the Defendant’s actions to this community to include the corresponding violence associated with his drug trafficking activities.
Acting United States Attorney Joseph Harrington said, “The heroin epidemic in this country is a real concern and sadly our community is not immune from its destruction.” Harrington went on to add, “this case highlights the joint commitment, dedication, and partnership between our state
and federal partners to combat this problem and the accompanying violence associated with trafficking such dangerous drugs into our community. Of additional significance, is the prevention of additional crimes of violence especially those that target our dedicated law enforcement officers.”
This case was conducted as part of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation, which included the Drug Enforcement Administration (Spokane Resident Office and Seattle Field Division); the Spokane Regional Drug Task Force; Idaho State Police; and the Spokane Police Department. The OCDETF program provides supplemental federal funding to the federal and state agencies involved in the investigation of drug-related crimes.
The investigation also included the participation of numerous federal and local law enforcement agencies, including Drug Enforcement Administration (Boise, Idaho); Federal Bureau of Investigation (Spokane, Washington); the Unified Police Department (Salt Lake City, Utah); Montana Department of Criminal Investigations (Kalispell, Montana) and Northwest HIDTA.
The case was prosecuted by Caitlin Baunsgard and Stephanie Van Marter, Assistant U.S. Attorneys for the Eastern District of Washington in partnership with the United States Attorneys Offices in the Districts of Idaho and Utah.
Hauser, Idaho Man Sentenced to 10 Years in Federal Prison for Attempted Enticement of a MinorRead the Press Release
Spokane – Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that today United States District Judge Rosanna Malouf Peterson sentenced
Jerry William Lindsey, Jr., age 34, of Hauser, Idaho, for Attempted Enticement of a Minor, which a jury found him guilty of committing. Judge Peterson sentenced Lindsey to a ten-year term of imprisonment, to be followed by a five-year term of court supervision after he is released from federal prison. Lindsey will be required to register as a sex offender.
According to information disclosed during the February, 2017 jury trial, Lindsey posted an ad entitled, “18 or so” on a well-known local website in December of 2015. The ad contained explicit photographs and described sexual acts. An undercover detective working with the Southeast Regional Internet Crimes Against Children Task Force (“ICAC”) and Homeland Security Investigations responded to the ad, posing as a local thirteen year old. During the course of the communications with the undercover officer, Lindsey repeatedly discussed the graphic sexual acts that he wished to engage in with the purported thirteen year old and sent explicit images of himself to accompany the descriptions of such acts.
Lindsey, a mechanic with a plumbing company, also sought to meet the purported minor on two occasions when he traveled to the Tri-Cities area for work. On one such occasion, Lindsey directed the purported thirteen year old to a residence in Pasco where he was working to engage in sexual acts. He initially suggested that she sneak out to meet him after her parents were asleep, but later provided directions to the purported minor child to meet him that afternoon. Law-enforcement-members of the ICAC team subsequently surveilled Lindsey waiting outside of the residence. Lindsey was later arrested and interviewed by ICAC officers and agents with Homeland Security Investigations. Lindsey advised during the interview that if the purported thirteen-year-old child had arrived at the Pasco residence, he “would have been in a lot of trouble.” Lindsey was charged with Attempted Enticement of a Minor, tried by a jury in Richland, Washington, and found guilty.
Harrington stated, “The sentence imposed in this case reflects how serious the crime of enticement of a minor is, including attempts to do so. The United States Attorney’s Office for the Eastern District of Washington continues to prioritize the investigation and prosecution of child sexual exploitation and abuse cases. The officers and agents with the Southeast Regional Internet Crimes Against Children Task Force and Homeland Security Investigations must be commended for their strong working partnership and tireless commitment to investigating this case.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May, 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit http://www.justice.gov/psc.
For information about internet safety education, please visit http://www.justice.gov/psc and click on the tab "resources."
This investigation was conducted by Homeland Security Investigations and the Southeast Regional Internet Crimes Against Children Task Force. The case was prosecuted by Laurel J. Holland and Stephanie J. Lister, Assistant United States Attorneys for the Eastern District of Washington.
Spokane Man Sentenced to 60 Years in Federal Prison for Production of Child PornographyRead the Press Release
Spokane – Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that United States District Judge Rosanna Malouf Peterson sentenced Dan Wayne Streetman, age 46, of Spokane, Washington, to a 60-year term of imprisonment, to be followed by a lifetime of court supervision and required sex offender registration, for three charges of production of child pornography. Streetman had pled guilty to the offenses on December 13, 2016.
According to court records, Streetman relocated to Spokane from Missouri in 2006. While residing in Spokane, Streetman sexually abused three children in his care, and documented that abuse through photographs, which he maintained on his computer.
Streetman admitted that in total there were probably “hundreds” of sexual encounters between himself and the children. Additionally, Streetman admitted to photographing the children in other situations when they were undressed. Two of the children abused by Streetman were under age ten, the other was fourteen, but had the mental functioning of a nine year old.
The photography documenting the abuse was found by a relative when she was looking at Streetman’s phone. Streetman admitted the misconduct, and the relative called the police. A review of Streetman’s digital devices, pursuant to a court-authorized warrant, showed over a thousand child pornography images and videos saved and edited by Streetman. Streetman had explained he had found additional child pornography on the internet.
During the sentencing hearing, Streetman detailed the abuse he suffered as a child and explained how that abuse “haunts” him. Streetman indicated he had “been through hell.” Nevertheless, Streetman went on to abuse children and create new victims. Streetman acknowledged that he “made bad choices.”
During the sentencing hearing, Judge Peterson told Streetman: “The nature of your offenses is horrific. The impact on these children is just mind-boggling.” The judge went on to say, “The most important factor in my mind is to make sure no other children are subject to your acting out from your past.”
Acting United States Attorney Harrington said, “Streetman exploited young and vulnerable children. This office prosecutes crimes against children with great fervour, because of the extreme vulnerability of the young victims.” Harrington went on to add, “This case is a superb example of the great work that can be done when state and federal law enforcement work together, even across state lines.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May, 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc.
For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
This investigation was conducted by the Federal Bureau of Investigation in conjunction with the Spokane County Sheriff’s Office, Cole County Sheriff’s Department, Missouri, Callaway County Sheriff’s Department, Missouri, and Boone County Sheriff’s Department, Missouri. The case was prosecuted by Stephanie J. Lister, an Assistant U.S. Attorney for the Eastern District of Washington.
Sex Offender Sentenced to a 270-Month Term of Imprisonment for Abusive Sexual Contact with a ChildRead the Press Release
Spokane – Today, Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that David Afterbuffalo, age 41, of Wellpinit, Washington, was sentenced to a 270-month term of imprisonment, to be followed by a lifetime of court supervision and continuing sex offender registration, for one count of Abusive Sexual Contact With a Child, in violation of Title 18 United States Code, Sections 2244(a)(5) and 1153.
Afterbuffalo entered plea of guilty on January 10, 2017, and, according to court documents, admitted repeatedly molesting a child under the age of twelve.
At sentencing, Afterbuffalo indicated he did not wish to make a statement. Senior Judge Nielsen told Afterbuffalo, “This conduct is a serious crime and a serious violation of the mores of our society.” Senior Judge Nielsen expressed concern that if the sentence was not significant and if Afterbuffalo did not receive the proper treatment, he could “perpetuate the same violent crime again and in the process do serious damage to some other young person.”
This was not Afterbuffalo’s first sex offense. Afterbuffalo pled guilty in 1999 to Sexual Intercourse Without Consent in violation of Montana Code 45-5-503(1), and was sentenced to a 20-year term of incarceration in Montana. After release, Afterbuffalo was convicted in 2013 in the Eastern District of Washington, of Failing to Register as a Sex Offender, in violation of Title 18, United States Code, Section 2250(a), and sentenced to 366 days confinement to be followed by 5 years of supervised release.
Joseph H. Harrington said, “I commend the Federal Bureau of Investigation, the Spokane Tribal Police, and the U.S. Marshal Service for their efforts in investigating the case and locating Afterbuffalo in South Dakota, where he had fled after committing the offense. The United States Attorney’s Office has been, and remains, committed with law enforcement to protect children throughout the Eastern District of Washington through thorough investigation, aggressive prosecution, and seeking lengthy sentences in violent crimes against children.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May, 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc.
For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
This investigation was conducted by the Federal Bureau of Investigation, the United States Marshal Service, and the Spokane Tribal Police. The case was prosecuted by Alison L. Gregoire and Matthew F. Duggan, Assistant United States Attorneys for the Eastern District of Washington.
Spokane Area Cardiologist, Dr. Romeo Pavlic, to Pay $300,000 Resolving Alleged False Health Care ClaimsRead the Press Release
Spokane, WA – Today, the United States Attorney’s Office (USAO) for the Eastern District of Washington announced a settlement agreement with Dr. Romeo Pavlic and various companies he owns. The settlement resolves allegations that for years Dr. Pavlic, a Spokane-area cardiologist, falsely billed Medicare and Medicaid by repeatedly and falsely claiming to have provided services and tests to vulnerable patients when in fact he had not.
The settlement agreement, which was entered into with both the United States as well as the State of Washington, calls for Dr. Pavlic to pay a total of $300,000 within 5 days- $279,190 to the United States and $20,810.00 to the State of Washington for its portion of the Medicaid payments that Dr. Pavlic allegedly took through his knowingly false billing.
According to the settlement agreement, between January 1, 2010, and December 31, 2013, Dr. Pavlic was ostensibly providing medical services and tests to the vulnerable adult residents of Lakeland Village in Medical Lake. Lakeland Village is a State operated facility that provides training, education, and healthcare for about 250 individuals with developmental disabilities. People who receive services at Lakeland Village have profound physical and mental disabilities.
The United States alleges that Dr. Pavlic would conduct “cardiac clinics” at Lakeland Village approximately once per month. These “cardiac clinics” would run two to three hours, during which time Dr. Pavlic would see approximately 20-35 residents, scheduled at five to ten minute intervals; at times seeing as many as 40-55 residents, according to allegations.
It was during those “cardiac clinics” that Dr. Pavlic allegedly billed for services not provided and tests not conducted. Specifically, Dr. Pavlic would routinely bill Medicare and Medicaid for a longer and more detailed patient evaluation than he actually provided, according to the allegations in the settlement agreement. In addition, Dr. Pavlic would routinely bill Medicare and Medicaid for a complete echocardiogram when in fact he was only providing a limited echocardiogram, according to the allegations in the settlement agreement. The United States also alleges that, at least as to providing supposedly full echocardiograms Dr. Pavlic was warned in writing in December of 2012 that while other cardiologists in his area billed for full echocardiograms on approximately 12% of their Medicare/Medicaid patients, Dr. Pavlic was claiming to have done so on over 90% of his Medicare/Medicaid patients. Despite this clear warning that his billing practices were suspect, Dr. Pavlic continued to bill for the full tests which were not provided, according to the United States’ allegations.
Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, said: “This settlement agreement resolves some very serious allegations very favorably for the tax payers.” Harrington went on to state that, “doctors, especially those providing services to our most vulnerable citizens, must not violate their duty to the tax payers who are funding those needed services. If doctors do violate that duty they can expect, at a minimum, to pay back the tax payers much more than they took.”
“When doctors exploit vulnerable patients and bill for procedures that were never performed, they violate the basic trust that patients and taxpayers extend to healthcare providers,” said Special Agent in Charge Steven J. Ryan of the U.S. Department of Health and Human Services Office of Inspector General. “We will continue to aggressively pursue those who engage in health care fraud.”
This case was investigated by the United States Attorney’s Office’s Health Care Fraud Investigator, the Office of Inspector General for the U.S. Department of Health and Human Services, and the Medicaid Fraud Control Unit of the Washington Office of the Attorney General.
A copy of the settlement agreement is attached.
Pasco Man Sentenced to 20 Years in Federal Prison for Production and Receipt of Child PornographyRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Sergio Magana, Jr., age 26, of Pasco, Washington, was sentenced today to 20 years in federal prison as a result of his convictions for production and receipt of child pornography.
On November 1, 2016, Magana was found guilty by a federal jury of one count of Production of Child Pornography and one count of Receipt of Child Pornography. Today, United States District Judge Salvador Mendoza, Jr., who presided over the trial, sentenced Magana to a 20-year term of imprisonment for Production of Child Pornography, and a 5-year term of imprisonment for Receipt of Child Pornography, to be served concurrently. Judge Mendoza further imposed a lifetime term of supervised release, and sex offender registration.
According to the evidence presented at trial or disclosed during court proceedings, Magana came to the attention of law enforcement in 2014, after a fourteen-year-old girl reported that she had been raped by an adult male at her family’s residence in Pasco. The adult male was later identified as Magana. During the course of the rape investigation, a Pasco police detective received Magana’s cellular phone from a third party. The cellular phone was subsequently examined, and determined to contain child pornography depicting a fifteen-year-old girl. The cellular phone also contained communications between Magana and the fifteen-year-old girl, during which Magana solicited child pornography depicting the minor, inquired where the minor lived, and stated that he wanted to have sexual intercourse with the minor. The Pasco Police Detective located and identified the fifteen-year-old minor. Evidence obtained by law enforcement officers during the course of the investigation revealed that Magana had engaged in a pattern of behavior whereby he contacted minor girls on Facebook and subsequently sought to meet or obtain photographs of said girls.
Joseph H. Harrington said, “The law enforcement officers with Homeland Security Investigations, the Pasco Police Department, and the Southeast Regional Internet Crimes Against Children Task Force must be commended for their tireless work on this matter. Their seamless working partnership resulted in the successful prosecution of this case. Prosecuting offenders who produce and receive child pornography is a priority of the United States Attorney’s Office for the Eastern District of Washington.”
“Predators who view pornographic images of children fuel the disturbing actions of like-minded criminals who create the illegal content. Both rob the innocence of their victims and leave permanent scars that can never be entirely healed,” said Brad Bench, Special Agent in Charge for Homeland Security Investigations (HSI) Seattle. “This sentence is a testament to our dedicated HSI agents and law enforcement partners who aggressively hunt down these abusive pedophiles and bring them out of the shadows to ensure they receive the judgment they deserve.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May, 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Homeland Security Investigations, the Pasco Police Department, and Southeast Regional Internet Crimes Against Children Task Force conducted the investigation of this matter. The case was prosecuted by Laurel J. Holland, an Assistant United States Attorney for the Eastern District of Washington.
Joseph H. Harrington to Serve as Acting United States Attorney for the Eastern District of WashingtonRead the Press Release
By operation of the Vacancies Reform Act, Joseph H. Harrington is serving as the Acting United States Attorney for the Eastern District of Washington following the recent resignation of Michael C. Ormsby. The Eastern District of Washington comprises the twenty counties east of the crest of the Cascade Mountains
Harrington has served in the United States Attorney’s Office since 1990. During his tenure in the office he has held the positions of First Assistant United States Attorney, Criminal Chief, Deputy Criminal Chief, Anti-Terrorism Advisory Coordinator, and Health Care Fraud Coordinator. Harrington was involved with the prosecutions of: Kevin W. Harpham, an avowed white supremacist who planted a sophisticated remotely-controlled IED along the route of the Martin Luther King, Jr. Day Unity March in Spokane; the Phineas Priest domestic terrorism case involving bank robberies and bombings of a Planned Parenthood office and a Spokane newspaper facility; and the Karl F. Thompson / Otto Zehm civil rights case.
Harrington received his J.D. from Gonzaga University in 1986, where he was a Thomas Moore Scholar (full academic scholarship) and served as the Editor-in- Chief of the Gonzaga Law Review. He holds a B.A. in Mathematics and a B.S. in Engineering.
Former Vice Principle of Lake Roosevelt Elementary School Sentenced to Seven Years in Federal Prison for Receipt of Child PornographyRead the Press Release
Spokane– Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Nathan Piturachsatit, age 38, of Grand Coulee, Washington, was sentenced today, after having previously pleaded guilty on November 29, 2016 to Receipt of Child Pornography. United States District Judge Salvador Mendoza Jr. sentenced Piturachsatit to a seven- year term of imprisonment, to be followed by a ten-year term of court supervision after he is released from Federal prison. In addition, Piturachsatit agreed to forfeit to the United States the iPhone he used to request and receive child pornography images and videos. Upon release from prison, Piturachsatit will be required to register as a Sex Offender.
According to information disclosed during the court proceedings, in January of 2016, an officer of the Janesville Police Department in Janesville, Wisconsin responded to a report of a mother of a fourteen-year-old girl who had received a suspicious package. The package was determined to have been sent by Nathan Piturachsatit and was a shirt from “Pink”, a sister store to Victoria’s Secret. Further investigation revealed from November 2015, until early January 2016, Piturachsatit had been communicating with the fourteen-year-old girl over the Internet using “Instagram”. Piturachsatit had sent the minor child explicit naked images of himself and had asked for sexually explicit images and videos of the minor, who was a freshman in high school at the time of the crime. Piturachsatit’ s communication with the minor was graphic and sexually explicit. Piturachsatit not only requested child pornography from the minor, but also said he wanted to have sexual intercourse with the minor. With the assistance of agents from Homeland Security, a federal search warrant was obtained and executed on February 3, 2016 at Piturachsatit’ s place of employment, the Lake Roosevelt Elementary School where he was the Vice Principle, his residence, and vehicle in Grand Coulee, WA. Law enforcement officers discovered Piturachsatit had installed the application “Instagram” on his iPhone. During the execution of the search warrant, Piturachsatit confessed to sending the package to the minor and to also sending the minor clothed and unclothed images, as well as videos of him naked or masturbating. In addition, Piturachsatit confessed to requesting and receiving sexually explicit images and videos of the minor he had been communicating with via “Instagram”.
Joseph H. Harrington stated, “Prosecuting offenders who entice minors to produce child pornography and receive child pornography is a priority of the United States Attorney’s Office for the Eastern District of Washington. This Office is, and will continue to be, committed to prosecuting aggressively and seeking appropriate punishment for child pornography crimes.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May, 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
This investigation was conducted by Homeland Security Investigations Special Agent Mark Mischke and the Janesville Police Department in Janesville, Wisconsin. The case was prosecuted by Stephanie J. Lister, an Assistant United States Attorney and PSC Coordinator for the Eastern District of Washington.
U.S. Attorney Announces ResignationRead the Press Release
Spokane – United States Attorney Michael C. Ormsby, of Spokane, Washington, has announced his resignation effective midnight March 10, 2017.
Ormsby, a graduate of Gonzaga University, had previously practiced with Lukins & Annis, P.S. and K&L Gates for 29 years prior to his appointment. During his tenure as United States Attorney, he served as the co-chair of the Marijuana Working Group and also served on the Native American Issues Criminal Practice Committee. The Criminal Practice and Northern Border Security and Strategies Subcommittees of the Attorney General’s Advisory Committee.
Michael C. Ormsby, stated “It has been an honor to serve in this position and has been the pinnacle of my professional life.” “Eastern Washington is very well served by the attorneys and staff of the U.S. Attorney’s Office.” “I am very proud of the law enforcement partnerships, the work with Tribal communities, and the high quality of legal work done by those in the office.”
The Eastern District of Washington includes twenty Washington counties east of the crest of the Cascade Mountains. The United States Attorney’s Office, with staffed offices in Spokane and Yakima, Washington, has 28 attorneys and is responsible for conducting all criminal and civil litigation in the district involving the United States government.
Federal Court Orders Eastern Washington Dentist and Spouse to Shut Down Their Dental Care BusinessRead the Press Release
WASHINGTON - A federal court in Spokane, Washington has found Dr. James Hood, a dentist, and his wife, Karen Hood, in contempt for violating the Court’s previous permanent injunction requiring them to timely file payroll tax returns and pay payroll taxes, announced Acting Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division. The Court ordered the Hoods to close their dental care businesses, cease operating as employers, and barred them from opening any new businesses where the Hoods would serve as employers.
On March 8, U.S. District Court Judge Rosanna Malouf Peterson for the Eastern District of Washington found James Hood and Karen Hood in contempt after they demonstrated a consistent pattern of disregarding their tax obligations by making incomplete employment tax payments, making dishonored payments, and missing deadlines. The Court had previously entered a permanent injunction requiring James and Karen Hood, and their entities, to comply with the federal employment tax laws.
According to the United States’ supplemental filing in the case, the Hoods had failed to show full compliance with the tax laws and the Court’s injunction by Jan. 31, as the Court had ordered. The court found that, the Hoods had failed to pay their taxes for the Fourth Quarter 2016 by the end of January 2017. The court also found that the Hoods had attempted to make payroll tax payments that were dishonored due to insufficient funds in their accounts.
Acting Assistant Attorney General Hubbert thanked the revenue officer of the Internal Revenue Service (IRS) Field Collection for investigating the taxpayer’s tax compliance.
In the past decade, the Tax Division has obtained injunctions against hundreds of employers that fail to meet their employment tax obligations. Information about these cases is available on the Justice Department’s website.
Orville Man Sentenced to 5 Years in Federal Prison for Distribution of Child PornographyRead the Press Release
Spokane–Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Ian Christopher Evans, age 31, of Orville, Washington, was sentenced on February 28, 2017, after having previously pleaded guilty on December 1, 2016 to Distribution of Child Pornography. Senior United States District Judge Wm. Fremming Nielsen sentenced Evans to a five-year term of imprisonment, to be followed by a ten-year term of court supervision after he is released from Federal prison. In addition, Evans agreed to abandon to the United States the laptop computer he used to distribute and store his child pornography collection.
According to information disclosed during the court proceedings, in April of 2013, an officer working undercover for the Spokane County Sheriff's Office discovered that Evans was using peer to peer file sharing to distribute images of child pornography. With the assistance of agents from Homeland Security, a federal search warrant was executed on December 13, 2013 at Evans residence in Oroville, Washington. Law enforcement officers discovered Evan’s Compaq laptop computer contained approximately 87 videos and 15 images of child pornography.
Michael C. Ormsby stated, “I commend the law enforcement officers with Homeland Security and Spokane County Sheriff's Office who worked on this case. Their seamless partnership resulted in the successful outcome in this matter. The United States Attorney’s Office in the Eastern District of Washington is, and will continue to be, committed to prosecuting aggressively and seeking appropriate punishment for child pornography crimes. Prosecuting offenders who distribute child pornography is a priority of the United States Attorney’s Office.”
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's
Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
• Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
• Participation of PSC partners in coordinated national initiatives;
• Increased federal enforcement in child pornography and enticement cases;
• Training of federal, state, and local law enforcement agents; and
• Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
This investigation was conducted the Homeland Security and the Spokane County Sheriff's Office. The case was prosecuted by Stephanie J. Lister, an Assistant United States Attorney and PSC Coordinator for the Eastern District of Washington.
Walla Walla Man Sentenced to 5 Years in Federal Prison for Attempted Receipt of Child PornographyRead the Press Release
Spokane–Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Kevin Michael Dettmer, age 34, of Walla Walla, Washington, was sentenced today for Attempted Receipt of Child Pornography. United States District Judge Salvador Mendoza Jr. sentenced Dettmer to a five-year term of imprisonment, to be followed by a ten-year term of court supervision after he is released from federal prison. Dettmer will also be required to register as a sex offender.
According to information disclosed during the court proceedings, in the fall of 2015, Dettmer responded to a personal ad posted by an undercover task force officer working with Homeland Security Investigations and the Southeast Regional Internet Crimes Against Children Task Force. The Southeast Regional Internet Crimes Against Children Task Force is composed of law enforcement officers from the Richland Police Department, the Kennewick Police Department and Homeland Security Investigations. During the course of the communications with the undercover officer, Dettmer repeatedly solicited images of the undercover officer’s fictitious twelve and thirteen-year-old children. Dettmer also provided graphic images of himself and of an adult female that he purported to be fifteen years old. Eventually, Dettmer asked the undercover officer for contact information for the fictitious thirteen-year-old child. The undercover officer provided such information to Dettmer, who proceeded to contact the fictitious child via email and text message.
During his communications with the fictitious child over an approximately one-month period, Dettmer asked the child to take pornographic images utilizing a phone or camera to send to him. Dettmer also encouraged the child to travel to Walla Walla to engage in sexual contact, and discussed providing her with a phone and money upon her arrival. Dettmer was later arrested in Walla Walla, Washington, after arriving to meet the fictitious child. On May 27, 2016, Dettmer pled guilty to Attempted Receipt of Child Pornography.
Michael C. Ormsby said, “This case is an fine example of the great work that can be done when state and federal law enforcement officers work together. Today’s sentence should serve as a warning to those who think they are acting with immunity when using email and text messages to send or receive child pornography or attempting to do so; such criminals will be actively and aggressively pursued by federal and state law enforcement.”
This case was prosecuted as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
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Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
-
Participation of PSC partners in coordinated national initiatives;
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Increased federal enforcement in child pornography and enticement cases;
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Training of federal, state, and local law enforcement agents; and
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Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”investigation was conducted by Homeland Security Investigations and the Southeast Regional Internet Crimes Against Children Task Force. The case was prosecuted by Laurel J. Holland, an Assistant United States Attorney for the Eastern District of Washington.
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West Richland Man Sentenced to 78 Months Imprisonment for Travel for Sex with MinorRead the Press Release
Spokane–Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Dale H. Weber, age 53, of West Richland, Washington, was sentenced today for one count of Travel in Interstate Commerce for the Purpose of Engaging in a Sexual Act With a Minor. United States District Court Judge Salvador Mendoza, Jr. sentenced Dale H. Weber to a 78-month term of imprisonment, to be followed by 10 years of court supervision after he is released from federal prison. Weber will also be required to register as a sex offender.
According to information disclosed during the court proceedings, in the fall of 2014, Weber posted a personals ad, “seeking naughty young girl.” An undercover task force officer with Homeland Security Investigations working with Southeast Regional Internet Crimes Against Children, saw the ad and responded, posing as a 13-year-old girl. During a series of online communications, Weber graphically described different sex acts that he would like to perform on the child. Eventually, Weber discussed meeting the child, at a specific location, for sexual contact.
Weber drove to the meet location, and was observed as he drove through the location at a slow rate of speed, in a vehicle registered to himself, and scanning the area. Weber later had a conversation with the purported 13-year-old wherein the child stated her mother had picked her up when she attempted to meet him.
Weber discussed meeting the child in Oregon, approximately a week later for sex. When the date came, again, Defendant arrived at the meet location. When he did not find the child he sent a series of angry text messages about wasting time and gas. The child explained she had trouble keeping in contact with Weber as her parents do not put many minutes on her phone. The two discussed Weber buying her a new phone. A third meeting was then set. When Weber arrived at the meet location, he was arrested. A new prepaid phone is found in his car. The receipt in his pocket indicated it was a new purchase.
On April 11, 2016, Weber pled guilty to Travel in Interstate Commerce for the Purpose of Engaging in a Sexual Act with a Minor. At sentencing, today Weber stated, “I fully take responsibility for my actions.” Judge Mendoza told Weber “this is an extremely serious offense,” and went on to tell Weber his behavior, specifically, was “extremely concerning,” and made more so by his repeated attempts to contact a person he believed to be a thirteen-year-old child. Judge Mendoza then announced sentence to 78 months imprisonment and 10 years supervised release.
This case was pursued as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources." This investigation was conducted by the Homeland Security Investigations and the Southeast Regional ICAC. The case was prosecuted by Alison L. Gregoire, an Assistant United States Attorney for the Eastern District of Washington.
Washington Businessman Pleads Guilty to Filing Fraudulent Federal Tax ReturnRead the Press Release
A Chelan Falls, Washington man pleaded guilty yesterday in the U.S. District Court in Yakima, Washington to filing a fraudulent 2011 federal tax return, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.
According to documents filed with the court, from 2009 through 2012, Jose L. Echeverria, 46, owned and operated a produce sales business. Echeverria filed fraudulent individual income tax returns for each of these years and underreported his income by a total of approximately $564,292. Echeverria admitted that he caused a tax loss of approximately $183,191.
Sentencing is scheduled for May 11. Echeverria faces a statutory maximum sentence of three years in prison, a period of supervised release, restitution and monetary penalties.
Acting Deputy Assistant Attorney General Goldberg commended special agents of Internal Revenue Service-Criminal Investigation, who conducted the investigation, and Trial Attorneys Lisa L. Bellamy and Gregory Bernstein of the Tax Division who prosecuted the case. Acting Deputy Assistant Attorney General Goldberg also thanked the U.S. Attorney’s Office for the Eastern District of Washington for its assistance.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Renton, Washington Man Sentenced to 105 Months in Prison for Conspiracy to Commit Money LaunderingRead the Press Release
Spokane, WA - Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Richard Estes, age 77, of Renton, Washington, was sentenced, after having previously pled guilty on December 16, 2015, to Conspiracy to Commit Money Laundering. United States District Judge Salvador Mendoza, Jr. sentenced Estes to a term of imprisonment of 105 months, to be followed by a three-year term of court supervision after he is released from Federal prison. In addition, Estes was ordered to pay $4,360,724.50 in restitution to the taxpayers of the United States.
According to information disclosed during the court proceedings, Estes was a member of a conspiracy involving Gen-X Energy Group, Inc. (Gen-X), a renewable energy company formerly located in Pasco and Moses Lake, Washington. Between March of 2013 and May of 2014, Estes and his co-conspirators laundered the proceeds of schemes to (1) falsely claim the production of marketable renewable energy credits; and (2) file false claims for refunds of excise credits with the IRS. Throughout this period, much of the renewable fuel claimed to be produced at the Gen-X facilities was either not produced or re-processed multiple times. In total, over $39,000,000 of proceeds of the scheme was laundered through accounts owned or controlled by Estes.
Michael C. Ormsby stated, “The United States Attorney’s Office for the Eastern District of Washington is, and will continue to be, committed to prosecuting aggressively and seeking appropriate punishment for white collar crimes. I commend the tenacious and thorough efforts of the IRS-Criminal investigations and the Environmental Protection Agency’s Criminal Investigation Division."
"This is a classic case of an individual who allowed his own unfettered greed to guide his duplicitous actions," stated Special Agent in Charge Darrell Waldon of IRS Criminal Investigation. "When that greed turns into fraud to the degree perpetrated by Richard Estes and his co-conspirators, IRS CI stands ready with our law enforcement partners to serve as the guardians of economic equity and social justice."
This investigation was conducted by the Internal Revenue Service-Criminal Investigations and the Criminal Investigation Division of the Environmental Protection Agency. The case was prosecuted by Scott T. Jones, Assistant United States Attorney for the Eastern District of Washington; Karla G. Perrin, EPA Regional Criminal Counsel and Special Assistant United States Attorney for the Eastern District of Washington; and Thomas Franzinger, Trial Attorney, Environmental Crimes Section, United States Department of Justice.
Washington River Protection Solutions Agrees to Pay $5.275 Million to Settle False Overtime and Premium Pay AllegationsRead the Press Release
Washington River Protection Solutions LLC (WRPS) has agreed to pay the United States $5.275 million to settle allegations that WRPS knowingly submitted false claims to the Department of Energy (DOE) for overtime and premium pay and also failed to comply with the contract’s internal audit requirements. The contract was performed at DOE’s Hanford Site near Richland, Washington.
“The monies utilized by DOE to fund important nuclear site environmental remediation across the nation are both precious and limited,” said Deputy Assistant Attorney General Joyce R. Branda of the Justice Department’s Civil Division. “Today’s settlement demonstrates that the Department of Justice will pursue contractors that knowingly divert those funds from the projects for which they were provided.”
Since 2008, WRPS has received millions of dollars from a prime contract with DOE to perform environmental cleanup and maintenance efforts at an area of DOE’s Hanford Nuclear Site known as the Tank Farms. The Tank Farms is a large area of the Hanford Site consisting of underground storage tanks that contain radioactive and hazardous waste from nuclear weapons production. The government alleged that, upon being awarded the Tank Farms Contract in October 2008, WRPS was advised by law enforcement of specific concerns about systemic timecard fraud being committed by the previous contractor at the Tank Farms, many of whose employees and procedures were retained by WRPS. WRPS allegedly made no actual changes to the timekeeping procedures at the Tank Farms for nearly five years and did not take steps, until after July 2013, to curtail the prior fraudulent practices. As a result, the government alleged that WRPS knowingly charged DOE for overtime for busy work or for work that was not actually performed and premium emergency call-in pay that was not authorized by the Tank Farms Contract.
The government also alleged that WRPS charged the government for auditing work that was not performed. WRPS allegedly installed as the head of the contractually required Internal Audit Department for the first three years of the Tank Farms contract its own general counsel, who allegedly had no auditing experience and failed to provide any meaningful oversight of the Audit Department. The government alleged that this knowing violation of an important safeguard in the contract enabled the extensive timecard fraud.
“This resolution demonstrates law enforcement’s continuing resolve in the Eastern District of Washington to hold fraudsters at all levels accountable,” said U.S. Attorney Michael C. Ormsby for the Eastern District of Washington. “In particular, the ongoing anti-fraud efforts at Hanford continue to be bolstered by the outstanding dedication of this office’s partners at the Department of Energy Office of Inspector General and at the Department of Justice Civil Frauds Section.”
“The Department of Energy Office of Inspector General is committed to ensuring the integrity of Departmental contracts and financial expenditures,” said Acting Inspector General April G. Stephenson. “We will continue to investigate allegations of fraudulent diversion of tax dollars throughout DOE programs. This settlement is a result of our staff’s dedicated work to ensure public funds are used for the mission-related purposes for which they are intended. We appreciate the support of Department of Justice attorneys in these matters.”
The settlement was the result of a coordinated effort by the U.S. Attorney’s Office for the Eastern District of Washington, the Civil Division’s Commercial Litigation Branch and the U.S. Department of Energy, Office of the Inspector General.
The claims resolved by the settlement are allegations only; there has been no determination of liability.
WRPS Agrees to Pay $5.275 Million to Settle False Time Card AllegationsRead the Press Release
Spokane, WA- The United States Attorney’s Office for the Eastern District of Washington (EDWA) and the Department of Justice (DOJ), Civil Frauds Section, announced a settlement agreement with government contractor Washington River Protection Solutions LLC (WRPS) for $5,275,000. The settlement resolves allegations that WRPS knowingly submitted false claims to the U.S. Department of Energy (DOE) between October 2008 and July 2013 concerning internal audit processes and the submission of false timecards by WRPS workers’ seeking payment of overtime and premium pay.
The alleged conduct involved three different schemes. First, upon being awarded Hanford’s Tank Farms Contract in October of 2008, WRPS was explicitly advised by federal law enforcement of systemic timecard fraud being committed by WRPS’s workforce at the Tank Farms under WRPS’s then utilized procedures. Notwithstanding this notification, it is alleged that WRPS failed to take any steps during the next five years (i.e., until after July 2013) to initiate any changes of the faulty procedures and failed to curtail the timecard fraud. As a result of this failure, the timecard fraud alleged at the Tank Farm was allowed to continue in a variety of forms under WRPS’s management and while WRPS’s management and executives allegedly looked the other way.
According to the DOJ, the most common form of the alleged timecard fraud involved WRPS workers, with management’s acceptance, not fully accounting for their claimed overtime work. The lack of a full accounting of worker overtime made it impossible for DOE to determine to what extent the claimed overtime was actually performed.
Given that the previous DOE contractor, CH2M Hill Hanford Group Inc. (CHG), admitted during its administration of the Tank Farms from 1999 to 2008 that it criminally conspired with its employees to submit false time cards to DOE, WRPS’ lack of accountability for that same work force and its continued use of the same loose overtime accounting procedures was, at a minimum, reckless and irresponsible conduct by WRPS’s managers and executives.
Second, WRPS also allegedly allowed its workers to falsely claim additional overtime pay at government expense by falsely classifying the workers’ overtime work as Emergency Call In (“ECI”) overtime. Under the Collective Bargaining Agreement (CBA) with WRPS’s Tank Farms’ workforce, ECI could only be used when, as the result of an actual emergency, a worker was provided less than 16 hours of advanced notice of the need to work an overtime shift. However, it is alleged that WRPS almost always allowed its workers to code timecards for higher ECI overtime pay when no emergency or urgency existed. This scheme allegedly resulted in the DOE paying hundreds of thousands of dollars of inflated labor rates for overtime that was falsely coded as ECI.
The third alleged scheme involved WRPS management and executives looking the other way when employees submitted false or fraudulent timecards for work allegedly performed at the Tank Farms. To oversee certain audit requirements, WRPS elected to install its own general counsel as the head of the contractually required Internal Audit Department during the first three years of WRPS’s Tank Farm contract. While DOE was generally aware of WRPS’s internal structural arrangement, DOE was not aware of the full extent of WRPS’s general counsel’s allegedly directing the audit department’s day-to-day auditing processes. WRPS’s arrangement was problematic for a number of alleged reasons, including that WRPS’s general counsel allegedly had no auditing experience and she consistently worked to avoid providing any meaningful oversight of the alleged ongoing timecard fraud scheme. When DOE became more aware of the true nature and extent of WRPS’s general counsel’s role in its internal audit process, DOE required WRPS to remove the general counsel as head of the Internal Audit Department and required WRPS to hire a new internal audit manager who could exercise independent judgment and true oversight of the program as contractually required by WRPS’s public contract with DOE.
“Robust and fully functioning internal audit processes are the first line of defense against fraud on prime contracts issued to private contractors at Hanford,” said Michael C. Ormsby, United States Attorney for the Eastern District of Washington. “WRPS’s acknowledgement and resolution of the Justice Department’s allegations goes to the heart of that essential defense and required oversight of tax payer dollars. This settlement shows that prime contractors should be wary of cutting corners on any
contractually required internal auditing obligation. To its credit, WRPS appears to have recently remedied the problem and we commend the career internal auditors at WRPS who despite these alleged systemic failings continue their good work under challenging and sometimes difficult circumstances,” stated Mr. Ormsby.
The settlement agreement between the government and WRPS requires WRPS to pay the full $5,275,000 settlement within 30 days. As authorized under the False Claims Act, the settlement recovers more than double the alleged loss caused to DOE by WRPS’s alleged false timecard schemes.
“It is deeply concerning that, in the wake of WRPS’s predecessor, CH2M Hill Hanford Group Inc.’s previous admission to criminal timecard fraud conspiracy with employees at the Tank Farms, conduct that occurred just shortly before WRPS took over the DOE’s contract, that WRPS continued to bury its head in the sand and allegedly allowed much of the same timecard fraudulent practices to continue,” stated USA Ormsby.
After being notified in July, 2013 of the lack of vigilant internal controls, WRPS did take significant steps to try to address its timecard fraud problem, principally by altering its procedures, instituting a proxy card system, negotiating changes in the relevant Collective Bargaining Agreement (CBA), and by working to ensure an environment of more meaningful and vigorous internal auditing processes and controls.
“We hope this settlement and the other false claims enforcement actions this Office and the Department of Justice in Washington D.C. have pursued these past years will assist WRPS and other Hanford contractors to perform their important clean-up work in a responsible and accountable manner, and in a way that does not place scarce tax payer dollars at irresponsible risk,” said USA Ormsby.
Since 2009, the United States Attorney’s Office (EDWA) and DOJ components have recovered more than $150,000,000 in false claims damages and penalties from Hanford – DOE nuclear reservation contractors and employees.
This case was investigated by the U.S. Department of Energy Office of Inspector General (OIG-DOE) and prosecuted by the United States Attorney’s Office (USAO) for the Eastern District of Washington and the Department of Justice (DOJ) Civil Frauds Section. A copy of the False Claims Act Settlement Agreement reached in this matter is attached.
This pre-lawsuit settlement resolves the fraud allegations that have been made. WRPS denies the allegations and there has been no formal determination of liability.
Attachment: Settlement Agreement
Costco Wholesale to Pay $11.75 Million to Settle Allegations of Lax Pharmacy ControlsRead the Press Release
WASHINGTON – Costco Wholesale will pay $11.75 million to settle allegations that its pharmacies violated the Controlled Substances Act when they improperly filled prescriptions for controlled substances. The settlement resolves allegations that Costco pharmacies filled prescriptions that were incomplete, lacked valid DEA numbers or were for substances beyond various doctors’ scope of practice. Additionally, the settlement resolves allegations that Costco failed to keep and maintain accurate records for controlled substances at its pharmacies and centralized fill locations.
The settlement was announced today by United States Attorneys Michael C. Ormsby for the Eastern District of Washington, Annette L. Hayes for the Western District of Washington, Eileen M. Decker for the Central District of California, Barbara L. McQuade for the Eastern District of Michigan and Phillip A. Talbert for the Eastern District of California.
Michael C. Ormsby, United States Attorney for the Eastern District of Washington, said “Opioid misuse has reached epidemic levels in the United States. This important matter is yet another example of the tenacious dedication of Drug Enforcement Administration investigators in uncovering and addressing corporate regulatory noncompliance. The DEA must be commended for its superb efforts in
combating the opioid problem at so many different levels, including regulatory compliance.”
“Last year, over 50,000 Americans died as a result of drug overdoses, many of which were related to the misuse of prescription drugs. This settlement demonstrates the accountability and responsibility that go along with handling controlled prescription drugs,” said DEA Assistant Administrator Louis Milione. “DEA works every day to reinforce good corporate practices through outreach and education efforts and, when appropriate, with administrative and criminal action.”
Under the settlement reached January 18, 2017, Costco acknowledges that between January 1, 2012 and December 31, 2015, certain Costco Pharmacies dispensed controlled substances inconsistent with their compliance obligations under the Controlled Substances Act (CSA) and its implementing regulations. The violations include: filling prescriptions from practitioners who did not have a valid DEA number; incorrectly recording the practitioner’s DEA number; filling prescriptions outside the scope of a practitioner’s DEA registration; filling prescriptions that did not contain all the required information; failing to maintain accurate dispensing records; and failing to maintain records for their central fill locations in Sacramento, California and Everett, Washington.
“Pharmacies across this country are on the leading edge of the battle against our prescription drug abuse crisis,” said U.S. Attorney Annette L. Hayes. “A company such as Costco that distributes a significant volume of controlled substances has a responsibility to ensure it complies with regulations that help prevent opioids and other dangerous drugs from being misused or otherwise added to the illegal marketplace. I commend the Drug Enforcement Administration investigators for uncovering the violations at issue in this case, and working with Costco to ensure that systems are put in place to prevent controlled substances from ending up in the wrong hands.”
United States Attorney Barbara L. McQuade stated, “In light of the prescription pill and opioid overdose epidemic we are seeing across the country, compliance with regulations governing pharmacies is more important than ever. We applaud Costco for working with DEA and taking steps to tighten up its compliance to ensure that prescription pills do not end up on the street market.”
“These are not just administrative or paperwork violations – Costco’s failure to have proper controls in place in its pharmacies played a role in prescription drugs reaching the black market,” said United States Attorney Eileen M. Decker. “Costco
pharmacies in Southern California filled numerous prescriptions for drugs that should not have been sold to consumers because of its flawed system for validating DEA registration numbers.”
“Pharmacies are the gatekeepers responsible for ensuring the lawful use of powerful drugs that have a legitimate medical purpose but are easily abused. The CSA provides the statutory oversight to ensure that pharmacies keep meticulous records,” U.S. Attorney Phillip A. Talbert for the Eastern District of California stated. “The successful resolution of this matter demonstrates the Department of Justice’s commitment to enforcing the CSA.”
To address issues uncovered in this investigation, Costco made improvements in its pharmacies. The company purchased a new pharmacy management system at a total budgeted five year cost of approximately $127 million. Additionally, Costco implemented a three tier audit program of its pharmacy locations: Tier 1 done by pharmacy managers and regional pharmacy supervisors; Tier 2 completed by an Internal Audit group consisting of three auditors and an audit supervisor; and Tier 3 an External Audit of 40 annual audits.
Under the terms of the settlement, over the next three years, DEA is allowed to conduct unannounced and unrestricted inspections of all DEA registered Costco Pharmacy locations without Administrative Inspection Warrants. The Drug Enforcement Administration monitors pharmacy prescribing practices to ensure compliance with federal law. Pharmacies found in violation face escalating penalties up to the revocation of their DEA Registration number – the authorization that allows them to write prescriptions for controlled substances.
This case was investigated by DEA Diversion Groups in Seattle, Los Angeles, Sacramento and Detroit. While this settlement is national in scope, the settlement was negotiated by the United States Attorney’s Offices in the Western and Eastern Districts of Washington, Central and Eastern Districts of California and Eastern District of Michigan.
Confederated Tribes of the Colville Reservation Enter into False Claims Act and Voluntary Compliance Agreements Regarding Challenged Youth Counseling ServicesRead the Press Release
Spokane, WA – Today, the Confederated Tribes of the Colville Reservation (CCT) and the United States of America, acting through the U.S. Department of Justice (DOJ) and on behalf of the Office of Inspector General of the Department of Health and Human Services (OIG-HHS), announced a voluntary settlement agreement reached by the parties relative to allegations that the Colville Tribes submitted false claims to Medicaid seeking the reimbursement of mental health counseling services that was purportedly provided by the Tribe’s Behavioral Health Unit – Youth Counseling services.
The CCT is a federally recognized, sovereign Indian tribe, with tribal offices located at Nespelem, Washington, on the Tribes’ reservation. In furtherance of the goals of the Indian Health Care Improvement Act (IHCIA) and to fulfill the United States’ trust and treaty obligations to the CCT’s members, the Secretary of HHS and the CCT entered into a Title I Contract and Annual Funding Agreement, on a government-to-government basis, to provide health and social services to tribal members and other eligible individuals. Thus, the CCT is entitled to bill federal health care programs for provided services.
Under the agreement, the Confederated Tribes of the Colville Reservation have agreed to pay $245,860 (Two Hundred Forty-Five Thousand, Eight Hundred Sixty Dollars) to resolve false claims allegations arising out of the Tribes’ billing irregularities that occurred from January 2010 through August 2010.
During that time, the CCT contracted with an independent mental health contractor to provide youth counseling services. The contractor submitted invoices to the CCT for payment of child mental health encounter sessions. The CCT used these invoices to generate claims that it submitted to the Washington State Medicaid Program for reimbursement. Medicaid administered payment of these encounter session claims with federal funds.
In 2010, the Federal Bureau of Investigation (FBI), along with the Medicaid Fraud Control Unit (MFCU) and the U.S. Attorney’s Office, began an investigation into allegations that the contractor falsely documented weekly billing invoices for alleged encounter sessions, which the contractor submitted to the CCT for child mental health counseling sessions which were either not provided or were not medically indicated or necessary.
The investigation found that the contractor conducted a 10-week summer group course, with the same curriculum, year after year, and for the same children. The contractor allegedly submitted invoices to the CCT indicating mental health sessions had been individually provided to each of the children. As alleged, the CCT submitted claims for payment of these false individual counseling sessions to Medicaid based on the falsified invoices.
The investigation determined that the group sessions were not clinically directed, did not address the patients’ diagnoses, and had little to no clinical value. The CCT was allegedly complacent in its supervision and review of their counseling contractor’s work.
While the CCT did not admit any wrongdoing, the Office of Inspector General for the U.S. Department of Health and Human Services (OIG-HHS) and the CCT agreed to a settlement that provides for performance of a Voluntary Tribal Compliance Agreement (VTCA), on a government‐to‐government basis, not only aims to enhance the health care services provided to CCT’s tribal members, but also supports CCT in fulfilling its’ obligations under applicable federal law. Per the VTCA, among other things, the CCI will designate a compliance officer and committee, will have an annual review performed by an independent review organization, will establish internal policies and procedures, and will annual reports with the OIG-HHS.
“This settlement shows both our commitment to protect tax payer dollars and the Colville Tribes’ commitment to providing quality and responsible health and health education services for its’ members,” said Michael C. Ormsby, United States Attorney for the Eastern District of Washington.
“Fraudulent schemes such as those alleged here drain scarce Medicaid dollars and jeopardize the program’s ability to provide necessary medical care,” said OIG-HHS’s Special Agent in Charge Steven J. Ryan. “Today’s settlement with CCT will help protect tribal children and the program upon which they depend.”
This case was investigated by the FBI, OIG-HHS, Washington State’s Medicaid Fraud Control Unit (MFCU), and federal prosecutors in the United States Attorney’s Office for the Eastern District of Washington.
See related case United States v. Debra Van Bunt-Oreiro, Cause No. 13-CR-00110-RMP (2014) and related press release at https://www.justice.gov/usao-edwa/pr/omak-mental-health-counselor-sentenced-five-years-probation-filing-false-income-tax
Attachment: Settlement Agreement, January 10, 2017Spokane, Washington Woman Sentenced to 60 Months in Federal Prison for Mail Theft, Identity Theft, and Bank FraudRead the Press Release
Spokane – Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Souha Yazbek, age 27, of Spokane, Washington, was sentenced today as a result of her guilty pleas on September 9, 2016, to the charges of Possession of a Counterfeit Postal Key, Possession of Stolen Mail, Aggravated Identity Theft, and Conspiracy to Commit Bank Fraud.
Senior United States District Judge Justin L. Quackenbush sentenced Souha Yazbek to a total of sixty months in federal prison on the charges, to be followed by an additional sixty months of court supervision following her release from imprisonment.
According to information disclosed during the court proceedings, in February of 2016, Yazbek was arrested in Spokane for attempting to sell a stolen vehicle. At the time, law enforcement officers discovered Yazbek was in possession of a counterfeit U.S. Postal Service key that would allow her access to the back of large cluster-style mail boxes. Law enforcement officers were aware that mail theft had been occurring in the area, and obtained a search warrant for Yazbek’s residence. During the search of her residence officers located thousands of pieces of stolen mail, belonging to more than 900 Spokane residents. The subsequent investigation revealed that Yazbek and three co-conspirators had forged personal and business checks stolen from the mail and deposited them into their own bank accounts, as well as using stolen credit cards to make fraudulent purchases. Yazbek had also previously stolen the identity of a California resident, opened a bank account under that person’s identity, and obtained and used a credit card in that person’s name. The fraudulently purchased items included, for example, Hobby Lobby furniture, a mattress from the Davenport Hotel, and pairs of eyeglasses from Lens Crafters.
Judge Quackenbush imposed significant sentences in Yazbek’s three co-conspirators’ cases as well: co-conspirator Charice Unruh received a thirty-seven month term of imprisonment to be followed by five years of supervised release; co-conspirator Shawn Fitzgerald received a twenty-four month term to be followed by five years of supervised release; and co-conspirator Raquel Calloway received a fifteen-month term to be followed by five years of supervised release. At the sentencing hearings, Judge Quackenbush emphasized the criminal conduct widely affected the community and had significant emotional and financial impact on the victims. Judge Quackenbush also ordered a total of more than $50,000 in restitution be paid to the individual and business victims in the case.
Michael C. Ormsby said, “This case is yet another fine example of the great work that can be accomplished when state and federal law enforcement work together. I commend the Spokane County Sherriff’s Department and the U.S. Postal Inspection Service. Today’s sentence should serve as a warning to those who may consider stealing mail or using another person’s identity; such criminals will be actively and aggressively pursued by federal and state law enforcement officers.”
The investigation of this case was conducted by the U.S. Postal Inspection Service with the assistance of the Spokane County Sherriff’s Department. The case was prosecuted by Allyson Edwards, an Assistant United States Attorney for the Eastern District of Washington.
Spokane, Washington Man Sentenced to 15 Years in Federal Prison for Receipt of Child PornographyRead the Press Release
Spokane – Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Hugh Allen Russell, age 31, of Spokane, Washington, was sentenced today after having previously pled guilty on September 15, 2016 to Receipt of Child Pornography. Senior United States District Court Judge Justin L. Quackenbush sentenced Russell to a fifteen-year term of imprisonment, to be followed a fifteen-year term of court supervision after he is released from federal prison. He will also be required to register as a sex offender upon release. Russell has a prior 2014 Washington State conviction for Possession of Depictions of Minors Engaged in Sexually Explicit Conduct, and was registering as a sex offender at the time he committed the offense of Receipt of Child Pornography.
According to information disclosed during the court proceedings, Dropbox reported to the National Center for Missing and Exploited Children (NCMEC) that someone had uploaded a video of child pornography to their Dropbox account. NCMEC referred the information to the Internet Crimes Against Children Task Force in Washington State. As a result, the Spokane Sheriff’s Office and the Federal Bureau of Investigation conducted an investigation and ultimately searched Russell’s cellular phone, pursuant to a warrant, and located images of child pornography on the device.
Michael C. Ormsby stated, "Prosecuting offenders with prior child pornography convictions is a priority of the United States Attorney's Office for the Eastern District of Washington. Cases of recidivists, like this one, will be prosecuted aggressively."
This case was prosecuted as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
· Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
· Participation of PSC partners in coordinated national initiatives;
· Increased federal enforcement in child pornography and enticement cases;
· Training of federal, state, and local law enforcement agents; and
· Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
This investigation was conducted by the Federal Bureau of Investigation in conjunction with the Spokane County Sheriff’s Office. The case was prosecuted by Alison L. Gregoire, an Assistant United States Attorney for the Eastern District of Washington.
Spokane Man Sentenced to 84 Months in Federal Prison for Possessing Body Armor, Firearm and AmmunitionRead the Press Release
Spokane – Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Keith Bennett Gordon Studhorse, II, age 43, of Spokane, Washington, was sentenced today for being a previously convicted violent felon in possession of body armor and previously convicted felon in possession of a firearm and ammunition. Chief United States District Court Judge Thomas O. Rice sentenced Studhorse to an 84-month term of imprisonment and a three-year term of court supervision following release from Federal prison.
According to information disclosed during court proceedings, the Bureau of Alcohol, Tobacco, Firearms and Explosives received information that Studhorse had body armor and a shotgun to sell. At the time, Studhorse had been previously convicted of attempted first degree murder, second degree manslaughter, riot-domestic violence and conspiracy to possess methamphetamine. As such, Studhorse was prohibited from possessing body armor, a firearm and ammunition. On January 12, 2016, using a confidential informant, the Spokane Resident Office of ATF conducted a controlled purchase of a Survival, Inc. ballistic level III vest, a Mossberg, model 500AT, 12-gauge shotgun, and approximately two-hundred-twenty-seven assorted rounds of 12-gauge ammunition from Studhorse in the public parking lot of a local retail business. Studhorse was charged in a two-count indictment with being a previously convicted violent felon in possession of body armor and previously convicted felon in possession of firearm and ammunition. He pled guilty to those crimes on September 8, 2016.
Michael C. Ormsby said, “Prosecuting firearms-related crimes continues to be a priority for the United States Attorney’s Office for the Eastern District of Washington. Previously convicted felons and violent felons should be aware that there are serious criminal penalties connected with possessing any firearm, ammunition and body armor and that this Office is committed to prosecuting aggressively firearm-related cases in the Eastern District of Washington.”
This case was investigated by the Spokane Resident Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives. This case was prosecuted by George J.C. Jacobs, III, an Assistant United States Attorney for the Eastern District of Washington.
BNI and URS to Pay $125 Million Resolving Alleged False Claims Regarding Deficient Nuclear Quality Procurements at the Waste Treatment Plant and Improper Payments to Lobby CongressRead the Press Release
Richland, WA – Today, the United States Attorney’s Office (USAO) for the Eastern District of Washington and the Department of Justice Civil Frauds Section (DOJ) announced a settlement agreement with federal contractor Bechtel National Inc., Bechtel Corp., (BNI) and AECOM, on behalf of URS Corp., and URS Energy & Construction Inc. (URS) (collectively “the defendants’). The settlement resolves allegations that BNI and URS, in the design and on-going construction of the U.S. Department of Energy’s (DOE) Waste Treatment & Immobilization Plant project (“WTP”) at the Hanford Site, falsely represented and charged DOE for deficient goods and services, which failed to be of the highest quality for nuclear facilities.
The settlement agreement, which requires BNI and URS to pay $125 million, also resolves allegations that BNI illegally used taxpayer dollars to pay for a multi-year Congressional lobbying campaign to acquire, among other things, more taxpayer dollars for BNI’s continued work on the WTP project.
The WTP is located at the DOE’s Hanford Site near Richland, Washington. Between 2001 and the present, the DOE has paid billions of dollars to the defendants to design and build the WTP, which is being built to treat hundreds of millions of gallons of dangerous radioactive waste currently stored at the Hanford Site. Key to the Plant’s ultimate ability to function is the requirement that certain
project components of the facility purchased by BNI and URS, and paid for by DOE, comply with the nuclear industry’s rigorous quality assurance standards and procedures. According to allegations accepted by the United States, for over 13 years -- from January 1, 2001, to June 30, 2013 -- BNI and URS knowingly submitted false claims for payment while failing to comply with the rigorous nuclear quality requirements for the DOE’s WTP project. It is further alleged that BNI’s and URS’ knowing false claims were not limited to just deficient parts, but also extended in some cases to testing used to resolve various technical issues in the proper design and/or construction of the WTP.
According to court documents, the case began in February of 2012, when whistleblowers (known as Relators) Gary Brunson, Dr. Donna Busche, and Dr. Walter Tamosaitis, filed a qui tam complaint under seal alleging, among other things, that BNI and URS had provided deficient goods and services to DOE on the WTP Contract. At that time the relators also alleged that BNI illegally used taxpayer dollars to lobby Congress.
When a relator(s) files a qui tam complaint, the False Claims Act requires the United States to investigate the allegations and thereafter elect to either intervene and take over the lawsuit or to decline to intervene and allow the relator(s) to go forward with the litigation on behalf of the United States. In this case, court documents show that on November 1, 2016, after more than a three and a half year investigation, the United States chose to “partially intervene” and adopt some of the Relators’ allegations, specifically, those allegations involving deficient nuclear quality procurements and illegal lobbying. Court records show that after the United States’ decision to partially intervene, the defendants, the Relators and the United States reached a negotiated settlement that provides for the global resolution of all of the Relators’ False Claims Act (FCA) allegations. In exchange for dismissal of the qui tam lawsuit, the defendants have agreed to pay $125 million to the United States, but denied any wrongdoing.
Michael C. Ormsby, United States Attorney for the Eastern District of Washington, said: “The allegations the United States chose to intervene in, including claims that BNI – URS recklessly purchased deficient materials and services with taxpayer money for more than a decade, are deeply concerning given the obvious importance of nuclear safety at the WTP. The WTP, once completed, is supposed to work safely to clean Hanford once and for all of millions of gallons of radioactive waste.” U.S. Attorney Ormsby also said: “With this settlement it is our hope that DOE will continue to move forward in its mission of environmental clean-up and restoration at Hanford, and will have greater confidence that its
contractors will not undermine those important efforts for their own short-term financial gain.”
The allegations resolved by the settlement agreement also include claims that BNI illegally used taxpayer dollars to improperly lobby Congress in direct violation of, among other things, the Byrd Amendment (1989), which prohibits federal contractors from using tax dollars to influence or attempt to influence federal officials in connection with their contract. BNI’s improper lobbying efforts allegedly included, but were not limited to, using taxpayer dollars to pay D.C. lobbyists to actively downplay to specific members of Congress the significance of concerns raised in 2009 by the Defense Nuclear Facilities Safety Board (“DNFSB”) relative to the design – construction of the WTP. Based on internal BNI emails referenced in the relators’ qui tam complaint, BNI’s alleged taxpayer funded lobbying of Congress also included an attempt to secure an additional $50 million in public funds in 2011 which was thought to be put in jeopardy by the DNFSB’s concerns. These alleged lobbying efforts - as well as others - were in direct violation of the Byrd Amendment (31 U.S.C. § 1352).
U.S. Attorney Ormsby said: “The use of federal taxpayer dollars to pay lobbyists in an attempt to elicit more taxpayer dollars is unacceptable.” USA Ormsby went on to say: “Illegal lobbying contravenes the established lawful process that is designed to provide independent federal oversight of contractors’ performances. As alleged, Defendants’ attempts to lessen the effectiveness of the Defense Nuclear Facility Safety Board (DNFSB), the only federal government agency with independent technical oversite on the WTPS project, and charged with identifying the nature and consequences of potential threats to public health and safety at Hanford, is shameful and must be blunted, penalized and deterred in the starkest manner possible.”
This case was investigated by the Department of Energy Office of Inspector General (DOE - OIG) and the Federal Bureau of Investigation. The United States was represented by the United States Attorney’s Office for the Eastern District of Washington and the Department of Justice Civil Frauds Section. The DOE and its Office of General Counsel also provided assistance. The relators were represented by the Lambert Firm.
The case is entitled: United States ex rel. Brunson, Busche, and Tamosaitis v. Bechtel National, In., Bechtel Corp., URS Corp., and URS Entergy & Construction, Inc., Case No. 2:13-CV-05013-EFS (E.D. Wash). A copy of the settlement agreement is attached.
United States Settles Lawsuit Against Energy Department Contractors for Knowingly Mischarging Costs on Contract at Nuclear Waste Treatment PlantRead the Press Release
The Justice Department announced today that Bechtel National Inc., Bechtel Corp., URS Corp. (predecessor in interest to AECOM Global II LLC) and URS Energy and Construction Inc. (now known as AECOM Energy and Construction Inc.) have agreed to pay $125 million to resolve allegations under the False Claims Act that they made false statements and claims to the Department of Energy (DOE) by charging DOE for deficient nuclear quality materials, services, and testing that was provided at the Waste Treatment Plant (WTP) at DOE’s Hanford Site near Richland, Washington. The settlement also resolves allegations that Bechtel National Inc. and Bechtel Corp. improperly used federal contract funds to pay for a comprehensive, multi-year lobbying campaign of Congress and other federal officials for continued funding at the WTP. Bechtel Corp. and Bechtel National Inc. are Nevada corporations. URS Corp. is headquartered in California, and URS Energy & Construction Inc. is headquartered in Colorado.
“The money allocated by Congress for the Waste Treatment Plant is intended to fund the Department of Energy’s important mission to clean up the contaminated Hanford nuclear site, and this mission is undermined if funds are wasted on goods or services that are not nuclear compliant or to further lobbying activities,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “This settlement demonstrates that the Justice Department will work to ensure that public funds are used for the important purposes for which they are intended.”
“The environmental clean-up and restoration of the land that comprises the Hanford Nuclear Reservation is one of the single most important projects in this region,” said U.S. Attorney Michael C. Ormsby of the Eastern District of Washington. “It is imperative that funds allocated for this project be used appropriately and judiciously – the public expects nothing less. This office and our DOJ and DOE counterparts take allegations of contractor abuse seriously and place a priority on investigating and pursuing enforcement when those allegations could impact the safety and security of our citizens.”
“The DOE Office of Inspector General is committed to ensuring the integrity of Departmental contracts and financial expenditures,” said Acting Inspector General Rickey R. Hass. “We will continue to steadfastly investigate allegations of fraudulent diversion of tax dollars throughout DOE programs and appreciate the support of DOJ attorneys in these matters.”
Between 2002 and the present, DOE has paid billions of dollars to the defendants to design and build the WTP, which will be used to treat dangerous radioactive wastes that are currently stored at DOE’s Hanford Site. The contract required materials, testing and services to meet certain nuclear quality standards. The United States alleged that the defendants violated the False Claims Act by charging the government the cost of complying with these standards when they failed to do so. In particular, the United States alleged that the defendants improperly billed the government for materials and services from vendors that did not meet quality control requirements, for piping and waste vessels that did not meet quality standards and for testing from vendors who did not have compliant quality programs. The United States also alleged that Bechtel National Inc. and Bechtel Corp. improperly claimed and received government funding for lobbying activities in violation of the Byrd Amendment, and applicable contractual and regulatory requirements, all of which prohibit the use of federal funds for lobbying activities.
The allegations resolved by this settlement were initially brought in a lawsuit filed under the qui tam, or whistleblower, provisions of the False Claims Act by Gary Brunson, Donna Busche, and Walter Tamosaitis, who worked on the WTP project. The False Claims Act permits private parties to sue on behalf of the United States when they believe that a party has submitted false claims for government funds, and to receive a share of any recovery. The Act also permits the government to intervene in such a lawsuit, as it did in part in this case. The whistleblowers’ reward has not yet been determined.
This matter was handled by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Eastern District of Washington, the DOE Office of the Inspector General and the FBI.
The claims asserted against defendants are allegations only, and there has been no determination of liability. The case is United States ex rel. Brunson, Busche, and Tamosaitis v. Bechtel National, Inc., Bechtel Corp., URS Corp., and URS Energy & Construction, Inc., Case No. 2:13-cv-05013-EFS (E.D. Wash.).
Sureno Gang Member Sentenced to 100 Months ImprisonmentRead the Press Release
Yakima – Today, Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Angel Jose Rangel, age 34, of Yakima, Washington, was sentenced today after having previously plead guilty on August 17, 2016, to being a Felon in Possession of a Firearm. United States District Judge Stanley A. Bastian sentenced Rangel to a 100-month term of imprisonment, to be followed by a three-year term of court supervision after he is released from Federal prison.
According to information disclosed during the court proceedings, on June 21, 2015, the Defendant and two other men entered a bar in Yakima, Washington. The three men were dressed in the color blue. Security officers recognized the blue to be associated with the Sureno street gang. The three men walked over to a group of males who were wearing the color red. Security officers were aware that the color red is associated with the Norteno street gang. Shortly thereafter all of the men quickly exited the bar and proceeded to fight in the parking lot. Security guards rushed outside to stop the fight. The Defendant was losing the fight so he ran to his vehicle and obtained a firearm. The Defendant returned to the parking lot and began waving the firearm while yelling expletives. Security guards and others convinced the Defendant not to shoot anyone. The Defendant and his two friends entered a vehicle and departed from the scene.
Officers with the Yakima Police Department (“YPD”) quickly arrived at the scene. Officers reviewed the video footage. An experienced YPD gang officer identified the Defendant and other individuals who had been involved in the gang fight. The officer was aware that the Defendant was known to be a high ranking Sureno gang member.
A few hours later, YPD officers responded to a second bar in regards to a gang fight in progress. A YPD officer observed the Defendant seated in a vehicle. The Defendant was arrested for a community supervision violation. Police obtained a search warrant and found two loaded firearms inside of the vehicle. A loaded pistol was recovered directly beneath where the Defendant had been seated.
The Defendant has a lengthy criminal history which includes convictions for Drive-By Shooting (1997); Drive-By Shooting (1999); Unlawful Possession of a Firearm (2005); Possession of a Dangerous Weapon (2005); Possession of Methamphetamine (2005); Second Degree Robbery (2006); Third Degree Assault (2007); and Second Degree Assault with a Deadly Weapon (2009).
Michael C. Ormsby, U.S. Attorney for the Eastern District of Washington, said, “the United States Attorney’s Office and our law enforcement partners are committed to protect our community from gang related violence. The United States Attorney’s Office will continue to seek lengthy sentences to remove dangerous gang members from our streets. In this case, the Yakima Police Department Gang Unit conducted a thorough investigation, conducted dozens of interviews, and collected all of the evidence to ensure that justice would prevail.”
The investigation was completed by the Yakima Police Department, the Eastern Washington Violent Gangs Safe Streets Task Force/Yakima, and the Department of Homeland Security. This case was prosecuted by Tom Hanlon, an Assistant U.S. Attorney for the Eastern District of Washington.
Warden, Washington Man Sentenced to 15 Years in Federal Prison for Production of Child Pornography and Firearm OffensesRead the Press Release
Spokane – Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Alfredo Mendoza, age 34, of Warden, Washington, was sentenced today after having previously plead guilty on August 30, 2016, to Production of Child Pornography and to being a Felon in Possession of a Firearm. United States District Judge Salvador Mendoza, Jr. sentenced Mendoza to a 15-year term of imprisonment, to be followed by a ten-year term of court supervision after he is released from Federal prison. In addition, Mendoza will be required to register as a sex offender.
According to information disclosed during the court proceedings, in November 2015, Mendoza was under investigation for his potential involvement in a series of gang-related drive-by shootings that had occurred in Grant County, Washington. Law enforcement officers obtained a search warrant for Mendoza’s residence. Upon executing the warrant, they discovered a loaded 9mm revolver in Mendoza’s bedroom. The firearm was forensically examined and Mendoza’s thumb print was found on it. His cellular telephone was also seized from the bedroom, which telephone was thereafter examined pursuant to a court-authorized search warrant to look for evidence of the earlier gang-related shootings.
When law enforcement officers discovered images of child pornography while examining Mendoza’s phone, they obtained a second search warrant. The officers’ follow-on investigation revealed that Mendoza had directed an underage girl to take pornographic photos of herself and text them to him. He had also created videos of sexual acts with the girl. Some of the images were taken in Mendoza’s bedroom and, in one video, he can be seen setting up the camera. Mendoza knew the victim was a minor at the time. The girl was a friend of Mendoza’s daughter and lived with him for a time.
At the sentencing hearing today, the Judge emphasized that the victim “was a child” and that he was troubled by “the manner in which [Mendoza] manipulated” her. The Judge also stated that Mendoza “had an opportunity to right this ship” and step away from his long history of gang-related violence, telling him “you created this and now you have theability to change.”
Michael C. Ormsby said, “This case is a superb example of the excellent work that can be accomplished when state and federal law enforcement work together. I commend the Grant County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Today’s sentence should serve as a warning that child pornography and firearm offenses will be actively and aggressively pursued by federal and state law enforcement officers.”
This investigation was conducted by the Grant County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Alison L. Gregoire and Allyson Edwards, Assistant United States Attorneys for the Eastern District of Washington.
Justice Department Files Suit Alleging Disability-Based Discrimination at Housing Complex in Ellensburg, WashingtonRead the Press Release
The Justice Department announced today that it has filed a lawsuit against the owners, builder and designer of the Ashlynn Estates in Ellensburg, Washington, alleging that the property was designed and constructed without complying with the Fair Housing Act’s (FHA) accessibility requirements. Situated near Central Washington University, each of the three buildings on the property have nine individually keyed units with their own bathroom and desk as well as a shared living space, a communal kitchen and two communal laundry rooms.
“When constructing new multifamily housing, including dormitory style residences like Ashlynn Estates, builders must make these facilities accessible to persons with disabilities,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division. “Building multifamily housing that is not accessible denies people with disabilities their legal right to equal housing opportunity.”
“The Fair Housing Act was originally enacted in 1968 and was amended in 1988 to prohibit discrimination on any protected basis, including disability,” said U.S. Attorney Michael C. Ormsby of the Eastern District of Washington. “This statute and other legislation guarantees safe and reasonable access for persons with disabilities to ensure full participation in all aspects of life, including housing. The DOJ’s Civil Rights Division, HUD and the U.S. Attorney’s Office take serious allegations of disability-based discrimination through access violations and we join our colleagues in seeking enforcement of those rights guaranteed by this historic legislation.”
The suit, filed in the U.S. District Court for the Eastern District of Washington, alleges that various barriers at the Ashlynn Estates deny persons with disabilities equal access to 12 ground-floor units and the associated public and common-use areas at the property that are covered by the FHA. Such barriers include: inaccessible building entrances on an inaccessible exterior route; inaccessible knob hardware throughout the buildings, including on the building entrances and unit entrances; inaccessible electrical outlets; inaccessible laundry facilities; inaccessible bathrooms and inaccessible walk-in closet entrances.
The lawsuit arises from a complaint filed with the U.S. Department of Housing and Urban Development (HUD) by the Northwest Fair Housing Alliance (NWFHA), a private, nonprofit corporation whose mission is to provide education regarding fair housing laws and to ensure compliance with those laws in Washington. NWFHA inspected the Ashlynn Estates and observed accessibility barriers. After conducting an investigation, HUD issued a charge of discrimination and referred the case to the Justice Department.
“The Fair Housing Act’s design and construction requirements are clear,” said Gustavo Velasquez, HUD’s Assistant Secretary for Fair Housing and Equal Opportunity. “Not complying not only violates the law, it also reduces the availability of the type of housing persons with disabilities depend on. HUD applauds the action the Justice Department took today, and we look forward to continuing to work together to send a clear message to property owners and developers that they will be held accountable for not meeting their legal obligations.”
The suit names the owners of the property, Keith and Tamra Riexinger, and Riexinger Enterprises Inc., also known as Crossroads Construction, the firm that designed and constructed the property. The suit seeks a court order requiring the defendants to retrofit the Ashlynn Estates property to bring it into compliance with the FHA, as well as monetary damages for NWFHA and for persons harmed by the lack of accessibility at the complex.
The FHA prohibits discrimination in housing based on race, color, religion, national origin, sex, familial status and disability. Among other things, the FHA requires all multifamily housing constructed after March 12, 1991, to have basic accessibility features, including accessible routes without steps to all ground-floor units. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Individuals who believe that they may have been victims of housing discrimination can call the Justice Department at 1-800-896-7743, email the Justice Department at [email protected] or contact HUD at 1-800-669-9777.
Riexinger ComplaintSpokane, Washington Man Sentenced to 25 Years in Federal Prison for Attempted Production of Child PornographyRead the Press Release
Spokane – Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Steven Harris, of Spokane, Washington, was sentenced today after having previously pleaded guilty on June 28, 2016, to attempted production of child pornography. United States District Judge Salvador Mendoza, Jr. sentenced Harris to a 25-year term of imprisonment, to be followed by a life-term of court supervision after he is released from Federal prison. In addition, Harris will be required to register as a sex offender.
According to information disclosed during the court proceedings, an investigation began in September, 2015 after Harris, a registered sex offender who had served as a volunteer with the Boy Scouts of America, uploaded a file containing child pornography from a specific Internet Protocol address to Omegle.com (a free online video chat website that randomly pairs users in one-on-one chat sessions where they chat anonymously using the names "You" and "Stranger”). The Internet Protocol address was linked to Harris’ residence. Law enforcement officers executed a search warrant at Harris’s residence and seized several electronic devices – officers discovered Harris not only possessed and distributed child pornography, he produced it, using websites like Omegle and Skype.
Officers discovered that Harris produced a library of child pornography which consisted primarily of juvenile boys masturbating. Harris utilized more than one means to get the children to masturbate, so that he could produce the recordings. For example, some of the victims were made to believe that Harris was a minor-aged girl. Harris maintained a series of webcam videos of a teenage girl, which he would use to entice juvenile boys to masturbate. Harris had the video files divided into several sections to include “brunetteshow,” “brunettetalk,” “brunettetalk2,” “Brunettetease,” “brunettewave,” and so on. All of the videos portrayed the same pubescent female waiving, communicating, exposing her chest, and dancing nude. Harris purported to be the teenage girl himself and would play the clips in a logical order that made sense with the conversation. The conversation was typed, as Harris informed his juvenile victims his computer’s microphone did not work. Harris would type that if the boys would get naked or masturbate, the teenage girl would do certain things of a sexual nature in return. When the children would eventually masturbate, Harris would record the acts and store the video on his computer.
Harris also used virtual webcam software to play child pornography over Omegle. The internet users he was randomly paired with on Omegle would either see the pornography and immediately move on or stay and watch the video. If juveniles stayed they were encouraged to engage in sexually explicit acts. If they did so, Harris would capture the acts on video and save the video.
Harris captured videos of children masturbating for a period of approximately two years. Harris’s desktop computer contained two folders of pictures which stored illegal images. One folder was for raw video he captured. The other was entitled, “Record.” Within that folder was a subfolder called “Save” which contained child pornography Harris produced, and within that folder was yet another subfolder, indicative of Harris’s goal in meeting the children on Omegle, entitled, “Win,” which contained over 500 videos nearly exclusively of boys masturbating. Harris shared some of the videos he created with other internet users, in exchange for other child pornography.
At sentencing a very contrite Harris told the judge that he understood the sentencing to be “less about me and more about the people that I’ve hurt, and I think that is right. I think your consideration should be more about the victims.” Harris detailed his remorse and stated, “Had I not been caught, I probably would have accelerated into more and more dangerous behaviors.”
When imposing the 25 year sentence, Judge Mendoza stated that Harris’s actions would have “far reaching consequences for the victims,” noting that “we are talking about real children here. These are real people, and not just real people, real children.” He went on to state, “The fact you were assisting in the creation of this material and assisting in the marketplace for this material is very concerning.”
Michael C. Ormsby said, “This case is a fine example of the great work that can be done when state and federal law enforcement work together. Harris fully exploited the anonymity the video chat site afforded him to the great harm of unsuspecting children. Today’s sentence should serve as a warning to those who think they are acting with immunity online; such criminals will be actively and aggressively pursued by federal and state law enforcement.”
This case was prosecuted as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
· Integrated federal, state, and local efforts to investigate and prosecute child
exploitation cases, and to identify and rescue children;
· Participation of PSC partners in coordinated national initiatives;
· Increased federal enforcement in child pornography and enticement cases;
· Training of federal, state, and local law enforcement agents; and
· Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
This investigation was conducted by the Federal Bureau of Investigation in conjunction with the Spokane County Sheriff’s Office. The case was prosecuted by Alison L. Gregoire, an Assistant United States Attorney for the Eastern District of Washington.
Inglewood, California Man Sentenced to Five Years in Federal Prison for Conspiracy to Commit Mail and Wire FraudRead the Press Release
Spokane – Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced Erick Halkier Hansen, age 58, of Inglewood, California, was sentenced today by Chief United States District Judge Thomas O. Rice to five years in federal prison as a result of his conviction for Conspiracy to Commit Wire and Mail Fraud. Chief Judge Rice also ordered Hansen to pay $2,872,300 in restitution to 51 investors who lost money as a result of Hansen’s criminal activity and required Hansen to serve three years of supervised release upon the completion of his sentence. Previously, on June 9, 2016, Chief Judge Rice also sentenced Sean Michael Borzage Boyd of Provo, Utah to 3 years in federal prison for his role in the same conspiracy. Chief Judge Rice ordered Boyd to pay restitution along with Hansen.
On March 24, 2016, the Defendant pled guilty to Conspiracy to Commit Wire and Mail Fraud with regard to his operation of BlueStar Digital Technologies, Inc. (“BlueStar”) and related entities in Spokane, Washington from October, 1, 2010 through January 1, 2014. Hansen was the President and Chief Executive Officer of BlueStar during the timeframe alleged in the indictment. According to information disclosed during court proceedings, the conspiracy involved Hansen’s solicitation of funds from investors across the United States for three separate schemes.
First, in 2010 Hansen took funds from investors based on representations that BlueStar had a contract for the exclusive distribution rights to video footage of a recently deceased celebrity (the “Celebrity Footage”) and that BlueStar would replicate large numbers of Blu-ray Discs containing the Celebrity Footage for profit. Hansen knew, however, that: 1) BlueStar, was not capable of replicating large numbers of Blu-ray Discs at that time and therefore could not perform under the contract regarding the Celebrity Footage; and, 2) BlueStar took no meaningful steps to undertake any production or distribution of the Celebrity Footage on Blu-ray Discs.
Second, in 2012 Hansen took funds from investors based on representations that BlueStar had a contract with a film company to release an animated film that BlueStar would exclusively distribute, including through distribution on Blu-ray Discs. Hansen continued to take funds from investors after the contract with the film company expired based on BlueStar’s failure to perform under the contract.
Third, also in 2012, Hansen signed a non-binding memorandum of understanding with an individual and another film company wherein BlueStar and the film company agreed to explore the possibility of the film company investing in BlueStar. Hansen knew that the memorandum of understanding with the film company was not binding, but continued to collect investor funds as if the deal were imminent. The deal never materialized.
Chief Judge Rice found the total loss from Hansen’s criminal activity to be $2,872,300.
Michael C. Ormsby said, “Today’s sentence reflects the seriousness of this major fraud scheme. I commend the FBI, the IRS-CID, and the Washington State Department of Financial Institutions for their tireless efforts in pursuing the investigation of this case. Prosecuting fraud matters is a priority for the United States Attorney’s Office here in the Eastern District of Washington.”
The investigation of this case was conducted by: (a) the Federal Bureau of Investigation, (b) the Internal Revenue Service, Criminal Investigation, and (c) the Washington State Department of Financial Institutions. The case was prosecuted by James A. Goeke and George J.C. Jacobs III, Assistant U.S. Attorneys for the Eastern District of Washington.
Benton City Man Sentenced to 30 Years in Federal Prison for Sex TraffickingRead the Press Release
Spokane – Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced Roberto L. Llerenas, Jr., age 36, of Benton City, Washington, was sentenced today to 30 years in federal prison as a result of his convictions on four counts of trafficking two children under 18 for commercial sex.
On June 30, 2016, the defendant was found guilty by jury trial on two counts of Sex Trafficking of Children or Sex Trafficking by Force, Fraud or Coercion and two counts of Financially Benefiting from Sex Trafficking by Force, Fraud, or Coercion, all involving two victims.
Today, Senior United States District Judge Edward F. Shea, who presided over the trial, sentenced Llerenas to a total of 30 years in federal prison for each count of conviction, with the sentences to run concurrently. Judge Shea further ordered that Llerenas must spend the rest of his life on supervised release and must register as a sex offender.
Llerenas prostituted two fifteen-year-old girls between June 1, 2013 and July 13, 2013, in and around migrant worker camps, in the Pasco, Washington and Wenatchee, Washington areas. Llerenas had a pattern wherein he would bring the girls to a migrant worker camp, take cash from a migrant worker, hand the customer a condom, and whichever girl the customer chose would be made to have sex with the customer, typically on the concrete floor of a communal shower room.
Llerenas prostituted the girls against their will using force, threats, and coercion, all the while keeping the proceeds from the prostitution for himself. Both victims testified at trial about how Llerenas used manipulation, coercion, threats, and sometimes violence to cause them to engage in prostitution and to prevent them from reporting the offenses to authorities.
During the lengthy sentencing hearing that began on August 31, 2016 and concluded today, Senior Judge Shea recounted the basis for the jury’s four guilty verdicts against Llerenas and noted that the victims’ testimony, as well as the testimony of other witnesses, was thoroughly convincing. Judge Shea stated the Defendant “carried out a heartless plot to prostitute [the two victims] . . . so that he would benefit financially.” Judge Shea also found that Llerenas willfully obstructed justice when he offered “patently false” testimony on “all points of this case” and when Llerenas accused the victims of fabricating the charges against him. Judge Shea described Llerenas as “cunning” and stated that Llerenas’ testimony was flatly contradicted by the government’s witnesses and other evidence.
During the sentencing hearing, the two victims and members of the victims’ families were also able to address the Court and Llerenas, recounting the effect of Llerenas’ crimes and the need for a lengthy sentence. One victim noted the offense made her feel lost and like she had no control. She explained that she still is able to “remember it all so well.” The other victim explained she had to numb her feelings and set aside her emotions to get through the trafficking, but that she still holds in a lot of pain.
Michael C. Ormsby said “I commend the victims for their incredible courage in coming forward and testifying at great length in this case. The damage Llerenas caused the two victims for his own selfish benefit is immeasurable. The sentence handed down today reflects the seriousness of the defendant’s conduct. Federal, state, and local authorities will continue to investigate allegations of child exploitation and our office will continue to zealously prosecute those who sexually exploit minors and other vulnerable members of our society.”
The investigation of this case was conducted by the Federal Bureau of Investigation and the Benton County Sheriff’s Office. The case was prosecuted by Alison L. Gregoire and James A. Goeke, Assistant U.S. Attorneys for the Eastern District of Washington, as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. The Project Safe Childhood Initiative (“PSC”) has five major components:
· Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
· Participation of PSC partners in coordinated national initiatives;
· Increased federal enforcement in child pornography and enticement cases;
· Training of federal, state, and local law enforcement agents; and
· Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."