Western District of Washington
Press releases recorded for this federal judicial district.
Leader of large Seattle-based drug trafficking organization sentenced to 12.5 years in prisonRead the Press Release
Seattle – A Seattle man trafficking large amounts of cocaine in the Seattle area as a leader of a violent street gang was sentenced today in U.S. District Court in Seattle to 150 months in prison, announced U.S. Attorney Brian T. Moran. MICHAEL SCOTT MORGAN, 43, was arrested June 6, 2018, as part of a joint federal and state law enforcement effort targeting violent drug trafficking organizations. At the sentencing hearing, U.S. District Judge Richard A. Jones said trafficking drugs is not a victimless crime. “Every time you put drugs in the community, that could begin a lifetime of addiction, a lifetime prison sentence or overdose and death,” Judge Jones said.
“Not only did this defendant lead a drug dealing organization moving huge amounts of cocaine, he and his gang members are linked to violence throughout the region,” said U.S. Attorney Moran. “One look at his personal arsenal, which included assault weapons, high capacity magazines and even a weapon designed to pierce ballistic vests, and you know he needs to be off the streets for a significant period of time.”
According to records filed in the case, MORGAN is a leader of the East Union Street Hustlers street gang, a subset of the Black Gangster Disciples (BGDs). During various surveillance activities in 2017 and 2018, law enforcement identified MORGAN as the leader of a group trafficking large amounts of cocaine, heroin, methamphetamine and other drugs. The group was linked to violence, including shootings and an assault at a casino.
Much of the drug proceeds were laundered through area casinos, with MORGAN depositing more than $750,000 between January 2017 and January 2018.
On the date of the drug takedown, in June 2018, law enforcement seized six firearms at MORGAN’s residence: a loaded Glock pistol with loaded spare magazines: a Smith and Wesson “Bodyguard” .380 semiautomatic pistol; a .38 caliber revolver; a combat shotgun; a loaded AK-47-style assault pistol and a PS-90 PDW (personal defense weapon) which fires rounds designed to puncture body armor. Also at the residence, law enforcement seized 41 cell phones, $66,000 in cash, and jewelry valued at more than $265,000.
MORGAN has a lengthy criminal history, including firearms offenses as a juvenile and adult, drug offenses, forgery, eluding and assault.
On June 26, 2019, MORGAN pleaded guilty to conspiracy to distribute controlled substances, being a felon in possession of a firearm and money laundering.
In all, 42 defendants have pleaded guilty in connection with the drug trafficking conspiracy. The most significant sentences in the case to date range from five years in prison to 11.5 years in prison.
This was an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation, providing supplemental federal funding to the federal and state agencies involved. This investigation was led by the Seattle Police Department Gang and Narcotics Units, FBI Seattle Safe Streets Task Force, and the Drug Enforcement Administration (DEA). Other agencies providing investigative assistance include ATF, USMS, and the U.S Bureau of Prisons.
The case is being prosecuted by Assistant United States Attorneys Vince Lombardi, Erin Becker and Nicholas Manheim.
A sentencing exhibit with photos from the June 6, 2018 operation is attached to this release.
morgan_exhibit.pdfDOJ reaches $6.4 million settlement with large engineering and scientific consulting firm regarding overbilling on government contractsRead the Press Release
Seattle – The U.S. Department of Justice and CH2M Hill have reached a $6.4 million settlement to resolve allegations that CH2M Hill overbilled the U.S. Air Force for environmental consulting work and then continued to overbill despite an audit highlighting the problem, announced U.S. Attorney Brian T. Moran. At issue is the use of consulting staff who did not meet the minimum educational requirements of two Air Force contracts.
“We rely on those who apply for, and receive, government contracts to fulfill their end of the deal -- and that includes making sure that the personnel on the job are qualified for the job,” said U.S. Attorney Brian T. Moran. “As stewards of American's tax dollars, we need to make sure we get what we paid for.”
According to the settlement agreement, in 2017, CH2M Hill headquartered in Englewood, Colorado and with offices in Bellevue, Washington, reported an overpayment from the Air Force and paid the government $10,529,707. The sum represents $8,323,179 in overbilling and $2,206,528 in interest between 2003 and 2014. In connection with that agreement, CH2M Hill admits that it billed under the government contract for employees who did not meet the educational and work experience qualifications in the contract.
The government contends that CH2M Hill knew of the overpayment as early as 2011, but attempted to keep the information secret by claiming that an audit of its labor practices was privileged information. Under the law, the government is allowed to collect double damages, but due to statute of limitations constraints, that amount is capped at $6,400,000.
“This investigation highlights the patience and perseverance of the Air Force Office of Special Investigations’ Office of Procurement Fraud Investigations and our Department of Defense and Department of Justice partners, who work diligently day in and day out to identify and neutralize fraudulent activity affecting the DoD and our U.S. Government,” said Special Agent Anthony Walker, AFOSI Office of Procurement Fraud Investigations, Detachment 2. “No company or person who defrauds the U.S. Government is outside of the reach of justice.”
CH2M Hill is not admitting any wrongdoing with the settlement, which resolves all claims.
The case was investigated by the Defense Contract Audit Agency (DCAA) and the settlement was negotiated by Assistant United States Attorneys Kayla Stahman and Pooja Davé.
Sixteen indicted for trafficking large amounts of heroin and methamphetamine in Seattle areaRead the Press Release
Seattle – Federal, state and local law enforcement fanned-out across the Puget Sound region today arresting 17 people in connection with multiple counts of drug trafficking, announced U.S. Attorney Brian T. Moran. The drug trafficking organization brought large loads of heroin and methamphetamine into the Seattle area – in one instance law enforcement seized 33 pounds of meth and 14 pounds of heroin.
“Federal law enforcement continues to target those who seek to poison our communities and to line their pockets on the misery of others,” said U.S. Attorney Moran. “I commend the men and women of law enforcement who put their lives on the line to stem those who traffic in violence, addiction and death.”
“At the height of the opioid epidemic, the Pacific Northwest is also drowning in methamphetamine,” said DEA Special Agent in Charge Keith Weis. “Today’s enforcement operation is another example of the focused effort by law enforcement against those transnational distribution cells most responsible for opening the floodgates.” He further added, “In the last year, DEA working with other federal, state and local law enforcement, have seized 3,400 pounds of methamphetamine, representing a record amount for the region.”
The investigation into this criminal group began in September 2018 and utilized undercover purchases as well as various types of surveillance.
Of those arrested, fourteen are indicted for conspiracy to distribute controlled substances. Various individuals are indicted for specific instances of distributing methamphetamine, heroin or both. Three additional people were arrested and one of those people is charged by criminal complaint following today’s searches. Those indicted by the grand jury include:
Daniel Hernandez-Hernandez, 35, Seattle
Doriam German Moreno-Rocha, 29, SeaTac, Washington
Adrian Alberto Sanchez-Esparza, 30, Madera, California
Fernando Bautista-Sanchez, 43, Auburn, Washington
Angela Davina Encinas, 38, Auburn, Washington
Norberto Flores-Lopez, 22, Pacific, Washington
Faustino Islas-Estrada, 52, SeaTac, Washington
Omar Salazar, 32, Federal Way, Washington
Manuela Gabriele Zahn, 56, Olympia, Washington
Adam Mark Bishop, 35, Tacoma
Mitchell Eugene Vaughan, 33, Puyallup, Washington
Ryan Lee Isaksen, 28, Spanaway, Washington
Karissa Jean Mason, 36, Seattle
Anthony Jacques McKinney, 38, Lakewood, Washington
Luis Manuel Rivera-Leriget, 44, San Diego
Karina Rodriguez, 39, Newman, California
During today’s arrest operation law enforcement seized 4.5 pounds of meth and 13 pounds of heroin, $10,000 cash and six firearms. Over the course of the investigation, law enforcement seized 37.5 pounds of methamphetamine, 27 pounds of heroin and $40,000 in drug proceeds.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
This was an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation, providing supplemental federal funding to the federal and state agencies involved.
The investigation was led by the Drug Enforcement Administration’s (DEA) Tacoma Resident Office and the Tahoma Narcotics Enforcement Team (TNET) and the Burien Police Department (BPD) Street Team. TNET is comprised of the Tacoma, Lakewood, Auburn, Bonney Lake, and Puyallup Police Departments, the Pierce County Sheriff’s Office and the Washington State Department of Corrections (DOC). Other assisting agencies include the Kent Police Department and the King County Sheriff’s Office SeaTac Police Department Street Team. The investigation was supported by North West High Intensity Drug Trafficking Area (NW HIDTA).
In addition to the agencies listed above, these law enforcement agencies assisted with the arrests and search warrants executed today: King County SWAT, Valley SWAT, Pierce County SWAT, Washington State Patrol SWAT, Lakewood Police Tactical Team, Valley Narcotics Enforcement Team (VNET), Joint Narcotics Enforcement Team (VNET), West Sound Narcotics Enforcement Team (WestNet), Lewis County Sheriff’s Office, Grays Harbor Sheriff’s Office, Hoquiam Police Department and Aberdeen Police Department.
The case is being prosecuted by Assistant United States Attorneys Andrew Colasurdo and Marci Ellsworth.
DEA Drug and cash seized in investigationU.S. Department of Justice awards Washington State nearly $5.3 million for testing backlog of sexual assault kitsRead the Press Release
Seattle – U.S. Attorney Brian T. Moran announced today that the Washington State Patrol and the State Attorney General’s Office received four grants totaling nearly $5.3 million to reduce the backlog of untested rape kits and improve the scientific capacity of the state crime labs.
“In my long career as a prosecutor, I saw first-hand the value of DNA evidence to solve crimes and get violent predators off the street,” said U.S. Attorney Moran. “DOJ understands that we cannot leave untested evidence languishing in storage. These funds will help Washington keep up with the scientific advances in DNA that can both identify the guilty and exonerate the innocent.”
The Washington State Attorney General’s Office was awarded two grants: $1.5 million is directed at inventorying, testing and tracking unsubmitted rape kits and an additional $1 million was awarded to expand the collection of DNA from offenders and its submission to the Combined DNA Index System (CODIS).
The Washington State Patrol was awarded two grants totaling more than $2.7 million. The largest grant, $1,857,667 is to increase the capacity of all the WSP crime labs, including equipping a new DNA section in the Vancouver, Washington crime lab. One goal of the grant is to reduce the backlog of cases. The second WSP lab grant for $920,951 is aimed at digitizing and storing some 480,000 case records currently archived in off-site storage so that they can more easily be accessed for investigation.
The grants were awarded by the Bureau of Justice Assistance and the National Institute of Justice.
For additional information on individual grants, please contact the recipient organizations.
Youth safety and support is the focus of four U.S. DOJ grantsRead the Press Release
Seattle – About $2 million in U.S. Department of Justice grant funding will flow into Washington State to bolster youth safety, combat gang activity and reduce racial disparities in the juvenile criminal justice system, announced U.S. Attorney Brian T. Moran.
“These grants support efforts to intervene early and stop youth crime and violence before it damages our community,” said U.S. Attorney Moran. “The grant to Seattle Public Schools may even save lives by stopping school violence before a tragedy happens.”
Seattle Public Schools was awarded $496,945 as part of the STOP School Violence Prevention and Mental Health Training Program. The funding will provide students and teachers with training to recognize and respond quickly to violence and to prevent acts of violence. The district will develop threat assessments and crisis intervention teams and an anonymous reporting system for threats, including those from people with mental health issues.
The Washington State Department of Social and Health Services received $872,897 for its work to reduce racial and ethnic disparities in the Washington State juvenile justice system. DSHS’ Office of Juvenile Justice is partnering with the Center for Study and Advancement of Justice Effectiveness (a joint operation of the University of Washington and Washington State University) and the Washington State Center for Court research. One goal is to build more culturally responsive and effective services into pre-court diversion.
The Children and Youth Justice Center received a $500,000 grant for its program to reduce gang related criminal activity. The grant monies will be used to expand and enhance gang prevention, gang resistance and intervention programs, and to expand community awareness about gang violence and its negative effects.
Finally, King County received $171,026 in funding for the newly constructed Children and Family Justice Center. The funding will focus on recruiting quality juvenile detention officers for the new facility.
For additional information on individual grants, please contact the recipient organizations. A fact sheet from DOJ is attached to this release.
department_of_justice_invests_about_85.pdfKent, Washington man who made multiple online threats sentenced to 5 years in prisonRead the Press Release
Seattle – A 27-year-old Kent, Washington, man was sentenced today in U.S. District Court in Seattle to five years in prison and three years of supervised release for two counts of making interstate threats. CHASE BLISS COLASURDO made multiple online posts threatening members of President Trump’s family and media figures in Southern California and made threats to bomb synagogues. COLASURDO, was arrested May 1, 2019 after he attempted to purchase a firearm. At the sentencing hearing Chief U.S. District Judge Ricardo S. Martinez said, “Mental illness may explain the intensity, but it does not excuse the actions that he took or the threats that he made instilling fear in his victims.”
“This case shines a spotlight on the frightening intersection of mental illness and weapons,” said U.S. Attorney Moran. “I commend law enforcement who closely monitored this defendant so that he was arrested before he could commit any violent acts. Supervision following prison is designed to stop him from such frightening threats and behavior in the future.”
According to records in the case, in March 2019, a member of the public reported to the FBI concerns about Instagram and other social media posts where COLASURDO threatened to execute members of President Donald Trump’s family. Additionally, COLASURDO sent messages to five different media organizations that he was going to execute the family member. COLASURDO posted a photo on Instagram showing a hand with a firearm pointed at the photo of a Trump family member. When initially contacted by law enforcement in March, COLASURDO claimed his social media accounts had been hacked.
Despite his statements that he was not responsible for the posts, COLASURDO continued to make threatening comments, specifically threats to members of the Jewish community. In one post, he wrote it was time to start “bombing synagogues.” Throughout April 2019, COLASURDO sent threatening email messages and online posts to media figures in Southern California using anti-Semitic slurs and threats to kill. As law enforcement continued to track his activity, it became clear he was purchasing various items related to firearms, such as a holster, bulletproof vest, and ammunition. COLASURDO attempted to purchase a firearm but was denied.
When law enforcement served search warrants at COLASURDO’s apartment, they recovered Nazi and Adolph Hitler related items, as well as ammunition, night vision goggles, and a gas mask.
“People need to understand that such threats will be taken seriously,” Chief Judge Martinez said. “It makes no difference to the victims that the person was mentally ill.”
The case was investigated by the FBI and U.S. Secret Service, in conjunction with an investigation by the Los Angeles Police Department. Significant assistance was provided by the Sound Regional Violent Crimes Task Force. The case was prosecuted by Assistant United States Attorney Todd Greenberg
Canadian seafood wholesaler, and owner, plead guilty to illegally importing fish into U.SRead the Press Release
Seattle – Seven Seas Fish Company, Ltd of Richmond, BC Canada, and a company owner JOHN HERAS, 78, of Delta, B.C, pleaded guilty today in U.S. District Court in Seattle to importation of previously refused food. The company and HERAS admit that between October 2014 and August 2015, they imported more than 9,000 pounds of potentially adulterated fish into the U.S. The fish had previously been refused entry into the U.S., because the FDA judged samples of the fish too decomposed and putrid. Seven Seas has agreed to pay a $150,000 fine. HERAS could face to up to a year in prison when sentenced by U.S. Magistrate Judge Mary Alice Theiler on February 7, 2020.
According to records filed in the case, in June 2014, Seven Seas purchased 12,100 pounds of frozen corvina, a white fish similar to sea bass. The fish was purchased for $36,375 from a seafood company in Mexico. Seven Seas attempted to have the fish imported into the U.S. at the Otay Mesa Port of Entry. However, when Food and Drug Administration (FDA) Consumer Safety Officers examined the fish, they determined that one third of the samples from the shipment were more than 20 percent spoiled. The shipment was refused entry to the U.S. However, Seven Seas arranged for the fish to be lawfully shipped through the U.S. to its plant in Richmond, BC, claiming that the product would be distributed in Canada.
After the fish arrived in B.C., HERAS cooked and ate some of the fish and claimed he found nothing wrong with it. Despite his knowledge that the fish had been refused entry to the U.S., HERAS encouraged others within Seven Seas to sell the fish to customers in Washington State and elsewhere. Some 9,020 pounds of the fish was imported into the U.S. without the required notice to the Secretary of Health and Human services.
The FDA has not found any illness linked to those who consumed the fish.
Importation of previously refused food is punishable by up to a year in prison. Prosecutors have agreed to recommend a probationary sentence for HERAS, but the ultimate sentence will be determined by Magistrate Judge Theiler based on the sentencing guidelines and other statutory factors.
The case was investigated by the FDA Office of Criminal Investigation, Customs and Border Protection (CBP) and Homeland Security Investigations. The case was prosecuted by Assistant United States Attorney Matthew Diggs.
Four Western Washington organizations receive U.S. DOJ grants totaling more than $2 million to support victims of human traffickingRead the Press Release
Seattle – U.S. Attorney Brian T. Moran announced Department of Justice grants for four organizations in Western Washington who are working to rescue and support victims of human trafficking. The organizations work with young people and one has a special focus on Native American victims.
“I’m pleased that the Seattle Indian Health Board received funding under DOJ’s Project Beacon – designed to increase services for Native Americans living in urban areas,” said U.S. Attorney Moran. “As we work to address the problem of Murdered and Missing Indigenous Women, developing services and informing the community about the scourge of sex trafficking is critically important.”
The Seattle Indian Health Board received a $450,000 grant to build a referral network for sex trafficking victims, to educate the public and to train providers about culturally appropriate treatment for Native victims of sex trafficking.
YouthCare in Seattle received a $571,307 grant to support victims of human trafficking. YouthCare works with homeless, street-involved and sexually exploited youth ages 12-24. These funds are to provide case management, training and coordination among a variety of organizations serving young people.
Real Escape from the Sex Trade in Seattle’s Rainier Valley will receive a $500,000 grant to launch the Economic Leadership and Empowerment Academy to provide training in a job readiness program. The program will be designed specifically for victims of sex trafficking, providing internships and employment placement as well as monthly leadership development workshops.
In Everett, Cocoon House received a $500,000 grant. The grant will expand services for Snohomish County trafficking victims under age 18. The organization plans to add a Human Trafficking Advocate and Program Coordinator so that it can provide services to at least 100 trafficked or at-risk youth.
For additional information on individual grants, please contact the recipient organizations.
U.S. DOJ awards federal grants aimed at battling opioid epidemicRead the Press Release
Seattle – U.S. Attorney Brian T. Moran today announced significant grants to Western Washington counties and health departments to battle the opioid epidemic. The Washington State Health Department, King County, Whatcom County, Skagit County and Pacific County were all awarded U.S. Department of Justice grant funding.
“Many of these grants are aimed at providing treatment and support to those who are reentering society after prison sentences,” said U.S. Attorney Moran. “With these funds DOJ is making a commitment to breaking the harmful cycle of substance abuse and incarceration.”
Pacific County in Southwest Washington was awarded two grants totaling $1,250,000 to focus on substance abuse and reentry from prison. The bulk of the grant funds support the Pacific County Second Chance Reentry Program that works to reduce recidivism of individuals with substance abuse and mental disorders.
Whatcom County received a $900,000 grant to implement a Law Enforcement Assisted Diversion (LEAD) program to expand access to treatment and recovery support services in the criminal justice system. The Whatcom County Prosecutor’s Office will partner with law enforcement, public defenders, the local health department and health care providers on diversion to treatment and supportive housing options.
The Seattle King County Health Department was awarded $1.2 million to focus on treatment within the corrections system and the transition to community based substance abuse treatment options. The support will assist those with substance abuse disorder as they leave prison and connect to community treatment providers.
Skagit County was awarded $997,407 to support innovative work in reentry from prison to the community. The Jail to Community Transitions Program aims to reduce recidivism with data driven programs that focus on public safety. The program is expected to serve 200 participants.
The Washington State Department of Health was awarded nearly $2 million to support its prescription monitoring program. The $1,996,316 grant will improve the monitoring of opioid prescriptions for educational and law enforcement purposes.
The Washington State Health Care Authority was awarded two grants totaling $222,637 to provide residential drug treatment in jails and prisons.
For additional information on individual grants, please contact the recipient organizations.
U.S. DOJ awards $6.3 million to local and state law enforcementRead the Press Release
Seattle – U.S. Attorney Brian T. Moran today announced more than $6 million in federal grant funds to support law enforcement officers and community safety in Washington. Speaking at Microsoft for the 2019 Regional Conference for the Internet Crimes Against Children (ICAC) Task Forces, U.S. Attorney Moran congratulated the Seattle Police based ICAC for successfully competing for a $606,404 grant to support ICAC investigations in 25 of Washington’s 39 counties.
“More than 100 partner law enforcement agencies are working with the Seattle based ICAC to investigate predators who are using the internet to lure children and steal their innocence,” said Moran. “These grant monies are a tangible indication of how important our ICAC task forces are – they are literally saving children from predation and exploitation, and we owe the men and women who have devoted their professional lives to preventing these crimes a debt of gratitude.”
The ICAC grant is just one of a number of grant awards to law enforcement at the state and local level to enhance public safety. Just over $3.3 million was awarded to Washington State as part of the Edward Byrne Memorial Justice Assistance Grant program. The monies will be funneled to state and local organizations supporting a variety of initiatives including anti-gang and drug task forces, crime prevention, and officer safety.
Other Byrne grants include: $672,410 to the City of Seattle; $290,738 to Tacoma; $96,127 to Clark County; $51,888 to Snohomish County; $35,915 to Kitsap County; $20,200 to Bremerton; $36,076 to Bellingham; $41,723 to Lakewood; $13,585 to Marysville; and $12,972 to Longview.
The Washington Association of Sheriffs and Police Chiefs were awarded two grants totaling $368,667 under the Project Safe Neighborhood program. The grant monies are used to support gang task forces working to reduce violent crime, firearms offenses, human trafficking and drug trafficking.
Finally, under the National Officer Safety Initiatives Program, Polis Solutions of Seattle was awarded $750,000 to evaluate and update defensive training for state, local, tribal and territorial law enforcement agencies. The grant is to develop a model defensive tactics training program that law enforcement agencies and academies can implement.
The Byrne Grants are named in honor of New York City Police Officer Edward R. Byrne, who was killed in the line of duty on February 26, 1988. Officer Byrne was just 22-years-old.
For additional information on individual grants, please contact the recipient organizations.
Citizen of Singapore indicted in scheme to steal cloud computing power for cryptocurrency miningRead the Press Release
Seattle - A 14-count indictment was unsealed today charging a citizen of Singapore, HO JUN JIA, a/k/a Matthew Ho, 29, with federal crimes related to his scheme to mine cryptocurrencies using stolen computing power and services, obtained with the stolen identity and credit card account information of California and Texas residents, announced U.S. Attorney Brian T. Moran. HO was taken into custody by the Singapore Police Force on September 26, 2019, and is being investigated for various alleged offenses committed under Singapore law.
According to the indictment, between October 2017 and February 2018, following the surge in popularity, and value, of cryptocurrencies, HO ran a large-scale cryptocurrency mining operation, propelled predominantly, if not exclusively, through fraud and identity theft. HO, allegedly used stolen identity and credit card information of a prominent California video-game developer to open cloud computing accounts at multiple U.S. cloud service providers, which he used to mine various cryptocurrencies, such as Bitcoin and Ethereum. HO created a web of phony email accounts and used social engineering techniques to trick cloud computing providers to approve heightened account privileges, increased computer processing power and storage, and deferred billing.
HO used the fraudulently obtained computing power to mine cryptocurrency – a resource-intensive process by which “miners” essentially compete to verify blockchain transactions and receive an amount of cryptocurrency in return. HO then used the cryptocurrency or exchanged it for traditional funds on various marketplace websites. In the few months his scheme remained active, HO consumed more than $5 million in unpaid cloud computing services with his mining operation and, for a brief period, was one of Amazon Web Services (AWS) largest consumers of data usage by volume. Some of the bills were paid by the California game developer’s financial staff before the fraud was detected. HO also used the identities of a Texas resident and the founder of a tech company in India and, in addition to AWS, opened cloud services accounts with Google Cloud Services, which he similarly used as part of his cryptocurrency mining operation.
Wire fraud is punishable by up to 20 years in prison. Access device fraud is punishable by up to ten years in prison. Aggravated identity theft is punishable by a mandatory two years in prison to run consecutive to any other sentence imposed in the case.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by the FBI Seattle Office, Cyber Crime Unit, with assistance from the Singapore Police Force - Technology Crime Investigation Branch, the Attorney General’s Chambers of Singapore, the U.S. Department of Justice’s Criminal Division’s Office of International Affairs, and the FBI Legal Attaché Office.
The case is being prosecuted by Assistant United States Attorney Steven Masada.
ho_indictment.pdfTen Tribes in Western Washington awarded nearly $13 million to strengthen law enforcement and provide services for crime victimsRead the Press Release
Ten Indian Tribes in Western Washington have been awarded nearly $13 million in U.S. Department of Justice grant funding to enhance criminal justice and safety in their communities, announced U.S. Attorney Brian T. Moran. One notable grant will fund a Special Assistant U.S. Attorney to work with the FBI’s Northwestern Washington Safe Trails Task Force to prosecute crime in tribal communities. The $482,419 three-year grant was awarded to the Swinomish Tribal Community, though the attorney will prosecute cases for a consortium of tribes located in northwest Washington.
“These grants provide a wide range of services in our tribal communities – everything from services for crime victims, to sex offender monitoring, to reducing alcohol and drug related crime,” said U.S. Attorney Moran. “It is a competitive process to obtain these grants, and I congratulate our tribal partners on their successful applications.”
The Lummi Indian Nation in Bellingham was awarded four grants totaling $2.5 million. The funded programs include: $748,608 to enhance tribal justice programs and reduce Alcohol and substance abuse related crime; $720,000 to support crime victims; $374,994 to support programs to reduce Elder Abuse; and $720,000 to hire a tribal attorney and advocate to assist crime victims with civil litigation.
The Swinomish Tribal Community in La Conner was awarded four grants totaling $1.4 million. In addition to the $482,419 for a designated attorney, the Tribe was awarded two additional grants totaling $802,205 to support services for crime victims. An additional grant of $134,267 will pay for personnel to enter 10 years of historical data into the nationwide National Criminal Background Check System.
Tulalip Tribes of Washington was awarded three grants totaling $1.5 million. A $643,871 grant will enhance the tribes family drug court program working to get parents into treatment and reunite families. Two additional grants totaling $926,845 will got to support services for victims of crime.
Port Gamble S’Klallam Tribe in Kingston was awarded three grants totaling nearly $1.5 million: An $898,000 grant to enhance the tribal justice system; $491,542 to support victims of crime; and $108,750 to enhance sex offender monitoring.
Puyallup Tribe of Indians were awarded two grants: $783,873 to improve the Tribal justice system and $717,292 to support victims of crime.
The Makah Tribe in Neah Bay was awarded $498,796 to support their drug court and $719,528 to support victims of crime.
The Confederated Tribes of Chehalis Reservation in Oakville were awarded $750,000 to strengthen their tribal justice system and $369,213 to support services for crime victims.
The Skokomish Indian Tribe was awarded $374,633 to improve their sex offender monitoring program and $488,978 to improve services for crime victims.
The Hoh Indian Tribe in Forks was awarded $514,778 to expand victim services with a special focus on educating the community on human trafficking and Missing and Murdered Indigenous Women and Girls.
The Quinault Indian Nation in Taholah was awarded $480,187 to enhance victim services.
The grants were awarded by a variety of DOJ agencies including the Office of Victims of Crime, the Bureau of Justice Assistance and the Office of Juvenile Justice and Delinquency Prevention.
For additional information on individual grants, please contact the recipient organizations.
U.S. DOJ awards nearly $10 million in grants to state, local and tribal entities to support services for victims of domestic violence and sexual assaultRead the Press Release
The U.S. Department of Justice has awarded grants totaling more than $9.8 million to support victims of domestic violence and sexual assault in Western Washington, announced U.S. Attorney Brian T. Moran. The grants run for the next one to three years, and some are supporting services in Tribal and Latino communities, as well as in rural areas.
“October is domestic violence awareness month, and an appropriate time to highlight the good work being done in our state to assist victims of domestic and sexual violence,” said U.S. Attorney Brian T. Moran. “In successfully competing for these grant dollars, these programs are demonstrating leadership on making a difference in their communities.”
The grants awarded over the last month include:
- $500,000 to the City of Longview, Wash., to improve criminal justice services to victims of domestic violence and sexual assault. The funding will pay for a domestic violence detective for Longview Police, as well as a domestic violence advocate and special training for prosecutors on domestic violence cases;
- $285,500 for Consejo Counseling and Referral Services of Seattle to provide culturally appropriate services to the Latino community;
- $285,500 to the Seattle Indian Health Board to provide culturally appropriate services to Urban Native survivors of violence and sexual assault;
- $450,000 to the Crisis Support Network in Raymond, Wash., to provide 30 housing units to survivors of domestic violence and sexual assault; and
- $437,192 to Turning Pointe Survivor Advocacy Center in Shelton, Wash., to work with the Shelton Police Department and Mason County Prosecutor’s Office to provide assistance to children exposed to domestic violence.
Five Indian Tribes received grants to strengthen their criminal justice programs for dealing with domestic violence and for providing support and resources for victims. Two tribal coalitions based in Western Washington also received grants. These include:
- $826,017 to the Confederated Tribes of the Chehalis Reservation;
- $450,000 to the Lummi Indian Nation;
- $302,979 to the Suquamish Indian Tribe of the Port Madison Reservation;
- $450,000 for the Nooksack Indian Tribe;
- $900,000 for the Cowlitz Indian Tribe;
- $323,007 to Washington State Native American Coalition Against Domestic Violence in Silverdale, Wash.; and
- $500,000 to Alliance of Tribal Coalitions to End Violence in Silverdale, Wash.
Finally, a number of local organizations will be supported with grant money that is funneled through the state and coalitions of nonprofit organizations:
- $90,975 to Washington State Coalition Against Domestic Violence;
- $151,242 to Washington Coalition of Sexual Assault programs; and
- $3.9 million be distributed through the Washington Department of Commerce to programs that encourage cooperation between law enforcement, prosecutors, courts and victim services to support victims of domestic violence and sexual assault. Some of these funds also support rape crisis centers and non-profits working with victims.
All of the grants were awarded by DOJ’s Office of Violence Against Women. For additional information on individual grants, please contact the recipient organizations.
Former online brokerage employee sentenced to prison for wire fraudRead the Press Release
Seattle – A former Washington State football player who had brief stints with two NFL teams was sentenced today to one year in prison for his kickback scheme that defrauded his employer of $1.5 million. AUGUSTINE OLOBIA, 49, of Hurst, Texas, pleaded guilty in April 2019 to wire fraud, admitting he took kickbacks for falsifying data on account referrals while he was employed at ShareBuilder. At the sentencing hearing, U.S. District Judge Robert S. Lasnik told him, “You made a severe mistake… You were taking too much pride in things that didn’t matter.”
According to records filed in the case, OLOBIA worked at ShareBuilder in Seattle from 1999 to 2013. OLOBIA was responsible for managing the third-party vendors who advertised ShareBuilder’s services. Those vendors were paid on a “bounty system.” For example, ShareBuilder paid Tega Creative $40-$55 per account that was opened after a customer opened a brokerage account at ShareBuilder as a result of Tega Creative’s marketing efforts. OLOBIA manipulated data in ShareBuilder’s computer system to vastly inflate the number of account openings attributable to Tega Creative’s marketing. Then he approved invoices issued by Tega Creative that were based on the inflated numbers. For example in 2007, Tega Creative was credited with about 2,000 account openings. In 2008, as a result of the fraud, Tega Creative was credited with 10,000 account openings. OLOBIA was secretly paid about one-third of the gross monthly payment from ShareBuilder to Tega Creative. The loss to ShareBuilder’s owner, Capital One, is estimated at more than $1.5 million.
The scheme was uncovered when OLOBIA left ShareBuilder and other employees tried to reconcile the number of accounts attributed to Tega Creative.
In asking for the prison sentence, prosecutors noted that OLOBIA had a fortunate upbringing as a child in Nigeria, and later as a member of the Nigerian Olympic team. He was a recruited athlete at a university in Houston and later as a football player at WSU. He graduated with a degree in business administration and held a number of good jobs. Despite those advantages, OLOBIA engaged in a fraud that lasted about five years and cost his employer $1.5 million.
In addition to the prison term, Judge Lasnik ordered OLOBIA to forfeit $500,000 – the amount he gained from the scheme. Restitution will be determined at a hearing on December 6, 2019.
The case was investigated by the FBI. The case is being prosecuted by Assistant United States Attorney Michael Dion.
Olalla, WA man arrested in scheme to steal identity and Social Security benefits from missing brotherRead the Press Release
Tacoma – An Olalla, Washington man is under arrest on a criminal complaint charging him with aggravated identity theft and access device fraud for his scheme to steal the identity and income of his missing brother. CHRIS HARVEY SAYLER, 72, allegedly began fraudulently collecting his missing brother’s Social Security Disability benefits by at least 1998. Over the last twenty years, those benefits total more than $400,000. SAYLER made his initial appearance on the criminal complaint in U.S. District Court in Tacoma today. He remains detained pending a further hearing on Friday October 4, 2019.
According to the complaint, CHRIS SAYLER’s brother, Jarvis L. Sayler, traveled from his home in Missouri to the Vancouver, Washington area in 1988. He told relatives that he planned to visit CHRIS SAYLER, then return to Missouri to build a home on property there. Jarvis Sayler was born with partial eyesight, and had been receiving Social Security disability benefits since 1977. Jarvis Sayler wrote a few letters to Missouri between June and September 1988, but that was the last anyone heard from him. A third brother in Missouri reported Jarvis Sayler missing in March of 1989. The Clark County Sheriff’s Office interviewed CHRIS SAYLER about his brother’s whereabouts. SAYLER claimed his brother moved from his home after the two had an argument. That was the last reported sighting of Jarvis Sayler.
In 2013, a person claiming to be Jarvis Sayler attempted to renew a Washington State ID card, but the renewal was denied because facial recognition software indicated the person in the ID photo was the same as in a drivers license photo of CHRIS SAYLER. When SAYLER went to a Department of Licensing Office to renew a license (in the SAYLER name) years later, he claimed that he and Jarvis were twins and that was the reason for the facial recognition report. The clerk pointed out that the two men’s birthdates were four years apart, but SAYLER said it is a “rare twin situation” that does occur. The investigation has revealed that SAYLER and Jarvis Sayler are not biologically related.
In 2019, the Department of Licensing referred the matter to the Social Security Office of Inspector General (SSA-OIG) for investigation. The investigation revealed that as early as 1998, SAYLER’s photo appears on Jarvis Sayler’s identification card and that the addresses on Jarvis’ cards and other identifying documents are associated with SAYLER.
Since at least 1998, Jarvis Sayler’s Social Security benefits went to a bank account opened with an address in Vancouver, Washington. When SAYLER moved to Olalla, the address on the account was updated to the new address as well. ATM withdrawal records and debit card records from retailers such as Costco and Fred Meyer show SAYLER withdrawing money or making purchases with the debit card associated with Jarvis Sayler’s account.
Access device fraud is punishable by up to ten years in prison. Aggravated identity theft is punishable by a mandatory minimum two-year sentence to run consecutive to any other sentencing in the case.
The charges contained in the complaint are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The Clark County Sheriff’s Office is interested in hearing from anyone who has information on Jarvis Sayler and his disappearance. Contact Detective Jon Shields at 564-397-2120.
The case is being investigated by the Social Security Office of Inspector General (SSA-OIG), Health and Human Services Office of Inspector General (HHS-OIG), and Homeland Security Investigations (HSI) as part of the Document and Benefit Fraud Task Force in Seattle. Investigative assistance was also provided by the FBI and Sheriff’s Offices for Clark County, Cowlitz County, and Kitsap County.
The case is being prosecuted by Special Assistant United States Attorney Benjamin Diggs. Mr. Diggs is an attorney with the Social Security Administration specially designated to prosecute fraud cases in federal court.
sayler_complaint_0.pdfDistributor of potentially tainted pills charged in federal court with drug crimesRead the Press Release
A Bellingham, WA man was charged in federal court today with two drug crimes related to cocaine and heroin found in his apartment, announced U.S. Attorney Brian T. Moran. TONY LEE WILLIAMS, 33, was arrested this morning following an investigation by the Lummi Tribal Police and the FBI. The investigation began late yesterday, when medics responded to a home on the Lummi reservation where a woman was unresponsive. The woman could not be revived with NARCAN and is deceased. Pills ingested by the woman are linked to those sold by WILLIAMS. Lab analysis of the pills is underway to determine whether they are tainted with a substance such as fentanyl.
“It is critically important that the word go out about these potentially deadly pills,” said U.S. Attorney Brian T. Moran. “Right now we don’t know whether the pills are directly connected to the death. However, anyone buying street pills that appear to be oxycodone 30s – like those described in this case -- could be risking his or her life by ingesting them.”
The pills were sold to those associated with nightclubs in Bellingham, as well as on the Lummi Reservation.
WILLIAMS is charged with possession of cocaine with intent to distribute and possession of heroin with intent to distribute. According to the criminal complaint, WILLIAMS sold the pills to a brother and sister who distributed them to others. When law enforcement searched WILLIAMS’ apartment, they recovered cocaine, heroin, and 30 additional pills that appear to be oxycodone.
The drug crimes are punishable by up to 20 years in prison.
The charges contained in the complaint are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The case is being prosecuted by Assistant United States Attorneys Rebecca Cohen, Chantelle Dial, and J. Tate London.
williams_complaint.pdfTimber thieves indicted in conspiracy that started 3,300-acre forest fireRead the Press Release
Seattle – Two former Hood Canal area residents are under arrest on an indictment charging eight federal felonies related to their scheme to steal the wood of big leaf maple trees from Olympic National Forest, announced U.S. Attorney Brian T. Moran. The indictment alleges that between April and August 2018, JUSTIN ANDREW WILKE and SHAWN EDWARD WILLIAMS felled and sold publicly-owned maple trees. The indictment alleges that, in August 2018, the defendants started a forest fire when they set fire to a bee’s nest in a tree they were trying to unlawfully harvest from the National Forest land. The resulting fire – known as “The Maple Fire” – burned more than 3,300 acres between August and November 2018 and cost approximately $4.5 million to contain.
According to the indictment, as early as April 2018, the defendants traveled into areas of the Olympic National Forest to scout for big leaf maple trees that might contain ‘figured’ wood – wood that is highly prized for musical instruments. The men looked for maple trees they could steal in areas around Elk Lake and Lena Lake. The men then cut the maple trees, took blocks of wood from the trees to a property near Lilliwaup, Washington, and sold the blocks to a lumber mill in Tumwater, Washington. The conspirators presented the mill owner with permits claiming the maple had been harvested on private land, when in fact it had been illegally cut and stolen from the National Forest.
In early August 2018, after selling thousands of dollars’ worth of maple to the mill, WILKE and WILLIAMS identified a big leaf maple they wanted to steal. However, the large tree contained a bee’s nest, which made it difficult to fell. After unsuccessfully attempting to get rid of the bees with wasp killer, the men decided to kill the bees by burning the nest. WILKE poured gasoline on the nest and lit it on fire. The men tried to put the fire out with water bottles but were unsuccessful. The fire grew into a 3,300-acre forest fire, damaging public lands in Olympic National Forest and costing $4.5 million to extinguish.
WILKE is charged with eight federal felonies: Conspiracy; two counts of depredation of public property; theft of public property; trafficking in unlawfully harvested timber; attempted trafficking in unlawfully harvested timber; setting timber afire; and using fire in furtherance of a felony. WILLIAMS is charged with conspiracy, depredation of government property, and attempted trafficking in unlawfully harvested timber.
WILKE will appear in U.S. District Court in Tacoma at 2:30 today. WILLIAMS is in state custody in California.
Conspiracy, setting timber afire, and trafficking in unlawfully harvested timber are each punishable by up to five years in prison and a $250,000 fine. Theft of public property and depredation of government property are punishable by up to ten years in prison and a $250,000 fine. Using fire in furtherance of a felony is punishable by a mandatory ten-year sentence of imprisonment.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The case was investigated by the United States Forest Service. The case is being prosecuted by Assistant United States Attorneys Seth Wilkinson and Will Dreher.
wilke-williams_indictment.pdfScammer who re-victimized unhappy investors sentenced to 30 months in prisonRead the Press Release
Seattle – A former Seattle resident who relocated to Laguna Niguel, California in the midst of his fraud scheme, was sentenced today in U.S. District Court in Seattle to 30 months in prison for mail fraud, announced U.S. Attorney Brian T. Moran. Between 2011 and 2014, TROY CLINTON VAN SICKLE, 48, fraudulently operated an asset recovery business that defrauded unhappy investors who previously had lost money they had invested with a Bellevue investment company. At sentencing, U.S. District Judge James L. Robart found that VAN SICKLE, had been living a life of crime since he was 21, and had shown no respect for the law.
According to records filed in the case, during May and June 2011, VAN SICKLE represented to the unhappy investors that he had a company, Troy C. Van Sickle Consulting and Collections, and that for a fee he could help them recover their lost funds. VAN SICKLE falsely claimed that he had helped other investors recover large sums, and, in order to win investors’ trust, VAN SICKLE made various promises, including entering into a romantic relationship with one of the investors.
In February of 2012, VAN SICKLE moved to California. After he moved, VAN SICKLE’s agent told the investors that if they loaned him $75,000, he would (1) use the money in order to recover their lost investment, and (2) repay the $75,000 in 30 days. In fact, VAN SICKLE planned to use the money for his own purposes, including paying his rent through the end of the year, and did not intend to repay the investors. In July 2013, after one of the investors who loaned VAN SICKLE funds repeatedly sought the return of the money he loaned VAN SICKLE, VAN SICKLE sent the investor an invoice with false charges purporting to explain how VAN SICKLE had used the loaned funds in order to try to recover the investor’s funds.
Over the course of the scheme, VAN SICKLE fraudulently took in $75,000. Under the terms of the Plea Agreement, in addition to repaying the investors that $75,000, VAN SICKLE has agreed to repay the investors an additional $175,000 in funds that he received from the investors.
The case was investigated by the FBI and the Washington State Department of Financial Institutions. The case is being prosecuted by Assistant United States Attorneys Arlen Storm and Andre Penalver
Enumclaw, WA couple charged with mail fraud for scheme to steal local drainage district tax dollars for their own useRead the Press Release
Seattle – An Enumclaw, Washington couple were charged in U.S. District Court in Seattle today in connection with their six-year scheme to divert more than $400,000 in local tax dollars to their own use, announced U.S. Attorney Brian T. Moran. ALLAN B. THOMAS and JOANN E. THOMAS are scheduled to appear on the federal charges in U.S. District Court in Seattle at 2:00 p.m. today.
According to the criminal complaint, ALLAN B. THOMAS served as Commissioner for Drainage District 5 in King County for more than 35 years. As a commissioner, THOMAS was involved in estimating the costs of drainage maintenance for the district so that the county auditor could set and assess the appropriate taxes. The Commissioners then authorized payment to service providers who were supposed to do maintenance work on the drainage system.
As early as 2012, JOANN THOMAS set up a joint bank account with ALLAN THOMAS’ son from a previous marriage. The account was a business account for a company called A C Services. Over the next six years, ALLAN THOMAS had $413,323 of local tax dollars paid to A C Services claiming it was for drainage ditch maintenance. However, THOMAS’ son said other than two small jobs performed in 2012, he did not perform any drainage ditch work. Financial records indicate that over the six years, shortly after the tax dollars were deposited into A C Services account, the money was quickly transferred to other accounts belonging to the THOMASES, or was used to pay their expenses for such things as hay, mortgage payments, or property taxes. More than $70,000 was withdrawn as cash.
In 2018, after the couple became aware of an investigation into their conduct, they began funneling the tax dollars through another company: City Biz. The couple submitted warrants for City Biz to be paid for drainage maintenance work and within days of the funds arriving in City Biz bank accounts, nearly all of the money was transferred directly to ALLAN THOMAS or the THOMASES’ dairy farm. In all the criminal complaint alleges the THOMASES defrauded taxpayers of $468,165.
The charges contained in the complaint are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
Mail fraud is punishable by up to 20 years in prison and a $250,000 fine.
The FBI and IRS - Criminal Investigation are leading the investigation with assistance from the Enumclaw Police Department. The Enumclaw City Attorney initiated the review of the district finances. The Washington State Auditor’s Office also conducted an audit of the district in 2019. The King County Prosecuting Attorney’s Office, in consultation with the U.S. Attorney’s Office, determined the case was appropriate for federal prosecution.
The case is being prosecuted by Assistant United States Attorneys Justin Arnold and Andrew Friedman.
thomas_complaint.pdfArmed robber sentenced to 11+ years in prison for Mountlake Terrace cannabis store robberyRead the Press Release
SEATTLE – One of two men who robbed a marijuana store at gunpoint was sentenced today in U.S. District Court to 138 months in prison and five years of supervised release for three federal felonies. ERIC HENRY WOODBERRY, 23, was convicted in June 2019, of robbery, possession of marijuana with intent to distribute and aiding and abetting possession of a firearm in furtherance of a crime of violence and a drug trafficking crime. At the sentencing hearing U.S. District Judge Richard A. Jones said, the robbery was a “very aggressive, very violent action on your part… (the victims) were terrified.”
According to records in the case and testimony at trial, WOODBERRY and co-defendant Bradford M. Johnson robbed Rainier Cannabis in Mountlake Terrace, Washington on November 21, 2017. The men entered the store carrying a stolen short-barreled rifle and a handgun. Both wore masks. They forced the employees onto the floor, took their phones and then ordered two of the employees to fill large bags with marijuana products and cash. When they saw police arriving at the front of the store, they ran out the back and attempted to hide from police in the nearby neighborhood. With the assistance of a police tracking dog, officers located WOODBERRY hiding in a boat trailered next to a house a few blocks from the store. Johnson was located a short time later.
Court records detail two other robberies and a Seattle robbery/burglary linked in police reports and state charging documents to WOODBERRY.
Johnson is scheduled for sentencing on November 22, 2019.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and the Mountlake Terrace Police Department, with assistance from the Lynnwood Police Department, Edmonds Police Department, Everett Police Department, King County Sheriff’s Office, and Washington State Patrol.
The case is being prosecuted by Assistant United States Attorneys Erin H. Becker and Stephen P. Hobbs.
Former shipbuilding Project Manager pleads guilty to wire fraud in $1.5 million false invoice schemeRead the Press Release
SEATTLE - A former project manager for Portland, Oregon-based shipbuilder Vigor Marine LLC, pleaded guilty today to wire fraud related to his scheme to defraud his employer out of approximately $1.5 million, announced U.S. Attorney Brian T. Moran. SHELTON LAYNE SMITH, 50, of Portsmouth Virginia, is scheduled to be sentenced by U.S. District Judge Robert S. Lasnik on December 19, 2019.
According to records in the case, in 2016 and 2017, SMITH served as the project manager on the renovation of two U.S. Coast Guard cutters called the “Bertholf” and the “Waesche.” The renovations took place at Vigor’s Seattle facility. SMITH was responsible for selecting vendors and approving payments to them for equipment and services related to the renovations. In this role, SMITH fabricated invoices from a fictitious company called “Marine Service Solutions” (MSS). The fraudulent invoices caused Vigor to pay out approximately $1.5 million for work that was never done and equipment that was never provided.
SMITH’s scheme to defraud was an elaborate charade. SMITH persuaded a legitimate Vigor vendor to serve as a “pass-through” entity that received invoices from MSS, marked up the cost of the services, and passed on the fraudulent expenses to Vigor. The local vendor was not aware that Marine Service Solutions was not a real company. SMITH also misled a long-time acquaintance in Mississippi into setting up a bank account for MSS, cashing the checks, and funneling most of the proceeds to SMITH. In emails, SMITH posed as the Mississippi man, making it appear as if the Mississippi man was the owner of MSS. When questioned by the FBI, SMITH repeatedly lied about MSS and encouraged his acquaintance in Mississippi to stick to a false story about the company.
Vigor terminated SMITH in 2017 after discovering that SMITH had mishandled the Bertholf project. SMITH’s successor discovered the fraud, and Vigor reported the crime to the FBI.
SMITH has agreed to make restitution to Vigor of $1,483,802. As part of that restitution he will forfeit his right, title, and interest in any and all property, real or personal, that constitutes or is derived from proceeds traceable to the offense of Wire Fraud.
Wire fraud is punishable by up to 20 years in prison and a $250,000 fine. The ultimate sentence will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
The case is being investigated by the FBI. The case is being prosecuted by Assistant United States Attorney Seth Wilkinson.
Former CEO of Two Bellevue IT Companies Sentenced to 7+ Years in Prison for Mail Fraud and Failure to Pay more than $1 Million in Employment TaxesRead the Press Release
The former CEO of two Bellevue, Washington information-technology (IT) firms was sentenced today in U.S. District Court in Seattle to 87 months in prison for mail fraud and tax crimes related to a multi-year visa-fraud scheme, announced U.S. Attorney Brian T. Moran. PRADYUMNA KUMAR SAMAL, 50, a citizen of India, was arrested in August 2018 when he arrived on an international flight at Sea-Tac Airport. Prior to the arrest, SAMAL had fled the U.S. in the midst of the visa fraud investigation. He has been in custody since his arrest last year. At the sentencing hearing U.S. District Judge James L. Robart said “Based on your time in the U.S. you have basically defrauded everyone you could defraud…. It is clear you have not followed the law since you came to this country. You engaged in an extensive scheme…. This was driven by greed: nothing more, nothing less.”
“This was the largest and most sophisticated H-1B visa fraud scheme we have prosecuted in Western Washington,” said U.S. Attorney Brian Moran. “The fraud harmed the workers who wound up far from home, essentially “benched” by the company, with no pay and no job. It harmed foreign workers who legitimately sought, but could not get visas, and it harmed U.S. workers who were excluded from employment opportunities.”
According to records filed in the case, two companies incorporated by SAMAL in 2010 and 2011, engaged in a scheme sometimes referred to as a “bench-and-switch” scheme, to exploit foreign-national workers, compete unlawfully in the market, and defraud the U.S. government. According to the investigation that began in 2015, SAMAL served as the Chief Executive Officer of ‘Divensi’ and ‘Azimetry.’ Both companies were in the business of providing information-technology workers, such as Software Development Engineers, to major corporate clients. SAMAL submitted, and directed his employees to submit, forged and false application materials to the United States government, making it appear as if foreign-national employees named in the petitions had been earmarked for projects contracted to SAMAL’s companies by end clients. In fact, these project assignments were fictitious. The forged documents included forged letters and fraudulent statements of work, which appeared as if they had been signed by senior executives at SAMAL’s clients. After USCIS relied on the false representations and approved the applications, SAMAL’s companies “benched” the foreign nationals – i.e., the companies left those foreign nationals unpaid, and forced them to submit phony sick and annual leave requests – until and unless they were able to place those employees at actual end clients.
More than 250 workers were brought in under the phony applications. The employees were forced to pay SAMAL’s companies a partially-refundable “security deposit” of as much as $5,000 for the visa filings, regardless of whether they were assigned to any projects that provided them with income.
"This sentence punishes a sophisticated offender who fraudulently manipulated the U.S. visa process to exploit foreign-national workers, compete unlawfully in the market, and defraud the U.S. government,” said Matthew Perlman, Special Agent in Charge, U.S. Department of State’s Diplomatic Security Service, San Francisco Field Office. “The Diplomatic Security Service is committed to ensuring the integrity of the visa process, securing the homeland, and protecting the American work force.”
Not only did SAMAL’s companies fail to pay the clients, it failed to pay more than $1 million in employment taxes. SAMAL has agreed to pay restitution of $1,119,867 for the tax loss. In addition Judge Robart imposed a $10,000 fine.
“Mr. Samal exploited foreign nationals for personal gain while also stealing $1.1 million from his employees' payroll withholdings to fund his luxury car, his mortgage, and his personal accounts in India,” said IRS-Criminal Investigation Special Agent in Charge Justin Campbell. “IRS-Criminal Investigation continues to prioritize employment tax fraud in order to protect hard-working employees and serve honest taxpayers.”
The case was investigated by the U.S. State Department’s Diplomatic Security Service (DSS), Homeland Security Investigations (HSI) and the Internal Revenue Service Criminal Investigation (IRS-CI). The case is being prosecuted by Assistant United States Attorneys Siddharth Velamoor and Michael Dion.
Bellingham Woman who Stole $200,000 from Tribal Casino Sentenced to PrisonRead the Press Release
A Bellingham, Washington woman who used her employee access to steal $200,000 from the Lummi Nation’s Silver Reef Casino was sentenced today in U.S. District Court in Seattle to time-served (approximately 10 months in prison) and two years of supervised release, announced U.S. Attorney Brian T. Moran. SHANNON MARIE MORRIS is a Lummi Tribal member and was an employee of the casino on November 24, 2018, when she stole $200,000 from the vault at the casino. Hours after the theft, MORRIS led law enforcement to where she had stashed the cash, but not before making a false report about a bomb in the casino that forced the evacuation of the casino and adjacent hotel. At the sentencing hearing, U.S. District Judge Richard A. Jones noted that MORRIS placed her young son in harm’s way and adversely impacted the lives of a lot of people due to the bomb scare.
According to records filed in the case, it was just before 3:00 AM on November 24, 2018 when MORRIS walked into the employee entrance at the rear of the casino and got another employee to let her into the cash vault. MORRIS filled a bag with four bricks of cash totaling $200,000 and told the employee in the vault not to push the panic button. MORRIS ran from the vault, got in her car and drove away. MORRIS called 9-1-1 claiming that a man with a gun had forced her to rob the casino and that the man claimed to have placed a bomb at the casino which he would trigger if she did not steal the money. MORRIS claimed the man had jumped out of her car with the money.
Because of the report of a bomb, law enforcement from the Lummi Nation, Bellingham and Ferndale Police Departments, the FBI and the Whatcom County Sheriff’s Department evacuated the hotel and casino. No bomb was located.
While being questioned by law enforcement, MORRIS’ statement changed over time: initially she claimed that a strange man with a gun held her and her child hostage and forced her to steal the money from the casino. Later she admitted she was alone in the vehicle with her child when she drove to the casino and stole the money. MORRIS led the investigators to the location in Ferndale where she had hidden the money near a tree at the side of the road.
While the money was recovered, the Lummi Nation still lost money due to the evacuation of the hotel and casino on a busy holiday weekend. The funds generated by the hotel and casino are used to provide services to the tribal members and their families.
On December 12, 2018, MORRIS was indicted for theft by an employee of a gaming establishment on Indian lands. She pleaded guilty to that charge on June 12, 2019.
The case was investigated by the Lummi Nation Police Department and the FBI, with assistance from the Whatcom County Sheriff’s Office.
The case was prosecuted by Assistant United States Attorney J. Tate London
Puyallup Bar Owner Pleads Guilty to Illegal Drug DistributionRead the Press Release
The former owner of Johnny’s Bar and Grill in Puyallup, Washington, pleaded guilty today in U.S. District Court in Tacoma to possession of methamphetamine with intent to distribute, announced U.S. Attorney Brian T. Moran. JOHN CHOE admits in his plea agreement that, in January 2018, he obtained methamphetamine, cocaine, and heroin from his sources and began selling them to customers at his bar. Between January 2019 and April 2019, CHOE sold cocaine to a person working with law enforcement on four different occasions. The Washington State Liquor and Cannabis Board suspended the bar’s liquor license on June 19, 2019. Judge Benjamin H. Settle scheduled sentencing for December 16, 2019.
According to the facts admitted in the plea agreement, the Drug Enforcement Administration (DEA) and state and local law enforcement began investigating CHOE after receiving information about drug sales at the bar. After the confidential informant and an undercover DEA agent purchased a total of 45 grams of cocaine on four different occasions, law enforcement served a court-authorized search warrant for the bar and for CHOE’s vehicle. Agents found methamphetamine, heroin, synthetic cannabinoids, and Percocet pills in a metal box at the bar. When CHOE was arrested, he was carrying cocaine. CHOE admits all the drugs were for distribution.
Possession of methamphetamine with intent to distribute is punishable by up to 40 years in prison and a $5,000,000 fine. Under some circumstances, the charge carries a mandatory minimum five-year prison term. The ultimate sentence will be determined by the Court based on the advisory Sentencing Guidelines and other statutory factors.
The case was investigated by the DEA’s Tacoma Narcotics Enforcement Task Force (TNET), in collaboration with the Puyallup Police Department. The case is being prosecuted by Assistant United States Attorney Seungjae Lee.
Child and Youth Program Assistant Sentenced to Prison for Abusive Sexual Contact with a MinorRead the Press Release
WASHINGTON – A North Carolina man was sentenced today to two years in prison, to be followed by five years of supervised release, for abusive sexual contact with a minor, Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and U.S. Attorney Brian T. Moran of the Western District of Washington announced.
Joseph Robertson, 38, of Sanford, North Carolina, pleaded guilty on June 6, to one count of abusive sexual contact before U.S. District Court Judge Ronald B. Leighton of the Western District of Washington, who sentenced him earlier today.
According to facts admitted by the defendant during his guilty plea, Robertson was employed by the Department of Defense as a child and youth program assistant at Ramstein Air Force Base in Germany. During the summer of 2016, while accompanying children from the Ramstein youth center to a swimming pool in a nearby town, Robertson engaged in abusive sexual contact with a minor who was 13-14 years old on multiple occasions, including touching the minors genitals over the minor’s clothing.
The investigation of the case was conducted by U.S. Air Force Office of Special Investigations and the FBI, led by Seattle Division’s Tacoma Resident Agency Child Exploitation Task Force.
This case is being prosecuted by Trial Attorney Kaylynn Foulon of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Grady Leupold of the U.S. Attorney’s Office in the Western District of Washington.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc.
Child and Youth Program Assistant Sentenced to Prison for Abusive Sexual Contact with a MinorRead the Press Release
A North Carolina man was sentenced today to two years in prison, to be followed by five years of supervised release, for abusive sexual contact with a minor, Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and U.S. Attorney Brian T. Moran of the Western District of Washington announced.
Joseph Robertson, 38, of Sanford, North Carolina, pleaded guilty on June 6, to one count of abusive sexual contact before U.S. District Court Judge Ronald B. Leighton of the Western District of Washington, who sentenced him earlier today.
According to facts admitted by the defendant during his guilty plea, Robertson was employed by the Department of Defense as a child and youth program assistant at Ramstein Air Force Base in Germany. During the summer of 2016, while accompanying children from the Ramstein youth center to a swimming pool in a nearby town, Robertson engaged in abusive sexual contact with a minor who was 13-14 years old on multiple occasions, including touching the minor's genitals over the minor’s clothing.
The investigation of the case was conducted by U.S. Air Force Office of Special Investigations and the FBI, led by Seattle Division’s Tacoma Resident Agency Child Exploitation Task Force.
This case is being prosecuted by Trial Attorney Kaylynn Foulon of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Grady Leupold of the U.S. Attorney’s Office in the Western District of Washington.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc.
Former Seattle Tech Worker Indicted on Federal Charges for Wire Fraud and Computer Data TheftRead the Press Release
A former Seattle technology company software engineer was indicted today by a federal grand jury on two counts related to her unauthorized intrusion into stored data of more than 30 different companies, announced U.S. Attorney Brian T. Moran. PAIGE A. THOMPSON a/k/a erratic, 33, will be arraigned on the indictment in U.S. District Court in Seattle on September 5, 2019. THOMPSON remains in custody.
THOMPSON is charged with wire fraud and computer fraud and abuse for the intrusion into data of Capital One and more than 30 other entities. Law enforcement has identified many of the victims whose data was accessed and is working to notify them. The indictment describes some of the victims as a state agency outside the State of Washington; a telecommunications conglomerate outside the United States; and a public research university outside the State of Washington.
According to the indictment, THOMPSON created scanning software that allowed her to identify customers of a cloud computing company who had misconfigured their firewalls, allowing outside commands to penetrate and access their servers. THOMPSON used this access not only to steal data, but also used stolen computer power to “mine” cryptocurrency for her own benefit, a practice known as “cryptojacking.”
Law enforcement became aware of THOMPSON’s activity after she shared information with another user on the site GitHub relating to her theft of information from the servers storing Capital One data. On July 17, 2019, the GitHub user alerted Capital One to the possibility it had suffered a data theft. After determining on July 19, 2019, that there had been an intrusion into its data, Capital One contacted the FBI. Cyber investigators confirmed THOMPSON was the person responsible for the data theft. On July 29, 2019, agents executed a search warrant at THOMPSON’s residence and seized electronic storage devices containing a copy of the data. Investigators have found no evidence that THOMPSON sold or disseminated any of the information she accessed.
The charges in the indictment carry penalties of up to 25 years in prison.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by the FBI. The case is being prosecuted by Assistant United States Attorneys Steven Masada and Andrew Friedman.
thompson_indictment.pdfPhysicians and Cardiac Center Agree to Pay Total of more than $1.1 Million to Resolve Allegations that They Received Kickbacks from Northwest Medical Testing CompanyRead the Press Release
Three doctors and one medical practice entered into settlements with the U.S. Department of Justice to resolve allegations that they referred patients for genetic testing in exchange for kickbacks from a Seattle-area testing company, announced U.S. Attorney Brian T. Moran. The physicians, Dr. Gregory Sampognaro of Monroe, Louisiana, Dr. Warren Strickland and Dr. Isabella Strickland of Huntsville, Alabama and a cardiac center, Cardiology P.C. of Birmingham, Alabama, have agreed to pay a total of more than $1.1 million to resolve the allegations.
“Providers who line their pockets by ordering unnecessary tests increase medical costs for all of us and drain critical funds from Medicare and other government health programs,” said U.S. Attorney Brian T. Moran. “The government will continue to hold accountable medical professionals who undermine our healthcare system by accepting illegal kickbacks.”
According to the settlement agreements, between 2012 and 2013 the doctors and cardiac center were alleged to have accepted payments from now-defunct testing company Natural Molecular Testing Corporation (NMTC) in return for ordering genetic tests from NMTC, which NMTC then billed to Medicare. The scheme was alleged to be in violation of the Anti-Kickback Statute and the civil False Claims Act.
The providers have agreed to pay a total of more than $1.1 million. Specifically, Dr. Gregory Sampognaro will pay $519,750, Dr. Warren Strickland will pay $95,053, Dr. Isabella Strickland will pay $107,900, and Cardiology P.C. will pay $411,300 to resolve the government’s allegations. The claims resolved by the settlement are allegations only; there has been no determination of liability.
“Patients, taxpayers, and Federal health care programs are all victimized when providers work in exchange for kickbacks– as the government contended in this case,” said Steven J. Ryan, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “We will continue working with our law enforcement partners to hold such providers accountable.”
NMTC declared bankruptcy in 2013. The Centers for Medicare and Medicaid Services has an unsecured claim against NMTC for $70 million, but has little chance of recovering those funds as there are few remaining assets.
The matter was investigated by the Department of Health and Human Services Office of Inspector General (HHS-OIG). The settlements were negotiated by Assistant United States Attorneys Kayla Stahman and Ashley Burns.
Federal Way Tax Preparer Sentenced to Prison for Scheme to Prepare False Income Tax ReturnsRead the Press Release
A 52-year-old Federal Way, Washington resident was sentenced today in U.S. District Court in Seattle to one year in prison, one year of supervised release, and $13,141 in restitution for eight counts of aiding and assisting in preparing false income tax returns, announced U.S. Attorney Brian T. Moran. LINA PASTARS ran a tax preparation business out of her home and collected higher fees from customers by falsely inflating their deductions, so that her clients received a bigger refund. PASTARS was convicted February 28, 2019, following a four–day jury trial. At the sentencing hearing, Chief U.S. District Judge Ricardo S. Martinez said PASTARS’ clients were primarily immigrants with little knowledge of the tax system and limited language skills. “That population is most vulnerable,” the Chief Judge said “They were left to flounder by themselves when the IRS came knocking at their door.”
According to testimony at trial and records filed in the case, the investigation of PASTARS began in 2015, when the IRS audited one of her clients whose 2012 tax return claimed more than $30,000 in unreimbursed business expenses. The clients claimed PASTARS had claimed the deductions without their knowledge. The IRS Scheme Development Center then began a review of returns prepared by PASTARS between 2012 and 2014 and discovered the returns had unreimbursed employee business expenses that far exceeded the average claims in the Puget Sound region. The statistical analysis revealed PASTARS claimed unreimbursed business expenses for clients that were three to four times the average claim.
On two different occasions in March and April 2015, undercover IRS Criminal Investigation (IRS-CI) agents went to PASTARS posing as clients for tax preparation. Both were very clear that they had no employee business expenses. They told PASTARS that all their expenses were reimbursed by their employers. Nevertheless, PASTARS claimed thousands of dollars in unreimbursed expenses so that the returns showed a refund. She increased the fee that she charged each undercover agent saying “If I do deduction I charge more.” Undercover audio and video of these exchanges were admitted into evidence and played for the jury.
As PASTARS deductions and promised refunds grew, so did her business. Most of her customers paid in cash – making her profit from the scheme difficult to trace. But based on those customers who paid by check or via an online payment system she went from 159 returns prepared in 2012 to 366 prepared in 2015. Over those same years, her trackable income from tax prep increased ten-fold from $6,500 in 2012 to $65,470 in 2015. Those figures do not account for clients who paid in cash.
The case was investigated by Internal Revenue Service Criminal Investigation.
The case was prosecuted by Assistant United States Attorneys Seungjae Lee and Michael Dion.
Owners of Popular Thai Restaurant Group Plead Guilty in Scheme to use ‘Tax Zapper’ Software to Hide Cash Income and Reduce State & Federal TaxesRead the Press Release
Two owners of the popular ‘Bai Tong’ restaurant chain pleaded guilty Wednesday, August 14 in U.S. District Court in Seattle to a multi-year scheme to hide cash sales and reduce the taxes owed at the restaurant chain, announced U.S. Attorney Brian T. Moran. PORNCHAI CHAISEEHA, 41, and CHADILLADA LAPANGKURA, 40, both of Kent, Washington, pleaded guilty Wednesday to conspiracy to defraud the government by hiding more than $1 million in income. The two are scheduled for sentencing by U.S. District Judge James L. Robart on November 4, 2019.
According to records filed in the case, CHAISEEHA and LAPANGKURA were part owners of the chain that has Thai restaurants in Washington, Oregon, and Hawaii. Some of the restaurants operated under the name ‘Bai Tong,’ and some were called ‘Noi.’ The restaurants used a point-of-sale computer system that included a “cash suppression” or “Zapper” software program that modifies the sales records by removing cash sales from the business records. The two had the “Zapper” software operating at their Redmond and Tukwila, Washington, restaurants and at their Bend, Oregon, restaurant. The restaurants earned $1,034,750 in cash income that was never reported on state or federal tax returns, resulting in an agreed tax loss of $299,806. The pair also used the unreported cash to pay employees under the table, avoiding state and federal employment taxes. Finally, some of the cash proceeds were siphoned off to bank accounts in Thailand, and the existence of the accounts was not reported on their income tax returns.
The defendants have agreed to pay $299,806 in state and federal taxes as part of the criminal case. The IRS may also assess other taxes, penalties, and interest through its civil processes.
Prosecutors have agreed to recommend sentences of no more than two years in prison for LAPANGKURA and no more than 18 months in prison for CHAISEEHA. The Court is not bound by the recommendation. The sentence will be determined by the Court based on the advisory Sentencing Guidelines and other statutory factors.
The case was investigated by the Internal Revenue Service Criminal Investigation (IRS-CI) and Homeland Security Investigations (HSI). The case is being prosecuted by Assistant United States Attorney Matthew Diggs.
Former Washington Resident Pleads Guilty to Wire Fraud and Money Laundering in Fraudulent IPO Stock SchemeRead the Press Release
A former Seattle area resident who defrauded dozens of investors of at least $5.8 million pleaded guilty today in U.S. District Court in Seattle to wire fraud and money laundering, announced U.S. Attorney Brian T. Moran. KEENAN A. GRACEY, 28, formerly of Newcastle, Washington, defrauded Seattle-area investors and others out of millions of dollars by pretending to sell them stock that GRACEY did not own and had no right to sell. Under the terms of the plea agreement, both the prosecution and the defense will recommend a prison term of 153 months in custody when GRACEY is sentenced by Chief U.S. District Judge Ricardo S. Martinez on November 15, 2019.
According to records in the case, between 2016 and 2018, GRACEY posed as a British billionaire with degrees from the London School of Economics and Oxford University. He drove expensive cars such as Bentleys and Ferraris and claimed to own expensive homes in Clyde Hill, Mercer Island, and Newcastle, Washington, as well as in Beverly Hills and San Diego, California. GRACEY also used falsified bank statements to make it appear he had hundreds of millions of dollars of cash on hand. The investigation revealed that GRACEY is Canadian, not British, and rented expensive homes and cars to make it appear he was wealthy.
GRACEY told potential investors he had special access to millions of shares of “pre IPO” stock that would produce returns of as much as 60 times the initial investment. Some investors gave GRACEY as much as $745,000, believing that they were purchasing stock. In fact, GRACEY did not own any of the stock he was pretending to sell and simply stole the victims’ money. In all, GRACEY collected $5,894,676 from dozens of investors.
The Securities and Exchange Commission filed a civil suit against GRACEY in May 2018 and obtained a temporary restraining order barring him from selling securities. In September 2018, the order was made permanent, and GRACEY was ordered to disgorge $4.4 million in cash and wire transfers that he had fraudulently obtained from investors. However, even after the SEC order, GRACEY continued to try to defraud investors by claiming he owned shares in a gene editing company. Between June 2018 and December 2018, GRACEY collected $2.2 million for shares of stock he did not own.
GRACEY’s fraud ended when he was arrested by the FBI on December 20, 2018. A federal grand jury charged him with wire fraud on January 3, 2019. On July 25, 2019, the grand jury returned a superseding indictment asserting additional charges, including money laundering charges.
On March 29, 2019, the United States seized $603,840 of fraud proceeds that GRACEY had paid to rent a luxury mansion in Beverly Hills, California. According to court pleadings, the government intends to forfeit this money and request it be used to compensate GRACEY’s victims.
Money Laundering and Wire Fraud are each punishable by up to 20 years in prison.
The case is being investigated by the FBI. The case is being prosecuted by Assistant United States Attorneys Seth Wilkinson, Lyndsie Schmalz, and Michelle Jensen.
Seattle Felon Indicted for Possession of a Dozen Weapons Including Ar-Style Assault RiflesRead the Press Release
A 66-year-old Seattle resident was indicted today by a grand jury for being a felon in possession of firearms, announced U.S. Attorney Brian T. Moran. PARK QUAN was arrested July 29, 2019, after FBI agents investigating one of his roommates in connection with a data theft, served a search warrant on his home and discovered a cache of weapons. QUAN has two federal convictions and is prohibited from possessing firearms. QUAN remains in federal custody and will be arraigned on the indictment on August 22, 2019.
“Federal law enforcement makes it a priority to get weapons out of the hands of those who illegally possess them,” said U.S. Attorney Brian T. Moran. “I commend the FBI agents who went into a potentially-dangerous situation and secured these weapons without any shots fired. The U.S. Attorney’s office works every day with state, local, tribal and federal law enforcement to keep our communities safe.”
According to records filed in the case, agents investigating the data theft were sweeping the residence for safety when they observed numerous firearms in a bedroom used by QUAN. Agents applied for and got a second judicially-authorized search warrant and began collecting the firearms. The cache of weapons included four semi-automatic handguns, eight rifles, six of them semi-automatic rifles including two AR-style assault rifles.
QUAN has a 1983 conviction in Washington for being a felon in possession of explosives and a 1991 conviction in Texas for possessing an unregistered machine gun. QUAN also has a military court-martial conviction for soliciting the theft of military weapons. Due to those convictions, QUAN is prohibited from possessing firearms.
Being a felon in possession of a firearm is punishable by up to ten years in prison and a $250,000 fine.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by the FBI with assistance from the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF). The case is being prosecuted by Assistant United States Attorneys Steven Masada and Andrew Friedman.
Leader of Conspiracy to Illegally Unlock Cell Phones for Profit Extradited from Hong KongRead the Press Release
A 34-year-old citizen of Pakistan, who is alleged to have paid insiders at telecommunications giant AT&T to plant malware and otherwise misuse computer networks to unlock cellphones, was charged in a 14-count federal indictment unsealed yesterday following his extradition from Hong Kong to the Western District of Washington.
Muhammad Fahd was arrested in Hong Kong on Feb. 4, 2018, at the request of the United States, and was extradited to the United States on Aug. 2, 2019. The second superseding indictment, filed in March 2018, alleges how Fahd recruited and paid AT&T insiders to use their computer credentials and access to disable AT&T’s proprietary locking software that prevented ineligible phones from being removed from AT&T’s network. The scheme resulted in millions of phones being removed from AT&T service and/or payment plans, costing the company millions of dollars. Fahd allegedly paid the insiders tens of thousands of dollars – paying one coconspirator $428,500 over the five-year scheme.
Muhammad Fahd is charged with conspiracy to commit wire fraud, conspiracy to violate the Travel Act and the Computer Fraud and Abuse Act, four counts of wire fraud, two counts of accessing a protected computer in furtherance of fraud, two counts of intentional damage to a protected computer, and four counts of violating the Travel Act.
“This arrest illustrates what can be achieved when the victim of a cyber attack partners quickly and closely with law enforcement,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division. “When companies that fall prey to malware work with the Department of Justice, no cybercriminal—no matter how sophisticated their scheme—is beyond our reach.”
“This defendant thought he could safely run his bribery and hacking scheme from overseas, making millions of dollars while he induced young workers to choose greed over ethical conduct,” said U.S. Attorney Brian T. Moran for the Western District of Washington. “Now he will be held accountable for the fraud and the lives he has derailed.”
According to the indictment, between 2012 and 2017, Fahd recruited various AT&T employees to the conspiracy. Some early recruits were paid to identify other employees who could be bribed and convinced to join the scheme. So far, three of those coconspirators have pleaded guilty, admitting they were paid thousands of dollars for facilitating Fahd’s fraudulent scheme.
Initially, Fahd allegedly would send the employees batches of international mobile equipment identity (IMEI) numbers for cell phones that were not eligible to be removed from AT&T’s network. The employees would then unlock the phones. After some of the co-conspirators were terminated by AT&T, the remaining co-conspirator employees aided Fahd in developing and installing additional tools that would allow Fahd to use the AT&T computers to unlock cell phones from a remote location. Fahd and a second co-conspirator, who is now deceased, allegedly delivered bribes to the AT&T employees both in person and via payment systems such as Western Union.
The charges contained in the indictment are only allegations. A person is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by the U.S. Secret Service Electronic Crimes Task Force.
The case is being prosecuted by Senior Counsel Anthony V. Teelucksingh of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorneys Francis Franze-Nakamura, Andrew Friedman and Michelle Jensen of the Western District of Washington. The Criminal Division’s Office of International Affairs was instrumental in the successful extradition. The U.S. Marshals Service transported Fahd to the United States.
Port Townsend, Washington Man Arrested for Engaging in Illicit Sexual Conduct in a Foreign PlaceRead the Press Release
A 62-year-old Port Townsend, Washington, man was arrested today on a complaint charging him with two counts of engaging in illicit sexual conduct in a foreign place, announced U.S. Attorney Brian T. Moran. JOHN TIMOTHY WHICHER will make his initial appearance on the complaint in U.S. District Court in Tacoma at 2:30 today.
According to the criminal complaint, in August 2017 WHICHER took the 6-year-old child to Canada to stay at a family cabin in Ontario. WHICHER allegedly planned the trip as a surprise and purchased the trip without informing the child’s custodial parent. When the child returned from the trip the child disclosed to the parent the sexual molestation, saying WHICHER said to keep it a secret. The parent confronted WHICHER and reported the conduct to the Port Townsend Police.
Engaging in illicit sexual conduct in a foreign place is punishable by up to 30 years in prison and a $250,000 fine.
The charges contained in the criminal complaint are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by Homeland Security Investigations (HSI). The case is being prosecuted by Assistant United States Attorney Matthew Hampton.
Leader of Conspiracy to Illegally Unlock Cell Phones for Profit Extradited from Hong KongRead the Press Release
A 34-year-old citizen of Pakistan, who allegedly paid insiders at telecommunications giant AT&T to plant malware and otherwise misuse computer networks to unlock cellphones, made an initial appearance today on a 14-count federal indictment, announced U.S. Attorney Brian T. Moran. MUHAMMAD FAHD was arrested in Hong Kong on February 4, 2018, at the request of the United States, and was extradited to the U.S. on Friday August 2, 2019. The second superseding indictment, filed in March 2018, describes how FAHD recruited and paid AT&T insiders to use their computer credentials and access to disable AT&T’s proprietary locking software that prevented ineligible phones from being removed from AT&T’s network. The scheme resulted in millions of phones being removed from AT&T service and/or payment plans, costing the company millions of dollars. FAHD allegedly paid the insiders hundreds of thousands of dollars – paying one coconspirator $428,500 over the five-year scheme.
MUHAMMAD FAHD is charged with conspiracy to commit wire fraud, conspiracy to violate the Travel Act and the Computer Fraud and Abuse Act, four counts of wire fraud, two counts of accessing a protected computer in furtherance of fraud, two counts of intentional damage to a protected computer, and four counts of violating the Travel Act.
“This defendant thought he could safely run his bribery and hacking scheme from overseas, making millions of dollars while he induced young workers to choose greed over ethical conduct,” said U.S. Attorney Brian T. Moran. “Now he will be held accountable for the fraud and the lives he has derailed.”
"This arrest illustrates what can be achieved when the victim of a cyber attack partners quickly and closely with law enforcement,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division. “When companies that fall prey to malware work with the Department of Justice, no cybercriminal—no matter how sophisticated their scheme—is beyond our reach.”
According to the indictment, between 2012 and 2017, FAHD recruited various AT&T employees to the conspiracy. Some early recruits were paid to identify other employees who could be bribed and convinced to join the scheme. So far, three of those coconspirators have pleaded guilty admitting they were paid thousands of dollars for facilitating FAHD’s fraudulent scheme.
Initially, FAHD allegedly would send the employees batches of international mobile equipment identity (IMEI) numbers for cell phones that were not eligible to be removed from AT&T’s network. The employees would then unlock the phones. After some of the co-conspirators were terminated by AT&T, the remaining co-conspirator employees aided FAHD in developing and installing additional tools that would allow FAHD to use the AT&T computers to unlock cell phones from a remote location. FAHD and a second co-conspirator, who is now deceased, allegedly delivered bribes to the AT&T employees both in person and via payment systems such as Western Union.
The crimes charged are punishable by up to 20 years in prison. If convicted, the ultimate sentence will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by the U.S. Secret Service Electronic Crimes Task Force.
The case is being prosecuted by Assistant United States Attorneys Francis Franze-Nakamura, Andrew Friedman, Michelle Jensen and Senior Counsel Anthony V. Teelucksingh of DOJ’s Computer Crime and Intellectual Property Section. DOJ’s Office of International Affairs was instrumental in the successful extradition. The U.S. Marshals Service transported FAHD to the United States.
fahd_second_superseding_indictment.pdfKent, Washington Dentists Plead Guilty to Tax FraudRead the Press Release
Two Kent, Washington dentists who conspired to avoid more than $460,000 in income taxes pleaded guilty today in U.S. District Court in Seattle to filing a false tax return, announced U.S. Attorney Brian T. Moran. MIKE HSIEH, 48, of Bellevue, Washington, and CHRISTINE CHEN 45, of Renton, Washington, own Comfort Family Dentistry Inc. Between 2007 and 2014, the two took steps to illegally hide their income from the IRS to reduce their tax obligation. U.S. District Judge Richard A. Jones scheduled sentencing for November 22, 2019.
According to records filed in the case, HSIEH and CHEN maintained two sets of financial statements for the business – one showing the actual expenses, and another showing inflated expenses. The fraudulent expense statements were given to their accountant for tax preparation. The pair also established a bank account that was not disclosed to the tax preparer. Patient fees deposited into the account were not reported as income. Finally, the pair took cash proceeds from the dental practice and never reported that income to the accountant or on their taxes.
For tax year 2013, HSIEH admits he reported a taxable income of $232,753, when it was really more than $100,000 higher. HSIEH should have paid taxes on income of $348,663. For tax year 2013, CHEN reported income of $319,131 when her true income was $425,679. For all the tax years between 2007 and 2014 they each admit failing to pay about $231,000 in taxes that they should have paid.
HSIEH and CHEN have agreed to make restitution of slightly more than $231,000 each to the U.S. and pay any additional tax, penalties and interest.
Filing a false tax return is punishable by up to three years in prison and a $250,000 fine.
The case was investigated by the Internal Revenue Service Criminal Investigation (IRS-CI). The case is being prosecuted by Assistant United States Attorney Matthew Diggs.
Seattle Tech Worker Arrested for Data Theft Involving Large Financial Services CompanyRead the Press Release
A former Seattle technology company software engineer was arrested today on a criminal complaint charging computer fraud and abuse for an intrusion on the stored data of Capital One Financial Corporation, announced U.S. Attorney Brian T. Moran. PAIGE A. THOMPSON a/k/a erratic, 33, made her initial appearance in U.S. District Court in Seattle today and was ordered detained pending a hearing on August 1, 2019.
According to the criminal complaint, THOMPSON posted on the information sharing site GitHub about her theft of information from the servers storing Capital One data. The intrusion occurred through a misconfigured web application firewall that enabled access to the data. On July 17, 2019, a GitHub user who saw the post alerted Capital One to the possibility it had suffered a data theft. After determining on July 19, 2019, that there had been an intrusion into its data, Capital One contacted the FBI. Cyber investigators were able to identify THOMPSON as the person who was posting about the data theft. This morning agents executed a search warrant at THOMPSON’s residence and seized electronic storage devices containing a copy of the data.
“Capital One quickly alerted law enforcement to the data theft -- allowing the FBI to trace the intrusion,” said U.S. Attorney Moran. “I commend our law enforcement partners who are doing all they can to determine the status of the data and secure it.”
Computer fraud and abuse is punishable by up to five years in prison and a $250,000 fine.
The charges contained in the complaint are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by the FBI. The case is being prosecuted by Assistant United States Attorneys Steven Masada and Andrew Friedman.
thompson_complaint.pdfSeattle Felon Arrested with Cache of Firearms Including Assault Weapons and ‘Bump Stocks’Read the Press Release
A 66-year-old Seattle resident was arrested this morning for illegally possessing approximately 20 firearms following the serving of a search warrant at a home he owns, announced U.S. Attorney Brian T. Moran. PARK QUAN was arrested after FBI agents investigating a data theft served a search warrant on his home and discovered the cache of weapons. QUAN has two federal convictions for firearms violations and is prohibited from possessing firearms. QUAN made his initial appearance in U.S. District Court in Seattle today. He remains detained pending a hearing on August 1, 2019.
According to the criminal complaint, agents investigating the data theft were sweeping the residence for safety when they observed numerous firearms in a bedroom used by QUAN. Agents observed approximately twenty firearms in the bedroom, including what appeared to be an AR15-style assault rifle, an AK47-style assault rifle, and handguns; firearm accessories, including bump stocks, scopes, and grips; ammunition; and gun powder. Agents also encountered what appear to be fake grenades in the bedroom.
QUAN has a 1983 conviction in Washington for being a felon in possession of explosives and a 1991 conviction in Texas for possessing an unregistered machine gun. QUAN is prohibited from possessing firearms.
Being a felon in possession of a firearm is punishable by up to ten years in prison and a $250,000 fine.
The charges contained in the complaint are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by the FBI and the Bureau of Alcohol, Tobacco, Firearms & Explosives. The case is being prosecuted by Assistant United States Attorneys Steven Masada and Andrew Friedman.
Suspect in Gun Store Burglaries in Two Different Counties Charged in Federal CourtRead the Press Release
A 38-year-old man was charged today in U.S. District Court in Seattle with two counts of theft from a federal firearms licensee in connection with gun store burglaries in Clallam and Skagit Counties, announced U.S. Attorney Brian T. Moran. JOEY A. MAILLET will make his initial appearance on the complaint at 2:00 today. MAILLET has been held on local burglary charges since May 10, 2019, when he was arrested by Ferndale Police. MAILLET was transferred to federal custody from Clallam County.
According to records filed in the case, forensic evidence and surveillance video link MAILLET to the April 13, 2019, burglary of Fred’s Guns in Sequim, Washington. In that case, the suspect used a backhoe to ram the doors of the store and then broke glass display cases to steal 26 firearms. While the Sequim burglary was still under investigation, there was a second gun store burglary on May 3, 2019, at All American Armory in Bow, Washington. In that case, surveillance showed the suspect used a stolen pick-up truck to back into the doors of the store, shattering them. The suspect then used a garbage can to load up 13 rifles from the store and drove away with them in the stolen pick-up.
The pick-up truck was ultimately found abandoned in Birch Bay State Park in Whatcom County, Washington. Shattered glass was in the truck bed, as well as a stolen boat motor and battery. The truck was reported stolen from an agricultural operation not far from the Bow gun store, and the boat motor and battery were reported stolen by a resident of Ferndale, Washington.
On May 10, 2019, a Ferndale Police Officer encountered MAILLET and arrested him on an outstanding warrant for an Everett, Washington, burglary. After obtaining a court-authorized search warrant, investigators determined items in MAILLET’s backpack linked him to the thefts at the Bow gun store.
MAILLET was held on state charges in Clallam County in connection with the Fred’s Guns burglary. Those charges were dismissed earlier this week in favor of federal prosecution.
Only one of the stolen firearms has been recovered.
The charges contained in the criminal complaint are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
Theft from a federal firearms licensee is punishable by up to ten years in prison.
The case is being investigated by the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF), with assistance from the Clallam County Sheriff’s Office, Sequim Police Department, Washington State Patrol, Skagit County Sheriff’s Office, Ferndale Police Department, and Washington State Parks Rangers.
The case is being prosecuted by Assistant United States Attorney Erin H. Becker with assistance from Clallam County Deputy Prosecutor Jesse Espinoza.
maillet_complaint.pdfCo-Leader of Large Drug Trafficking Organization Sentenced to more than 11 Years in PrisonRead the Press Release
A 38-year-old Seattle man who persisted in trafficking methamphetamine, heroin, and cocaine, despite repeated run-ins with law enforcement, was sentenced today in U.S. District Court in Seattle to 11 years in prison and 5 years of supervised release, announced U.S. Attorney Brian T. Moran. MICHAEL LAVON DAVIS pleaded guilty to conspiracy to distribute controlled substances, being a felon in possession of a firearm, and conspiracy to commit money laundering. DAVIS was arrested in June 2018 as part of a large drug trafficking conspiracy that spanned five western Washington counties. DAVIS was identified as a co-leader of the group, recruiting others to transport heroin, methamphetamine, and cocaine from California to Washington and Illinois. At the sentencing hearing, U.S. District Judge Richard A. Jones said this was “a very large drug trafficking organization… you were a critical player in the organization… one of several key people who kept this organization afloat.”
“This defendant persisted in bringing cocaine and heroin into our community and recruited others to his life of crime,” said U.S. Attorney Brian T. Moran. “In this investigation more than 40 defendants were taken off the streets and are now paying the price for the poison they spread in our communities. We owe a debt of gratitude to the relentless work of federal, state, and local law enforcement officers who brought an end to this criminal conspiracy.”
The drug ring was targeted by DEA, FBI, and the Seattle Police Department as part of an effort to combat rising crime in South King and North Pierce County. According to records filed in the case, conspirators trafficked cocaine, heroin, methamphetamine, oxycodone, illegal marijuana, and fentanyl. Associates of some of the traffickers were shot and some killed in various shooting incidents in both Seattle and South King County. On the wiretap, law enforcement heard conspirators talk about various shootings after they occurred. Following an 18-month wiretap investigation, law enforcement raided more than 50 locations, seizing 12 pounds of heroin, more than 2 kilos of cocaine, a pound of methamphetamine, 124 pounds of marijuana, 41 firearms, and hundreds of thousands of dollars in cash.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. DOJ reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally based strategies to reduce violent crime.
This was an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation, providing supplemental federal funding to the federal and state agencies involved. This investigation was led by the Seattle Police Department Gang and Narcotics Units, the FBI Seattle Safe Streets Task Force, and the Drug Enforcement Administration (DEA). Other agencies providing investigative assistance include ATF, USMS, and the U.S Bureau of Prisons.
The cases are being prosecuted by Assistant United States Attorneys Vince Lombardi, Erin Becker, and Nicholas Manheim.
Disbarred Lawyer Pleads Guilty to Wire Fraud and Aggravated Identity Theft for Scheme to Steal from Friend and FamilyRead the Press Release
A disbarred Seattle attorney pleaded guilty today to aggravated identity theft and wire fraud for his scheme to steal the identities of a romantic partner and his relatives and using that personal information for fraud, announced U.S. Attorney Brian T. Moran. JOHN WILLIAM ALDERSON, 47, had a previous conviction in 2003 for wire fraud and Social Security fraud which resulted in a 41-month prison sentence and his disbarment. In 2014, ALDERSON met and began a romantic relationship with the victim and stole the victim’s identity to open multiple credit card accounts and incurred more than $260,000 in debt. All the while ALDERSON lied about his age, claimed to be independently wealthy, and concealed his prior criminal conviction and disbarment. Prosecutors have agreed to recommend no more than 54 months in prison when ALDERSON is sentenced by U.S. District Judge Richard A. Jones on November 1, 2019.
According to the plea agreement, ALDERSON moved into his victim’s home in 2015 and gained access to the victim’s personally identifying information. Using that information ALDERSON opened the credit card accounts and pretended to be the victim to dispute charges on the credit cards. One of the charges incurred on the cards was for ALDERSON to have plastic surgery at a Bellevue clinic. Those charges traveled interstate, constituting wire fraud. ALDERSON induced the victim to write him checks that were to be deposited in a joint investment account but instead were used by ALDERSON for his own expenses. ALDERSON forged letters and emails from various attorneys representing that ALDERSON was to receive a large financial settlement. Those representations were false. ALDERSON also used the identity of relatives living in Enumclaw to open an additional credit card account resulting in more than $38,000 in fraud. ALDERSON admits to a total fraud loss of more than $262,712.
The case was investigated by the FBI.
The case is being prosecuted by Assistant United States Attorney Michael Dion.
Former Microsoft Software Engineer Charged with Mail Fraud for Scheme to Steal Digital Value Such as Gift CardsRead the Press Release
A former Microsoft software engineer was arrested today and charged in a criminal complaint charging him with mail fraud for a scheme to steal $10 million in digital currency from Microsoft, announced U.S. Attorney Brian T. Moran. VOLODYMYR KVASHUK, 25, a Ukrainian citizen residing in Renton, Washington, worked first as a contractor at Microsoft and then as an employee from August 2016 until he was fired in June 2018. KVASHUK was involved in the testing of Microsoft’s online retail sales platform, and used that testing access to steal “currency stored value” such as gift cards. The complaint alleges KVASHUK resold the value on the internet, using the proceeds to purchase a $160,000 Tesla vehicle and a $1.6 million dollar lakefront home. KVASHUK made his initial appearance in U.S. District Court in Seattle today and is detained pending a further hearing on Friday July 19, 2019.
According to the criminal complaint, KVASHUK was to use a test Microsoft store account to access the company’s online sales platform and simulate the experience of customers making purchases. The system was set up to ensure no physical products ever shipped. The testing program was not supposed to involve purchases of ‘currency stored value’ (CSV) such as gift cards. KVASHUK used test accounts to purchase CSV, and then resold some or all of it on Internet reseller websites. Initially, he started stealing smaller amounts of about $10,000 in value using his own account access. As the thefts escalated into millions of dollars of value, KVASHUK used test email accounts associated with other employees. KVASHUK, a knowledgeable software developer, attempted to mask digital evidence that would trace the fraud and the internet sales back to him. He used a bitcoin “mixing” service in an attempt to hide the source of the funds ultimately passing into his bank account. In all, over the seven months of KVASHUK’s illegal activity, approximately $2.8 million was transferred to his bank accounts.
Microsoft investigators confronted KVASHUK about the thefts in May 2018 and he was fired by the company in June 2018.
The charges contained in the complaint are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
Mail fraud is punishable by up to twenty years in prison and a $250,000 fine.
The case is being investigated by the U.S. Secret Service and the Internal Revenue Service Criminal Investigation’s Western Area Cyber Crime Unit.
The case is being prosecuted by Assistant United States Attorney Michael Dion.
Department of Justice Enables Direct Tribal Access to FBI National Sex Offender RegistryRead the Press Release
WASHINGTON, DC — The U.S. Department of Justice announced today a new tool giving tribal governments the ability to directly input data and gain access to the FBI’s National Sex Offender Registry (NSOR) using the Tribe and Territory Sex Offender Registry System (TTSORS). The system connection will be available to all tribal governments already participating in the Tribal Access Program (TAP), which allows information sharing between tribal and federal government criminal information systems.
TTSORS is a no-cost registry system provided by the Justice Department’s Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering, and Tracking (SMART). The Department’s Office of the Chief Information Officer (OCIO) developed the connections which allows tribes to seamlessly submit new and updated sex offender information directly from TTSORS to NSOR.
“The Department of Justice is dedicated to addressing the public safety crisis in American Indian and Alaska Native communities, including the high rates of sexual violence against women and children,” said Attorney General William P. Barr. “Providing a direct connection to the FBI National Sex Offender Registry gives tribal law enforcement the information they need to investigate and prevent these heinous offenses.”
“Nine of our Western Washington tribes participate in TAP, and this new ability to share information will improve safety in our communities,” said U.S. Attorney Brian T. Moran. “I’m hopeful that more of our tribal partners will successfully apply for TAP funds and we will see additional communities joining in this important information sharing network.”
American Indian and Alaska Native people suffer persistently high rates of victimization, including from sexual assault. According to a 2016 study funded by the National Institute of Justice, more than four in five American Indian and Alaska Native adults have experienced some form of violence in their lifetime, and more than half of all American Indian and Alaska Native women have experienced violence from an intimate partner. In June, the department extended a deadline for tribes to apply for up to $167 million in federal funds through August 16, 2019, to support crime victims throughout Indian country.
“The direct connection between the National Sex Offender Registry and Tribe and Territory Sex Offender Registry System provides increased resources for identifying, tracking, and sharing information about persons convicted of committing these crimes,” said Gwendena L. Gatewood, Chairwoman of the White Mountain Apache Tribe of the Fort Apache Indian Reservation. “It will also allow for further improvements in providing a safer community for all involved to integrate tribal law, custom, tradition and practices in a comprehensive fashion consistent with holding offenders accountable.”
“Standing Rock has always had a priority of ensuring public safety,” said Mike Faith, Chairman of the Standing Rock Sioux Tribe. “Technological advances to our systems ensure that our SORNA staff are able to input offender information and get back in the field while ensuring compliance is maintained.”
The Sex Offender Registration and Notification Act, Title I of the Adam Walsh Child Protection and Safety Act of 2006, requires that, when an offender initially registers or updates his or her information in a jurisdiction, that the state, tribe, territory or District of Columbia must submit immediately the information to NSOR as well as other jurisdictions where the offender has to register. TTSORS is a fully functioning registry system that complies with SORNA requirements. TTSORS was created to assist the Indian tribes that have elected to implement SORNA.
Since 2015, the SMART Office, OCIO, the FBI, the Office of Tribal Justice, Community Oriented Policing Services and the Office for Victims of Crime, have worked together to develop the Tribal Access Program to provide tribes direct access to national crime information systems for both criminal and non-criminal justice purposes. This includes the ability to directly enter NSOR data and enhance the capacity to collect and submit fingerprints and palm prints to the FBI. TAP has been instrumental in assisting tribes with ongoing implementation of SORNA. In fiscal year 2019, the department expanded TAP to 25 more tribes, for a total of 72 participating tribes.
Tribes with TAP access in Western Washington include: Chehalis, Swinomish, Lower Elwha, Quinault, Port Gamble S'Klallam, Suquamish, Tulalip Tribes, Makah, and Lummi Nation.
Leader of Gift Card Fraud Ring that Stole more than $700,000 from Target and Customers Sentenced to 5 Years in PrisonRead the Press Release
A 30-year-old man arrested last year in Snohomish County, Washington was sentenced today in U.S. District Court in Seattle to five years in prison and three years of supervised release for his scheme to defraud Target and its customers of more than $700,000, announced U.S. Attorney Brian T. Moran. JEFFERY DOUGLAS MANN, of Marysville, Washington, led a group of five people who used a system to decipher gift card identifying numbers and used them across five western states for fraud. U.S. District Judge James L. Robart ordered MANN to pay more than $214,000 in restitution saying MANN, “is obviously talented and used that talent to break the law… This is not a victimless crime -- it impacts real people.”
According to records filed in the case, between May 2017 and December 2017, the ring stole gift card balances worth more than $700,000, and often sold illegally purchased goods or store gift cards for bitcoin on an internet marketplace. The co-conspirators used a formula to reverse-engineer and identify unique bar code numbers of thousands of authentic gift cards sold by Target to legitimate customers. Members of the scheme then used the retailer’s automated customer service telephone system to verify balances linked to the various stolen gift card numbers. They then loaded active gift card numbers onto a mobile or electronic wallet app on their phones, which the co-conspirators used to purchase merchandise and legitimate gift cards at various Target store locations across at least five states: Washington, Oregon, California, Nevada and Colorado. For example, on a single occasion in November 2017, MANN and others used roughly 180 compromised gift card numbers to make $6,900 in purchases at the Southcenter Mall Target store in Tukwila, Washington.
When the actual cardholders later tried to use their gift cards, they discovered that they had zero balance. In December 2017, Target modified its gift card system in response to the fraud, putting an end to the scheme. Target reimbursed customers for their losses.
MANN pleaded guilty to wire fraud in March 2019. Four other defendants have resolved their criminal charges: Corey Mosey was sentenced to 46 months in prison; Joshua Newman was sentenced to 38 months in prison and Derrick Quintana was sentenced to 27 months in prison. Kennady Weston is resolving her case with participation in federal drug court. Those defendants agreed to pay a total of roughly $263,000 in restitution in addition to that ordered from MANN.
The case was investigated by the U.S. Secret Service, with assistance from the Kirkland, Lynnwood, and West Linn (OR) Police Departments, and is being prosecuted by Special Assistant United States Attorney Benjamin Diggs and Assistant United States Attorney Steven Masada.
Tukwila, Washington Man Sentenced to 6 Years in Prison for Possession of Child PornographyRead the Press Release
A 50-year-old Tukwila, Washington man, with a prior state conviction for possession of child pornography, was sentenced July 1, 2019, to six years in prison, announced U.S. Attorney Brian T. Moran. JEFFREY ALLEN MORRIS was arrested in September 2018, following a cybertip to the National Center for Missing and Exploited Children (NCMEC). At the sentencing hearing, U.S. District Judge James L. Robart sentenced MORRIS to ten years of supervised release to follow prison, telling the defendant that he needed to get control of his demons or he would “spend the rest of his life in prison.”
According to records filed in the case, the investigation by the Seattle Police and Homeland Security Investigations began May 10, 2018, when Microsoft Skype reported to NCMEC that a subscriber, MORRIS, had uploaded images of child rape. Law enforcement confirmed the images were sexual abuse of toddlers. A review of MORRIS’ Skype chats revealed his interest in sex acts with children as young as 3 years old. When law enforcement conducted a court-authorized search of MORRIS’ residence, forensic analysis revealed hundreds of images of child rape and molestation on his electronic devices.
MORRIS served a 21-month state sentence in 2007 for possession of images of child pornography. In that case, he had posted over 100 images of sexually explicit images of child rape and abuse to Yahoo.com profile photos. A search of his computers at that time revealed he had more than 700 images and 14 movies depicting the sexual abuse of children.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys= Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate better, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
The case was investigated by Homeland Security Investigations, as part of the Internet Crimes Against Children (ICAC) Taskforce led by the Seattle Police Department.
The case is being prosecuted by Special Assistant United States Attorney Cecelia Gregson. Ms. Gregson is a Senior King County Deputy Prosecutor specially designated to prosecute child exploitation crimes in federal court.
Clark County Man Sentenced to 5+ Years in Prison for Dealing Methamphetamine while on Supervised Release for Gun CrimeRead the Press Release
A 33-year-old resident of Clark County, Washington was sentenced July 1, 2019 to 66 months in prison for distributing methamphetamine, announced U.S. Attorney Brian T. Moran. JOSHUA ADAM HOOVER was on supervised release for illegally selling a firearm in 2011, when he sold methamphetamine to a person working with law enforcement. U.S. District Judge Benjamin H. Settle imposed a four-year term of supervised release to follow this new prison term.
According to records filed in the case, HOOVER sold methamphetamine to the confidential source on two occasions in June and July 2018. The transactions were audio and video recorded and took place in the Battle Ground area of Clark County. HOOVER was arrested on State charges by Battle Ground PD officers on August 8, 2018. He was taken into federal custody on October 31, 2018. HOOVER pleaded guilty on February 7, 2019.
HOOVER has a lengthy criminal history including five felony convictions between 2003 and 2016.
The case was investigated by the Southwest Washington Interagency Gang Enforcement Team (also known as the FBI’s Safe Streets Taskforce), and the Battle Ground Police Department. It was prosecuted by Assistant United States Attorney Gregory A. Gruber.
U.S. Attorney's Office, Federal Public Defender, U.S. Probation, and Bureau of Prisons Join Forces to Improve Success of Transition from Federal Custody to the CommunityRead the Press Release
U.S. Attorney Brian T. Moran today highlighted collaborative work among the U.S. Attorney’s Office, the Federal Public Defender, the U.S. Probation Office, and the Bureau of Prisons to assist formerly incarcerated individuals with the transition from prison to the community. The Western District of Washington is one of the first federal judicial districts to create a “reentry guide” for individuals preparing for release. The district also created one of the first “warrant clearing” initiatives to assist individuals who are federally incarcerated with clearing state court warrants. Unresolved warrants prohibit incarcerated individuals from participating in programs that play an important role in the rehabilitative process, such as halfway houses and drug treatment.
“As a long-time prosecutor, I am always pleased when someone who has been incarcerated is able to successfully rejoin the community and become a contributing member of society,” said U.S. Attorney Brian T. Moran. “That success makes our communities safer and frees up resources to investigate and prosecute other crimes. I’m pleased that the Western District of Washington is a leader in working collaboratively to reduce barriers and facilitate successful transitions to the community.”
Working with the Bureau of Prisons at the Federal Detention Center in SeaTac, the U.S. Probation Office, and the Federal Public Defender, the U.S. Attorney’s Office produced a 32-page guide for those within six months of their release from incarceration. The content of the guide was created with input from those in FDC SeaTac. Currently incarcerated individuals were asked what information they most needed, and prosecutors, defenders, probation, and the Bureau of Prisons worked together to provide clear and comprehensive answers. The guide was first provided to incarcerated persons in December 2018 as part of a quarterly reentry event at FDC SeaTac and is now provided on an ongoing basis to individuals within six months of release. At the reentry events, reentry experts provide information on education, employment, and housing options and answer questions about legal concerns regarding supervised release.
Incarcerated individuals are also able to take advantage of a unique warrant-clearing initiative in the Western District of Washington. Through this program, one of only a few in the country, federal prosecutors work hand-in-hand with local prosecutors and federal defenders to determine the warrant status and seek a resolution that improves the likelihood of successful reentry. By clearing the warrants, incarcerated persons can take advantage of more education programs at the Bureau of Prisons and more successfully transition to the community upon release.
Long-Time Redmond, Washington Investment Advisor Sentenced to Prison for Defrauding Investors of more than $3 MillionRead the Press Release
A long-time investment advisor in Redmond, Washington was sentenced today in U.S. District Court in Seattle to five years in prison for defrauding more than 15 investors of more than $3 million, announced U.S. Attorney Brian T. Moran. DENNIS GIBB, 72, the President and owner of Sweetwater Investments Inc., pleaded guilty in March 2019, to wire fraud and falsification of records with the intent to obstruct a matter within the jurisdiction of the Securities and Exchange Commission (SEC). Simultaneously, GIBB and Sweetwater investment entered into a consent decree with the SEC liquidating the Sweetwater Income Flood LP Fund and barring GIBB from further investment activity. At the sentencing hearing, Chief U.S. District Judge Ricardo S. Martinez said GIBB “entered into a scheme and deliberately, intentionally and knowingly stole money from people who came to him…. Many victims, late in their lives, entrusting him with money they intended to get them through the last years of their lives.”
“Those who invested with this defendant were not looking for the ridiculously large profits promised by some Ponzi schemers – they invested with the defendant because he promised them a secure, if modest, payout,” said U.S. Attorney Brian T. Moran. “Instead, over more than a decade this defendant stole their savings, retirement funds, future home down payments, and children’s education funds. To make matters worse, he provided victims with false tax documents, causing some to pay additional taxes on non-existent gains. This defendant not only robbed the victims financially, he stole their peace of mind and their trust.”
According to the criminal case filings and the SEC consent decree, GIBB created Sweetwater Income Flood Limited Partnership, a private fund Gibb managed, in 2008. As early as 2007, he began soliciting investors for the fund targeting those who wanted steady retirement income in the near future. Between 2007 and 2018, about 25 investors put about $7.3 million into the fund. GIBB secretly transferred more than $3.1 million from the fund for his own expenses. To hide his theft, GIBB sent investors falsified quarterly account statements. When the SEC began an examination of the Sweetwater Investments in May 2018, GIBB provided false records to examiners indicating the fund had been liquidated.
GIBB agreed to forfeit a money judgment of $3,197,401. The Court also ordered restitution of $4,233,616. This amount includes approximately $1.77 million that remained in the Income Flood fund at the time of Gibb’s consent decree and guilty plea. Gibb agreed to turn these funds over to the SEC for disbursement to victims, and the funds will be disbursed as part of the restitution order.
The case was investigated by the SEC and the FBI. The case is being prosecuted by Assistant United States Attorney Matthew Diggs.
Former Microsoft Director of Sports Marketing Sentenced to 28 Months in Prison for Wire FraudRead the Press Release
The former Director of Sports Marketing and Alliances at Microsoft was sentenced today in U.S. District Court in Seattle to 28 months in prison, and three years of supervised release for wire fraud for his scheme to profit by stealing from Microsoft. JEFF TRAN, a/k/a TRUNG TRAN, 45 of Seattle, used his position at Microsoft to attempt to steal more than $1.5 million through the creation and submission of fraudulent invoices and the unauthorized use of other Microsoft assets. At the sentencing hearing Chief U.S. District Judge Ricardo S. Martinez asked TRAN why he stolen the money. TRAN told the court he was still trying to answer why he did it.
According to records filed in the case, TRAN oversaw Microsoft’s promotional relationship with the National Football League (NFL). Tran’s scheme began in January of 2016. Tran, who was responsible for distributing Microsoft’s Super Bowl tickets to Microsoft employees, secretly misappropriated over $40,000 worth of 2016 Super Bowl tickets and sold them to a New York ticket broker. He repeated this activity the following year, this misappropriating tickets worth more than $200,000 for the 2017 Super Bowl.
Tran continued his theft after the 2017 Super Bowl. In March 2017, TRAN persuaded a Microsoft vendor to invoice Microsoft $775,000 for supposed services the vendor had never provided. Tran explained the request by telling the vendor the services had been provided by another company that could not bill Microsoft directly because it had not gone through Microsoft’s accreditation process. At Tran’s direction, Microsoft paid the $775,000 invoice to the vendor, and the vendor forwarded the proceeds to Tran.
In July 2017, Tran attempted to repeat the invoicing scheme, and asked the vendor to prepare a $670,000 invoice for services it had not provided. This time, the vendor became suspicious and reported Tran’s activity to Microsoft. When Microsoft confronted Tran, Tran made false statements to corporate investigators, destroyed evidence, and attempted to persuade witnesses to lie to investigators.
Tran returned $775,000 to Microsoft days after being confronted. Tran returned the remaining stolen funds after entering into a plea agreement with the government.
In asking for a prison sentence, prosecutors wrote to the Court that, “When Tran stole from Microsoft, the company was already paying him hundreds of thousands of dollars annually to do a job most people would envy. Tran’s decision to steal when he already occupied a lucrative and privileged position makes his conduct more volitional, and the crime more reprehensible, than crimes committed by people who steal, deal drugs, or commit other crime to put food on the table.”
TRAN has already paid restitution to Microsoft of $1,036,000. Chief Judge Martinez also imposed a $50,000 fine.
The case was investigated by the FBI. The case was prosecuted by Assistant United States Attorney Seth Wilkinson.
Bothell Woman Sentenced to 3 Years in Prison for Embezzling more than $400,000 from Family-Owned Property Management FirmRead the Press Release
A 52-year-old Bothell, Washington woman was sentenced today in U.S. District Court in Seattle to three years in prison and five years of supervised release for bank fraud and aggravated identity theft for a five-year scheme in which she cashed 306 fraudulent checks, totaling $400,526 and drawn on the bank accounts of her employer. ERIN K. McCAULEY, also known as ERIN K. CHARLES, was a trusted part-time employee of a Lynnwood, Washington property management firm. The firm managed a number of commercial properties and a contracting business. It was owned by a couple who brought McCAULEY on in 2004 to assist with the book-keeping. As early as 2012, McCAULEY began writing large checks to herself and forging the owners signatures. At the sentencing hearing, Chief U.S. District Judge Ricardo S. Martinez said “she stole a significant amount of money from a small company and it greatly impacted that business.”
According to records filed in the case, McCAULEY had become a trusted employee of the couple as they entered their 60’s and 70’s. They gave McCAULEY gifts, assisted her with car and house payments and made sure she got an annual bonus. In 2017 for example, the couple loaned McCAULEY $8,000 for home repairs. It appears now they were repaid with some of the $400,000 that was stolen from their own accounts.
When the couple became aware of the theft, they worked with the FBI to see if McCAULEY would admit the embezzlement. She vastly underestimated the amount of money she had embezzled, and acknowledged much of the money had gone to feed her gambling addiction.
In asking for a four-year prison sentence prosecutors wrote to the court McCAULEY “wanted money that she did not have in order to live a lifestyle should could not afford. To do so, she took advantage of her position as the trusted office manager and bookkeeper for the (couple) and used their business accounts as her personal “piggy bank” to fund the lifestyle she wanted to live.”
The case was investigated by the FBI and was prosecuted by Assistant United States Attorney Stephen Hobbs.