Eastern District of Wisconsin
Press releases recorded for this federal judicial district.
Federal Bureau of Investigation Arrests Milwaukee Man Who Planned Mass Shooting; Man Charged with Possession of MachinegunsRead the Press Release
Acting United States Attorney Gregory J. Haanstad and Special Agent in Charge Robert J. Shields of the FBI’s Milwaukee Division announced today that Milwaukee resident Samy Mohamed Hamzeh, 23, has been charged with possessing machineguns and a silencer.
According to the criminal complaint, Hamzeh had been under investigation since September 2015. The investigation revealed that, in October 2015, Hamzeh planned to travel to Jordan, enter the West Bank, and conduct an attack on Israeli soldiers and citizens living in the West Bank. Hamzeh later abandoned those plans and began to focus on conducting an attack in the United States.
According to the criminal complaint, Hamzeh has engaged in extensive conversations with two confidential sources (referred to here as CS-1 and CS-2). Those conversations, which were in Arabic, were monitored, recorded, and translated by the FBI beginning in October 2015.
During those recorded conversations, Hamzeh explained that he wanted to commit a domestic act of violence and, earlier this month, he settled on a Masonic temple in Milwaukee as his target.
On January 19, 2016, Hamzeh, CS-1 and CS-2 took a guided tour of the Masonic temple, during which they learned meeting schedules and where people would be located during meetings. In a recorded conversation after they left the temple, Hamzeh, discussed his plans with CS-1 and CS-2. In that conversation, Hamzeh reaffirmed his intention to commit an armed attack on the temple and discussed in further detail how they would carry out the attack.
Hamzeh said that they would need two machineguns so that they each would have one (Hamzeh indicated that one CS already had a machinegun), and also said that they would need three silencers:
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“We want two machineguns, you now have one, so we want two more, and we need three silencers, that’s it.Find out how much all together these will cost, and then we will march.”
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“We want two, like the machinegun you have. . . . And we need silencers. . . . Three, yes three silencers, and that’s it.”
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“. . . each one has a weapon, each one has a silencer gun, the operation will be one hundred percent successful.I am telling you, to go without silencer gun, you will be exposed from the beginning.”
Hamzeh also explained to CS1 and CS2 that, when they executed the attack at the temple, one of the three of them would have to stay at the main door while the others went upstairs to kill the people who would be meeting there:
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“one of us will stay at the door at the entrance and lock the door down, he will be at the main door down, two will get to the lift up, they will enter the room, and spray everyone in the room.The one who is standing downstairs will spray anyone he finds.We will shoot them, kill them and get out.We will walk and walk, after a while, we will be covered as if it is cold, and we’ll take the covers off and dump them in a corner and keep on walking, as if nothing happened, as if everything is normal.But one has to stand on the door, because if no one stood at the door, people will be going in and out, if people came in from outside and found out what is going on, everything is busted.”
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“As long as the one on the door understands he has bigger responsibility than the others.For your information, he has to take care of everyone around him, the comers and the one that wants to go, he has to annihilate everyone, there is no one left, I mean when we go into a room, we will be killing everyone, that’s it, this is our duty, as for the one at the door, he must have 20/20 eye vision and always alert for all the traffic around him.”
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“I am telling you, as I was saying, all three of us get in together, one will go, to the one that is staying at the reception . . . . If she was alone, it is okay, if there were two of them, shoot both of them, do not let the blood show, shoot her from the bottom, two or three shots in her stomach and let her sit on the chair and push her to the front, as if she is sleeping, did you understand?Then stay downstairs, the other two will take the lift to the third floor, go directly to the room, open the door, shoot everyone, move fast even avoiding the lift and take the stairs running down. . . . Using the stairs, the third one on the door will notice us coming down, we will go out together.No one sees anything and no one knows anything.We leave, as if there is nothing, no running, no panic, just regular walking.We’ll get three head covers with three holes in them. . . . we’ll get in all three of us together, the minute we get in, we shoot whoever is in front of us, and all have to be eliminated.One stays down and two will go up quickly.
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“And we will eliminate everyone.”
Hamzeh also explained what his objectives were in committing the attack:
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“I am telling you, if this hit is executed, it will be known all over the world. . . . Sure, all over the world, all the Mujahedeen will be talking and they will be proud of us. . . such operations will increase in America, when they hear about it.The people will be scared and the operations will increase, and there will be problems all over, because more than one problem took place, and this will be the third problem, this will lead to people clashing with each other.This way we will be igniting it.I mean we are marching at the front of the war.”
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“They are all Masonic; they are playing with the world like a game, man, and we are like asses, we don’t know what is going on, these are the ones who are fighting, these are the ones that needs to be killed, not the Shi’iat, because these are the ones who are against us, these are the ones who are making living for us like hell.”
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“Thirty is excellent.If I got out, after killing thirty people, I will be happy 100%. . . . 100% happy, because these 30 will terrify the world.”
Hamzeh made plans to purchase machineguns and silencers from two individuals who, unbeknownst to Hamzeh, were undercover FBI agents. He met with them, along with CS-1 and CS-2, on January 25, 2016. The undercover agents displayed the weapons and a silencer to Hamzeh, told him that the weapons were capable of automatic fire, and explained to him the functioning of the selector switch that allowed the weapons to fire automatically. Hamzeh agreed to a price and paid it to the undercover agents, who then handed Hamzeh a bag containing two automatic weapons and a silencer. Hamzeh carried the bag to the vehicle in which he had traveled to the meeting, and he placed the bag in the trunk of the vehicle. He then was arrested and has been charged with illegally possessing machineguns.
Acting United States Attorney Gregory J. Haanstad said, “Samy Mohamed Hamzeh devised a detailed plan to commit a mass shooting intended to kill dozens of people. He also said that he wanted this mass shooting to be ‘known the world over’ and to ‘ignite’ broader clashes. It is difficult to calculate the injury and loss of life that was prevented by concerned citizens coming forward and by the tireless efforts of the FBI and the Joint Terrorism Task Force.”
Special Agent in Charge of the FBI Robert J. Shields said “The arrest of Samy Mohamed Hamzeh is the result of a well-coordinated undercover law enforcement action, at no time was the public’s safety placed in jeopardy. I would like to commend the efforts of the Joint Terrorism Task Force which includes our local and state law enforcement partners in thwarting an attack that could have resulted in significant injury and /or loss of life.”
This case is being prosecuted by Assistant United States Attorney Paul L. Kanter.
The charges contained in the criminal complaint are only allegations; the defendant is presumed innocent unless and until he is proven guilty beyond a reasonable doubt.
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Milwaukee Woman Sentenced to Prison for Aiding and Assisting in the Filing of False Federal Income Tax ReturnsRead the Press Release
Acting United States Attorney Gregory J. Haanstad for the Eastern District of Wisconsin, announced that on January 5, 2016, Tina M. Gentry (age: 48) of Milwaukee was sentenced to a total of six months imprisonment based on her conviction for filing false tax returns with the Internal Revenue Service in violation of Title 18, United States Code, Section 287. Gentry was also ordered to pay $57,000 in restitution payable to the IRS.
According to the indictment, Gentry assisted individuals in falsely obtaining federal income tax refunds from the IRS. To obtain the refunds, Gentry prepared tax returns claiming false and fraudulent federal taxable income and federal income tax withheld, when she knew that none of the individuals she prepared returns for had federal taxable income or federal income tax withheld. In total, Gentry caused approximately 112 federal income tax returns to be filed with the IRS, falsely claiming federal income tax refunds of more than $90,000.
The case was investigated by Internal Revenue Service Criminal Investigation. The case was prosecuted by Assistant United States Attorney Lisa A. Wesley
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Three Sentenced for Promoting Interstate ProstitutionRead the Press Release
Acting United States Attorney Gregory J. Haanstad announced that Charles Nash (28) and Brandon Smith (40) of Appleton, WI and Elizabeth Johnson (27) of Two Rivers, WI were recently sentenced by Chief Judge William C. Griesbach. Smith was sentenced on December 10, 2015, to 48 months imprisonment following his guilty plea to three counts of using a telephone to promote, manage and carry on a prostitution business in violation of Title 18, United State Code, Section 1952. Smith was ordered to serve three years of federal supervised release following his prison term. Nash was sentenced on November 25, 2015, to 46 months prison following his guilty plea to two counts of using a telephone to promote, manage and carry on a prostitution business. Nash will also serve a three year term of federal supervised release after the service of his prison term. Johnson was sentenced on November 23, 2015, to “time served” meaning a six month sentence but credited for that same amount of time that she was held in jail both before and following her guilty plea to the charge of using a telephone to promote, manage and carry on a prostitution business. Johnson is currently serving a three year term of federal supervised release.
According to court documents, in February 2015, Nash and Smith arranged for Johnson and Jane Doe to travel from the Fox Valley area to Iowa and then Nebraska for purposes of engaging in prostitution. Johnson had previously worked as a prostitute and instructed Jane Doe, prior to the travel, in how to commit such offenses without being detected by law enforcement. Johnson and Jane Doe were arrested in Nebraska on February 26, 2015, pursuant to an undercover prostitution sting operation. Prior to their arrest, Nash was in continual contact with Johnson for purposes of persuading and inducing her to commit acts of prostitution in order to raise money so he could hire an attorney for his pending drug charge. Smith was in regular contact with Jane Doe for purposes of persuading and inducing her to commit acts of prostitution. Jane Doe later stated that any money made would have been given to Smith, her pimp. Jane Doe also confirmed that Johnson instructed her on how to conduct acts of prostitution. The investigation confirmed that Johnson performed acts of prostitution at Nash’s direction for many months and also attempted to persuade others to work as prostitutes for Nash. Further, the investigation revealed several other prostitutes that worked under the direction of both Nash and Smith.
In pronouncing sentence, Judge Griesbach noted the aggravated nature of the case including the negative impact such conduct has on the community. In particular, Judge Griesbach referenced the psychological and often physical trauma sustained by young women through the course of being prostituted by individuals such as Nash and Smith.
The case was investigated by the Wisconsin Department of Justice-Division of Criminal Investigation, Appleton Police Department, Oshkosh Police Department, Outagamie County Sheriff Department, the Lincoln (Nebraska) Police Department, and the Omaha Police Department/FBI Child Exploitation Task Force. The Outagamie County District Attorney’s Office, in particular, Assistant District Attorney Andrew Maier, provided invaluable assistance by initiating and leading the initial investigation of the case. The federal case was prosecuted by Assistant U.S. Attorney William Roach.
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Green Bay Man Sentenced to 5 Years in Federal Prison for Methamphetamine DistributionRead the Press Release
Gregory J. Haanstad, Acting United States Attorney for the Eastern District of Wisconsin, announced that on January 4, 2016, Kou Lee (age: 26) of Green Bay, Wisconsin, was sentenced by Chief United States District Judge William C. Griesbach, to 60 months in federal prison followed by 60 months of supervised release.
Lee had previously entered a guilty plea to a charge of knowingly possessing with the intent to distribute 50 grams or more of methamphetamine in violation of Title 21, United States Code, Section 841(a)(1). According to the plea agreement and other documents filed with the court, Lee was stopped for speeding in the Village of Little Chute, in Outagamie County, Wisconsin. During the traffic stop the defendant was found to be in possession of 95 grams of methamphetamine packaged for sale.
In pronouncing sentence, Chief Judge Griesbach noted that the defendant’s actions brought “poison” into the Green Bay community and ruined untold number of lives through addiction to methamphetamine.
This case was investigated by the Fox Valley Metro Police Department and the Drug Enforcement Administration. The case was prosecuted by Assistant United States Attorney Daniel R. Humble.
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Manitowoc Man Indicted for Federal Kidnapping, Drug Conspiracy, and Firearm CrimesRead the Press Release
Acting United States Attorney Gregory J. Haanstad for the Eastern District of Wisconsin, announced that on December 15, 2015, a federal grand jury returned a three-count indictment charging Steven R. Schenian Jr. (age: 37) of Manitowoc, Wisconsin, with one count each of kidnapping in violation of Title 18, United States Code, Section 1201(a)(1), conspiracy to distribute 500 grams or more of a controlled substance in violation of Title 21, United States Code, Section 846, and possession of a firearm in furtherance of a drug crime in violation of Title 18, United States Code, Section 924(c).
If convicted of kidnapping, the defendant faces a life sentence, and if convicted of the drug conspiracy the defendant faces between five and forty years imprisonment. Conviction on the firearm offense carries a mandatory consecutive term of five years imprisonment.
According to the indictment, the defendant conspired with others to sell over 500 grams of cocaine in the Manitowoc County area, and on at least one occasion is alleged to have done so while possessing a firearm. Further, he is alleged to have unlawfully and willfully kidnapped an individual identified only as “John Doe” for the purpose of seeking retaliation against that individual.
The defendant appeared in federal court in Green Bay this morning and was remanded to the custody of the U.S. Marshal’s Service pending trial.
The case was investigated by the U.S. Drug Enforcement Agency (DEA) and the Manitowoc County MEG Unit. It is being prosecuted by Assistant United States Attorney Daniel R. Humble.
An indictment is only a charge and not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
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Keshena Man Sentenced for Assault on 6 Month Old ChildRead the Press Release
Acting United States Attorney Gregory J. Haanstad announced that Derrick M. Corn (32), Keshena, Menominee Indian Reservation, WI., was sentenced on December 9, 2015 by Chief Judge William C. Griesbach to 60 months imprisonment for the assault of a six-month old child resulting in substantial bodily injury to the child, in violation of Title 18, United States Code, Section 113(a)(7). Corn is the father of the child. Upon his release, Corn will be on federal supervised release for 3 years.
In pronouncing sentence, Judge Griesbach noted the serious injuries to the child including multiple skull fractures. He also rejected Corn’s claim that the injuries occurred when his child was submerged under water for a period of time while taking a bath. Corn claimed he was shaving at the time and was not paying attention to the child. Judge Griesbach referenced the complete lack of evidence supporting Corn’s claim and cited to the extensive medical reports disproving his claim.
The case was investigated by the Federal Bureau of Investigation and the Menominee Tribal Police Department and was prosecuted by Assistant U.S. Attorney Ben Whittemore and William Roach.
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Three Milwaukee Persons Convicted for Sending Fraudulently Obtained Funds to the UkraineRead the Press Release
Today, Gregory J. Haanstad, Acting United States Attorney for the Eastern District of Wisconsin, announced that Vladimir Sonin (age 50) of Bayside, Wisconsin; Natalya Sonina (age 47) of Bayside, Wisconsin; and Irina Tinney (age 47) of Milwaukee, Wisconsin entered guilty pleas in federal court. According to court documents, on June 9, 2015, all three individuals were indicted on various offenses related to a scheme to fraudulently obtain more than $1.1 million in federal and state tax refunds from 2013 through 2015.
Vladimir Sonin and his wife Natalya Sonin pled guilty to counts five and fifteen of the indictment which alleged mail fraud in violation of Title 18, United States Code, Section 1341 and aggravated identity theft in violation of Title 18, United States Code, Section 1028A. The Sonins face a maximum penalty of 20 years imprisonment, a $250,000 fine, and 3 years of supervised release for the mail fraud convictions, plus a two year consecutive sentence and a $250,000 fine for aggravated identity theft. According to their plea agreements, the scheme involved the filing of fraudulent tax returns in the names of identity theft victims. Funds from fraudulently-obtained tax returns were loaded onto access devices, such as bank cards, and the money was then withdrawn from ATMs. Most of the money was then sent to the Ukraine, much of it to the brother of Natalya Sonin and Irina Tinney. More than $1.1 million was sent to the Ukraine using cash wire transfers. The Internal Revenue Service identified more than 1500 unauthorized tax returns filed using stolen identities from Southeastern Wisconsin
Irina Tinney pled guilty to one count of structuring to evade reporting requirements in violation of Title 31, United States Code, Section 5324. Tinney faces a maximum penalty of five years imprisonment, $250,000 fine, and 3 years of supervised release.
The case was investigated by the Internal Revenue Service Criminal Investigation, the Postal Inspection Service and the Federal Bureau of Investigation. This case was prosecuted by Assistant United States Attorney Stephen A. Ingraham.
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Milwaukee Carjacker Sentenced to 50 Years ImprisonmentRead the Press Release
Acting United States Attorney Gregory J. Haanstad announced today that Milwaukee resident Grover Ferguson (age:18) was sentenced to 50 years of imprisonment, to be followed by 5 years of supervised release, for committing a carjacking on April 21, 2015, during which he shot the vehicle’s owner.
On August 25, 2015, Ferguson pleaded guilty to one count of armed motor vehicle robbery, in violation of 18 U.S.C. § 2119(2), and one count of discharging a firearm during a crime of violence, in violation of 18 U.S.C. § 924(c). According to the plea agreement, Ferguson approached a parked vehicle on April 21, 2015, pointed a revolver at the owner who was in the driver’s seat, and demanded the keys. Ferguson then fired several shots from the revolver, hitting the owner in the face and body. Ferguson drove away in the vehicle, but was captured the following day after leading Milwaukee Police officers on a high-speed chase.
At the sentencing hearing, U.S. District Judge Rudolph T. Randa emphasized the violent nature of the crime committed by Ferguson.
“Armed carjackings are a significant threat to public safety and we are going to continue to vigorously pursue cases like this as a part of our strategy to combat violent crime in this district,” Haanstad commented. “Carjackers who are prosecuted in federal court face decades in prison without the potential for parole.”
“As a result of this joint local and federal investigation, another violent individual has been removed from the streets of Milwaukee,” stated ATF-St. Paul Field Division Special Agent in Charge Jim Modzelewski. “ATF is committed to combating firearms violence and will continue to partner with the Milwaukee Police Department and utilize all available resources to increase the safety in our communities”.
Milwaukee Police Chief Edward Flynn added “We are grateful the Judge imposed a sentence commensurate with the crime that was committed and are hopeful this measure of justice is a comfort to the family and victim.”
This case was investigated by law enforcement officers from the Milwaukee Police Department and the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). The case was prosecuted by Assistant United States Attorney Benjamin W. Proctor.
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Appleton Man Indicted on Child Pornography ChargesRead the Press Release
Acting United States Attorney Gregory J. Haanstad for the Eastern District of Wisconsin, announced that on December 1, 2015, a federal grand jury returned a two-count indictment against Larry L. Turk (age: 68) of Appleton, Wisconsin, charging him with one count of distributing child pornography in violation of Title 18, United States Code, Section 2252A (a)(2) and one count of possessing child pornography in violation of Title, 18 United States Code, Section 2252A (a)(5)(B).
If convicted of the distribution offense, the defendant faces a sentence of between 5 and 20 years imprisonment, a $250,000.00 fine, and between five years and a lifetime of supervised release. Conviction on the possession offense carries penalties of up to ten years imprisonment, a $250,000.00 fine, and between five years and a lifetime of supervised release.
According to the indictment, Turk knowingly used a computer to distribute and possess pornographic videos of children, some as young as three years old, engaged in sexually explicit behavior with adults.
The case was investigated by the Wisconsin Department of Justice, Division of Criminal Investigation, the Outagamie County Sheriff’s Department, and the Appleton Police Department. The case is being prosecuted by Assistant United States Attorney Daniel R. Humble.
An indictment is only a charge and not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
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Milwaukee Man Sentenced to 18 Years ImprisonmentRead the Press Release
Acting United States Attorney Gregory J. Haanstad announced today that Milwaukee resident Drayon Wren (age: 38), was sentenced to 18 years imprisonment followed by 5 years of supervised release for federal sex trafficking charges involving three minor victims and one adult victim.
On July 16, 2015, Wren plead guilty to three counts of sex trafficking of a child and one count of sex trafficking an adult by use of force, fraud or coercion. Wren recruited the three minors girls and an adult female in Milwaukee and transported them to Elk Grove, Illinois to engage in prostitution.
In his sentencing remarks, the Honorable J.P. Stadtmueller, emphasized the depravity of Wren’s conduct, “on our young people, our most important resource.”The judge further stated that “the public at large deserves protection from this terrible, terrible business” of sex trafficking.
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, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov
This case was investigated by law enforcement officers from the Human Trafficking Task Force, including those from the Wisconsin Department of Justice Division of Criminal Investigation, the Federal Bureau of Investigation, and the Milwaukee Police Department. The case was prosecuted by Assistant United States Attorneys Penelope Coblentz and Joseph R. Wall.
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Neenah Woman Sentenced to 12 Years in Federal Prison for Role in Fatal Heroin OverdoseRead the Press Release
Acting United States Attorney Gregory J. Haanstad for the Eastern District of Wisconsin, announced that today, Brandi Kniebes-Larsen (age: 37) of Neenah, Wisconsin, was sentenced to 12 years in federal prison followed by 10 years of supervised release by Chief United States District Judge William C. Griesbach. Kniebes-Larsen previously entered a guilty plea for her role in a conspiracy to deliver 100 grams or more of heroin in violation of Title 21, United States Code, Sections 841(a)(1), (b)(1)(B), and 851. According to the plea agreement and other documents filed with the court, Kniebes-Larsen procured and dealt the heroin which ultimately led to the overdose death of Frederick J. Schnettler (age: 24) also of Neenah.
In pronouncing the sentence, Chief Judge Griesbach noted the extreme nature of the offense which resulted in the death of Mr. Schnettler, as well as the lengthy criminal history of Ms. Kniebes-Larsen involving numerous drug convictions. The sentence also included the forfeiture of the defendant’s residence, from which she had distributed controlled substances in the past.
The case was investigated by the Winnebago County Sheriff’s Department, the Lake Winnebago Area MEG Unit, and the City and Town of Menasha Police Departments. The case was prosecuted by Assistant United States Attorney Daniel R. Humble.
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Appleton Man Sentenced to 65 Months in Federal Prison for Methamphetamine Distribution and Firearms ChargesRead the Press Release
Acting United States Attorney Gregory J. Haanstad, for the Eastern District of Wisconsin, announced that yesterday Khee Vang (age: 36) of Appleton, Wisconsin, was sentenced to 65 months in federal prison followed by 5 years of supervised release by Chief United States District Judge William C. Griesbach. Vang had previously entered guilty pleas for possession with intent to distribute 50 grams or more of methamphetamine in violation of Title 21, United States Code, Section 846, and possession of a firearm in furtherance of a drug trafficking charge in violation of Title 18, United States Code, Section 922(c)(1)(A).
According to the plea agreement and other documents filed with the court, Vang was arrested with a loaded firearm, 117 grams of methamphetamine, and $4,500 in cash while traveling back to Appleton from La Crosse where he met with his drug source. In pronouncing the sentence, Chief Judge Griesbach noted the many lives that methamphetamine has destroyed in Northeast Wisconsin. He further noted that the quantity of methamphetamine and the presence of firearms made this an inherently dangerous crime.
The case was investigated by the Lake Winnebago Area Metropolitan Enforcement Group and the United States Drug Enforcement Administration. The case was prosecuted by Assistant United States Attorney Daniel R. Humble.
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Deaconess Home Health, Inc. and Owner Agree to Criminal and Civil Resolution of Health Care Fraud ChargesRead the Press Release
The Acting United States Attorney for the Eastern District of Wisconsin, Gregory Haanstad, announced today that the United States has filed a criminal information charging Deaconess Home Health, Inc. and its owner, Lazarus Bonilla, with committing health care fraud against the Wisconsin Medicaid Program. Deaconess has agreed to plead guilty to the crime under a plea agreement filed with the information. Bonilla and the United States have entered into a deferred prosecution agreement. The United States also reached a civil settlement agreement with Deaconess and Bonilla for $3,724,000 pursuant to the federal False Claims Act.
The agreements arose out of an investigation into the false billing of personal care worker services Deaconess (formerly known as Outreach Home Health) to the Wisconsin Medicaid Program. The Wisconsin Medicaid Program pays for personal care services, which are medically orientated services intended to assist a recipient with activities of daily living necessary to maintain a recipient in his or her place of residence in the community. As charged in the criminal information and the stipulated statement of facts, the defendants engaged in a scheme to defraud the Medicaid program by (1) intentionally recruiting patients and personal care workers without regards to whether to whether personal care worker services were medically necessary for those patients; (2) instructing nurses employed by Deaconess to routinely inflate, without regard to medical necessity, the assessment of the patient that was provided to the Medicaid program; (3) failing to conduct required supervisory visits to ensure that services were in fact being provided, that services continued to be medically necessary, and that any services provided were appropriate for the needs of the patient; and (4) hiring physicians to act as medical directors to sign plans of care for patients on whom they had not completed a physical examination.
As a result of these practices, the defendants submitted claims to the Medicaid Program for services that were not medically necessary or that Deaconess could not verify had ever been provided. Between 2011 and 2012, Deaconess increased its billing to the Medicaid Program for personal care service by over 100%.
“Medicaid has long been an invaluable lifeline for many of the most vulnerable members of society,” said Acting United States Attorney Haanstad. “Particularly in a time of increasing federal and state budget constraints, it is vitally important to ensure that funds in that program are not improperly diverted.”
“The billing of Medicaid for services not rendered and/or medically unnecessary services depletes the program of vital resources that are needed for the care of some of the nation’s most vulnerable citizens,” said Lamont Pugh III, Special Agent in Charge of the U.S. Department of Health & Human Services, Office of Inspector General – Chicago Region. “The OIG will continue to root out and identify those who seek to defraud the Medicaid program and work with our law enforcement partners to ensure that they are held accountable.”
Deaconess ceased operation after Medicaid stopped paying claims submitted by Deaconess in April 2013. Pursuant to a plea agreement, Deaconess will plead guilty to a felony charge of health care fraud and the government is entering into a deferred prosecution agreement with Bonilla. Bonilla has agreed to be voluntary excluded from participating in any federal health care program, including Medicare and Medicaid, for fifteen (15) years.
The Civil Settlement resolves there (3) lawsuits filed under the qui tam, or whistleblower, providers of the False Claims Act. The False Claims Act allows private citizens with knowledge of fraud against the government to bring civil actions on behalf of the United Sates and share in any recovery. Two of the whistleblowers are former employees of Deaconess. As part of today’s resolution, the whistleblowers will receive payment of approximately $600,000.
Acting United States Attorney Haanstad praised the investigative work of the Office of the Inspector General for the United States Department of Health and Human Services, the Medicaid Fraud Control Unit for the Wisconsin Department of Justice, the Federal Bureau of Investigation, and the United States Attorney’s Office for the Eastern District of Wisconsin.
The criminal cases are captioned United Sates v. Deaconess Home Health, Inc, and United States v. Lazarus Bonilla, 15-CR-207. The civil cases are captioned U.S. and State of Wisconsin ex rel. Ritacca v. Atlas Healthcare Inc., et al., Case No. 10-C-253; U.S. and State of Wisconsin ex rel. Komlodi v. Outreach Healthcare Inc., et al,. Case No. 11-C-973; and U.S. and State of Wisconsin ex rel. Campbell v. DHH, et al., Case No. 13-C-488.
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Atlas Healthcare, Inc. and Owners Agree to Civil Resolution of Health Care Fraud ChargesRead the Press Release
The Acting United States Attorney for the Eastern District of Wisconsin, Gregory Haanstad, announced today that the United States has reached a civil settlement agreement with Atlas Healthcare, Inc., and its owners, Deana Bajanen and Sheena Jones, for $435,000 pursuant to the federal False Claims Act. Atlas is located in Hales Corners, Wisconsin. Atlas is alleged to have knowingly submitted false claims for personal care worker services to the Wisconsin Medicaid Program for patients that did not need the services or did not need the level of services for which Atlas billed the Medicaid program.
The civil settlement resolves a lawsuit filed under the qui tam – or whistleblower – provisions of the False Claims Act, which allows private citizens with knowledge of fraud on the government to bring a civil action on behalf of the United States. The Wisconsin Medicaid Program pays for medically necessary personal care services, which are services intended to assist a recipient with activities of daily living necessary to maintain a recipient in his or her place of residence in the community. The qui tam complaint alleged that Atlas submitted false claims to the Wisconsin Medicaid Program for personal care worker services for patients who did not need the care. As part of the resolution, the whistleblower will receive a share of the settlement.
The investigation of Atlas, Jones, and Bajanen was undertaken by the Office of the Inspector General for the United States Department of Health and Human Services, the Medicaid Fraud Control Unit for the Wisconsin Department of Justice, the Federal Bureau of Investigation, and the United States Attorney’s Office for the Eastern District of Wisconsin.
The civil case was captioned U.S. and State of Wisconsin ex rel. Ritacca v. Atlas Healthcare Inc., et al., Case No. 10-C-253.
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Man Sentenced to 19 Years for Armed Robbery of Hampton Service CenterRead the Press Release
Gregory J. Haanstad, Acting United States Attorney for the Eastern District of Wisconsin, announced today that Michael Anglin (age 25) of Milwaukee, Wisconsin, was sentenced by the Honorable Judge Charles N. Clevert to 230 months’ imprisonment for his involvement in the December 9, 2013, robbery of the Hampton Service Center in Milwaukee, Wisconsin. The robbery was committed by three masked men, two of whom were armed with a 9mm handgun and an assault rifle.
Following a trial in April, a jury found Michael Anglin guilty of conspiracy to commit Hobbs robbery, armed Hobbs robbery, discharging a firearm during a crime of violence, and illegal possession of a firearm and ammunition. During the robbery, Michael Anglin pistol whipped and shot an employee of the Hampton Service Center, causing life-threatening and permanent injuries. Two other individuals have been charged with committing this robbery, one of whom has plead guilty and is awaiting sentencing, and another who intends to proceed to trial in December.
According to Acting United States Attorney Gregory J. Haanstad: “The United States Attorney’s Office is committed to addressing violent crime in this district and will continue to prosecute and seek substantial prison sentences for those who use firearms in the commission of crimes.”
Haanstad also emphasized that “the successful prosecution of this important case was the result of a collaborative law enforcement effort by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Federal Bureau of Investigation, and the Milwaukee Police Department.”
Assistant United States Attorneys Kelly B. Watzka and Jonathan H. Koenig prosecuted this case.
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Federal Officials Close Review into the Death of Dontre HamiltonRead the Press Release
The Justice Department announced today that there is insufficient evidence to pursue federal criminal civil rights charges against former Milwaukee Police Officer Christopher Manney for the death of Dontre Hamilton on April 30, 2014.
Officials from the U.S. Attorney’s Office of the Eastern District of Wisconsin, the Department of Justice’s Civil Rights Division and the FBI met today with Hamilton’s family and their representatives to inform them of this decision.
Federal authorities conducted a comprehensive and independent review of the evidence collected related to the death of Hamilton, who was shot during a struggle with Manney. This included reviewing all information from the state investigation, reviewing all recorded interviews, consulting with the Milwaukee County medical examiner and reviewing the transcripts from Manney’s termination hearing by the Milwaukee Fire and Police Commission.
The team of experienced federal prosecutors and FBI agents considered whether Manney violated federal law by willfully using unreasonable force against Hamilton. Under the applicable federal criminal civil rights statute, prosecutors must establish, beyond a reasonable doubt, that a law enforcement officer willfully deprived an individual of a Constitutional right. To establish willfulness, federal authorities must show that the officer acted with the deliberate and specific intent to do something the law forbids. This is the highest standard of intent imposed by law. Mistake, misperception, negligence or poor judgment are not sufficient to establish a federal criminal civil rights violation.
In this case, there were numerous civilian witnesses who saw some part of the physical confrontation between Manney and Hamilton. Based on those eyewitness accounts, the account of the former officer involved, the physical evidence and the assessments of independent use of force experts, the team of experienced federal prosecutors and FBI agents determined that the evidence was insufficient to prove, beyond a reasonable doubt, that Manney acted willfully with a bad purpose to violate the law. Accordingly, the federal review of this incident has been closed without prosecution. This decision is limited strictly to an application of the high legal standard required to prosecute the case under the federal civil rights statute; it does not reflect an assessment of any other aspect of the incident that led to Hamilton’s death.
The U.S. Attorney’s Office of the Eastern District of Wisconsin, the Civil Rights Division and the FBI are committed to investigating allegations of civil rights violations by law enforcement officers and will continue to devote the resources required to ensure that all allegations of serious civil rights violations are fully and completely investigated. The department will aggressively prosecute criminal civil rights violations whenever there is sufficient evidence to do so.
Federal Officials Close Review into the Death of Dontre HamiltonRead the Press Release
WASHINGTON – The Justice Department announced today that there is insufficient evidence to pursue federal criminal civil rights charges against former Milwaukee Police Officer Christopher Manney for the death of Dontre Hamilton on April 30, 2014.
Officials from the U.S. Attorney’s Office of the Eastern District of Wisconsin, the Department of Justice’s Civil Rights Division and the FBI met today with Hamilton’s family and their representatives to inform them of this decision.
Federal authorities conducted a comprehensive and independent review of the evidence collected related to the death of Hamilton, who was shot during a struggle with Manney. This included reviewing all information from the state investigation, reviewing all recorded interviews, consulting with the Milwaukee County medical examiner and reviewing the transcripts from Manney’s termination hearing by the Milwaukee Fire and Police Commission.
The team of experienced federal prosecutors and FBI agents considered whether Manney violated federal law by willfully using unreasonable force against Hamilton. Under the applicable federal criminal civil rights statute, prosecutors must establish, beyond a reasonable doubt, that a law enforcement officer willfully deprived an individual of a Constitutional right. To establish willfulness, federal authorities must show that the officer acted with the deliberate and specific intent to do something the law forbids. This is the highest standard of intent imposed by law. Mistake, misperception, negligence or poor judgment are not sufficient to establish a federal criminal civil rights violation.
In this case, there were numerous civilian witnesses who saw some part of the physical confrontation between Manney and Hamilton. Based on those eyewitness accounts, the account of the former officer involved, the physical evidence and the assessments of independent use of force experts, the team of experienced federal prosecutors and FBI agents determined that the evidence was insufficient to prove, beyond a reasonable doubt, that Manney acted willfully with a bad purpose to violate the law. Accordingly, the federal review of this incident has been closed without prosecution. This decision is limited strictly to an application of the high legal standard required to prosecute the case under the federal civil rights statute; it does not reflect an assessment of any other aspect of the incident that led to Hamilton’s death.
The U.S. Attorney’s Office of the Eastern District of Wisconsin, the Civil Rights Division and the FBI are committed to investigating allegations of civil rights violations by law enforcement officers and will continue to devote the resources required to ensure that all allegations of serious civil rights violations are fully and completely investigated. The department will aggressively prosecute criminal civil rights violations whenever there is sufficient evidence to do so.
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Three Appleton Men Indicted for Firearms ViolationsRead the Press Release
Acting United States Attorney Gregory J. Haanstad of the Eastern District of Wisconsin, announced that a federal grand jury returned an indictment against Cory M. Yant (age: 35), Zachary C. Sternhagen (age: 31), and Kong P. Vang (age: 21) charging each of them with being felons in possession of a firearm in violation of Title 18, United States Code, Section 922(g). Additionally, Yant and Sternhagen are alleged to be “Armed Career Criminals” based on three prior violent felony convictions each.
Defendants Yant and Sternhagen face a mandatory minimum sentence of 15 years incarceration and up to a life sentence, a fine of $250,000, and a three year term of supervised release. Vang faces up to 10 years imprisonment, with the same fine and term of supervised release.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the Winnebago County Sherriff and District Attorney’s Office, the Outagamie Sheriff and District Attorney’s Office, the Lake Winnebago MEG Unit, Wisconsin Department of Justice - Division of Criminal Investigation, the Appleton Police Department, and the Wausau Police Department. The case will be prosecuted by Assistant United States Attorney Daniel R. Humble.
An indictment is only a charge and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government must prove each of them guilty beyond a reasonable doubt.
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Elgin, Illinois Man Indicted for Defrauding Four in Marinette, WisconsinRead the Press Release
Acting United States Attorney Gregory J. Haanstad of the Eastern District of Wisconsin, announced that a federal grand jury returned an indictment against Gregory J. Kuczora (age: 55) of Elgin, Illinois, charging him with two counts of wire fraud in violation of Title 18, United States Code, Section1343. On each count the defendant faces maximum penalties of not more than twenty years imprisonment, a maximum fine of $250,000, a $100 special assessment, and a three year term of supervised release.
The indictment alleges that from February 2007 to February 2011, Kurzora defrauded approximately 70 individuals nationwide out of just over $1 million, including four individuals from Marinette County, Wisconsin. The defendant promised business loans in exchange for up-front fees, purporting to be an agent of a fictitious financial investment firm located in the United Kingdom. Records show, however, that the investment firm was little more than a website registered in the nation of Panama.
This case was investigated by the Federal Bureau of Investigation and the Marinette County Sheriff’s Office. The case will be prosecuted by Assistant United States Attorney Daniel R. Humble.
An indictment is only a charge and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government must prove him guilty beyond a reasonable doubt.
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Defendant Sentenced on Multiple Federal Charges in Connection with Purchase and Export of Luxury Vehicles to ChinaRead the Press Release
Acting United States Attorney Gregory J. Haanstad of the United States Attorney’s Office for the Eastern District of Wisconsin announced that, on October 27, 2015, Defendant Mao Peng (age: 26) of Shorewood, Wisconsin, was sentenced to 27 months in federal prison and ordered to pay $517,265.72 in restitution by United States District Court Judge J.P. Stadtmueller.
Peng had previously been charged by criminal information with, and had pleaded guilty to, three federal felony offenses: conspiracy to engage in wire fraud, conspiracy to engage in identity theft, and conspiracy to misuse of the United States’ Automated Export System to further criminal activity.
According to the information and plea agreement, Peng had conspired to defraud the State of Wisconsin of state and local sales tax revenue in connection with the purchase of luxury vehicles, which Peng and his company Longen Trading intended to export to China, by fraudulently using Native American straw buyers to make those purchases in a tax-exempt manner. Specifically, Peng and Longen Trading used straw buyers in connection with the purchase of approximately 154 luxury vehicle purchase transactions, having a total purchase price of approximately $9,132,106.94, and thereby evaded Longen Trading’s payment of a total of approximately $515,964.04 in state and local sales taxes that Longen Trading was legally obligated to pay in connection with the purchase of those vehicles.
According to the information and a plea agreement, Peng and Longen Trading also conspired to cause luxury vehicles to be purchased for export, via identity theft, that is, by using means of identification that belonged to a past or prospective straw buyer, without that person’s permission to purchase the vehicle using his or her identity. Specifically, between in or about June 2012 and June 2014, Peng and Longen Trading conspired with others to purchase approximately 71 luxury vehicles, having a total purchase price of approximately $4,212,945.06, using a means of identification belonging to another person, without that person’s knowledge or permission.
According to the information and a plea agreement, between approximately June 2012 and June 2014, Peng and Longen Trading also conspired with others to use the Department of Commerce’s Automated Export System (“AES”) to further these illegal activities, in violation of 13 U.S.C. § 305(a)(2).
As a part of his plea agreement, Peng also agreed to the civil forfeiture of approximately $1.2 million in funds seized from various bank accounts he controlled as well as 29 new luxury vehicles, including new Porsche, Mercedes Benz, and BMW vehicles.
Following the sentencing, Acting United States Attorney Gregory J. Haanstad stated: “As this case reflects, the United States Attorney’s Office and the United States Department of Justice are committed to aggressively combatting both identity theft and tax evasion, in whatever form that tax evasion conduct might take. We are also committed to taking the profit out of crime and to obtaining just financial outcomes in our criminal cases through the judicious use of both asset forfeiture and restitution remedies.”
Haanstad commended the investigative work that the United States Secret Service and United States Department of Commerce, Bureau of Industry & Security, Office of Export Enforcement conducted in this matter, along with the investigative assistance provided by the following state and local law enforcement agencies: the Wisconsin Department of Criminal Investigations, the Wisconsin Department of Transportation Investigations, the Milwaukee Police Department, the Oneida Police Department, the Menomonee Police Department, the Stockbridge-Munsee Police Department, the Kenosha Police Department, the Wauwatosa Police Department, the Waukesha Police Department, the Glendale Police Department, the Green Bay Police Department, the Milwaukee Secret Service Financial Crimes Task Force, and the Native American Drug and Gun Initiative Task Force.
Dan Clutch, Special Agent in Charge of the U.S. Department of Commerce, Bureau of Industry & Security, Office of Export Enforcement, Chicago Field Office, stated: “This sentencing sends a strong message to those who criminally misuse the Automated Export System to further illegal activity. This case is the result of outstanding collaborative investigative work between federal, state, local, and tribal law enforcement agencies.”
This case was prosecuted by Assistant United States Attorney Scott J. Campbell.
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Man Sentenced in Federal Court for Passing Forged Postal NotesRead the Press Release
Gregory J. Haanstad, Acting United States Attorney for the Eastern District of Wisconsin, announced that on October 22, 2015, Robert James Zoellner (age: 52) of Ripon was sentenced to 18 months in a federal prison by Chief United States District Judge William C. Griesbach. Zoellner previously pled guilty to a single count of passing forged postal notes, in violation of Title 18 United States Code, Section 500. According to the plea agreement and other documents filed with the court, Zoellner acted as a middle-man for a West African counterfeiter and utilized “mystery shopper” advertisements in newspapers and magazines to recruit unknowing individuals to cash hundreds of thousands of dollars in counterfeit postal notes and money orders and forward the proceeds to Zoellner who would in turn wire the proceeds to his contact in Mali, West Africa. In addition to the term of imprisonment, Zoellner was ordered to serve three years of supervised release.
In sentencing the defendant, Chief Judge Griesbach noted the serious nature of the offense, the defendant’s prior criminal record, as well as the need to deter others in the community from engaging in similar fraudulent behavior.
The case was investigated by the Department of Homeland Security – Immigration and Customs Enforcement and the U.S. Postal Inspection Service. The case was prosecuted by Assistant United States Attorney Daniel R. Humble.
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Four Men and One Woman Federally Indicted for Robbery of West Bend Jewelry StoreRead the Press Release
Acting United States Attorney Gregory J. Haanstad announced today that five Detroit-area individuals were indicted for the December 29, 2014 robbery of the Husar’s House of Fine Diamonds in West Bend, Wisconsin. Trayvon Shelton (age 24) Charles Leroy Hall (age 28) Gawain Mandeville-Nelson II (age 23) Deangelo Hayes (age 23) and Aliya Rahman (age 21) were charged with one count of Hobbs Act robbery.
The criminal complaints filed against Shelton, Hall, and Mandeville-Nelson II provide a detailed account of the allegations against the defendants. According to the complaints, in the days leading up to the robbery, the defendants traveled from Detroit, Michigan to Wisconsin. On December 29, 2014, the defendants entered the jewelry store armed with sledgehammers and stole a number of Rolex watches. If convicted, each defendant faces up to 20 years in prison on the Hobbs Act robbery count.
Shelton, Hall, and Mandeville-Nelson are currently in federal custody. Hayes and Rahman remain at large.
This matter is being investigated by the FBI’s Milwaukee Area Violent Crimes Task Force and the West Bend Police Department, with assistance from the FBI – Detroit Division and the Eastern District of Michigan United States Attorney’s Office. This case is being prosecuted by Assistant United States Attorney Margaret B. Honrath.
The public is cautioned that an indictment is merely a charge and the defendants are presumed innocent until proven guilty.
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Appleton Man Receives 10 Year Sentenced for Lead Role in Meth ConspiracyRead the Press Release
Gregory J. Haanstad, Acting U.S. Attorney for the Eastern District of Wisconsin, announced today, that Kham Meng Vang (age: 33) of Appleton, Wisconsin, was sentenced to 120 months in federal prison by Chief United States District Judge William C. Griesbach. Vang had previously entered a guilty plea to a single count of conspiracy to distribute 500 grams or more of methamphetamine in violation of Title 21, United States Code, Section 846. According to the plea agreement and other documents filed with the court, Vang was the lead actor in a methamphetamine distribution ring stretching from the Fox Valley to Calumet County. Vang and his co-conspirators (Sa Xiong (age: 25) and Bee Vang (age: 23) who were sentenced on September 21, 2015 to 120 months and 18 months respectfully) distributed the methamphetamine while in possession of several semi-automatic firearms.
In pronouncing sentence, Chief Judge Griesbach noted the need for a significant sentence to ensure the protection of the community and deter the defendant and others from engaging in dangerous criminal activity. In addition to the prison sentence, Vang was ordered to spend an additional 10 years on supervised release.
The case was investigated by the Wisconsin Department of Justice, Division of Criminal Investigation, the Lake Winnebago Area Metropolitan Enforcement Group, the Appleton Police Department, Fox Valley Metro Police Department, Kaukauna Police Department, Town of Menasha Police Department, Menasha Police Department, Neenah Police Department, Oshkosh Police Department, Calumet County Sheriff’s Department, and the Winnebago County Sheriff’s Department. The case is being prosecuted by Assistant United States Attorney Daniel R. Humble.
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Federal Court Permanently Bars Wisconsin Tax Return Preparer from Preparing Tax Returns for OthersRead the Press Release
FEDERAL COURT PERMANENTLY BARS WISCONSIN TAX RETURN PREPARER FROM PREPARING TAX RETURNS FOR OTHERS
Allegedly Concocted Phony Businesses and Made Other False Claims on Customers’ Returns
WASHINGTON – A federal court has permanently barred an Appleton, Wisconsin, tax return preparer from preparing federal tax returns for others, the Justice Department announced today.
The civil injunction order prohibits Gerardo Garcia, aka Gerry Garcia, and his firm Garcia Enterprises LLC, from acting as a tax return preparer and from continuing to operate a tax return preparation business. The order was entered by the U.S. District Court for the Eastern District of Wisconsin. Garcia agreed to the entry of the injunction, but did not admit to the allegations in the civil complaint against him.
According to the complaint, Garcia prepared false and improper returns during the 2015 filing season, even though the Internal Revenue Service (IRS) had previously assessed $26,000 in penalties against him. The complaint alleged that Garcia prepared tax returns on which he concocted phony businesses for his customers in order to understate his customers’ tax liabilities or inflate their refunds. In addition, as alleged in the complaint, Garcia fabricated business expenses, understated his customers’ business income and claimed other false or improper deductions, credits and filing statuses. In one case, the complaint alleged that Garcia prepared two tax returns for a customer that reported more than $10,000 in losses over two years from a non-existent “aquaculture” business that Garcia asserted his customer owned. The complaint cited several additional examples, including Garcia improperly claiming child tax credits for children, who live outside of the United States; dependency exemptions without proof the customer supported the children; and incorrect filing statuses, such as head-of-household, that resulted in more favorable tax rates.
The injunction order requires Garcia to provide the United States with a list of his customers since 2010 and to send a copy of the court’s injunction order to all customers for whom he prepared returns. The injunction order also requires Garcia to provide a link to the court’s injunction order on any website he maintains and to post a copy in any physical business location in which he receives customers and potential customers for any bookkeeping, payroll or other financial services.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams for 2015. The IRS has some tips on their website for choosing a tax preparer, and has launched a free directory of federal tax preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers and tax scheme promoters. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
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Appleton Men Sentenced for Roles in Meth ConspiracyRead the Press Release
Gregory J. Haanstad, Acting U.S. Attorney for the Eastern District of Wisconsin, announced that on September 21, 2015, Sa Xiong (age: 25) and Bee Vang (age: 23) of Appleton, Wisconsin, were both sentenced to federal prison by Chief United States District Judge William C. Griesbach. Xiong and Vang had previously entered guilty pleas to a single count of conspiracy to distribute 500 grams or more of methamphetamine in violation of Title 21 United States Code Section 846. According to the plea agreement and other documents filed with the court, Xiong and Vang helped operate a methamphetamine distribution ring stretching from the Fox Valley to Calumet County. Xiong and another high level co-conspirator distributed the methamphetamine while in possession of several semi-automatic firearms.
In pronouncing the sentences, Chief Judge Griesbach noted the debilitating effect that methamphetamine has on individuals and the great harm the drug causes in Northeast Wisconsin. He further noted that the quantity of methamphetamine and the presence of firearms made this a particularly dangerous conspiracy. Ultimately, Xiong was sentenced to a mandatory minimum of 120 months in federal prison for his role as the “right-hand man” to the leader of the drug conspiracy. Vang, who played a much lesser role, received a sentence of 18 months imprisonment followed by 4 months of electronic monitoring and home detention.
The case was investigated by the Wisconsin Department of Justice, Division of Criminal Investigation, the Lake Winnebago Area Metropolitan Enforcement Group, the Appleton Police Department, Fox Valley Metro Police Department, Kaukauna Police Department, Town of Menasha Police Department, Menasha Police Department, Neenah Police Department, Oshkosh Police Department, Calumet County Sheriff’s Department, and the Winnebago County Sheriff’s Department. The case is being prosecuted by Assistant United States Attorney Daniel R. Humble.
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Project Safe Neighborhoods Grant Awarded to Milwaukee Police Department to Support the Milwaukee Homicide Review CommissionRead the Press Release
The United States Attorney’s Office announced today that the Milwaukee Police Department has been awarded a Project Safe Neighborhoods (PSN) Program grant of $294,668 to support the Milwaukee Homicide Review Commission (MHRC) efforts to reduce gun violence in the City of Milwaukee.
The PSN program, led by the United States Attorney, is a collaborative effort between federal, state, and local law enforcement and other community members to implement gang violence and gun crime enforcement, intervention and prevention initiatives within the Eastern District of Wisconsin. As key component of the Milwaukee PSN effort, the MHRC regularly brings together police, prosecutors, corrections, probation and parole, ATF, FBI and community service providers to review homicides and non-fatal shootings to better understand the problem of gun violence in the City of Milwaukee and seek solutions based on proven prevention and enforcement efforts developed around the country. The MHRC’s research-based, anti-violence program is being replicated in other major US cities.
The grant announced today will be used to enhance the MHRC work with law enforcement and corrections to focus on those individuals repeatedly involved as victims, witnesses, or suspects in shootings and associated violent crimes. The grant will be used to support research and intelligence efforts to identify the individuals and groups frequently involved in shootings, armed robberies, car-jackings and other violent crimes and coordinate the targeting of these individuals and their criminally involved associates for investigation and prosecution by joint federal, state, and local task forces.
In announcing the grant award today, Acting United States Attorney Greg Haanstad said, “The Milwaukee Police Department and the Milwaukee Homicide Review Commission are essential partners in the United States Department of Justice’s efforts to combat gun crime in Milwaukee. The US Attorney’s Office and our federal law enforcement partners look forward to working even more closely with our state and local partners on this focused effort to target those most prone to gun violence in Milwaukee.”
“When the Milwaukee Police Department and I commenced the Homicide Review process a decade ago, we envisioned effective partnerships with federal, state and local agencies as anticipated under this Project Safe Neighborhood grant,” said Mayor Tom Barrett. “I am confident that our system-wide partners will join us as we redouble our efforts and continually refine our focus to reduce gun violence and apprehend those who choose to victimize their neighborhoods with guns.”
MHRC is led by Mallory O’Brien, an epidemiologist with the Medical College of Wisconsin who is working out of the City of Milwaukee Health Department. Research support under the new grant will be provided by researchers from Indiana University and the University of Missouri who have been working as PSN research partners for many years.
Milwaukee Man Sentenced on Federal Gun Charge as an Armed Career CriminalRead the Press Release
Gregory J. Haanstad, Acting U.S. Attorney for the Eastern District of Wisconsin, announced that Justin King Nalls (age: 27) of Milwaukee, Wisconsin, appeared in federal court in Green Bay and was sentenced to 180 months in federal prison for being a felon in possession of a firearm. Based on his criminal record of violent felonies, Nalls qualified as an Armed Career Criminal under federal law which required that he be sentenced to not less than 15 years and up to a lifetime in prison. He was convicted in state court of two armed robberies in 2005 and a burglary in 2009.
Nalls was arrested in October of 2014 for his role in the armed robbery of a Kewaunee County tavern. Further investigation linked Nalls to an additional armed robbery in Sheboygan County and a violent robbery in the City of Milwaukee. Nalls and a female associate placed ads offering prostitution services online, and then robbed at gunpoint those who responded to the advertisements. A search of Nalls’ residence and vehicle yielded a loaded .44 revolver and ammunition for a .357 caliber firearm, both of which are illegal for Nalls or any felon to possess.
In pronouncing sentence, Chief U.S. District Court Judge William C. Griesbach noted the need to protect the community from future criminal acts, the need to send a strong message of deterrence to others, as well as the substantial penalties that the U.S. Congress ascribes to individuals like Nalls with violent felony convictions in their past.
The case was investigated by the Kewaunee County Sheriff’s Department, the City of Kewaunee Police Department, the Kewaunee County District Attorney’s Office, the Wisconsin Department of Justice - Division of Criminal Investigation, and the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). It was prosecuted by Assistant United States Attorney Daniel R. Humble.
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Two Men Federally Indicted for Attempted CarjackingRead the Press Release
Acting United States Attorney Gregory J. Haanstad announced today that two Milwaukee men were indicted for the August 12, 2015 attempted armed carjacking at 76th Street and W. Layton Avenue in Greenfield. Devonte Hayes, age 19, and Norman Howard, age 18, were charged with one count of attempted motor vehicle robbery and one count of brandishing a firearm in furtherance of a crime of violence.
The attached Criminal Complaint provides a detailed account of the allegations against the defendants. If convicted, each man faces up to 15 years in prison on the motor vehicle robbery count and a minimum mandatory sentence of 7 years and up to life in prison on the charge of use of a firearm during a crime of violence.
This matter is being investigated by the FBI’s Milwaukee Area Violent Crimes Task Force, the Greenfield Police Department, the Oak Creek Police Department, the West Allis Police Department, and the Milwaukee Police Department. It is being prosecuted by Assistant United States Attorney Margaret B. Honrath.
The public is cautioned that an indictment is merely a charge and the defendants are presumed innocent until and unless proven guilty.
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Milwaukee Man Sentenced to 10 Years in Prison for Receiving Child PornographyRead the Press Release
WASHINGTON – A Milwaukee man was sentenced today to 10 years in prison for receiving more than one million images of child pornography, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Acting U.S. Attorney Gregory J. Haanstad of the Eastern District of Wisconsin.
Jeffrey Feldman, 48, of Milwaukee, pleaded guilty in April 2015 to one count of receipt of child pornography. The sentence was imposed by U.S. District Judge Lynn S. Adelman of the Eastern District of Wisconsin.
According both to admissions made in connection with his guilty plea and to information introduced at sentencing, in January 2013, FBI special agents detected Feldman sharing files containing child pornography over the Internet via a peer-2-peer network. During a subsequent search of Feldman’s residence, agents recovered numerous encrypted computers and electronic storage devices. And forensic analyses of those devices revealed that Feldman had received over one million files that included child pornography images and videos.
The case was investigated by the FBI. The case was prosecuted by Trial Attorney Jeffrey Zeeman of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Karine Moreno-Taxman of the Eastern District of Wisconsin.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Milwaukee Man Sentenced to 10 Years in Prison for Receiving Child PornographyRead the Press Release
A Milwaukee man was sentenced today to 10 years in prison for receiving more than one million images of child pornography, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Acting U.S. Attorney Gregory J. Haanstad of the Eastern District of Wisconsin.
Jeffrey Feldman, 48, of Milwaukee, pleaded guilty in April 2015 to one count of receipt of child pornography. The sentence was imposed by U.S. District Judge Lynn S. Adelman of the Eastern District of Wisconsin.
According both to admissions made in connection with his guilty plea and to information introduced at sentencing, in January 2013, FBI special agents detected Feldman sharing files containing child pornography over the Internet via a peer-2-peer network. During a subsequent search of Feldman’s residence, agents recovered numerous encrypted computers and electronic storage devices. And forensic analyses of those devices revealed that Feldman had received over one million files that included child pornography images and videos.
The case was investigated by the FBI. The case was prosecuted by Trial Attorney Jeffrey Zeeman of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Karine Moreno-Taxman of the Eastern District of Wisconsin.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
United States Files Complaint Against Three Wisconsin Dietary Supplement ManufacturersRead the Press Release
WASHINGTON – The Department of Justice filed a complaint today alleging that three Wisconsin companies that manufacture dietary supplements were not complying with the U.S. Food and Drug Administration’s (FDA’s) current good manufacturing practices and were misbranding their products. The complaint was filed in the Eastern District of Wisconsin against Atrium Inc., Aspen Group Inc., Nutri-Pak of Wisconsin Inc., and the owners of the three firms, James F. Sommers and Roberta A. Sommers. The companies, located in Wautoma, Wisconsin, sell dietary supplements to retail stores, healthcare professionals and directly to consumers via the Internet.
The complaint alleged that the firms were violating the federal Food, Drug and Cosmetic Act (FDCA) by failing to comply with current good manufacturing practices that, among other things, require manufacturers to establish specifications to ensure the identity and potency of the ingredients in dietary supplements. The complaint also alleged that the firms’ products were misbranded because they failed to identify the part of the plant from which the ingredients were derived, did not list the number of servings per container and failed to identify the serving size.
Supplements manufactured by the firms included Atrium brands Chole-Sterin, Di-Acid Stim, Ocu-Comp and Super-Flex; Aspen brand Flexile-Plus; and Nutri-Pak brands Glucobiotic Supreme and Ocu-Comp.
“Makers of dietary supplements who do not follow the FDA’s regulations put the public at risk,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “The Department of Justice will continue to work with the FDA to try to make sure that consumers are ingesting safe products and are getting what they paid for.”
“This case and the remedial actions required by the consent decree reflect the continuing focus of our office and the Justice Department generally in safeguarding and promoting the health and well-being of our people,” said U.S. Attorney James L. Santelle of the Eastern District of Wisconsin. “The corrections that these companies are required to accomplish along with oversight and inspection of them, will ensure compliance with the law and responsible sales to consumers.”
In conjunction with the filing of the complaint, the defendants agreed to settle the litigation and be bound by a consent decree of permanent injunction that prohibits them from violating the FDCA. The consent decree requires the dietary supplement manufacturer to cease all operations and requires that if the defendants wish to resume manufacturing dietary supplements in the future, the FDA first must determine that their manufacturing practices have come into compliance with the law. The proposed consent decree is awaiting approval by the court.
The case is being handled by Trial Attorney Patrick Jasperse of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Susan M. Knepel of the Eastern District of Wisconsin, with assistance from Deeona Gaskin of the FDA’s Office of the Chief Counsel.
A complaint is merely a set of allegations that, if the case were to proceed to trial, the government would need to prove by a preponderance of the evidence.
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Green Bay Man Sentenced for Sexual Exploitation of Minor ChildrenRead the Press Release
James L. Santelle, United States Attorney for the Eastern District of Wisconsin, announced that on July 30, 2015, Joseph J. Valdez (age: 29) of Green Bay, Wisconsin, was sentenced by Chief District Judge William C. Griesbach to 15 years in federal prison for sexual exploitation of a child in violation of Title 18 U.S.C. Section 2251(a). Upon his release the defendant will be on federal supervised release for 20 years and will have to register as a sex offender in the jurisdiction in which he resides.
Valdez used his cellular telephone to exchange texts and instant messages with hundreds, if not thousands, of underage girls across the country and in Canada. Often, Valdez held himself out as a modeling agent to entice the minors to send him naked photographs of themselves. He would then threaten to send these photographs to the girls’ school administrators, parents, or threaten to release them on the internet with their home address accompanying the photographs. In response, many of the teen girls sent Valdez increasingly more graphic and sexually explicit photographs. Some of the minors threatened suicide in an attempt to stop the cycle of blackmail, though Valdez continued making further demands undeterred.
Valdez was previously convicted of sending obscene email messages to a minor in 2009, in Kewaunee County Circuit Court, following a prosecution by the State of Wisconsin. He received a sentence of probation which he violated approximately a year later by electronically corresponding with a minor.
In pronouncing sentence, Chief Judge Griesbach noted the reprehensible nature of Valdez’s crime, as well as the lifelong effects that his sexual exploitation will have on an untold number of victims. The court noted Valdez’s “continuous pattern of exploiting children” and declared his actions “horrendous and not to be tolerated.”
The case was investigated by the Seymour Police Department and the Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorney Daniel R. Humble.
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 U.S. Department of Justice. Led by U.S. Attorneys’ Offices and the Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Lake Geneva Resident Charged in Second Fraud IndictmentRead the Press Release
United States Attorney James L. Santelle announced today that a two-count indictment was handed down Tuesday charging Todd Dyer, age 51, a resident of Lake Geneva, Wisconsin, with one count of wire fraud and one count of money laundering. The wire fraud count carries a maximum penalty of 20 years in prison and the money laundering count carries a maximum penalty of 10 years imprisonment.
Dyer was convicted in federal court in 1999 with charges related to his operation of a Ponzi scheme. He was sentenced to 70 months imprisonment for that conduct. Dyer and three others were charged on June 9 with running a separate scheme to defraud that resulted in various criminal counts. In that indictment, Dyer was charged in 31 counts.
According to the current indictment, Dyer defrauded a Missouri individual who was seeking funding to build a manufacturing plant. The plant was budgeted to cost $25 million. Dyer obtained $75,000 from this individual as a result of false representations and promises that Dyer had investors who could fund the entire $25 million cost. According to the indictment, Dyer had no such investors available and used the entire $75,000 for personal purposes.
The case was investigated by agents from the Internal Revenue Service Criminal Division, and agents the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorneys Joseph R. Wall and Benjamin W. Proctor.
The public is cautioned that criminal charges do not constitute evidence of guilt. An individual is presumed innocent until such time, if ever, that the government establishes his or her guilt beyond a reasonable doubt.
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Appleton Man Indicted on Methamphetamine and Firearm ChargesRead the Press Release
Mr. James L. Santelle, United States Attorney for the Eastern District of Wisconsin, announced that on July 7, 2015, a federal grand jury returned a two-count indictment against Khee Vang (age: 36) of Appleton, Wisconsin, charging him with a count of possession with intent to distribute methamphetamine in violation of Title 21, United States Code, Sections 841(a)(1), (b)(1)(B) and, further, charging him with possession of a firearm in furtherance of a drug crime in violation of Title 18, United States Code, Section 924(c)(1)(A)(i). If convicted of the drug offense, the defendant faces a sentence of between five and forty years imprisonment, a five million dollar fine, and between four years and a lifetime of supervised release. Conviction on the firearm offense carries a mandatory consecutive term of five years imprisonment and up to a life sentence.
According to court filings, the defendant was under surveillance when he travelled from Appleton to La Crosse to purchase methamphetamine. The defendant was stopped by law enforcement in the City of Menasha and was found to be in possession of 117 grams of methamphetamine and a semi-automatic weapon.
The case was investigated by the Wisconsin Department of Justice, Division of Criminal Investigation, the Lake Winnebago Area Metropolitan Enforcement Group, and the United States Drug Enforcement Administration, with the assistance of the Wisconsin State Patrol. It is being prosecuted by Assistant United States Attorney Daniel R. Humble.
An indictment is only a charge and not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
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Statement of United States Attorney James L. Santelle on His Retirement from Government ServiceRead the Press Release
The United States Attorney for the Eastern District of Wisconsin, James L. Santelle, today released the following remarks:
“This Sunday, July 5, 2015, marks my 30th anniversary of employment with the United States Department of Justice and nearly 35 years of public service in the United States Government.
At this important milestone, I have decided that this is the right time to conclude my five and one-half years as the United States Attorney for the people of Eastern Wisconsin. I expect to spend many of the days of this month in my present position, completing a number of projects and initiatives—related to the litigation, community, and administrative functions of my office—that have been and remain important to our goals and missions.
I am exceptionally mindful and supremely appreciative of the many, enriching and strengthening opportunities that the United States of America, including the United States Department of Justice, has extended to me and in which it has supported me unfailingly.
Following my graduation in 1983 from the University of Chicago Law School, the Honorable Robert W. Warren, United States District Judge for the Eastern District of Wisconsin, brought me home to Milwaukee for a two-year term as one of his judicial law clerks. It was in that position that I not only began my legal career but also came to understand with greater depth the importance of litigation—both criminal and civil—as a mechanism to promote the interests of our citizens, to ensure due process and equal protection, and to accomplish justice in furtherance of the principles on which our nation was founded.
Two years later, the Honorable J.P. Stadtmueller, then serving as the United States Attorney, extended to me the opportunity to pursue those goals further as an Assistant United States Attorney. He, like all of the other United States Attorneys who followed him, encouraged and sustained my growth as a litigator for the federal government. Throughout many of the past 30 years, it has been my supreme honor to prosecute a wide variety of criminal cases with the purpose of promoting the safety and security of our community and ensuring the protection of victims. I have also been privileged to litigate a broad spectrum of civil cases, defending the interests of the United States in some and affirmative seeking remedial relief on behalf of its citizens in others.
Along the way, my supervisors and colleagues have vested in me various special responsibilities and tasks—including work as a Senior Litigation Counsel, as an Executive Assistant United States Attorney, and, arguably with most case- and court-related focus, as the Civil Division Chief for this district and for the Western District of Michigan. In all of these litigation assignments—and in various opportunities to provide training to colleagues both locally and nationally—I have benefited immeasurably from the counsel, the direction, the wisdom, and the judgment of my many outstanding colleagues throughout the United States Department of Justice—including Assistant United States Attorneys, Litigating Division Attorneys, and equally skilled and highly experienced professional staff.
That same Justice Department, led by distinguished and committed Attorneys General and Deputy Attorneys General, has further permitted me the professionally transformative and personally enriching opportunities to serve in other special roles—including two years of work with the Iraqi people, their leadership, and their nation in developing the institutions of good government and the rule of law in areas throughout that still-emerging nation, including Baghdad and the United States Mission there. And for some 2-1/2 years, I was specially honored to serve in a leadership position of the Executive Office for United States Attorneys at the Robert F. Kennedy Main Justice Building in Washington, D.C.—working in collaboration with lawyers and others there and throughout the nation on issues, cases, challenges, and projects critical to the work of the Offices of United States Attorneys nationwide and other vital litigation units of the Department.
Since January of 2010, Attorneys General Eric H. Holder, Jr. and Loretta E. Lynch have not only supported, encouraged, and inspired me and my cherished colleagues of United States Attorneys nationwide in the pursuit of our assigned roles as chief federal law enforcement officers but they, along with their exceptionally engaged staffs, have also given to me and others the mechanisms, the discretion, the capacity, and the vision to do what the Department was initially and remains to this day commissioned to do—that is, serve our nation and its people in abiding, focused pursuit of an achievable aspiration—justice. I extend my deep thanks to Attorneys General Holder and Lynch for doing just that—and I communicate with equal spirit and sincerity my unqualified appreciation to and admiration of the many Assistant United States Attorneys, professional staff members, and the tireless, brave, and honorable law enforcement officers here in Eastern Wisconsin and in every state of our Union—who every day live up to and exceed our country’s expectations for the delivery of balanced justice, fair treatment, and thoughtful humanity, even in the midst of dramatic challenges and compelling human tragedy.
Because the job of United States Attorney typically concludes at or about the time that a new President is sworn in, and because I have been privileged already to have worked in the federal government for over three decades, I have long considered options for my next, suitable engagements with the community I so cherish and whose leadership representatives—in social service agencies, advocacy and victim support groups, health care and educational units, faith and familial associations, and many other industrious and productive non-governmental organizations—are assets of terrific depth and immeasurable scope. As my time with the United States Department of Justice nears a conclusion, I am looking forward to those continued, exhilarating engagements in this place—my home—and perhaps beyond. Among other pursuits, I hope to do some long-delayed writing about my life experiences, some teaching to those who may benefit from those modest perspectives, and perhaps even some renewed traveling to places where people—our fellow women and men—seek with hope and are committed to achieving the lives and livelihoods of the sort that we enjoy with imperfection but abundance here in America.
It has been and will always remain my honor to have served our nation and our citizenry, and I am appreciative beyond words for the opportunities for that that have been bestowed generously and graciously on me to engage in this work. To the people of Wisconsin and of our nation—to all of you who have animated and breathed life into mine—I extend, as I have in other farewell settings, this adopted commission: “More Life. The Great Work Begins.”
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Former UW-Oshkosh Student Sentenced to 40 Months in Prison for Possession of RicinRead the Press Release
WASHINGTON – Kyle Allen Smith, 21, of Oshkosh, Wisconsin, was sentenced today to 40 months in federal prison for possession of ricin by the Chief District Judge William C. Griesbach of the Eastern District of Wisconsin, announced Assistant Attorney General for National Security John P. Carlin and U.S. Attorney James L. Santelle of the Eastern District of Wisconsin.
Smith was arrested on October 31, 2014, after two professors at the University of Wisconsin at Oshkosh reported to campus authorities that Smith was making unusual inquiries about chemical processes, including extracting of ribosomal inhibiting protein. According to the plea agreement, Smith admitted growing castor bean plants and extracting ricin from the beans. A substance found in Smith’s residence was sent to the Department of Homeland Security’s National Bioforensics Analysis Center at Fort Detrick, Maryland, and tested positive for the toxin ricin. Ricin is a toxin that infects human cells and blocks their ability to synthesize their own protein. Small doses of ricin may be lethal to human beings if ingested, inhaled or injected. Symptoms of ricin poisoning can include difficulty breathing, nausea, vomiting and diarrhea, with possible death occurring within 36 to 72 hours. According to information posted on the website of the Centers for Disease Control and Prevention (CDC), there are no known antidotes for ricin poisoning.
Smith admitted having homicidal thoughts and that these thoughts might have sparked his curiosity about the production of ricin. He stated he would not use or test the ricin on any human because too many people knew what he was doing and would turn him in.
Assistant Attorney General Carlin joined U.S. Attorney Santelle in praising the actions of the professors and the University administration in bringing Smith to the prompt attention of law enforcement authorities. It is a perfect example of “see something, say something,” which guides the required vigilance of our times. Assistant Attorney General Carlin and U.S. Attorney Santelle also thanked the Wisconsin National Guard, 54th Civil Support Team, for the critical assistance they provided in the safe recovery of the ricin.
The case was investigated by the Oshkosh Police Department, the FBI and the University of Wisconsin – Oshkosh Police Department. The case was prosecuted by Assistant U.S. Attorney Paul L. Kanter of the Eastern District of Wisconsin and the Justice Department’s National Security Division.
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Milwaukee Man Pleads Guilty to Federal Gun Charges as an Armed Career CriminalRead the Press Release
James L. Santelle, United States Attorney for the Eastern District of Wisconsin, announced that on June 24, 2015, Justin King Nalls (age: 27) of Milwaukee, Wisconsin, appeared in federal court in Green Bay and pleaded guilty to a single count of being a felon in possession of a firearm. Based on his prior record of violent felonies, Nalls qualifies as an Armed Career Criminal under federal law.
Nalls was arrested in October of 2014 for his role in the armed robbery of a Kewaunee County tavern. Further investigation linked Nalls to an additional armed robbery in Sheboygan County and a violent robbery in the City of Milwaukee. Nalls and a female associate placed ads offering prostitution services online, and then robbed at gunpoint those who responded to the advertisements. A search of Nalls’ residence and vehicle yielded a loaded .44 revolver and ammunition for a .357 caliber firearm, both of which are illegal for Nalls or any felon to possess.
Based on two previous armed robbery convictions in 2005, and a burglary conviction in 2009, Nalls falls under the Armed Career Criminal Act which requires that he serve not less than 15 years and up to a lifetime in prison. He is scheduled to be sentenced on September 14, 2015. He remains incarcerated pending that hearing.
The case was investigated by the Kewaunee County Sheriff’s Department, the City of Kewaunee Police Department, the Kewaunee County District Attorney’s Office, the Wisconsin Department of Justice - Division of Criminal Investigation, and the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). This case is being prosecuted by Assistant United States Attorney Daniel R. Humble.
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Restaurant Owner Indicted with Violating Federal Tax LawsRead the Press Release
A federal grand jury in Milwaukee returned a 33-count indictment charging Paul Bouraxis and three members of his family with violating federal tax laws.
The indictment charges Paul Bouraxis (age 65), his wife Freida Bouraxis (age 60), their son, Andreas Bouraxis (age 38), and son-in-law, Reiad “Ray” Awadallah (age 44), all of whom reside in Franklin, Wisconsin, with conspiring to impede the Internal Revenue Service based on their skimming of cash from the receipts of three restaurants they operated: the Omega Burger restaurant, located on S. 27th Street in Franklin, the El Fuego restaurant located on W. Layton Avenue in Milwaukee, and the El Beso restaurant located on S. 74th Street, in Greenfield.
The indictment also alleges that the defendants paid restaurant employees in cash and failed to withhold or pay taxes on such wages. According to the indictment, the defendants concealed their actions by not depositing cash skimmed from the restaurants to bank accounts and, instead maintained a cash hoard of more than $1.7 million. Some of the skimmed cash was used to purchase jewelry and precious metals, including 33, 100-ounce bars of silver.
The indictment also charges Paul Bouraxis with 10 counts of tax evasion based on the tax return he filed for himself for 2010 and payroll tax returns he filed for Omega Burger. Andreas Bouraxis is also charge with 18 counts of tax evasion based on the tax return he filed for himself for 2010 and payroll tax returns he filed for El Fuego and El Beso. Awadallah is also charged with three counts of filing false tax returns based on the tax returns he filed for himself for the years 2009 – 2011.
Paul Bouraxis is also charged with bank fraud in connection with loans he obtained from Associated Bank. The indictment alleges that Paul Bouraxis defaulted on the loans and then re-negotiated the terms of the loans by concealing his true financial condition from the bank, including that he and his family had a cash hoard of more than $1.7 million and bank accounts in Greece with balances of more than $2 million. According to the indictment, Associated Bank lost more than $4 million as a result of this scheme.
Based on these charges, Paul Bouraxis faces up to 85 years in prison and fines of up to $3.75 million. Freida Bouraxis faces up to 5 years in prison and a fine of up to $250,000. Andreas Bouraxis faces up to 19 years in prison and fines of up to $4.75 million. Reiad Awadallah faces up to 14 years in prison and fines of up to $1 million. The indictment also seeks to forfeit more than $1.7 million in currency and gold and silver coins and bars previously seized by federal agents.
Separately, a two-count indictment was returned against Gus Koutromanos (age 68) of New Berlin charging him with two counts of tax evasion. The indictment alleges that during 2012, Koutromanos, who was the part-owner of a restaurant known as Omega on Twenty Seven, located on S. 27th Street in Milwaukee, paid restaurant employees more than $385,000 in cash, from which he did not withhold income or payroll taxes. Koutromanos faces up to 10 years in prison and fines of up to $500,000 if convicted
In addition, the government filed a plea agreement that had been reached with Scott Sherman (age 45), an accountant residing in Sheboygan. Under the terms of this plea agreement, Sherman will plead guilty to one count of filing a false federal income tax return. Sherman, who provided accounting and bookkeeping services to Paul Bouraxis and his businesses, failed to report all of the income he earned from his accounting practice during the years 2007-2011. As a result, Sherman underpaid his income taxes by more than $48,000.
Sherman faces up to three years in prison and a fine of up to $250,000. Sherman has agreed to make full restitution to the IRS for the unpaid taxes, penalties and interest, which is presently estimated to be approximately $93,000. As part of his plea agreement, Sherman has also agreed to cooperate with the government in its investigation and prosecution of this and related matters.
These matters were investigated by Special Agents from the Internal Revenue Service Criminal Investigation and the Federal Bureau of Investigation. The prosecution is assigned to Assistant United States Attorneys Matthew Jacobs and Richard Frohling.
“This indictment should serve as a warning to those who choose to actively engage in illegal schemes to evade their income and payroll tax obligations,“ said Shea Jones, Special Agent in Charge of IRS Criminal Investigation’s St. Paul Field Office. “Using cash in an attempt to conceal illegal activity will not deter IRS Criminal Investigation’s Special Agents from vigorously pursuing those who threaten the integrity of our nation's tax system.”
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Federal Judge Sentences Milwaukee Pimp to 20 Years ImprisonmentRead the Press Release
United States Attorney James L. Santelle announced that United States District Judge Lynn S. Adelman has sentenced Milwaukee resident Troy Randle, age 37, to 20 years imprisonment following Randle’s conviction on two federal sex-trafficking counts. The sex-trafficking counts involved two separate minor females.
Evidence introduced at Randle’s sentencing showed that he began prostituting both of the child-victims when they were just 14 years old and that he prostituted them through their 17th birthdays until his arrest by federal authorities in January of 2014. Further evidence introduced by the United States showed that Randle’s sex trafficking of these two minors took place in Milwaukee through street prostitution and at hotels; in Chicago, Illinois; Dubuque and Cedar Rapids, Iowa; Ft. Wayne, Indiana; and South Dakota. Randle ordinarily accompanied the victim-girls to these cities and provided the transportation. Randle controlled them through false expressions of love and loyalty as well as through his physical abuse of both. Randle advertised the prostitution services of both victims through postings to Backpage.com.
In making this public announcement, United States Attorney Santelle stated: “The sentence most appropriately imposed by Judge Adelman on this defendant is a genuine reflection of both the horrific victimization suffered by these two girls and the terrible impact that this type of criminal behavior has on the life and the well-being of our communities.” Santelle stated further: “The investigation and prosecution of sex-trafficking cases in the Eastern District of Wisconsin is among the highest priorities of my office, and we will continue to pursue the perpetrators of this heinous conduct with all of the resources available to us.”
Randle was prosecuted by Assistant United States Attorney Joseph R. Wall. United States Attorney Santelle commended AUSA Wall and the partnered law enforcement agencies responsible for investigating Randle’s trafficking enterprise—namely, the Federal Bureau of Investigation, the Milwaukee Police Department, and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
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New Berlin Contractor Agrees to Plead Guilty to Scheme to Underpay Wages – Will Pay $1.6 Million in Restitution and DamagesRead the Press Release
United States Attorney James L. Santelle of the Eastern District of Wisconsin announced today that Scott Watry of New Berlin, Wisconsin, has agreed to plead guilty to conspiring to defraud the United States. Mr. Watry is the president and owner of Watry Homes, LLC, a contractor alleged to have underpaid wages on federally funded housing projects. Mr. Watry and Watry Homes, LLC, have also agreed to settle related civil False Claims Act allegations. In total, Mr. Watry and Watry Homes, LLC, will pay over $1.6 million in restitution and damages.
Watry Homes, LLC, does roofing, siding, and carpentry work on private residences, commercial projects, and public housing projects in Wisconsin. From 2011 to 2012, Watry Homes performed contracts worth approximately $4.7 million on the Westlawn public housing project in Milwaukee. Because the federal government contributed funds to the Westlawn project, it was subject to the Davis Bacon Act. The Act requires contractors to pay workers prevailing wages in order to protect local wage rates. The Act further requires contractors to submit weekly certified payroll reports.
According to the plea agreement, Mr. Watry conspired with others to pay workers on the Westlawn project hourly wage rates that were considerably lower than the legally required wage rate. To conceal the scheme, the certified payroll reports consistently understated the number of hours worked to compensate for the overstatement of the wage rate being paid. In some cases, the certified payroll reports falsely listed names of purported employees who did not actually work at the site while crew leaders would pay out lower wages to the actual workers. In mid-2012, the United States Department of Labor (DOL) began investigating Watry Homes. In response, Mr. Watry and co-conspirators provided false information to investigators and encouraged workers likewise to obstruct the investigation.
By an information and plea agreement filed today, Mr. Watry has agreed to plead guilty to conspiring to defraud the United States and obstruct the investigation. He has also agreed to pay $659,822 in restitution to workers who were underpaid on the Westlawn project. DOL will be responsible for distributing the restitution to individual workers.
In the accompanying civil settlement announced today, Mr. Watry and Watry Homes, LLC, have agreed to pay $1,000,490 in damages for violations of the False Claims Act. The civil settlement resolves a lawsuit filed under the qui tam—or whistleblower—provisions of the False Claims Act, which allows private citizens with knowledge of fraud to bring a civil action on behalf the United States and share in any recovery. The qui tam complaint alleges that Watry Homes, LLC, submitted false certified payroll reports to support claims for payment on the Westlawn project as well as public housing projects in Beloit and Waukesha that were also subject to the Davis Bacon Act. As part of the resolution, the whistleblower will receive a share of the settlement.
“The joint criminal and civil resolutions that we are announcing today reflect the seriousness with which the federal government, including the Departments of Labor, Housing and Urban Development, and Justice enforce the rules that govern contracting on public projects, including the payment of all required wages,” said Mr. Santelle. “Contractors should take note that public funds come with strict requirements to pay workers every dollar they are due and to comply with all applicable rules. Under the authority of criminal statutes and the False Claims Act, we will continue to pursue wrongdoing in public contracting vigilantly.”
FBI Special Agent in Charge Robert J. Shields, Jr. added, “This case is an excellent example of how law enforcement agencies, in concert with concerned citizens, can effectively collaborate to combat fraud, waste and abuse in government-funded projects designed to help hardworking Americans.”
James Vanderberg, Special Agent in Charge of the Chicago Office of Labor Racketeering and Fraud Investigations, Office of Inspector General, U.S. Department of Labor, stated, “The U.S. Department of Labor, Office of Inspector General is committed to enforcing the Davis-Bacon Act, which requires that the prevailing wage is paid to workers in government projects. We appreciate the assistance and cooperation of the United States Attorney’s Office, Civil and Criminal Divisions; the Federal Bureau of Investigation; the Department of Housing and Urban Development, Office of Inspector General; and the U.S. Department of Labor’s Wage and Hour Division.”
HUD Office of Inspector General Special Agent in Charge, Brad Geary commented, “This case is an example of how the U. S. Department of Housing and Urban Development, Office of Inspector General for Investigation, working with our law enforcement partners and the U. S. Attorney’s Office will pursue individuals who victimize HUD’s public housing stock and ultimately affect our nation’s neediest families.”
Mr. Santelle especially commended the Federal Bureau of Investigation and the Offices of Inspector General for DOL and the Department of Housing and Urban Development, as well as the Wage & Hour Division of DOL, for the investigative efforts and accomplishments that led to today’s resolutions. The cases were handled by Assistant United States Attorneys Mel S. Johnson and Matthew D. Krueger.
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Attorney General Recognizes Wisconsin Federal ProsecutorRead the Press Release
United States Attorney James L. Santelle announced today that on June 4, 2015, Assistant United States Attorney (AUSA) Benjamin L. Whittemore was one of 160 employees of the United States Department of Justice (DOJ) recognized by Attorney General Loretta Lynch, Deputy Attorney General Sally Quillian Yates, and Executive Office for United States Attorneys (EOUSA) Director Monty Wilkinson at the 31st Annual EOUSA Director’s Awards Ceremony in Washington D.C. AUSA Whittemore was recognized for Superior Performance while serving as the DOJ Community Prosecutor assigned to engage and work with the Menominee Indian Tribe.
The Eastern District of Wisconsin was one of 31 districts represented at the ceremony which was held in the Great Hall at the Robert F. Kennedy Department of Justice Building.
In her prepared remarks, Attorney General Lynch told the awardees: “Our honorees include career executives and supervisors; Assistant U.S. Attorneys and Special Assistant U.S. Attorneys; appellate attorneys and law enforcement officials; administrators, paralegals, and public affairs officers. These individuals, and so many others, have faced daunting and sometimes dangerous challenges. They have dedicated their leadership and their expertise, their time and their energy, to the service of their mission. And they have remained devoted, at all times, to the high ideals and deeply-held values that animate our country and our cause.”
According to United States Attorney Santelle: “Mr. Whittemore’s tireless work in identifying and addressing threats to public safety on the Menominee Indian Reservation, his prosecution of a large volume of difficult sexual assault cases, and his commitment to working on behalf of Tribal victims led to him being considered a trusted partner of the Tribe, including its leadership. Mr. Whittemore’s work modernizing the Tribe’s drug code and updating its domestic violence laws will have lasting impact on the community. His training, education, and outreach efforts have greatly enhanced the working relationship and trust between Tribal and federal public safety agencies and helped to make the Menominee Reservation a safer place.”
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Four Charged with Running an Investment Fraud SchemeRead the Press Release
United States Attorney James L. Santelle announced today that a 31-count indictment was handed down Tuesday charging four individuals with running an investment fraud scheme from 2008 through 2012. Todd Dyer, age 51, a resident of Lake Geneva, Wisconsin, was charged in all 31 counts, including 21 counts of wire fraud, five counts of money laundering, and five counts of transporting funds obtained from fraud across state lines. Nicholas Hindman, age 63, a resident of Glen Ellyn, Illinois, was charged with engaging in the scheme with charges of wire fraud, money laundering, and transporting funds obtained from fraud across state lines. Melvin Krumdick, age 73, a resident of Oak Park, IL, was also charged with engaging in the scheme and with wire fraud and money laundering counts. Tracy Bolton, age 47, a resident of Lakemoor, IL, was also charged with engaging in the scheme to defraud and with counts charging wire fraud and interstate transportation of funds obtained by fraud. Each wire fraud count carries a maximum penalty of 20 years in prison, the money laundering counts and interstate transportation of funds obtained by fraud each carry a maximum penalty of 10 years imprisonment.
According to the indictment, the defendants created and marketed investment entities that were involved in purchasing valuable and scarce Midwest farmland property. The defendants offered investors an opportunity to invest in these entities by selling investors common stock, limited partnership interests, and stock warrants. Despite representations to the contrary, none of the investment entities ever purchased any farmland. According to the indictment, investors gave the defendants approximately $1.5 million, and instead of using the funds to purchase farmland, the defendants diverted the money and used it for personal purposes or to pay costs necessary to continue the promotion of the fraud scheme.
The case was investigated by agents from the Internal Revenue Service Criminal Division, and agents the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorneys Joseph R. Wall and Benjamin W. Proctor.
The public is cautioned that criminal charges do not constitute evidence of guilt. An individual is presumed innocent until such time, if ever, that the government establishes his or her guilt beyond a reasonable doubt.
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Three Milwaukee Area Persons Indicted for Wire, Mail, and Credit Card FraudRead the Press Release
James L. Santelle, the United States Attorney for the Eastern District of Wisconsin, announced that on June 9, 2015, a federal grand jury in Milwaukee returned an indictment charging three persons: Vladimir Sonin of Bayside, Wisconsin (age 50); Natalya Sonina of Bayside, Wisconsin (age 47); and Irina Tinney of Milwaukee, Wisconsin (age 47). Each defendant is charged with thirteen counts of wire, mail, and credit card fraud in violation of Title 18, United States Code, Sections 1029(a)(2), (a)(3), 1341, and 1343. Mr. Sonin and Ms. Sonina are also charged in an additional count of credit card fraud and two counts of aggravated identity theft in violation of Title 18, United States Code, Sections 1028A.
The indictment alleges that during the period from approximately January 1, 2013 until May 13, 2015, the defendants carried out a scheme to defraud and steal money from the IRS and various state treasuries through electronically filed fraudulent tax returns claiming tax refunds in the names of identity theft victims. The indictment further charges that as part of the scheme, the defendants received unauthorized access devices issued by financial institutions in the names of identity theft victims and then caused the IRS and various state treasuries to electronically place stolen refunds onto those unauthorized access devices. Finally, the indictment charges that as part of the scheme, the defendants used the unauthorized access devices at ATMs and then transferred more than $1 million in scheme proceeds to individuals in Ukraine.
Each of the ten mail or wire fraud charges contained in the indictment carries a maximum possible penalty of up to twenty years in prison and a fine of up to $250,000, or both. Each of the four credit card fraud charges contained in the indictment carries a maximum possible penalty of up to ten years in prison and a fine of up to $250,000, or both. Each of the two aggravated identity theft charges contained in the indictment carries a maximum possible penalty of a mandatory two years in prison consecutive to any other sentence and a fine of up to $250,000 or both.
According to United States Attorney James L. Santelle, "Today's charges are the result of collaborative efforts by many federal investigative agencies to dismantle a scheme that was defrauding both federal and state governments in addition to victimizing individuals. These charges reflect our continued commitment to investigate and prosecute criminal conduct such as identity theft that directly impacts the citizenry, including identity theft through which fraudulent claims for tax refunds are made." United States Attorney Santelle specifically commended the participating agencies for their hard work on the joint investigation, which was conducted by Special Agents from the Internal Revenue Service Criminal Investigations Division, the Postal Inspection Service, and the Federal Bureau of Investigation.
“IRS Criminal investigation is committed to rigorously pursuing identity thieves who steal from American taxpayers,” said IRS Criminal Investigation Special Agent in Charge Shea Jones of the St. Paul Field Office. “Today’s indictment should serve as a warning to identity thieves that we, along with our law enforcement partners and the United States Attorney's Office, will pursue those criminals who prey on innocent victims and bring them to justice.”
This case is assigned to Assistant United States Attorney Stephen A. Ingraham for prosecution.
The public is cautioned that an indictment is merely the formal method of presenting charges in federal court and does not constitute evidence of the defendant’s guilt. The defendant is presumed innocent until such time, if ever, as the government establishes her guilt beyond a reasonable doubt.
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Sixteen Defendants Charged in Federal Court & Six Defendants Charged in State CourtRead the Press Release
United States Attorney James L. Santelle announced today that four indictments were unsealed in federal court charging the following 16 defendants with conspiracy to distribute controlled substances, including crack cocaine and cocaine:
Deron P. GILBERT, age 33
Steven T. HARRIS, age 34
James D. ASHFORD, age 23
Terrence C. JAMISON, age 34
Ronald L. PARKER, age 32
Xavier G. POSTON, age 19
Devon K. THOMAS, age 26
Jerrold A. EZELL, age 26
Julius D. GONZALEZ, age 23
Devonte E. GUERCY, age 22
Rodney L. ROWSEY, age 25
Anthony D. WALTON, age 29
Monta T. BEAMON, age 42
Michael W. THOMAS, age 27
Kyeonta L. AMES, age 20
Jemarcus T. WILLIAMS, age 32All of the defendants except Ames, Beamon, Michael Thomas, and Williams, are charged with offenses punishable by up to life imprisonment, with a mandatory minimum sentence of ten years in prison. Beamon and Michael Thomas are charged with offenses punishable by up to forty years in prison, with a mandatory sentence of five years in prison. Ames and Williams are charged with offenses punishable by up to twenty years in prison. The majority of the suspects arrested were members of the HPT/ATK Street Gang, and all of them operated in Milwaukee County.
On June 9, 2015, law enforcement officers arrested four of these defendants. Six were already in custody. Six are still at large, including: Deron Gilbert, Devonte Guercy, Ronald Parker, Devon Thomas, Michael Thomas, and Jemarcus Williams.
In addition, the following defendants were charged by the Milwaukee County District Attorney’s Office with narcotics and firearms offenses: Kareen Hayes, age 23; Sean Barbosa, age 25; Mitchell Anderson, age 21; Darryl Agnew, age 31; Orell Davis, age 32; and Larrenzo Willis, age 35. All six defendants facing state charges reside and operate in Milwaukee. On June 9, 2015, law enforcement officers arrested two of these defendants. One was already in custody. Three are still at large, including: Larrenzo Willis, Mitchell Anderson, and Darrell Agnew. These cases are being prosecuted by Milwaukee County Assistant District Attorney Megan Williamson.
In making today’s announcement, United States Attorney Santelle stated: “These charges, arrests, and seizures are a part of our continuing work to dismantle drug organizations that threaten the safety and security of neighborhoods in the Eastern District of Wisconsin and elsewhere. These efforts reflect the importance of ongoing collaboration between federal, state, and local law enforcement.” Santelle commended all of the law enforcement officers involved in the investigation.
Acknowledging the collaborative efforts necessary to make today’s roundup a success, Milwaukee County District Attorney John Chisholm commented: “As we have in the past, our local, state, and federal public safety organizations continue to work closely together to identify violent offenders and effectively remove them from our community.”
Milwaukee Police Chief Edward A. Flynn provided the following remarks regarding today’s takedown: “Targeting violent gangs is a core element of our multi-pronged strategy to reduce violence in Milwaukee by focusing on high-hazard groups, individuals, and locations.”
Continuing with the theme of cooperation among law enforcement agencies, FBI Special Agent in Charge Robert Shields provided the following comment: “This case is an outstanding example of multi-jurisdictional cooperation, enabled by the FBI’s Southeastern Wisconsin Regional Gang Task Force, which resulted in the disruption of two violent criminal gangs. The citizens of Milwaukee have the right to feel safe and live free of violence from gangs in their neighborhood.”
The case was investigated by the Federal Bureau of Investigation, Milwaukee Police Department, and the Drug Enforcement Administration. The following agencies also assisted with today’s arrests and search warrants: Bureau of Alcohol, Tobacco, Firearms, and Explosives, Milwaukee County District Attorney’s Office – Investigators and Analyst, Oak Creek Police Department, and West Allis Police Department.
These cases are being prosecuted federally by Assistant U.S. Attorneys Brian Resler and Elizabeth Monfils.
An indictment is merely the formal method of charging an individual and does not constitute inference of his or her guilt. An individual is presumed innocent until such time, if ever, that the government establishes his or her guilt beyond a reasonable doubt.
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Defendants Charged with Conspiracy to Engage in Wire Fraud, Identity Theft, and Misuse of Automated Export SystemRead the Press Release
First Assistant United States Attorney Gregory J. Haanstad of the Eastern District of Wisconsin announced that defendant Mao Peng (age 25) of Kenosha, Wisconsin has been charged in a three-count criminal information with conspiring to engage in wire fraud, identity theft, and misuse of the United States’ Automated Export System to further criminal activity. Mr. Peng has also entered into a written plea agreement by which he has agreed to plead guilty to those charges.
According to the information and a plea agreement, Peng conspired to defraud the State of Wisconsin of state and local sales tax revenue in connection with the purchase of luxury vehicles, which Peng and his company Longen Trading intended to export to China, by fraudulently using Native American straw buyers to make those purchases in a tax-exempt manner. Specifically, Peng and Longen Trading used Native American straw buyers in connection with the purchase of approximately 154 luxury vehicle purchase transactions, having a total purchase price of approximately $9,132,106.94, and thereby evaded Longen Trading’s payment of a total of approximately $515,964.04 in state and local sales taxes that Longen Trading was legally obligated to pay in connection with the purchase of those vehicles.
According to the information and a plea agreement, Peng and Longen Trading also conspired to cause luxury vehicles to be purchased for export, via identity theft, that is, by using means of identification that belonged to a past or prospective straw buyer, without that person’s permission to purchase the vehicle using his or her identity. Specifically, between on or about June 2012 and June 2014, Peng and Longen Trading conspired with others to purchase approximately 71 luxury vehicles, having a total purchase price of approximately $4,212,945.06, using a means of identification belonging to another person, without that person’s knowledge or permission.
According to the information and plea agreement, between approximately June 2012 and June 2014, Peng and Longen Trading also conspired with others to use the Department of Commerce’s Automated Export System (“AES”) to further these illegal activities, in violation of 13 U.S.C. § 305(a)(2).
Under the plea agreement, Mr. Peng has agreed to plead to all three counts of the information, to join the government in recommending that the sentencing court impose a sentence of 27 months’ imprisonment, to pay restitution of $515,964.04 to the Wisconsin Department of Revenue, and to stipulate to the civil forfeiture of approximately $1.2 million in funds seized from various bank accounts he controlled as well as 29 new luxury vehicles, including new Porsche, Mercedes Benz, and BMW vehicles.
In announcing the filing of the information and plea agreement, First Assistant United States Attorney Gregory J. Haanstad stated: “As this case reflects, the United States Attorney’s Office and the United States Department of Justice are committed to aggressively combatting both identity theft and tax evasion. We are also committed to taking the profit out of crime and to obtaining just financial outcomes in our criminal cases through the judicious use of both asset forfeiture and restitution remedies.”
Haanstad commended the investigative work that the United States Secret Service and United States Department of Commerce, Bureau of Industry & Security, Office of Export Enforcement conducted in this matter, along with the investigative assistance provided by the following state and local law enforcement agencies: the Wisconsin Department of Criminal Investigations, the Wisconsin Department of Transportation Investigations, the Milwaukee Police Department, the Oneida Police Department, the Menomonee Police Department, the Stockbridge-Munsee Police Department, the Kenosha Police Department, the Wauwatosa Police Department, the Waukesha Police Department, the Glendale Police Department, the Green Bay Police Department, the Milwaukee Secret Service Financial Crimes Task Force, and the Native American Drug and Gun Initiative Task Force.
“The quality and overall success of this investigation is a direct reflection of the contributing agencies’ efforts, resources, and teamwork,” stated a spokesperson for the United States Secret Service’s Milwaukee Office.
"OEE will continue to work diligently with our law enforcement partners to identify and disrupt criminal export activity," stated David R. Nardella, Acting Special Agent-in-Charge, U.S. Department of Commerce, Bureau of Industry & Security, Office of Export Enforcement, Chicago Field Office.
This case is being prosecuted by Assistant United States Attorney Scott Campbell.
An information is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilty beyond a reasonable doubt.
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Neenah Woman Indicted on Heroin ChargesRead the Press Release
James L. Santelle, United States Attorney for the Eastern District of Wisconsin, announced that on June 2, 2015, a federal grand jury returned a single-count indictment against Brandi Kniebes-Larsen (age: 37) of Neenah, Wisconsin, charging her with one count of conspiracy to distribute 100 grams or more of heroin in violation of Title 21, United States Code, Section 846. If convicted of this offense, and based upon her previous felony drug conviction, Ms. Kniebes-Larsen faces a mandatory minimum ten years of imprisonment and up to a life sentence, from eight years to a lifetime of supervised release, and a maximum $8 million fine.
According to the indictment, the defendant conspired with others to sell over 100 grams of heroin in the Fox Valley region.
The case was investigated by the Lake Winnebago Area Metropolitan Enforcement Group and the Winnebago County Sheriff’s Department. The case is being prosecuted by Assistant United States Attorney Daniel R. Humble.
An indictment is only a charge and not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
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Sturgeon Bay Man Sentenced for Receipt of Child PornographyRead the Press Release
First Assistant United States Attorney Gregory J. Haanstad announced that Steven P. Link (47) was sentenced on June 1, 2015, by Chief Judge William C. Griesbach to 90 months imprisonment for the receipt of child pornography in violation of Title 18, United State Code, Section 2252A. Upon his release, Link will be on federal supervised release for 15 years and will have to report as a sex offender.
According to court documents, Sturgeon Bay Police Department officers executed a search warrant at a bookstore named “Untitled and Rare Used Books” that is owned and operated by Mr. Link. They also searched Link’s residence. Law enforcement officers seized numerous computers and media storage devices, searched them, and identified thousands of images and movie files containing child pornography. In particular, law enforcement forensic examiners determined that Link’s external hard drive contained approximately 841 GB of pornography consisting of 37,100 movie/image files (approximately 31,014 image files and the remainder movie files). According to law enforcement officers, at least 800 GB of this total consisted of images of teenage girls engaged in sexually explicit conduct; at least half of that 800 GB total involves minors believed to be between 5 and 16 years of age engaged in various forms of sexually explicit conduct.
In pronouncing sentence, Judge Griesbach noted Link’s extensive collection of child pornography including graphic movie files depicting minors engaged in horrific sexual acts. He also found the case aggravated because Link made secret video recordings of young adult females using the public bathroom at the bookstore while in various stages of undress.
The case was investigated by the Sturgeon Bay Police Department and was prosecuted by Assistant U.S. Attorney William Roach.
First Assistant United States Attorney Gregory J. Haanstad said: “Child pornography offenses exploit and victimize the most vulnerable members of our society. Investigations and prosecutions like this reflect the absolute commitment that the Department of Justice has made to protecting children from abuse and exploitation. The Department often is assisted in these efforts by our local law enforcement partners, and the tireless work of Sturgeon Bay Police Department Sergeant Carl Waterstreet and Officer Chad Mielke, the computer forensic examiner, was integral to the successful investigation and prosecution of this complicated case.”
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Wisconsin Farmer Charged with Crop Insurance FraudRead the Press Release
United States Attorney James L. Santelle of the Eastern District of Wisconsin announced today that a federal grand jury returned an indictment charging Jeffrey Lewke (age: 37) of Beaver Dam, Wisconsin with nine counts of crop insurance fraud. Mr. Lewke operated a large farming operation, farming as many as 12,000 acres in Wisconsin during 2011 and 2012.
The United States Department of Agriculture (“USDA”), through the Federal Crop Insurance Corporation (“FCIC”), provides insurance to farmers for unavoidable crop losses. The FCIC provides insurance by reinsuring private crop insurance companies for losses claimed by their policy holders.
According to the indictment, from 2009 through 2013, Lewke knowingly devised and executed a scheme to defraud a crop insurance company that was reinsured by the FCIC in a number of ways,including the following:
a. falsely representing that he was prevented from planting corn due to excessive moisture on land that was actually planted with corn, land that he did own or lease, land that established waterways, and land that was fenced-off for livestock;
b. falsely representing that he irrigated land more times than he actually did;
c. falsely representing that he sold damaged crops to a third party by submitting a receipt of a cancelled transaction to the crop insurance company;
d. falsely representing the county from which he harvested corn so as to increase his insurance claim; and
e. falsely underreporting his crop production so as to increase his insurance claim.
Counts One through Three of the indictment charge Mr. Lewke for using interstate wires in the execution of his scheme to defraud. Each count carries a maximum of 20 years in prison, a $250,000 fine, and 3 years of supervised release. Counts Four through Nine of the indictment charge Mr. Lewke for making false statements with the purpose of influencing a crop insurance company that was reinsured by the FCIC. Each count carries a maximum of 30 years in prison, a $1,000,000 fine, and 5 years of supervised release.
Mr. Lewke was charged after a long-term investigation by the United States Department of Agriculture – Office of Inspector General.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
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Brookfield Physician Sentenced to Prison for Illegally Distributing Prescription NarcoticsRead the Press Release
United States Attorney James L. Santelle, announced that on May 6, 2015, Jerry Yee (age: 82) a former Brookfield physician was sentenced in federal court to one year and a day in prison for illegally distributing prescription narcotics. Yee who was a doctor of osteopathic medicine, previously pleaded guilty to two counts of illegally attempting to distribute controlled substances by issuing prescriptions for narcotics outside of his professional practice and without a legitimate medical purpose.
As a physician, Yee was authorized to issue prescriptions for narcotics but only for legitimate medical purposes. Yee, however, issued prescriptions in the names of individuals who were not his patients and who he had never examined, let alone treated. In some instances, Yee issued prescriptions in the names of fictitious individuals and provided the prescriptions to third parties. Based on this conduct, Yee was charged with 15 specific instances of illegally issuing prescriptions for controlled substances and pleaded guilty to two representative counts.
In December 2013, after the allegations against Yee came to light, Yee surrendered his license to practice medicine.
This matter was investigated by the Drug Enforcement Administration. The case was prosecuted by Assistant United States Attorney Matthew L. Jacobs.
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Long-Term Care Pharmacy to Pay $31.5 Million to Settle Lawsuit Alleging Violations of Controlled Substances Act and False Claims ActRead the Press Release
James L. Santelle, United States Attorney for the Eastern District of Wisconsin announced today that PharMerica Corporation has agreed to pay the United States $31.5 million to resolve a lawsuit alleging that they violated the Controlled Substances Act by dispensing Schedule II controlled drugs without a valid prescription and violated the False Claims Act by submitting false claims to Medicare for these improperly dispensed drugs, the Justice Department announced today.
“Pharmacies put patients at risk when they dispense Schedule II narcotics, which have the highest potential for abuse of any prescription drug, without a valid prescription from a physician,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Department of Justice’s Civil Division. “Today’s settlement demonstrates our commitment to the fight against the misuse of controlled substances.”
PharMerica is a long-term care pharmacy that dispenses medications to residents of long-term care facilities, including nursing homes and skilled nursing facilities. Many of the prescriptions filled by PharMerica are for controlled substances listed in Schedule II under the Controlled Substances Act. Schedule II drugs, such as oxycodone and fentanyl, can cause significant harm if used improperly and have a high potential for abuse.
The government’s suit alleged that PharMerica pharmacies operating across the country routinely dispensed Schedule II controlled drugs in non-emergency situations without first obtaining a written prescription from a treating physician. According to the complaint, PharMerica’s actions violated the Controlled Substances Act by enabling nursing home staff to order narcotics, and pharmacists to dispense them, without confirming that a physician had made a medical judgment as to whether the narcotics were necessary and should be administered to the resident. Under the settlement, PharMerica has agreed to pay $8 million to resolve these allegations.
The government’s complaint also alleged that PharMerica violated the False Claims Act by knowingly causing the submission of false claims to Medicare Part D for improperly dispensed Schedule II drugs. The False Claims Act imposes treble damages and penalties for the knowing submission of false claims for federal funds. PharMerica has agreed to pay $23.5 million to resolve its alleged False Claims Act violations.
“Today’s significant settlement represents a single but critical significant step toward promoting integrity in the administration of public health programs,” said U.S. Attorney James L. Santelle of the Eastern District of Wisconsin. “This civil litigation and its meaningful resolution demonstrates that our fight against health care fraud is helping to protect all Americans, including the elderly, people with disabilities and other who may be vulnerable to mistreatment and abuse.”
The False Claims Act claims resolved by today’s settlement were originally brought by Jennifer Denk, a pharmacist formerly employed by PharMerica, under the whistleblower provisions of the act, which authorize private parties to sue on behalf of the United States and to receive a portion of any recovery. The act permits the United States to intervene and take over the lawsuit, as it did in this case with respect to some of Ms. Denk’s allegations. Ms. Denk will receive $4.3 million as her share of the settlement.
“DEA registrants are responsible to handle controlled substances in compliance with the Controlled Substances Act,” said Special Agent in Charge Dennis Wichern of the Drug Enforcement Administration (DEA) Chicago Field Division. “Failure to do so increases the potential for diversion and jeopardizes the public health and safety”.
“The DEA is committed to investigating organizations that are not in compliance with the Controlled Substances Act,” said Special Agent in Charge Michael J. Ferguson of the DEA New England Field Division. “Our obligation is to ensure public safety and public health and we are committed to working with our law enforcement and regulatory partners nationwide to ensure that these rules and regulations are followed.”
“The legal requirement that narcotics like oxycodone be prescribed by a physician is a crucial patient protection, which is especially important to safeguard the health of the vulnerable elderly and disabled patients in long term care facilities,” said Special Agent in Charge Lamont Pugh of the U.S. Department of Health and Human Services-Office of Inspector General (HHS-OIG). “Our agency is dedicated to protecting the taxpayer-funded Medicare and Medicaid programs as well as the millions of beneficiaries who rely on those programs for their health and well-being.”
As part of the settlement announced today, the settling defendant has also agreed to enter into a corporate integrity agreement with the HHS-OIG, which obligates PharMerica to undertake substantial internal compliance reforms and to submit federal health care program claims for an independent review for the next five years.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $24 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs.
The settlement with PharMerica was the result of a coordinated effort among the Civil Division, the U.S. Attorney’s Office of the Eastern District of Wisconsin, the U.S. Attorney’s Office of the District of Rhode Island, HHS-OIG and the DEA.
The lawsuit is captioned U.S. ex rel. Denk v. PharMerica Corp., No. 09-cv-720 (E.D. Wis.). The claims resolved by the settlement are allegations only; there has been no determination of liability.
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