Western District of Wisconsin
Press releases recorded for this federal judicial district.
University to Pay $1.5 Million to Settle False Claims Act AllegationsRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that the Board of Regents of the University of Wisconsin System, acting through the University of Wisconsin-Madison (“University”), agreed to pay $1.5 million to the United States to settle the claims that it violated the False Claims Act by failing to properly account for rebates and credits to reduce costs allocable to federal grants and awards (“Federal Awards”).
The United States awards more than $500 billion in Federal Awards annually, usually in the form of grants to help support a variety of programs, including supporting human health, agriculture, homeland security, and funding scientific research, studies, and analysis. As a public research institution, the University obtains significant Federal Awards from the United States to conduct research in a wide range of fields and programs, including but not limited to science, health care, and engineering.
According to the Settlement Agreement, the University was required to adhere to Office of Management and Budget cost principles as a condition of receiving its Federal Awards. These principles require, in relevant part, that when a Federal Award recipient receives rebates and discounts on purchases for Federal Awards, those rebates and discounts must be credited to the Awards. Because the University failed to do so with respect to various rebates and discounts, the United States alleged that the University overcharged it and is liable to the United States under the False Claims Act.
Specifically, the settlement alleges that the University participated in a number of rebate and discount programs with supply and equipment vendors, which generated rebates and discounts through various purchase cards and service centers, including the University’s Material Distribution Services and DoIT Techstore service centers. The rebate and discount programs were applied to certain supplies and equipment purchased by the University, however, the University failed to credit the rebates and discounts associated with these purchases to the Federal Awards.
“The United States entrusts Federal Award recipients with federal dollars, but the funds are subject to regulation, oversight, and audit,” said United States Attorney Blader. “It is incumbent on Award recipients, including public institutions, to provide the United States the benefit of credits or rebates it receives – failure to do so results in overcharging.”
In addition, the United States’ investigation revealed that the University’s accounting for these rebates and discounts failed to comply with its own operative Cost Accounting Standards Board Disclosure Statement as it relates to accounting practices for service centers.
This coordinated investigation was conducted by the United States Attorney’s Office and the Offices of Inspectors General for the U.S. Department of Health and Human Services, the National Science Foundation, the U.S. Department of Energy, the U.S. Department of Defense and Defense Contract Audit Agency, and the National Aeronautics and Space Administration. The prosecution of this matter has been handled by Assistant U.S. Attorney Leslie K. Herje. The settlement agreement states allegations only; the University does not admit the allegations.
Third Member of Methamphetamine Conspiracy SentencedRead the Press Release
Madison, Wis. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Ryan Witter, 36, Manitowoc, Wisconsin, pleaded guilty and was sentenced yesterday by U.S. District Judge William M. Conley to 126 months in federal prison for conspiring to distribute methamphetamine.
The amount of methamphetamine attributable to Witter was approximately 680 grams, which Judge Conley described as a conservative estimate. Witter conspired with others, including Tyrone Butterfield, whom he met when they were previously incarcerated together. Witter arranged for the shipping of numerous packages of methamphetamine from his sources in California, including his mother, to Butterfield in Bayfield, Wisconsin. Almost all of this methamphetamine was distributed into the Red Cliff Reservation.
During the course of the conspiracy, Witter was incarcerated for a prior drug charge and while in custody, he continued to arrange for the delivery of methamphetamine to the Red Cliff Reservation. Judge Conley described this as complete disregard for the laws and rules of society.
Four individuals, including Witter, have been charged for their roles in this methamphetamine distribution conspiracy. Rita Witter, Ryan Witter’s mother, was sentenced to three years and Simon Sayers was sentenced to 90 months. Tyrone Butterfield’s sentencing is scheduled for April 3.
The charge against Witter was the result of an investigation conducted by the Red Cliff Police Department; Wisconsin Department of Justice Division of Criminal Investigation; U.S. Postal Inspection Service; Drug Enforcement Administration in Wisconsin and California; Bayfield County Sheriff’s Office; Ashland Police Department; and the Fremont (California) Police Department. The prosecution of the case has been handled by Assistant U.S. Attorney Diane Schlipper.
Man Sentenced to 15 Years for Producing Child PornographyRead the Press Release
Madison, Wis. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Andrew Steiskal, 23, New Lisbon, Wisconsin, was sentenced today by U.S. District Judge James Peterson to 15 years in federal prison for producing child pornography. Steiskal pleaded guilty to this offense on December 7, 2018.
In January 2018, a minor in Dorchester, South Carolina went to the police and reported that she had been having contact with a Snapchat user who sent her a Dropbox link to sexually explicit pictures of an adult male and a young child. Law enforcement officers ultimately were able to identify the sender, who had the user name “steisdaddy95,” as Andrew Steiskal.
Law enforcement officers searched the minor’s phone and saw the images the minor described. They also found numerous Snapchat messages from Steiskal identifying himself and the minor child as the people shown in the sexually explicit images.
The mother of the child who appears in the sexually explicit images told the Court that there were not enough words to describe how horrible the experience has been for her and her child.
In sentencing the defendant, Judge Peterson said that part of what made the crime so horrible is that the defendant exploited a child who was incapable of defending herself or calling for help. Judge Peterson also pointed out that there were a number of victims here, and that the effects of the defendant’s actions would be felt long into the future.
The charges against Steiskal were the result of an investigation conducted by the Juneau County Sheriff’s Department, the Wisconsin Department of Justice Division of Criminal Investigation, and the Dorchester County (South Carolina) Sheriff’s Office. The prosecution of the case has been handled by Assistant U.S. Attorney Elizabeth Altman.
Chicago Man Sentenced to 66 Months for Distributing HeroinRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Terry Glaspie, 55, Chicago, Illinois was sentenced today by U.S. District Judge William M. Conley to 66 months in federal prison for possessing with intent to distribute 100 grams for more of heroin. Glaspie pleaded guilty to this charge on January 21, 2019.
On January 31, 2018, law enforcement officers recovered approximately 104 grams of fentanyl-laced heroin during a traffic stop of a vehicle which was occupied by Glaspie and two other individuals. During the course of their investigation, law enforcement determined that Glaspie helped transport the heroin from Chicago so it could be sold in Minneapolis, Minnesota.
During sentencing, Judge Conley stated that, despite knowing the risk of heroin to users, Glaspie was “part of the world that is putting this drug on the street to ensnare people.”
United States Attorney Blader echoed Judge Conley’s remarks when he stated that too many communities are being victimized by the heroin crisis. United States Attorney Blader said, “The United States Attorney’s Office is committed to battling this epidemic by prosecuting individuals who sell illegal drugs on our streets or transport them through our district.”
Dunn County District Attorney Andrea Nodolf thanked all of the federal, state, and local law enforcement agencies who participated in the investigation. She also noted how drugs like heroin have a “ripple effect throughout our communities.”
The charge against Glaspie was the result of an investigation conducted by the Dunn County Sheriff’s Office, Menomonie Police Department, Wisconsin State Patrol, Dunn County District Attorney’s Office, and the Drug Enforcement Administration. The prosecution of the case has been handled by Special Assistant U.S. Attorney Chadwick M. Elgersma.
Madison Gas Station Owner Sentenced to 30 Months & $1 Million Fine for Selling Synthetic CannabinoidsRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Farooq Shahzad, 50, Madison, Wisconsin, was sentenced today by Chief U.S. District Judge James D. Peterson to 30 months in federal prison and fined $1,000,000 for conspiring to distribute synthetic cannabinoids and possessing untaxed smokeless tobacco. Shahzad further agreed to forfeit the proceeds from the sale of a gas station involved in the drug offense. Shahzad pleaded guilty to these charges on January 10, 2019.
Farooq Shahzad owns and operates Capitol Petroleum, LLC (Capitol Petroleum). From July 2015 through May 2016, Shahzad conspired with certain Capitol Petroleum employees and others to distribute synthetic cannabinoids, a dangerous drug manufactured to mimic the effects of THC.
Law enforcement repeatedly instructed Shahzad and Capitol Petroleum employees to stop the sale of these dangerous drugs, and executed search warrants in June 2015 seizing the inventories of two gas stations. Despite these warnings, the conspirators continued to distribute synthetic cannabinoids from a Mobil gas station located at 3505 East Washington Avenue in Madison.
During this period, Shahzad also procured and sold untaxed smokeless tobacco, evading approximately $52,000 in State of Wisconsin excise tax.
In sentencing Shahzad, Judge Peterson stated that Shahzad “compartmentalized away the illegal aspects of activities that were profitable to him.” Judge Peterson was concerned that Shahzad persisted in distributing synthetic cannabinoids even after he knew it was illegal and damaging to the community. Judge Peterson stated that he wanted the sentence to send a strong message to the business community.
The charges against Farooq Shahzad were the result of an investigation conducted by IRS Criminal Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, Drug Enforcement Administration, Wisconsin Department of Justice Division of Criminal Investigation, Wisconsin Department of Revenue, and the Dane County Narcotics Task Force. The prosecution of the case has been handled by Assistant U.S. Attorneys Antonio M. Trillo, Aaron Wegner, and Kevin Burke.
Minnesota Man Sentenced for Distributing Methamphetamine in WisconsinRead the Press Release
Madison, Wis. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Bradley Kraemer, 34, White Bear Lake, Minnesota, pleaded guilty and was sentenced on March 14, 2019, by U.S. District Judge William M. Conley to 78 months in prison for distributing methamphetamine.
Kraemer transported more than 100 grams of high quality methamphetamine from Minnesota to Monona, Wisconsin, on February 20, 2018. Judge Conley noted that this is Kraemer’s first federal conviction, though he has a lengthy criminal history, “dotted with numerous periods of incarceration, all having been brief in duration.”
The charge against Kraemer was the result of an investigation conducted by the Drug Enforcement Administration in Wisconsin and Minnesota, and the Wisconsin Department of Justice Division of Criminal Investigation. The prosecution of the case has been handled by Assistant U.S. Attorney Diane Schlipper.
Grand Jury Returns IndictmentsRead the Press Release
MADISON, WIS. -- A federal grand jury in the Western District of Wisconsin, sitting in Madison, returned the following indictments today. You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
Eau Claire Woman Charged with Distributing Methamphetamine and Illegally Possessing a Firearm
Sylvia Erickson, 40, Eau Claire, Wisconsin, is charged with five counts of distributing methamphetamine, one count of attempting to possess 50 grams or more of methamphetamine with intent to distribute, and being a felon in possession of a firearm.
The indictment alleges that Erickson committed the drug offenses between November 12, 2018 and January 7, 2019, and that she possessed a .380 handgun and ammunition on November 20, 2018. One of the distribution counts alleges that on January 7, 2019, she distributed 50 grams or more of methamphetamine.
If convicted, Erickson faces a maximum penalty of 20 years in federal prison on each drug count, with the exception of the two counts alleging 50 grams or more of methamphetamine. These charges carry a mandatory minimum penalty of five years and a maximum of 40 years. The charge of being a felon in possession of a firearm has a maximum penalty of 10 years.
The charges against Erickson are the result of an investigation by the Drug Enforcement Administration, West Central Drug Task Force, Eau Claire Police Department, Wisconsin Department of Justice Division of Criminal Investigation, Chippewa County Sheriff’s Office, and Eau Claire County Sheriff’s and District Attorney’s Offices. The prosecution of this case is being handled by Assistant U.S. Attorney Meredith P. Duchemin.
Portage County Man Charged with Drug & Gun Crimes
Corey Scheerenberger, 35, Alban, Wisconsin, is charged with possessing 50 grams or more of methamphetamine with intent to distribute, and with being a felon in possession of firearms. The indictment alleges that on September 27, 2018, he possessed the methamphetamine and three .22 caliber rifles, a .22 caliber pistol, and a .22-250 caliber rifle.
If convicted, Scheerenberger faces a mandatory minimum penalty of five years and a maximum of 40 years in federal prison on the drug charge, and a maximum of 10 years on the felon in possession of firearms charge. The charges against him are the result of an investigation by the Portage County Sheriff’s Office and the Central Wisconsin Drug Task Force. The prosecution of this case is being handled by United States Attorney Scott C. Blader and Assistant U.S. Attorney Diane Schlipper.
Edgerton Man Charged with Illegally Possessing Firearms
David Hill, 39, Edgerton, Wisconsin, is charged with being a felon in possession of firearms. The indictment alleges that on February 25, 2019, he possessed a loaded .40 caliber pistol, a .45 caliber pistol, and three rifles.
If convicted, Hill faces a maximum penalty of 10 years in federal prison. The charge against him is the result of an investigation by the Edgerton Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The prosecution of this case is being handled by Assistant U.S. Attorney Rita M. Rumbelow.
Madison Man Charged with Drug & Gun Crimes
Daniel Norris, 31, Madison, Wisconsin, is charged with possessing crack cocaine with the intent to distribute, possessing a firearm in furtherance of a drug trafficking crime, and being a felon in possession of a firearm. The indictment alleges that on January 7, 2019, he possessed 28 grams or more of crack cocaine and a loaded 9mm semi-automatic pistol.
If convicted, Norris faces a mandatory minimum penalty of five years and a maximum of 40 years in federal prison on the drug charge. On the charge of possessing a firearm in furtherance of a drug trafficking crime, he faces a mandatory minimum penalty of five years. Federal law requires that any penalty imposed for this charge be served consecutive to any sentence imposed on the drug charge. The maximum penalty for the felon in possession of a firearm charge is 10 years. The charges against Norris are the result of an investigation by the Dane County Narcotics Task Force. The prosecution of this case is being handled by Assistant U.S. Attorney Aaron Wegner.
Elkhorn Man Charged with Bank Robbery
Jeffrey A. Campton, 29, Elkhorn, Wisconsin, is charged with bank robbery. The indictment alleges that he robbed the Home Savings Bank on East Washington Avenue in Madison, Wisconsin on September 4, 2018.
If convicted, Campton faces a maximum penalty of 20 years in federal prison. The charge against him is the result of an investigation by the Madison Police Department and the Federal Bureau of Investigation. The prosecution of this case is being handled by Assistant U.S. Attorney Corey Stephan.
The indictments against Erickson, Scheerenberger, Hill, Norris, and Campton have been brought as part of Project Safe Neighborhoods (PSN), the U.S. Justice Department’s program to reduce violent crime. The PSN approach emphasizes coordination between state and federal prosecutors and all levels of law enforcement to address violent crime.
Tomah Man Charged with Crime Involving Methamphetamine
Bobby L. Ostrum, 36, Tomah, Wisconsin, is charged with possessing methamphetamine with intent to distribute. The indictment alleges that he possessed 50 grams or more of methamphetamine on November 16, 2018.
If convicted, Ostrum faces a mandatory minimum penalty of five years and a maximum of 40 years in federal prison. The charge against him is the result of an investigation by the Sparta and Tomah Police Departments, the Monroe County Joint Investigative Task Force, and the West Central Metropolitan Enforcement Group. The prosecution of this case is being handled by Assistant U.S. Attorney Diane Schlipper.
Two Federal Prison Inmates Charged with Possessing Controlled Substance
In separate and unrelated indictments, two inmates of the Federal Correctional Institution at Oxford, Wisconsin, are charged with possessing a prohibited object. Demario Angel, 42, is charged with possessing paper containing the chemical compound 5F-ADB, a Schedule I controlled substance. The indictment against him alleges that he possessed this prohibited object on July 25, 2018.
Christopher Mallett, 37, is charged with possessing pieces of paper containing the chemical compound FUB-AMB, a Schedule I controlled substance. The indictment against him alleges that he possessed this prohibited object on February 22, 2018.
The chemical compounds alleged in these two indictments are both synthetic cannabinoids.
If convicted, Angel and Mallet each face a maximum penalty of 10 years in federal prison. The charges against them are the result of investigations by the Federal Bureau of Investigation and the Federal Bureau of Prisons – Special Investigative Services. The Angel case is being handled by Special Assistant U.S. Attorney Chadwick Elgersma and the Mallett case is being handled by Assistant U.S. Attorney Kevin Burke.
Man Charged with Escape
Sean Nance, 43, Beloit, Wisconsin, is charged with escape. The indictment alleges that on January 9, 2019, he escaped from the Rock Valley Community Programs Center in Janesville, Wisconsin, where he was confined.
If convicted, Nance faces a maximum penalty of five years in federal prison. The charge against him is the result of an investigation by the U.S. Marshals Service. The prosecution of this matter is being handled by Assistant U.S. Attorney Laura Przybylinski Finn.
Sawyer County Woman Sentenced to 4 Years for Methamphetamine DistributionRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Tabatha Case, 32, Stone Lake, Wisconsin, was sentenced last week by U.S. District Judge William Conley to four years in federal prison for possessing methamphetamine with intent to distribute. Case pleaded guilty to this charge on January 3, 2019, and was sentenced on March 8.
The government’s investigation revealed that Case regularly traveled to Minnesota between 2016 and 2018 to purchase large amounts of methamphetamine. Case transported the methamphetamine back to Wisconsin and sold it in the Minong area.
During the investigation, Case sold methamphetamine to a confidential source working with law enforcement on six separate occasions. Case also sold over 20 firearms to methamphetamine suppliers and customers while she was actively dealing methamphetamine.
The charge against Case was a result of an investigation conducted by the Washburn County Sheriff’s Office, Sawyer County Sheriff’s Office, Wisconsin Department of Justice Division of Criminal Investigation, and Federal Bureau of Investigation. The prosecution of this matter was handled by Assistant U.S. Attorney Aaron Wegner.
Felon Sentenced to 30 Months for Possessing Two Guns & AmmunitionRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Raymond Jackson, 52, Chicago, Illinois, was sentenced today by U.S. District Judge James D. Peterson to 30 months in federal prison for possessing two firearms and ammunition as a felon. Jackson pleaded guilty to the charge on December 17, 2018.
On January 28, 2017, Price County law enforcement recovered two firearms and ammunition from Jackson’s vehicle during a traffic stop for operating while intoxicated. Jackson initially was charged in state court, but he absconded from his pretrial supervision and failed to appear for court. He was subsequently indicted by a federal grand jury and arrested by law enforcement in Chicago in September 2018.
In selecting a 30-month sentence, Judge Peterson noted Jackson’s lengthy criminal history, which included prior convictions for burglary, robbery, possession of a controlled substance, theft, unlawful use of a weapon by a felon, criminal damage to property, and domestic battery. Judge Peterson also noted that one of the firearms Jackson possessed had an obliterated serial number.
The charge against Jackson was the result of an investigation conducted by the Price County Sheriff’s Office; Phillips Police Department; Bureau of Alcohol, Tobacco, Firearms and Explosives; Chicago Police Department Fugitive Apprehension Unit; Federal Bureau of Investigation; and the Price County District Attorney’s Office. The prosecution of the case has been handled by Assistant U.S. Attorney Meredith P. Duchemin.
This case has been brought as part of Project Safe Neighborhoods (PSN), the U.S. Justice Department’s program to reduce violent crime. The PSN approach emphasizes coordination between state and federal prosecutors and all levels of law enforcement to address gun crime, especially felons illegally possessing firearms and ammunition and violent and drug crimes that involve the use of firearms.
California Woman Sentenced for Shipping Methamphetamine to Red Cliff ReservationRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western Disttrict of Wisconsin, announced that Rita Witter, 69, Fremont, California, pleaded guilty and was sentenced last week by U.S. District Judge William M. Conley to three years in prison for conspiring to distribute methamphetamine. Witter appeared in federal court in Madison on March 7.
Witter conspired with others, including her son, to traffic methamphetamine to the Red Cliff Reservation in Bayfield, Wisconsin. While the conspiracy was ongoing for approximately one year, Witter did not join until the final six months. During that time, she shipped four or five packages containing substantial amounts of methamphetamine to the Red Cliff Reservation. Judge Conley described Witter as knowingly fueling the addiction of untold others in the small Red Cliff community.
Rita Witter and three other individuals were charged for their roles in this methamphetamine distribution conspiracy. All have pleaded guilty and Witter is the second to be sentenced. Simon Sayers was sentenced to 7.5 years in prison for his role in the conspiracy. Ryan Witter, Rita Witter’s son, is scheduled to be sentenced March 20, and Tyrone Butterfield’s sentencing is scheduled for April 3.
The charge against Witter was the result of an investigation conducted by the Red Cliff Police Department; Wisconsin Department of Justice Division of Criminal Investigation; U.S. Postal Inspection Service; Drug Enforcement Administration in Wisconsin and California; Bayfield County Sheriff’s Office; Ashland Police Department; and the Fremont (Calif.) Police Department. The prosecution of the case has been handled by Assistant U.S. Attorney Diane Schlipper.
Convicted Felon Sentenced After Discharging Firearm in Madison Parking StructureRead the Press Release
MADISON, WIS. - Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Tony D. Smith, 30, Madison, Wisconsin, was sentenced today by U.S. District Judge William M. Conley to four years in federal prison, followed by a three-year term of supervised release, for possessing a firearm as a convicted felon. Smith pleaded guilty to this charge on October 23, 2018.
On August 10, 2018, Madison Police Department patrol officers heard a gunshot in a public parking ramp in downtown Madison. The parking ramp’s security guard reported that he observed the driver of a red Dodge sedan discharge a firearm at three individuals in the ramp before speeding out of the ramp and striking through the exit’s stop arm. Security video showed the license plate of the vehicle, and an MPD officer located it shortly afterwards. Officers followed the car and conducted a high-risk traffic stop in an apartment parking lot. They identified the driver and sole occupant of the vehicle as Smith, but no firearm was located in the vehicle. Officers searched the parking ramp and located a 9mm shell casing. The following day, a citizen located a 9mm firearm near the apartment complex where Smith was arrested, and called the police. The firearm had one round in the chamber. Investigation revealed the firearm was owned by Smith’s girlfriend.
Given Smith’s criminal history and background, Judge Conley rejected his request for an 18-month sentence.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone.
The charge against Smith was the result of an investigation conducted by the Madison Police Department. The prosecution of the case has been handled by Assistant U.S. Attorney Rita M. Rumbelow.
Beloit Man Sentenced to 6 Months for Social Security FraudRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Gregory Whitt, 63, Beloit, Wisconsin, was sentenced yesterday by U.S. District Judge James D. Peterson to six months in prison for Social Security fraud. Whitt pleaded guilty to this charge on October 17, 2018.
Whitt began receiving Social Security benefits in June of 2011 after claiming an inability to work due to physical and mental health issues. However, the investigation revealed that the defendant, while collecting Social Security payments, worked full-time as a dump truck driver in Beloit until 2017. During this time, Whitt insisted that his employers pay him in cash so he could continue to receive Social Security payments. As a result of his fraudulent conduct, Whitt received $118,602 in Social Security benefits to which he was not entitled.
In imposing the six-month prison sentence, Judge Peterson noted that Whitt’s fraud lasted over six years and involved a significant amount of money. Judge Peterson stated that Whitt knowingly cheated the system and was disappointed that Whitt made false statements to investigating agents when initially confronted with his crime.
The charges against Whitt are the result of an investigation by the Social Security Administration - Office of the Inspector General and the Wisconsin Department of Justice Division of Criminal Investigation. The prosecution of this case has been handled by Assistant U.S. Attorney Aaron D. Wegner.
Nurse Anesthetist Sentenced for Stealing Fentanyl at VA HospitalRead the Press Release
Madison, Wis. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Todd Mehrhoff, 49, Waunakee, Wisconsin, was sentenced today by U.S. District Judge James Peterson to three years of probation for obtaining fentanyl by use of misrepresentation and fraud.
During the timeframe of the government’s investigation, Mehrhoff was employed at the William S. Middleton Memorial Veterans Hospital in Madison as a Certified Registered Nurse Anesthetist and primarily participated in surgeries in the operating room. The hospital utilized a Med-Select system, which automated and monitored the distribution, management, and control of prescription medications, including fentanyl. As a Certified Registered Nurse Anesthetist, Mehrhoff had access to the Med-Select system. Each individual user of the Med-Select system logged in by either entering their unique user ID number along with a PIN number or entering their unique ID number along with a fingerprint scan.
On December 19, 2017, Veteran Affairs police officers responded to a complaint of suspected drug diversion by Mehrhoff. Earlier that day, employees in an operating room found a fentanyl syringe that was left unattended on a medical cart. Staff within the operating room queried usage within the automatic dispensing cabinet and determined Mehrhoff had removed fentanyl earlier in the day and did not report its administration or destruction.
The subsequent investigation into Mehrhoff’s records revealed over 100 suspected diversions of fentanyl between August and December of 2017. Mehrhoff admitted obtaining fentanyl for personal use from the Med-Select system in the following situations: 1) when he was not on duty; 2) for patients he was not assigned to; 3) on days when no surgeries were scheduled; and 4) in amounts greater than would be typical for any operating room procedure.
The charges against Mehrhoff are the result of an investigation by the Veteran’s Affairs Police Department and the Drug Enforcement Administration. The prosecution of this case has been handled by Assistant U.S. Attorney Aaron D. Wegner.
Four Wisconsin Hunters Sentenced for Lacey Act Crimes & ObstructionRead the Press Release
Madison, Wis. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that four men -- Robert Peters, 53, Turtle Lake, Wisconsin; Steven Reindahl, 55, Turtle Lake; David Johnson, 31, Barnes, Wisconsin; and Darren Johnson, 52, Deer Park, Wisconsin -- were sentenced today in federal court in Madison. The defendants were convicted of crimes related to an illegal 2017 mountain lion hunt in Montana, in violation of the Lacey Act, and conspiring to obstruct a 2018 federal grand jury investigation.
Magistrate Judge Stephen L. Crocker sentenced Peters and Reindahl to two years of probation, David Johnson to a three-year term of probation, and Darren Johnson to a four-year term of probation. As a condition of probation, these defendants cannot hunt and trap, or assist and/or accompany others engaged in hunting or trapping worldwide for a period of two years to begin on the date of sentencing. Both Peters and Reindahl were fined $5,000, David Johnson was fined $25,000, and Darren Johnson was fined $30,000. All fines were due and payable immediately, and all defendants paid the fines today. The Johnsons’ fines were paid directly to the Lacey Act Reward Fund.
In addition, Judge Crocker ordered three of the defendants to forfeit instrumentalities used during the illegal hunt. Robert Peters was ordered to forfeit a Browning Abolti rifle and a bobcat hide.
David Johnson was ordered to forfeit a Garmin Astro 320 Receiver, three Garmin dog collars, 10-30x50 Zoom Binoculars, a Remington 870 Super Mag 12 gauge shotgun, and a Mountain lion hide (Montana lion).
Darren Johnson was ordered to forfeit a 2012 Ford F-250 pickup truck, a Savage Model 11 .223 rifle with Konus 3-9x40 scope, a Garmin Astro 320 receiver, three Garmin Dog Collars, Nikon 10x42 binoculars, a Uniden UKM380 VHF radio, a Mountain lion and bobcat mount (Colorado lion), and a Mountain lion skull (Montana lion).
David Johnson and Darren Johnson are not related.
In imposing the sentences today, Judge Crocker observed that these four defendants were men “who loved and lived to hunt, but they cut corners and cheated. They broke the law knowingly.” Judge Crocker also said that “most hunters play by the rules and they expect all hunters to play by the rules.” The judge explained that these sentences need to send the general deterrence message to the hunting community that “if you play by the rules you are not a chump, and if you don’t play by the rules you face severe consequences, and the government will hit you where it hurts . . . . The government will take away what you love the most – hunting.”
Judge Crocker told the defendants that “these types of cases are important. Hunting is a privilege not a right. The rules apply to everyone. You cannot cheat.” Finally, the judge counseled the defendants that, “this case could easily have been a felony with far more severe sanctions with life-changing results . . . . It could have been much worse.” The judge ended by saying, “These sentences are no picnic. But they are supposed to hurt. If you cheat, your sentence should make you hurt. We won’t tolerate this type of behavior.”
On January 6, 2017, Darren and David Johnson, Bob Peters and Steve Reindahl were in Mosby, Montana hunting mountain lions with their dogs. That morning, the dogs treed a mountain lion. Only Darren Johnson and Steve Reindahl had valid licenses to hunt mountain lions.
Despite not having a valid license, David Johnson used Darren Johnson’s rifle to shoot and kill the mountain lion, and Darren Johnson took out his tag and tagged the lion. According to witness testimony, Darren Johnson told the group that everyone needed to stick to the story that Darren Johnson killed the mountain lion. On January 10, 2017, all four men drove back from Montana to Wisconsin, and Darren Johnson and Steve Reindahl transported the mountain lion hide. A few days later, Darren Johnson dropped off the hide at David Johnson’s home.
In late May 2018, Bob Peters and Steve Reindahl were served with grand jury subpoenas to testify before a federal grand jury on June 21, 2018, in Madison regarding the 2017 mountain lion hunt. On Sunday, June 17, 2018, Darren and David Johnson, Robert Peters, and Steve Reindahl met at Peter’s home in Turtle Lake to talk about the upcoming grand jury session. At the Sunday meeting, Darren Johnson allegedly told everyone to stick to the story that he killed the Montana mountain lion on January 6, 2017, and that the agents did not have any proof to say otherwise.
On June 21, 2018, Bob Peters and Steve Reindahl appeared before the grand jury. Later, Peters and Reindahl admitted that they lied to the grand jury and agreed to cooperate and tell the truth. They recanted their prior testimony and explained that David Johnson killed the mountain lion and Darren Johnson tagged it and told everyone he killed it and they all needed to stick to that story. Both men explained that they were told by Darren Johnson at the meeting in Turtle Lake not to tell the truth to the grand jury.
The charges against these men were the result of an investigation conducted by special agents with the U.S. Fish and Wildlife Service Office of Law Enforcement, the Wisconsin Department of Natural Resources Bureau of Law Enforcement, and the Montana Department of Fish, Wildlife and Parks. The prosecution of the case has been handled by Assistant U.S. Attorney Daniel J. Graber.
Madison Man Charged with Armed RobberyRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced today the unsealing of an indictment charging a Madison man with robbing a Madison business at gunpoint. Christian Killian, 33, was charged in an indictment returned yesterday by a grand jury sitting in Madison.
The indictment alleges that Killian robbed the Pizza Hut on South Park Street in Madison on January 29, 2019, and that he displayed a firearm to a Pizza Hut employee during the robbery. The indictment also charges Killian with possessing a firearm during this crime of violence.
Killian was arrested late yesterday afternoon in Madison by Madison Police and the Dane County Sheriff’s Office. He made an initial appearance in U.S. District Court in Madison today, and was detained in custody pending a detention hearing. The date for the detention hearing has not been set.
If convicted, Killian faces a maximum penalty of 20 years in federal prison on the robbery charge, and a mandatory minimum penalty of five years on the firearm charge. Federal law requires that a penalty imposed on the firearm charge be served consecutive to any penalty imposed on the robbery charge.
The charges against Killian are the result of an investigation by the Madison Police Department and Dane County Sheriff’s Office. The prosecution of this case is being handled by Assistant U.S. Attorney Rita M. Rumbelow.
You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
Grand Jury Returns IndictmentsRead the Press Release
MADISON, WIS. -- A federal grand jury in the Western District of Wisconsin, sitting in Madison, returned the following indictments this week. You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
Three Charged with Robbing Dane County Businesses
In three separate indictments, three individuals are charged with robbing various Dane County businesses in December 2018 and January 2019. The indictments allege that some of the robberies were armed robberies.
Marjory Dingwall, 39, Madison, Wisconsin, is charged with robbing the Stop N’ Go gas station on Monona Drive in Madison on January 6, 2019; with robbing Orange Tree Imports on Monroe Street in Madison on January 7, 2019; and with robbing the Mobil gas station on Lake Road in Windsor, Wisconsin on January 8, 2019. The indictment also charges her with brandishing a firearm during each robbery.
Aaron Stanley, 34, Madison, is charged with robbing the Speedway gas station on Monona Drive in Monona, Wisconsin on December 24, 2018; with robbing the Mobil gas station on Cottage Grove Road in Madison on December 30, 2018; with robbing the Speedway gas station on Lake Road in Windsor on January 6, 2019; and with robbing Papa Murphy’s Pizza on East Broadway in Monona on January 15, 2019. The indictment also charges him with brandishing a firearm during the December 24, 2018 robbery of the Speedway gas station.
Eric Clay, 28, Madison, is charged with robbing a Union Cab in Madison on December 14, 2018; with robbing the BP Stop-N-Go on Tower Drive in Sun Prairie, Wisconsin on December 14, 2018; and with robbing a Green Cab in Madison on December 15, 2018. The indictment also charges him with brandishing a firearm during the December 15 robbery of a Green Cab.
If convicted, the defendants face a maximum penalty of 20 years in federal prison on each robbery count. The charge of brandishing a firearm during a crime of violence carries a mandatory minimum penalty of seven years in federal prison. Federal law requires that any penalty imposed for the charge of brandishing a firearm be served consecutive to any sentence imposed on the robbery charges.
The charges against Dingwall and Stanley are the result of investigations by the Madison Police Department, Monona Police Department, and Dane County Sheriff’s Office. The charges against Clay are the result of an investigation by the Madison and Sun Prairie Police Departments. The prosecutions of Dingwall and Stanley are being handled by Assistant U.S. Attorney Rita M. Rumbelow. The prosecution of Clay is being handled by Special Assistant U.S. Attorney Chadwick Elgersma and Assistant U.S. Attorney Rumbelow.
McFarland Man Charged with Bank Robberies
Jason J. Yapp, 47, McFarland, Wisconsin, is charged with one count of bank robbery and one count of attempted bank robbery. The indictment alleges that he robbed the Associated Bank on West Broadway in Madison on September 17, 2018, and attempted to rob the Associated Bank on Cottage Grove Road in Madison on September 21, 2018.
If convicted, Yapp face 20 years in federal prison on each charge. The charges against him are the result of investigations by the Madison Police Department and Federal Bureau of Investigation. The prosecution of this case is being handled by Assistant U.S. Attorney Corey Stephan.
The indictments against Dingwall, Stanley, Clay, and Yapp have been brought as part of Project Safe Neighborhoods (PSN), the U.S. Justice Department’s program to reduce violent crime. The PSN approach emphasizes coordination between state and federal prosecutors and all levels of law enforcement to address violent crime.
Madison Man Charged with Production of Child Pornography and Lying to Federal Agent
Bryan Rogers, 31, Madison, Wisconsin, is charged with persuading a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of such conduct. The indictment alleges that Rogers did so between December 24, 2018 and January 13, 2019, and that the visual depiction was transported in interstate commerce from Tennessee to Wisconsin. Rogers is also charged with lying to an FBI agent during an interview.
Rogers was previously charged with the production of child pornography offense in a complaint filed in U.S. District Court for the Western District of Wisconsin on February 4, 2019. Federal law requires that felony offenses be charged by an indictment returned by a grand jury within 30 days of the date a criminal complaint is filed.
If convicted, Rogers faces a mandatory minimum penalty of 15 years and a maximum of 30 years in federal prison on the child pornography charge, and five years in prison on the charge of lying to investigators. The charges against him are the result of an investigation by the Wisconsin Department of Justice Division of Criminal Investigation, Federal Bureau of Investigation, Madison Police Department, Dane County Sheriff’s Office, and Monroe County (Tennessee) Sheriff’s Office. The prosecution of this case is being handled by Assistant U.S. Attorney Julie Pfluger.
Minnesota Man Charged with Drug Crime
Pheng Yang, 29, St. Paul, Minnesota, is charged with possessing 500 grams or more of methamphetamine with intent to distribute. The indictment alleges that he possessed the methamphetamine on February 4, 2019.
If convicted, Yang faces a mandatory minimum penalty of 10 years and a maximum of life in federal prison. The charge against him is the result of an investigation by the Drug Enforcement Administration in Wisconsin and Minnesota, the West Central Drug Task Force, Eau Claire Sheriff’s Office, Eau Claire Police Department, Buffalo County Sheriff’s Office, and Wisconsin Department of Justice Division of Criminal Investigation. The prosecution of this case is being handled by Assistant U.S. Attorney Meredith Duchemin.
McFarland Woman Charged with Attempting to Possess Fentanyl
Elizabeth Cirves, 55, McFarland, Wisconsin is charged with two counts of attempting to possess fentanyl with intent to distribute. The indictment alleges that she attempted to possess fentanyl on January 10 and 14, 2019.
If convicted, Cirves faces a maximum penalty of 20 years in federal prison on each count. The charges against her are the result of an investigation by the U.S. Postal Inspection Service. The prosecution of this case is being handled by Assistant U.S. Attorney Aaron Wegner.
Wausau Woman Charged with Making False Statements
Marjean Seehafer, 43, Wausau, Wisconsin is charged with two counts of making false statements for use in determining rights to payment under the Social Security Act. The indictment alleges that on November 20, 2017 and July 27, 2018, she falsely stated that she had not worked for private businesses in 2016 or 2017 while she was receiving Social Security disability benefits.
If convicted, Seehafer faces a maximum penalty of five years in federal prison on each count. The charges against her are the result of an investigation by the Social Security Administration, Office of Inspector General. The prosecution of this case is being handled by Assistant U.S. Attorney Robert Anderson.
DeForest Man Pleads Guilty to Selling Firearms Without LicenseRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Eugene Ripp, 66, DeForest, Wisconsin, pleaded guilty yesterday to willfully engaging in the business of dealing firearms without a qualifying federal firearms license.
At the plea hearing, Ripp acknowledged that he sold firearms without a license from October 2015 to December 2016. This occurred after agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives warned Ripp in July 2015 that dealing firearms without a license is unlawful.
Ripp attended gun shows throughout and outside of Wisconsin, and sold firearms using the trade name “Son of a Gun.” Ripp sold multiple AR-15-type pistols to an undercover agent in 2016. In December 2016, federal agents executed a search warrant at Ripp’s residence and seized evidence of his firearms dealing business and over 120 firearms.
Ripp faces a maximum penalty of five years in federal prison and a fine of $250,000. U.S. District Court Judge William M. Conley scheduled sentencing for May 8, 2019 at 1:00 p.m.
The investigation of this case was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives. The prosecution of this case is being handled by Assistant U.S. Attorneys Antonio M. Trillo and Kevin F. Burke.
US Attorney's Office Collects Nearly $40 Million in 2018Read the Press Release
MADISON, WIS. – U.S. Attorney Scott C. Blader announced today that the Western District of Wisconsin collected $39,852,608 in criminal and civil actions in Fiscal Year 2018. Of this amount, $36,880,504 was collected in criminal actions and $2,972,104 was collected in civil actions.
As a whole, the Justice Department collected nearly $15 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2018. The $14,839,821,650 in collections in FY 2018 represents is nearly seven times the appropriated $2.13 billion ($2,136,750,000) budget for the 94 U.S. Attorneys’ offices.
“The men and women of the U.S. Attorneys’ offices across the country work diligently, day in and day out, to see that the citizens of our nation receive justice. The money that we are able to recover for victims and this country as a whole is a direct result of their hard work,” Director James A. Crowell IV of the Executive Office for U.S. Attorneys.
The U.S. Attorneys’ Offices, along with the Department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the Department’s Crime Victims Fund, which distributes the funds collected to federal and state victim compensation and victim assistance programs.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, the Department of Health and Human Services, the Internal Revenue Service, the Small Business Administration and the Department of Education.
Onalaska Man Sentenced to 6 Years for Methamphetamine ConspiracyRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Ryan Koenig, 23, Onalaska, Wisconsin, was sentenced last week by U.S. District Judge William M. Conley to 72 months in federal prison for conspiring to distribute methamphetamine. Koenig pleaded guilty to this charge on November 16, 2018 and was sentenced on February 8.
Koenig conspired with Roberta Draheim and others to distribute large quantities of methamphetamine to the La Crosse area. Draheim’s trafficking operation was responsible for the shipment of over 35 packages of methamphetamine from California to the La Crosse area over a 15-month period. Many of those packages consisted of multiple pounds of methamphetamine.
During sentencing, Judge Conley stated that Koenig became aware that Draheim’s associates had access to cheap, high-quality methamphetamine from California and capitalized on this connection to order large quantities of methamphetamine for distribution in the La Crosse area. This was Koenig’s first federal conviction, second drug distribution conviction, and fifth overall adult criminal conviction.
Koenig and five other individuals were charged for their roles in this methamphetamine distribution conspiracy. Five of the six individuals charged in the indictment have pleaded guilty; Koenig is the third to be sentenced.
The charge against Koenig was the result of an investigation conducted by the Drug Enforcement Administration in Wisconsin and California; Wisconsin Department of Justice Division of Criminal Investigation; U.S. Postal Inspection Service; La Crosse Police Department; Prairie du Chien Police Department; and Dane County Sheriff’s Office. The prosecution of the case has been handled by Assistant U.S. Attorney Diane Schlipper.
Man Sentenced to Year in Prison for Bankruptcy FraudRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Teddy Stevens, 45, currently of Arizona but formerly of Middleton, Wisconsin, was sentenced yesterday by U.S. District Judge William Conley to one year and one day in federal prison for bankruptcy fraud. Stevens pleaded guilty to the charge on November 7, 2018.
Stevens defrauded the bankruptcy court and his creditors by making false statements on his bankruptcy documents and by making false statements under oath at a bankruptcy hearing called the Meeting of Creditors. Through his conduct, Stevens was attempting to shield from the bankruptcy trustee certain real-estate related assets. At his Meeting of Creditors, Stevens provided a false address and falsely testified under oath that he had not sold, transferred, given away or otherwise disposed of any of his assets in the four years prior to filing. Stevens also convinced another individual to provide false information to the bankruptcy court in an effort to conceal his real interest in a residence.
In selecting a sentence of prison, Judge Conley noted that Stevens’s actions were calculated and egregious. Judge Conley also said that he wanted to deter others from engaging in similar conduct.
The charges against Stevens were the result of an investigation conducted by the Federal Bureau of Investigation and IRS Criminal Investigation. The U.S. Attorney’s Office also acknowledges the assistance of the Office of the United States Trustee in Madison, Wisconsin. The prosecution of the case has been handled by Assistant U.S. Attorney Meredith Duchemin.
Madison Man Charged with Sexual Exploitation of ChildRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that a complaint has been filed against a Madison, Wisconsin resident for sexual exploitation of a child to produce a visual depiction. Bryan Rogers, 31, was charged in a complaint filed in U.S. District Court in Madison today with knowingly persuading a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of such conduct, and such visual depiction was transported from Tennessee to Wisconsin.
Rogers will make an initial appearance in federal court in Madison at 3:00 p.m. today.
The affidavit supporting the complaint alleges that Rogers came into contact with a minor in Tennessee through an online game who told him that she was being sexually assaulted. The affidavit alleges that Rogers persuaded the minor to engage in sexually explicit conduct, to make a video recording of the conduct, and send the video recording to him. The affidavit further alleges that Rogers traveled to Tennessee and returned to Wisconsin with the minor.
If convicted, Rogers faces a mandatory minimum penalty of 15 years and a maximum of 30 years in federal prison. The charge against him is the result of an investigation by the Wisconsin Department of Justice Division of Criminal Investigation, Federal Bureau of Investigation, Madison Police Department, Dane County Sheriff’s Office, and Monroe County (Tennessee) Sheriff’s Office. The prosecution of this case is being handled by Assistant U.S. Attorneys Julie Pfluger and Elizabeth Altman.
You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
La Crosse Woman Sentenced to 130 Months for Methamphetamine ConspiracyRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Roberta Draheim, 51, La Crosse, Wisconsin, was sentenced on Friday, February 1 by U.S. District Judge William M. Conley to 130 months in federal prison for conspiring to distribute methamphetamine. Draheim pleaded guilty to this charge on October 23, 2018.
Draheim was responsible for the shipment of more than 35 packages of methamphetamine from California to the La Crosse area over a 15-month period. Many of those packages consisted of multiple pound-level quantities of methamphetamine. During sentencing, Judge Conley stated that Draheim used her friends in California to obtain high quality methamphetamine at a low cost so she could supply people in the La Crosse area; she was feeding addictions. While this was Draheim’s first criminal conviction in over 20 years, the court found that she was an organizer of the conspiracy and sentenced her accordingly.
Draheim and five other individuals were charged for their roles in this methamphetamine distribution conspiracy. Five of the six individuals charged in the indictment have pleaded guilty; Draheim is the second to be sentenced.
The charge against Draheim was the result of an investigation conducted by the Drug Enforcement Administration in Wisconsin and California; Wisconsin Department of Justice Division of Criminal Investigation; U.S. Postal Inspection Service; La Crosse Police Department; Prairie du Chien Police Department; and Dane County Sheriff’s Office. The prosecution of the case has been handled by Assistant U.S. Attorney Diane Schlipper.
Grand Jury Returns Indictments Charging Gun & Drug CrimesRead the Press Release
MADISON, WIS. -- A federal grand jury in the Western District of Wisconsin, sitting in Madison, returned the following indictments today. You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
Nekoosa Man Charged with Possessing Sawed-Off Shotguns
Jere Wipfli, 47, Nekoosa, Wisconsin, is charged with two counts of possessing a sawed-off shotgun. The indictment alleges that on May 28, 2018, he possessed a Remington 12 gauge shotgun and a Hiawatha 20 gauge shotgun, and that each firearm had a barrel of less than 18 inches in length.
If convicted, Wipfli faces a maximum penalty of 10 years in federal prison on each count. The charges against him are the result of an investigation by the Rome Police Department, Juneau County Sheriff’s Office, and Bureau of Alcohol, Tobacco, Firearms and Explosives. The prosecution of this case is being handled by Special Assistant U.S. Attorney Chadwick Elgersma.
Madison Man Charged with Gun Crime
Juan Longino, 45, Madison, Wisconsin, is charged with being a felon in possession of a firearm. The indictment alleges that on January 9, 2019, Longino possessed a loaded .22 caliber pistol.
If convicted, Longino faces a maximum penalty of 10 years in federal prison. The charge against him is the result of an investigation by the Dane County Narcotics Task Force and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The prosecution of this case is being handled by Assistant U.S. Attorney Rita M. Rumbelow.
The indictments against Wipfli and Longino have been brought as part of Project Safe Neighborhoods (PSN), the U.S. Justice Department’s program to reduce violent crime. The PSN approach emphasizes coordination between state and federal prosecutors and all levels of law enforcement to address gun crime, especially felons illegally possessing firearms and ammunition and violent and drug crimes that involve the use of firearms.
Richland Center Man Charged with Drug Crime
Joshua Clarke, 31, Richland Center, Wisconsin, is charged with possessing methamphetamine with the intent to distribute. The indictment alleges that he possessed the methamphetamine on November 11, 2018.
If convicted, Clarke faces a maximum penalty of 20 years in federal prison. The charge against him is the result of an investigation by the Richland Center Police Department, Richland County Sheriff’s Office, Richland County District Attorney’s Office, and Drug Enforcement Administration. The prosecution of this case is being handled by Special Assistant U.S. Attorney Chadwick Elgersma.
Man Sentenced to 12 Years for Distributing Fentanyl Analogue That Killed Florida ManRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Michael Schoenmann, 31, Spring Green, Wisconsin, was sentenced yesterday by Chief U.S. District Judge James D. Peterson to 12 years in federal prison for attempting to distribute fentanyl, and distributing a fentanyl analogue that resulted in the overdose death of a Florida man. Schoenmann pleaded guilty to these charges on November 16, 2018.
On December 26, 2017, Wyatt Cox, a 25-year-old Florida resident, received a package in the mail containing a bottle of nasal spray containing what was later determined to be a fentanyl analogue. Cox died shortly after ingesting the substance. Based on a comprehensive investigation involving state and federal law enforcement officers, the package was traced back to the defendant, Michael Schoenmann.
From 2017 through March 2018, Schoenmann was running a vendor site on the dark web, advertising and selling fentanyl nasal spray. Schoenmann sold his product throughout the United States. He indicated on his website that he got his fentanyl from overseas and from various vendors, then packaged it as nasal spray to allow addicts like himself to use the fentanyl undetected. Schoenmann was arrested on March 8, 2018, following the execution of a federal search warrant at his residence in Spring Green.
Two of Wyatt Cox’s family members spoke during yesterday’s sentencing hearing, expressing the extraordinary pain, sadness, and loss that they felt. At one point, Cox’s sister acknowledged that both families lost someone – her brother forever, and the defendant for a long time to federal prison. She then told the defendant that she blamed both him and her brother, but she forgave the defendant. Judge Peterson commended her for her words of forgiveness and hoped that the sentencing would provide some justice and healing for both families. Judge Peterson assured the Cox family that Wyatt was not just another statistic.
In addressing Schoenmann, Judge Peterson pointed out that Schoenmann’s addiction was a disease, but that the disease was his responsibility, and noted that not every addict turns to crime to support their addiction. Judge Peterson called Schoenmann a danger to the public, and someone who was willing to do anything to feed their addiction, including exploiting other addicts. Judge Peterson also acknowledged that although Schoenmann did not murder Cox, nor did he want or intend to kill him, fentanyl is such a powerful drug that the risk of death is ever-present, and Schoenmann’s conduct made an overdose death extremely likely.
Judge Peterson concluded by warning Schoenmann that dealing with his addiction is his life’s work, and that a lifetime commitment to his sobriety was his responsibility. Schoenmann apologized to the Cox family, saying simply, “I am so, so sorry.”
U.S. Attorney Blader stated, “Fentanyl and all related substances and analogues are inherently dangerous. Ingesting any illegal substances obtained from the internet and in the mail are extraordinarily dangerous. Users have no idea what is really in the substance and illegal drug makers don’t care about users or the family they may leave behind – the risk cannot be overstated.”
The charges against Schoenmann were the result of an investigation conducted by the U.S. Postal Inspection Service, Drug Enforcement Administration, Wisconsin Department of Justice Division of Criminal Investigation, Richland-Iowa-Grant Drug Task Force, Sauk County Drug Task Force, Boscobel Police Department, and the Charlotte County (Florida) Sheriff’s Office. The prosecution of the case has been handled by Assistant U.S. Attorney Laura A. Przybylinski Finn.
Wisconsin Rapids Business Owner Sentenced for Tax EvasionRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Russell Broga, 51, Wisconsin Rapids, Wisconsin, was sentenced today by Chief U.S. District Judge James Peterson to two years of probation and fined $150,000. Judge Peterson ordered Broga to pay the fine immediately. On October 30, 2018, Broga pleaded guilty to tax evasion for tax year 2013.
Broga owned and operated A-1 Services Wisconsin Rapids, LLC (A-1), located in Wisconsin Rapids. A-1 provided customers with a variety of services, including asphalt paving, asphalt maintenance, tree removal and tree transplanting. Broga admitted at his plea hearing in October that he took customer checks and cashed them using his personal bank account, instead of depositing the income in his business bank account. Broga then withheld these skimmed receipts from the bookkeeper and tax return preparer for tax years 2012, 2013, and 2014. The total tax evaded for those these three years totaled $147,682. Broga paid the back taxes of $147,682 at the time of the plea hearing.
At today’s sentencing, Judge Peterson explained that imprisoning Broga did not serve the interest of protecting the safety and property of the community, due to Broga’s health issues. However, the judge told Broga that normally this type of crime deserves a prison sentence, and that morally there is no difference between Broga’s tax evasion conduct and the conduct of a car thief or drug dealer. The judge also told Broga that his arrogance in thinking he could cheat the government of taxes whenever he wanted year after year is appalling and reprehensible. Judge Peterson told Broga that he deserved a punitive sentence, which the court believed could be achieved with a fine of $150,000 payable immediately and two years of probation. The court hoped that such a sentence would send a specific deterrence message to Broga, and a general deterrence message to the community that evading $147,000 in taxes will cost double that amount in back taxes and a fine.
The charges against Broga were the result of an investigation conducted by special agents from the Madison office of IRS Criminal Investigation. The prosecution of the case has been handled by Assistant U.S. Attorney Daniel J. Graber.
Grand Jury Returns IndictmentsRead the Press Release
MADISON, WIS. – A federal grand jury in the Western District of Wisconsin, sitting in Madison, returned the following indictments today. You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
Two Charged with Drug Crimes Involving Heroin & Fentanyl
Arthur J. Jones, 41, Fitchburg, Wisconsin, and Corey D. Douglas, 27, Chicago, Illinois, are charged with conspiring to distribute 40 grams or more of a mixture containing both heroin and fentanyl. The indictment alleges that the conspiracy operated from May 2018 to November 29, 2018.
Jones is also charged with two counts of distributing heroin in October 2018, and with three counts of distributing a mixture of heroin and fentanyl in November 2018. The indictment also charges that on November 29, 2018, Jones possessed 40 grams of more of a mixture containing fentanyl with the intent to distribute. The final count in the indictment charges that on November 29, 2018, Douglas possessed a mixture of heroin and fentanyl with intent to distribute.
If convicted, Jones and Douglas face a mandatory minimum penalty of five years and a maximum of 40 years on the charges alleging 40 grams or more of heroin and fentanyl, and a maximum of 20 years on each of the other charges. The charges against Jones and Douglas are the result of an investigation by the Madison Police Department. The prosecution of this case is being handled by Assistant U.S. Attorney Robert A. Anderson.
Madison Man Charged with Four Robberies
Trevor Christian, 21, Madison, Wisconsin, is charged with robbing a Madison business and three financial institutions during November 2018, including:
- Walgreens, East Washington Avenue, on November 1;
- Associated Bank, Shopko Drive, on November 5;
- Associated Bank, Odana Road, on November 7; and
- Dane County Credit Union, Struck Street, on November 14.
If convicted, Christian faces a maximum penalty of 20 years in federal prison on each count. The charges against him are the result of an investigation by the Madison Police Department. The prosecution of this case is being handled by Assistant U.S. Attorney Rita M. Rumbelow.
Medford Man Charged with Gun & Drug Crimes
Ryan O. Kleinschmidt, 25, Medford, Wisconsin, is charged with being a felon in possession of a firearm and with possessing methamphetamine with intent to distribute. The indictment alleges that on September 18, 2018, he possessed a loaded .22 caliber handgun and methamphetamine.
If convicted, Kleinschmidt faces a maximum penalty of 10 years in federal prison on the felon in possession of a firearm count, and 20 years on the drug count. The charges against him are the result of an investigation by the Lincoln County Sheriff’s Office, Merrill Police Department, and Federal Bureau of Investigation. The prosecution of this case is being handled by Assistant U.S. Attorney Corey C. Stephan.
La Crosse Man Charged with Two Gun Crimes
Emmanuel Hunt, 23, La Crosse, Wisconsin, is charged with two counts of being a felon in possession of a firearm. The indictment alleges that on November 22, 2018, he possessed a loaded 9mm pistol, and that on December 5, 2018, he possessed two loaded 9mm pistols.
If convicted, Hunt faces a maximum penalty of 10 years in federal prison on each count. The charges against him are the result of an investigation by the La Crosse Police Department, La Crosse County Sheriff’s Department, and Bureau of Alcohol, Tobacco, Firearms and Explosives. The prosecution of this case is being handled by Assistant U.S. Attorney Rita M. Rumbelow.
Madison Man Charged with Illegally Possessing Firearm & Ammunition
David A. Kelly, 31, Madison, Wisconsin is charged with being a felon in possession of a firearm and ammunition. The indictment alleges that on July 24, 2018, he possessed a .40 caliber pistol and .40 caliber ammunition.
If convicted, Kelly faces a maximum penalty of 10 years in federal prison. The charge against him is the result of an investigation by the Madison Police Department and Bureau of Alcohol, Tobacco, Firearms and Explosives. The prosecution of this case is being handled by Assistant U.S. Attorney Rita M. Rumbelow.
The charges against Kleinschmidt, Hunt, and Kelly have been brought as part of Project Safe Neighborhoods (PSN), the U.S. Justice Department’s program to reduce violent crime. The PSN approach emphasizes coordination between state and federal prosecutors and all levels of law enforcement to address gun crime, especially felons illegally possessing firearms and ammunition and violent and drug crimes that involve the use of firearms.
Onalaska Man Charged in Farm Loan Fraud Case
Henry Berg, 42, formerly of Onalaska, Wisconsin, and currently of Geneva, Illinois, is charged with one count of making a false statement and one count of converting loan collateral. The indictment alleges that in May 2015, Berg made a false statement to Badgerland Financial ACA, an Agricultural Credit Association, in connection with a $650,000 agricultural loan. At the time Berg owned and operated Animal House Farms, LLC. The indictment alleges that Berg failed to disclose that his business had liabilities from the previous crop year of approximately $200,000.
The second count of the indictment alleges that Berg knowingly converted to his own use property which had been mortgaged to the Farm Service Agency, a successor agency to the Farmers Home Administration. The indictment alleges that Berg collected and then failed to remit any of the proceeds he received through a sublease contract.
If convicted, Berg faces a maximum penalty of 30 years in federal prison on the false statement count and five years on the conversion of collateral count. The charges against him are the result of an investigation by the U.S. Department of Agriculture, Office of Inspector General and the Federal Bureau of Investigation. The prosecution of this case is being handled by Assistant U.S. Attorney Meredith P. Duchemin.
Eau Claire Man Sentenced to 11 Years on Methamphetamine ChargeRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Steven Gwiazda, 38, Eau Claire, Wisconsin, was sentenced yesterday by U.S. District Judge William Conley to 11 years in federal prison for possessing methamphetamine with intent to distribute. Gwiazda pleaded guilty to this charge on September 28, 2018.
On March 29, 2018, Gwiazda was arrested in Eau Claire on an outstanding warrant. Following his arrest, law enforcement officers searched Gwiazda’s vehicle and found 11 separate bags containing a total of 171 grams of methamphetamine.
At the sentencing hearing, Judge Conley found that Gwiazda was a danger to society based on his lengthy criminal history, which included six prior felony convictions. Judge Conley also noted that Gwiazda was on probation from a prior felony drug conviction at the time of his arrest in Eau Claire.
The charge against Gwiazda was the result of an investigation conducted by the West Central Drug Task Force, the Eau Claire Police Department, the Eau Claire County District Attorney’s Office, and the Drug Enforcement Administration. The prosecution of the case has been handled by Assistant U.S. Attorney Aaron Wegner.
Man Sentenced to 25 Years for Sexually Exploiting a ChildRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Matthew R. Howard, 23, Madison, Wisconsin, was sentenced today by U.S. District Judge William M. Conley to 25 years in federal prison for sexually exploiting a child. The prison term will be followed by 25 years of supervised release.
On October 1, 2018, Howard was convicted of two counts of using a minor to produce sexually explicit videos, following a one-day trial in U.S. District Court in Madison. Prior to the trial, Howard pleaded guilty to federal charges of possessing, distributing, and receiving child pornography.
In August 2017, the Madison Police Department received information from the National Center for Missing and Exploited Children about a tip from an online service provider that an IP address registered to an address in Madison was used to upload and share images of child pornography. A search warrant was executed and an external hard drive was seized. The forensic analysis of that hard drive showed that Howard had recorded himself engaging in sexually explicit conduct with a minor, once in 2014 when the victim was nine years old, and once in 2017 when the victim was eleven years old.
In imposing sentence, Judge Conley noted that Howard’s conduct involved repeated abuse over several years and said, “It is essential to protect others from the defendant.”
The charges against Howard are the result of an investigation by the Madison Police Department, Wisconsin Department of Justice Division of Criminal Investigation, and Wisconsin Internet Crimes Against Children Task Force. The prosecution of this case is being handled by Assistant U.S. Attorneys Julie Pfluger and Diane Schlipper.
12 Indicted for Interstate Cocaine ConspiracyRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced the unsealing of an indictment charging twelve people with crimes related to the distribution of cocaine. The indictment was returned on November 28 by a federal grand jury sitting in Madison and was unsealed yesterday.
The indictment charges Joseph Harper, 41, Madison, Wisconsin; Gregory Smith, 49, Houston, Texas; Timothy Hotchkiss, 38, Middleton, Wisconsin; Jennifer Green, 46, Madison; Gerald Schad, 26, Madison; Lonell Johnson, 27, Grand Marsh, Wisconsin; Bryan Lewis, 48, Madison; Miesha Ihm, 24, Madison; Diane Williams, 36, Dubuque, Iowa; Jamal Jackson, 39, Madison; and Gerald Walters, 36, Madison, with conspiring to distribute and possess with intent to distribute 500 grams or more of cocaine. The indictment alleges that the conspiracy operated from November 2017 to November 2018.
In addition, the indictment charges Prince Hayes, 39, Fitchburg, Wisconsin, with distribution of cocaine on September 17, 2018. Harper and Jackson are also charged with separate counts of distribution and possession with intent distribute cocaine. Harper, Smith, Schad, and Ihm face additional charges of distribution and possession with intent to distribute 500 grams or more of cocaine.
During the detention hearing for Diane Williams on December 17, 2018, the government proffered that a long-term multi-agency investigation revealed a large-scale cocaine conspiracy in which Gregory Smith allegedly mailed packages containing kilograms of cocaine from Houston to Joseph Harper in Madison and to Harper’s associates in Milwaukee and Dubuque, Iowa, for eventual delivery to Harper, and in which Harper or his associates subsequently mailed drug proceeds to Smith.
“The twelve individuals charged in the criminal indictment are alleged to have been part of a drug ring that distributed a large amount of cocaine in southern Wisconsin,” said U.S. Attorney Blader. “Working closely with our federal, state, and local law enforcement partners, we will continue to investigate large-scale drug traffickers and dismantle drug networks that feed the deadly cycle of drug abuse, and jeopardize the safety and stability of our local communities.”
“DEA is proud to be part of this outstanding group effort to bring to justice those individuals who are responsible for poisoning our communities,” said DEA Resident Agent in Charge Dennis Hiorns.
“The United States Postal Inspection Service is determined to stop the distribution of illegal drugs in this country,” said Inspector in Charge Craig Goldberg of the Chicago Division of the U. S. Postal Inspection Service. “This indictment is a direct result of a thorough investigation by a group of tenacious law enforcement partners who share the same goal of protecting the American public from the flow of dangerous drugs.”
Harper, Hotchkiss, Green, Johnson, Lewis, Ihm, Williams, Jackson, Walters, and Hayes have all been arrested and made initial appearances in federal court in Madison. Smith and Schad were both arrested in Houston and have made initial appearances in federal court in Houston.
The conspiracy, distribution, and possession with intent to distribute charges alleging 500 grams or more of cocaine have a mandatory minimum penalty of five years and a maximum of 40 years in federal prison. The distribution and possession with intent to distribute cocaine charges against Hayes, Harper, and Jackson have a maximum penalty of 20 years in federal prison.
The charges in this case are the result of a joint investigation by the Drug Enforcement Administration, U.S. Postal Inspection Service, Federal Bureau of Investigation, and Wisconsin Department of Justice Division of Criminal Investigation. The investigation was conducted and funded by the Organized Crime Drug Enforcement Task Force (OCDETF), a multi-agency task force that coordinates long-term narcotics trafficking investigations. The prosecution of the case is being handled by Assistant U.S. Attorney Aaron Wegner.
You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
Felon Sentenced to 40 Months for Possessing FirearmRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Demarko D. Richmond, 21, Madison, Wisconsin, was sentenced today by U.S. District Judge William M. Conley to 40 months in federal prison for possessing a firearm as a convicted felon. Richmond pleaded guilty to this charge on September 7, 2018. His prison term will be followed by a three-year period of supervised release.
On July 23, 2018, the Dane County Narcotics Task Force and the Madison Police Department were attempting to locate individuals believed to be involved in recent shootings in the area. Officers observed Richmond exiting an apartment building with a person of interest. When officers approached, Richmond and his friend fled from the officers. Richmond was eventually arrested and was found to have possessed and discarded a stolen, loaded firearm, with a high capacity magazine.
Richmond is prohibited from possessing firearms because of a 2017 felony conviction for fleeing/eluding an officer. In choosing a 40-month sentence, Judge Conley noted that Richmond is an angry individual, with a history of domestic violence.
This case has been brought as part of Project Safe Neighborhoods (PSN), the U.S. Justice Department’s program to reduce violent crime. The PSN approach involves collaboration by federal, state and local law enforcement agencies, prosecutors and communities to prevent and deter gun violence.
The charge against Richmond was the result of an investigation conducted by the Dane County Narcotics Task Force and the Madison Police Department, Violent Crime Unit. The prosecution of the case has been handled by Assistant U.S. Attorney Rita M. Rumbelow.
Three Plead Guilty to Hunting Illegally & Obstructing Grand Jury InvestigationRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Robert Peters, 53, and Steven Reindahl, 55, both of Turtle Lake, Wisconsin, pleaded guilty today in U.S. District Court in Madison to hindering a federal grand jury investigation by providing false testimony about a January 2017 Montana mountain lion hunt. This charge carries maximum penalties of six months in prison, a $50,000 fine, and five years of probation.
A third man, David Johnson, 31, Barnes, Wisconsin, pleaded guilty to shooting a mountain lion in 2017 without a Montana hunting license, and conspiring with Darren Johnson to transport the illegally taken mountain lion from Montana to Wisconsin in violation of the Lacey Act. Each of these charges carries maximum penalties of one year in prison, a $100,000 fine, and five years of probation.
The charges against Darren Johnson, 52, Deer Park, Wisconsin, remain pending, and he is presumed innocent until and unless proven guilty. David Johnson and Darren Johnson are not related.
At the plea hearing, the government provided the court with a summary of the evidence that it would have introduced had the case gone to trial.
On January 6, 2017, Darren and David Johnson, Bob Peters and Steve Reindahl were in Mosby, Montana hunting mountain lions with their dogs. That morning, the dogs treed a mountain lion. Only Darren Johnson and Steve Reindahl had valid licenses to hunt mountain lions.
Despite not having a valid license, David Johnson used Darren Johnson’s rifle to shoot and kill the mountain lion, and Darren Johnson took out his tag and tagged the lion. According to witness testimony, Darren Johnson told the group that everyone needed to stick to the story that Darren Johnson killed the mountain lion. On January 10, 2017, all four men drove back from Montana to Wisconsin, and Darren Johnson and Steve Reindahl transported the mountain lion hide. A few days later, Darren Johnson dropped off the hide at David Johnson’s home.
In late May 2018, Bob Peters and Steve Reindahl were served with grand jury subpoenas to testify before a federal grand jury on June 21, 2018, in Madison regarding the 2017 mountain lion hunt. On Sunday June 17, 2018, Darren and David Johnson, Robert Peters, and Steve Reindahl met at Peter’s home in Turtle Lake to talk about the upcoming grand jury session. At the Sunday meeting, Darren Johnson allegedly told everyone to stick to the story that he killed the Montana mountain lion on January 6, 2017, and that the agents did not have any proof to say otherwise.
On June 21, 2018, Bob Peters and Steve Reindahl appeared before the grand jury. Later, Peters and Reindahl admitted that they lied to the grand jury and agreed to cooperate and tell the truth. They recanted their prior testimony and explained that David Johnson killed the mountain lion and Darren Johnson tagged it and told everyone he killed it and they all needed to stick to that story. Both men explained that they were told by Darren Johnson at the meeting in Turtle Lake not to tell the truth to the grand jury.
U.S. Magistrate Judge Stephen L. Crocker scheduled sentencing hearings for all three on February 26, 2019, beginning at 10:30 a.m.
The charges against these men were the result of an investigation conducted by special agents with the U.S. Fish and Wildlife Service Office of Law Enforcement, the Wisconsin Department of Natural Resources Bureau of Law Enforcement, and the Montana Department of Fish, Wildlife and Parks. The prosecution of the case has been handled by Assistant U.S. Attorney Daniel J. Graber.
Minong Man Sentenced to 78 Months for Distributing MethamphetamineRead the Press Release
MADISON, WIS. -- Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Rodney Kersten, 60, Minong, Wisconsin, was sentenced on Friday, December 7, by Chief U.S. District Judge James D. Peterson to 78 months in federal prison for distributing methamphetamine. Kersten pleaded guilty to this charge on September 25, 2018.
Kersten was arrested after three controlled purchases of methamphetamine coordinated by law enforcement. Judge Peterson found that Kersten was responsible for distributing 276 grams of methamphetamine. Judge Peterson noted that the sentence was necessary because Kersten was a meaningful part of a system of drug dealing that is damaging the community.
The charge against Kersten was the result of an investigation conducted by the Washburn County Sheriff’s Department, the Wisconsin Department of Justice Division of Criminal Investigation, and the Sawyer County Sheriff’s Department. The prosecution of the case has been handled by Assistant U.S. Attorney Darren Halverson.
Wausau Couple Sentenced for Money Laundering & Drug CrimesRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that on December 4, 2018, Chief U.S. District Judge James D. Peterson sentenced Xiong Lo, 53, Wausau, Wisconsin, to 30 months in federal prison and a $50,000 fine, and Ying Lo, 40, also of Wausau, to 4 months in federal prison and a $10,000 fine, for money laundering and distribution of marijuana.
Xiong Lo pleaded guilty to the money laundering charge on June 26, 2018. Ying Lo pleaded guilty to the drug charge on the same date. The two defendants are husband and wife. Both agreed to the forfeiture of $541,734 in drug proceeds.
On July 2, 2015, law enforcement agents arrested Ying Lo after she delivered 28 pounds of marijuana to another co-conspirator. This delivery was at the direction of her husband, Xiong Lo. In addition to the 28-pound seizure, search warrants executed at the defendants’ home and business uncovered large amounts of marijuana, approximately $50,000, drug ledgers, digital scales, and drug packaging materials, including vacuum sealers and rolls of vacuum sealed bags. Further, agents seized safe deposit keys from the defendants’ home, which led to the seizure of $491,000 in cash from safe deposit boxes rented by the defendants.
An investigation by IRS Criminal Investigation (IRSCI) during a 13-month period ending in July 2015, revealed that the Los made cash deposits over $1,000,000 into their bank accounts. Further, IRSCI agents determined that the defendants purchased two real estate properties for $180,000 in 2015. The defendants paid for these properties up-front, in full, with an unusual combination of cashier’s checks, teller checks, and money orders from different financial institutions. Shortly thereafter, the properties were sold to relatives for a fraction of the appraised value.
The charges against Xiong and Ying Lo were the result of an investigation conducted by the Wisconsin Department of Justice Division of Criminal Investigation, IRS Criminal Investigation, Marathon County Sheriff’s Office, and the Wausau Police Department. Prosecution of the case has been handled by Assistant U.S. Attorney David J. Reinhard.
Man Sentenced for Stealing Construction EquipmentRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Gene Sauer, 49, Cambria, Wisconsin, was sentenced on November 29 by U.S. District Judge William M. Conley to 42 months in federal prison for interstate trafficking of stolen property. Sauer pleaded guilty to the offense on September 18, 2018.
Sauer was taken into custody by U.S. Marshals to begin serving his sentence immediately following the sentencing. The final amount of restitution owed to victims will be determined at a hearing on February 15, 2018.
Over a two-year period, Sauer stole eight skid steer loaders from construction sites in Wisconsin, and transported them to an implement dealer in Illinois, where they were later resold. Sauer took the skid steer loaders to Illinois so they would be more difficult for law enforcement to find. Sauer has four previous felony theft-related convictions.
Sauer’s co-defendant in three of the thefts, Daniel Grupe, 26, pleaded guilty to interstate trafficking of stolen property on September 19, 2018. His sentencing is scheduled for December 13, 2018.
The charges against Gene Sauer and Daniel Grupe were the result of an investigation conducted by the Federal Bureau of Investigation, DeForest and Sun Prairie Police Departments, Columbia and Green Lake County Sheriffs’ Offices, and the Illinois State Police. The prosecution of the case has been handled by Assistant U.S. Attorney Meredith P. Duchemin.
Court Imposes Maximum Fine on Sinovel Wind Group for Theft of Trade SecretsRead the Press Release
A manufacturer and exporter of wind turbines based in the People’s Republic of China was sentenced today for stealing trade secrets from AMSC, a U.S.-based company formerly known as American Superconductor Inc., announced Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division and U.S. Attorney Scott C. Blader for the Western District of Wisconsin.
The Court found that AMSC’s losses from the theft exceeded $550 million, and imposed the maximum statutory fine in the amount of $1.5 million on Sinovel Wind Group LLC. The Court found that the parties settled the restitution amount, and imposed a year of probation until Sinovel pays the full restitution amount. Sinovel has paid $32.5 million to AMSC this week and will pay $25 million within its year of probation. Sinovel will also pay $850,000 to additional victims within its year of probation. Sinovel was convicted of conspiracy to commit trade secret theft, theft of trade secrets, and wire fraud on Jan. 24 following an 11-day jury trial in Madison, Wisconsin.
“Rather than pay AMSC for more than $800 million in products and services it had agreed to purchase, Sinovel instead hatched a scheme to brazenly steal AMSC’s proprietary wind turbine technology, causing the loss of almost 700 jobs and more than $1 billion in shareholder equity at AMSC,” said Acting Assistant Attorney General Cronan. “As demonstrated by this prosecution, intellectual property theft poses a serious threat to American companies, and the Department of Justice is committed to aggressively investigating and prosecuting individuals and corporations who undermine American competitiveness by stealing what they did not themselves create.”
“This case is about protecting American ideas and ingenuity,” said U.S. Attorney Blader. “My office is committed to prosecuting the theft of intellectual property to ensure an open and fair marketplace. The devastation Sinovel’s illegal actions caused to AMSC and its employees will not be tolerated.”
As proven at trial, Sinovel stole proprietary wind turbine technology from AMSC in order to produce its own turbines powered by the stolen intellectual property. AMSC developed the technology – software that regulates the flow of electricity from wind turbines to electrical grids – in Wisconsin and elsewhere. At the time of the theft in March 2011, Sinovel had contracted with AMSC for more than $800 million in products and services to be used for the wind turbines that Sinovel manufactured, sold, and serviced.
Sinovel was charged on June 27, 2013, along with Su Liying, the deputy director of Sinovel’s Research and Development Department; Zhao Haichun, a technology manager for Sinovel; and Dejan Karabasevic, a former employee of AMSC Windtec Gmbh, a wholly-owned subsidiary of AMSC. The evidence presented at trial showed that Sinovel conspired with the other defendants to obtain AMSC’s copyrighted information and trade secrets in order to produce wind turbines and to retrofit existing wind turbines with AMSC technology without paying AMSC the more than $800 million it was owed and promised. Through Su and Zhao, Sinovel convinced Karabasevic, who was head of AMSC Windtec’s automation engineering department in Klagenfurt, Austria, to leave AMSC Windtec, to join Sinovel, and to steal intellectual property from the AMSC computer system by secretly downloading source code on March 7, 2011, from an AMSC computer in Wisconsin to a computer in Klagenfurt. Sinovel then commissioned several wind turbines in Massachusetts and copied into the turbines software compiled from the source code stolen from AMSC. The U.S.-based builders of these Massachusetts turbines helped bring Sinovel to justice. Su and Zhao are Chinese nationals living in China, and Karabasevic is a Serbian national who lived in Austria, but now lives in Serbia.
According to evidence presented at trial, following the theft, AMSC suffered severe financial hardship. It lost more than $1 billion in shareholder equity and almost 700 jobs, over half its global workforce.
The case was investigated by the FBI’s Madison Resident Agency, Milwaukee Field Office, and the FBI’s Boston Field Office; this investigation was supported by an international team of FBI personnel, including agents and analysts stationed at FBI Legal Attaché Offices in Vienna, Austria and Beijing, China; and the FBI’s Intellectual Property Rights program within the Criminal Investigative Division; the Bundeskriminalamt (Federal Criminal Intelligence Service) and the Bundesministerium Fuer Justiz (Federal Ministry of Justice) in Austria; the Landeskriminalamt - Klagenfurt and the Staatsanwaltschaft - Klagenfurt (Criminal Investigative Police and State Prosecutor’s Office – Klagenfurt, Austria); and with the assistance of the Justice Department’s Office of International Affairs and the Cybercrime Laboratory of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS).
Senior Counsel Brian L. Levine of CCIPS and Assistant U.S. Attorneys Timothy M. O’Shea and Darren C. Halverson for the Western District of Wisconsin prosecuted the case, with substantial assistance from CCIPS Trial Attorney Joss Nichols and the CCIPS Cybercrime Lab, particularly Digital Investigative Analyst Laura Peterson.
The Department of Justice’s Task Force on Intellectual Property (IP Task Force) contributed to this case. The IP Task Force is led by the Deputy Attorney General to combat the growing number of domestic and intellectual property crimes, to protect the health and safety of American consumers, and to safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation, and hard work. To learn more about the IP Task Force, go to https://www.justice.gov/iptf .
Former Wisconsin Produce Vendor Executive Pleads Guilty to Tax EvasionRead the Press Release
The former corporate officer of a produce vendor in Johnson Creek, Wisconsin, pleaded guilty today to tax evasion, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Scott C. Blader for the Western District of Wisconsin.
According to the indictment and information provided to the court, Thomas G. Paine, 64, was the Vice President and Treasurer of G.W. Paine Inc., which sold fresh fruit and other produce under the business name Tree Ripe Citrus Company. Paine was responsible for the finance and tax aspects of the business, but failed to file corporate tax returns for tax years 2010 through 2012 and concealed the business’ income from the Internal Revenue Service (IRS) by structuring cash bank deposits in amounts less than $10,000 to evade bank reporting requirements. Paine admitted to causing a tax loss between $250,000 and $550,000.
U.S. District Court Judge James D. Peterson scheduled sentencing for May 8. Paine faces a statutory maximum sentence of five years in prison, a period of supervised release, restitution, and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Blader commended special agents of IRS Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Elizabeth Altman and Trial Attorney Eric C. Schmale of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Chinese Company Sinovel Wind Group Convicted of Theft of Trade SecretsRead the Press Release
A manufacturer and exporter of wind turbines based in the People’s Republic of China was convicted today of stealing trade secrets from AMSC, a U.S.-based company formerly known as American Superconductor Inc., announced Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division and U.S. Attorney Scott C. Blader for the Western District of Wisconsin.
Following an 11-day trial, a jury sitting in Madison, Wisconsin, convicted Sinovel Wind Group Co. Ltd., dba Sinovel Wind Group (USA) Co. Ltd. (Sinovel) of conspiracy to commit trade secret theft, theft of trade secrets, and wire fraud. Sentencing is set for June 4.
“Sinovel nearly destroyed an American company by stealing its intellectual property,” said Acting Assistant Attorney General Cronan. “As today’s jury verdict demonstrates, this type of conduct, by any corporation – anywhere – is a crime, and won’t be tolerated. The Department is dedicated to helping foster innovation and growth in our economy by deterring and punishing intellectual property theft from American companies.”
“Today’s verdict sends a strong and clear message that the theft of ideas and ingenuity is not a business dispute; it’s a crime and will be prosecuted as such,” said U.S. Attorney Blader. “Sinovel’s illegal actions caused devastating harm to AMSC. I commend the efforts of the investigation and prosecution team, and reaffirm the commitment of this office to protect American commerce and prosecute those who would seek to steal intellectual property.”
As proven at trial, Sinovel stole proprietary wind turbine technology from AMSC in order to produce its own turbines powered by the stolen intellectual property. AMSC developed the technology – software that regulates the flow of electricity from wind turbines to electrical grids – in Wisconsin and elsewhere. At the time of the theft in March 2011, Sinovel had contracted with AMSC for more than $800 million in products and services to be used for the wind turbines that Sinovel manufactured, sold, and serviced.
Sinovel was charged on June 27, 2013, along with Su Liying, the deputy director of Sinovel’s Research and Development Department; Zhao Haichun, a technology manager for Sinovel; and Dejan Karabasevic, a former employee of AMSC Windtec Gmbh, a wholly-owned subsidiary of AMSC. The evidence presented at trial showed that Sinovel conspired with the other defendants to obtain AMSC’s copyrighted information and trade secrets in order to produce wind turbines and to retrofit existing wind turbines with AMSC technology without paying AMSC the more than $800 million it was owed and promised. Through Su and Zhao, Sinovel convinced Karabasevic, who was head of AMSC Windtec’s automation engineering department in Klagenfurt, Austria, to leave AMSC Windtec, to join Sinovel, and to steal intellectual property from the AMSC computer system by secretly downloading source code on March 7, 2011, from an AMSC computer in Wisconsin to a computer in Klagenfurt. Sinovel then commissioned several wind turbines in Massachusetts and copied into the turbines software compiled from the source code stolen from AMSC. The U.S.-based builders of these Massachusetts turbines helped bring Sinovel to justice. Su and Zhao are Chinese nationals living in China, and Karabasevic is a Serbian national who lived in Austria, but now lives in Serbia.
According to evidence presented at trial, following the theft, AMSC suffered severe financial hardship. It lost more than $1 billion in shareholder equity and almost 700 jobs, over half its global workforce.
The case was investigated by the FBI’s Madison, Milwaukee, and Boston Offices; the FBI Legal Attachés’ Offices in Vienna, Austria and Beijing; the FBI Criminal Investigative Division; the FBI Intellectual Property Rights program; the Bundeskriminalamt (Federal Criminal Intelligence Service) and the Bundesministerium Fuer Justiz (Federal Ministry of Justice) in Austria; the Landeskriminalamt - Klagenfurt and the Staatsanwaltschaft - Klagenfurt (Criminal Investigative Police and State Prosecutor’s Office – Klagenfurt, Austria); and with the assistance of the Justice Department’s Office of International Affairs and the Cybercrime Laboratory of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS).
Senior Counsel Brian L. Levine of CCIPS and Assistant U.S. Attorneys Timothy M. O’Shea and Darren Halverson for the Western District of Wisconsin prosecuted the case, with substantial assistance from CCIPS Trial Attorney Joss Nichols and Digital Investigative Analyst Laura Peterson.
The Department of Justice’s Task Force on Intellectual Property (IP Task Force) contributed to this case. The IP Task Force is led by the Deputy Attorney General to combat the growing number of domestic and intellectual property crimes, to protect the health and safety of American consumers, and to safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation, and hard work. To learn more about the IP Task Force, go to https://www.justice.gov/iptf.
Wisconsin Department of Health Services Agrees to Pay Nearly $7 Million to Resolve Alleged False Claims for SNAP FundsRead the Press Release
The Wisconsin Department of Health Services (WDHS) has agreed to pay the United States $6,991,905 to resolve allegations that it violated the False Claims Act in its administration of the Supplemental Nutrition Assistance Program (SNAP), the Department of Justice announced today. Until 2008, SNAP was known as the Food Stamp Program.
Under SNAP, the U.S. Department of Agriculture (USDA) provides eligible low-income individuals and families with financial assistance to buy nutritious food. Since 2010, SNAP has served on average more than 45 million Americans per month, and provided more than $71 billion annually.
"This settlement reflects the Justice Department’s commitment to ensuring that taxpayer funds are spent appropriately so that the public can have confidence in the integrity of programs like SNAP,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division.
Although the federal government funds SNAP benefits, it relies on the states to determine whether applicants are eligible for benefits, to administer those benefits, and to perform quality control to ensure that eligibility decisions are accurate. USDA requires that the states’ quality control processes ensure that benefits are correctly awarded, are free from bias, and accurately report states’ error rates in making eligibility decisions. The USDA reimburses states for a portion of their administrative expenses in administering SNAP, including expenses for providing quality control. The USDA also pays performance bonuses to states that report the lowest and the most improved error rates each year, and can impose monetary sanctions on states with high error rates that do not show improvement.
As part of the settlement, WDHS admitted that, beginning in 2008, it utilized the services of Julie Osnes Consulting, a quality control consultant, to review the error cases identified by WDHS quality control workers. WDHS further admitted that based on instructions from Julie Osnes Consulting it implemented several improper and biased quality control practices, including: (1) finding a basis for dropping error cases from the review by discouraging beneficiaries from cooperating with information requests and pursuing unnecessary information; (2) selectively applying requirements and policies to overturn and reduce errors; (3) asking beneficiaries leading questions to obtain desired answers to eliminate error potential; (4) arbitrating any and all differences with USDA; (5) subjecting error cases to additional scrutiny and quality control casework with the goal of overturning an error or dropping a case; and (6) omitting verifying information in documents made available to USDA. These practices improperly decreased WDHS’s reported error rate, and as a result, WDHS earned performance bonuses for 2009, 2010, and 2011 to which it was not entitled.
This is the second settlement with a state agency for manipulating its SNAP quality control findings. On April 7, the Virginia Department of Social Services agreed to pay over $7 million to resolve its liability associated with the use of Julie Osnes Consulting to improperly reduce its reported error rate.
“While I am deeply troubled that these actions happened within a state agency entrusted with assisting vulnerable and needy Wisconsin residents, I am heartened that WDHS has cleaned up its act and that it cooperated with our investigation,” said Acting U.S. Attorney Jeffrey M. Anderson for the Western District of Wisconsin. “Together with our partners in the Civil Division and the USDA, we will continue to investigate and hold accountable entities, including government entities, which misuse and wrongfully obtain SNAP funding.”
“We appreciate the commitment and investigative assistance provided by our partners at the Department of Justice’s Civil Division and the U.S. Attorney’s Office throughout this multi-state investigation,” said Special Agent-in-Charge Bethanne M. Dinkins of the USDA Office of Inspector General (OIG). “We also wish to note the technical assistance provided by our colleagues in the Office of Audit at OIG. During the investigation, conducted by OIG’s Northeast Regional Office, we worked together to address the concerns of employees of multiple states and others who alleged that the integrity of the SNAP quality control process was weakened by third-party consultants. These concerned individuals reported that cases were not being treated in a consistent manner, and that certain advice from consultants resulted in identified errors being diminished rather than used to improve eligibility determinations. The settlements reached to date send a strong message regarding the Government’s commitment to work across agency lines to protect the integrity of SNAP.”
The settlement was the result of a joint investigation conducted by the USDA Office of Inspector General, the Civil Division’s Commercial Litigation Branch, and the U.S. Attorney’s Offices for the Western District of Wisconsin that arose out of a nationwide audit of SNAP QC processes by the USDA-OIG.
Virginia Department of Social Services Agrees to Pay $7.1 Million to Resolve Alleged False Claims for SNAP FundsRead the Press Release
The Virginia Department of Social Services (VDSS) has agreed to pay the United States $7,150,436 to resolve allegations that it violated the False Claims Act in its administration of the Supplemental Nutrition Assistance Program (SNAP), the Department of Justice announced today. Until 2008, SNAP was known as the Food Stamp Program.
Under SNAP, the U.S. Department of Agriculture (USDA) provides eligible low-income individuals and families with financial assistance to buy nutritious food. Since 2010, SNAP has served on average more than 45 million Americans per month, and provided more than $71 billion annually.
“SNAP is an important vehicle for helping needy families,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “This settlement reflects the Justice Department’s commitment to ensuring that taxpayer funds are spent appropriately so that the public can have confidence in the integrity of vital programs like SNAP.”
Although the federal government funds SNAP benefits, it relies on the states to determine whether applicants are eligible for benefits, to administer those benefits, and to perform quality control to ensure that its eligibility decisions are accurate. USDA requires that the quality control processes the states use ensure that benefits are correctly awarded, are free from bias, and accurately report states’ error rates in making eligibility decisions. The USDA reimburses states for a portion of their administrative expenses in administering SNAP, including expenses for providing quality control. The USDA also pays performance bonuses to states that report the lowest and the most improved error rates each year, and can impose monetary sanctions on states with high error rates that do not show improvement.
As part of the settlement, VDSS admitted that, beginning in 2010, it retained Julie Osnes Consulting, a quality control consultant, to reduce its SNAP benefits determination error rate by training VDSS quality control workers to “use whatever means necessary” to find a benefits decision “correct” rather than finding an error. VDSS also admitted that if its quality control staff “could not find a way to make a benefits decision correct,” they were instructed to “find a reason to ‘drop’ the case, or eliminate it from the sample.” VDSS acknowledged that this outcome-driven method, as implemented by VDSS between 2010 and 2015, “injected bias into the case review process” because it was designed to lower VDSS’s reported error rate by falsely reporting errors as “correct” or eliminating them from the sample. Through its use of these biased methods, VDSS was improperly awarded USDA performance bonuses for 2011, 2012, and 2013.
VDSS further admitted that VDSS quality control workers did not want to use the methods proposed by Julie Osnes Consulting because they believed the methods lacked integrity, injected bias into the quality control process, and violated USDA requirements, and that they communicated these concerns to their supervisors. VDSS admitted that the former VDSS quality control manager pressured and intimidated these employees to force them to adopt these methods, including, according to these employees, threatening termination, providing negative performance reviews, taking away teleworking and flexible scheduling privileges, and engaging in other forms of harassment and retaliation.
As part of the settlement, VDSS and the United States also agreed that VDSS had taken certain corrective actions beginning in 2015, including terminating its use of the improper quality controls methods devised by Julie Osnes Consulting.
“We appreciate the commitment and investigative assistance provided by our partners at the U.S. Department of Justice’s Civil Division, U.S. Attorney’s Office, and Virginia Office of the State Inspector General,” said Special Agent-in-Charge Bethanne M. Dinkins of the USDA Office of Inspector General (OIG). “We also wish to note the technical assistance provided by our colleagues in the Office of Audit at USDA, OIG. During our investigation, we worked together to address the concerns of state employees and others who alleged that the integrity of the SNAP quality control process was weakened by third-party consultants. These concerned individuals reported that cases were not being treated in a consistent manner, and that certain advice from consultants resulted in identified errors being diminished rather than used to improve eligibility determinations. Today’s settlement sends a strong message regarding the Government’s commitment to work across agency lines to protect the integrity of SNAP.”
The settlement was the result of an investigation conducted by the USDA Office of Inspector General (USDA-OIG), the Civil Division’s Commercial Litigation Branch, and the U.S. Attorney’s Office for the Western District of Wisconsin that arose out of a nationwide audit of SNAP QC processes by the USDA-OIG.
Wisconsin Man Sentenced to 10 Years in Prison for Attempting to Provide Material Support to ISILRead the Press Release
Joshua Van Haften, 36, of Madison, Wisconsin, was sentenced today to 10 years in federal prison and lifetime supervised release for attempting to provide material support, namely himself as personnel, to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization.
Acting Assistant Attorney General for National Security Mary B. McCord, U.S. Attorney John W. Vaudreuil of the Western District of Wisconsin and Special Agent in Charge Justin Tolomeo of the FBI’s Milwaukee Division made the announcement. U.S. District Judge James D. Peterson handed down the sentence.
“With this sentence, Joshua Van Haften will be held accountable for attempting to travel overseas to join ISIL and to provide material support to the designated terrorist organization,” said Acting Assistant Attorney General McCord. “The National Security Division’s highest priority is countering terrorist threats, and we will continue to work to stem the flow of foreign fighters abroad and bring to justice those who attempt to provide material support to designated foreign terrorist organizations.”
“Today’s sentence reflects the gravity of the defendant’s plan to betray the United States and to join terrorists dedicated to the murder of innocent individuals, both in the U.S. and abroad,” said U.S. Attorney Vaudreuil. “The U.S. Attorney’s Office and the FBI, working with our state and local partners on the Joint Terrorism Task Force, will continue to work to investigate, arrest, and vigorously prosecute all extremists who choose to aid ISIL, or any other terrorist organization, and to stop them before they harm the United States or our allies. We also remain committed to working with dedicated community members to bring this cycle to an end.”
“I commend the efforts of the FBI's Joint Terrorism Task Force which includes our local and state law enforcement partners who brought the defendant to justice,” said Special Agent in Charge Tolomeo. “Protecting Americans from terrorism remains our top priority.”
Van Haften admitted that in 2014, he attempted to provide material support to ISIL, knowing that the organization was a designated terrorist organization that has engaged and engages in terrorism.
According to the government’s evidence, Van Haften traveled to Turkey in 2014 and attempted to cross into Syria. He posted online that he had taken an oath of allegiance to the leader of ISIL, and that “The only thing that matters to me is joining my brothers for the war against America [sic] liars.”
In addition to traveling to Turkey in an attempt to fight with ISIL, Van Haften tried to assist another American, Leon Davis, in joining ISIL. He attempted to meet Davis in Istanbul upon Davis’s arrival – actually waiting for Davis at a bus stop in Istanbul – and planned to travel with Davis to Syria to join and fight with ISIL.
Leon Davis, of Augusta, Georgia, was sentenced to 15 years in federal prison in July 2015, following his conviction in the Southern District of Georgia for attempting to provide material support to a designated foreign terrorist organization, namely ISIL.
Van Haften was arrested at O’Hare Airport in Chicago, Illinois in April 2015, after his arrival in custody on an international flight from Turkey. He has been held in federal custody since his arrest.
The charge against Van Haften is the result of an investigation by members of the FBI-Joint Terrorism Task Force which include the FBI; the Wisconsin Department of Justice, Division of Criminal Investigation; the Dane County Sheriff’s Office in Wisconsin; and the University of Wisconsin Police Department. Assistance was also provided by the Department of Homeland Security.
The case was prosecuted by First Assistant U.S. Attorney Jeffrey Anderson for the Western District of Wisconsin and Trial Attorney Lolita Lukose of the National Security Division’s Counterterrorism Section.
Wisconsin Man Sentenced to 25 Years in Prison for Sex Trafficking and Drug OffensesRead the Press Release
Monta Groce, 30, of Sparta, Wisconsin, was sentenced today to 25 years in prison for using violence, threats and coercion to compel three young women suffering from heroin addiction to prostitute for his profit in Wisconsin and Minnesota.
The sentence was announced by Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division; U.S. Attorney John W. Vaudreuil of the Western District of Wisconsin and Special Agent in Charge R. Justin Tolomeo of the FBI’s Milwaukee Division.
On July 15, 2016, a jury convicted Groce of three counts of sex trafficking by force, threats or coercion; one count of conspiracy to engage in interstate transportation for prostitution; one count of interstate transportation for prostitution; one count of maintaining a property for drug trafficking; one count of using a firearm in furtherance of drug trafficking and one count of witness retaliation. A restitution hearing will be scheduled at a later date.
“Groce beat, tormented and enslaved vulnerable young women struggling with heroin addiction,” said Principal Deputy Assistant Attorney General Gupta. “He treated them as sex slaves rather than human beings, and his unconscionable actions offend the most basic standards of human decency. Nothing can undo the harm Groce inflicted or the pain he caused, but hopefully this sentence provides some measure of closure and relief for the victims.”
“Sex trafficking is modern slavery, and cannot be tolerated in any civilized nation,” said U.S. Attorney Vaudreuil. “These crimes, which took place in a small Wisconsin city, demonstrate that sex trafficking is not just a big city issue; it is a horrible problem in rural America too. We will continue to work with our local, state and federal law enforcement partners to bring to justice those who violently exploit vulnerable victims in Wisconsin.”
“Sex trafficking has no boundaries and can occur anywhere,” said Special Agent in Charge Tolomeo. “When combined with drug addiction, the results are devastating. Groce used heroin and violence to force victims into prostitution. The FBI will continue to work with its law enforcement partners to target these predators.”
Evidence presented during the four-day trial, including the testimony of the three victims identified in the indictment as Jane Does 1 through 3, revealed that the defendant sold heroin in Sparta between Dec. 2012 and April 2013. During that time, he enticed the victims to begin prostituting for his profit by providing them with heroin and pretending to be in love with them. As their dependency on him increased, he turned to violence and threatened to cut off their heroin supply if they disobeyed him, withheld money earned from prostitution or otherwise refused to prostitute. Groce further kept some of the victims in perpetual debt by fronting them heroin and charging fines as punishment. He advertised the victims on Backpage.com and paid other addicts to drive them from Wisconsin to Minnesota to prostitute. Groce used violence and the threat of violence to keep the victims under his control. On one occasion, in full view of two of the victims, he beat an associate and pointed a gun at the man because Groce believed the man had stolen a small quantity of drugs.
According to her testimony, Jane Doe 1 began using heroin when she was 15 and met the defendant when she was 19, around January 2013. She testified that Groce was initially kind to her, called her beautiful and offered her a place to stay when she had nowhere else to go. He started selling her heroin, and shortly after, he manipulated her emotions to convince her to start prostituting for him. Groce required her to prostitute before giving her heroin, and if she disobeyed him, he punished her by cutting her off, causing her to suffer intense and painful withdrawal symptoms. On one occasion, he burned her face with a cigarette because she withheld money from him. She escaped with the help of Jane Doe 2. Later on in April 2014, the defendant beat, punched and kicked her while calling her a snake and a snitch because she had previously cooperated with law enforcement. After the beating, she was covered in blood and bruises.
Jane Doe 2 testified that she met the defendant when she was 21, around December 2012, after her mother died from a drug overdose. Her mother’s death caused her to start using heroin and the defendant became her dealer. She helped Jane Doe 1 escape from the defendant and then was forced herself to prostitute because, as the defendant put it, she caused him to lose money. On one occasion, when Jane Doe 2 refused to answer a prostitution call, Groce told her that she had to do the call to get her heroin. When she told him that he was not giving her a choice, he pointed to his gun and responded that she always has a choice. On another occasion, the defendant beat Jane Doe 2, throwing her into a bathtub because she had sex with a prostitution customer in his bed, rather than the designated bed for prostitution, which was occupied by another victim and customer.
Jane Doe 3 testified that on one occasion she misplaced a debit card containing money belonging to Groce. In response, Groce ordered her to do a prostitution call to pay him back. Jane Doe 3 had to work that evening at her regular job and told Groce that she did not want to do the call. Groce insisted and told her that if she refused then he would cut off her entire supply of heroin. Jane Doe 3 testified concerning the debilitating symptoms of heroin withdrawal and stated that she did the call for Groce because she feared suffering those symptoms.
The case was investigated by FBI’s Milwaukee Division with assistance from the Sparta Police Department and Monroe County, Wisconsin, Joint Investigative Task Force. The case is being prosecuted by Assistant U.S. Attorney Julie S. Pfluger of the Western District of Wisconsin and Trial Attorney Shan Patel of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Wisconsin Man Pleads Guilty to Attempting to Provide Material Support to ISILRead the Press Release
Joshua Van Haften, 34, of Madison, Wisconsin, pleaded guilty to attempting to provide material support and resources, namely himself as personnel, to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization.
The announcement was made by Acting Assistant Attorney General for National Security Mary B. McCord and U.S. Attorney John W. Vaudreuil for the Western District of Wisconsin.
Van Haften admitted that in 2014, he attempted to provide material support to ISIL, knowing that the organization was a designated terrorist organization that has engaged and engages in terrorism.
According to the government’s evidence, Van Haften traveled to Turkey in 2014 and attempted to cross into Syria. He posted online that he had taken an oath of allegiance to the leader of ISIL, and that “The only thing that matters to me is joining my brothers for the war against America [sic] liars.”
Van Haften was arrested at O’Hare Airport in Chicago, Illinois in April 2015, after his arrival in custody on an international flight from Turkey. He has been held in federal custody since his arrest.
U.S. District Judge James D. Peterson scheduled sentencing for February 17, 2017 at 1:00pm CDT. Van Haften faces a maximum penalty of 15 years in federal prison.
The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
The charge against Van Haften is the result of an investigation by the Joint Terrorism Task Force, the members of which include the FBI; Wisconsin Department of Justice, Division of Criminal Investigation; Dane County Sheriff’s Office; and University of Wisconsin Police Department. Assistance was also provided by DHS.
The case is being prosecuted by First Assistant U.S. Attorney Jeffrey Anderson for the Western District of Wisconsin and Trial Attorney Lolita Lukose of the National Security Division’s Counterterrorism Section.
Heroin Dealer Convicted by Jury of Sex Trafficking and Drug-Related OffensesRead the Press Release
Defendant Sold Heroin and Used Violence, Threats and Coercion to Compel Three Young Heroin-Addicted Women to Prostitute for His Profit in Wisconsin and Minnesota
Monta Groce, 30, of Sparta, Wisconsin, was convicted by a federal jury of three counts of sex trafficking by force, threats of force or coercion; one count of conspiracy to engage in interstate transportation for prostitution; one count of interstate transportation for prostitution; one count of maintaining a property for drug trafficking; one count of using a firearm in furtherance of drug trafficking and one count of witness retaliation. The verdict was announced by Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division; U.S. Attorney John W. Vaudreuil of the Western District of Wisconsin and FBI Special Agent in Charge Robert J. Shields of the FBI’s Milwaukee Division.
After deliberating for 10 hours, the jury found the defendant guilty on all counts, with the exception of one count of attempted sex trafficking. Sentencing is scheduled for Oct. 19, 2016. The defendant faces a minimum sentence of 20 years in prison and a maximum sentence of life in prison.
“Groce supported the heroin epidemic impacting our country and exploited vulnerable young women by forcing them to engage in prostitution,” said Principal Deputy Assistant Attorney General Gupta. “I commend the trial team, investigators and victim advocates for their incredible work in this case. The Civil Rights Division will continue our vigorous efforts to work with our federal and state partners to hold human traffickers accountable and vindicate the rights of victims.”
“These cases are about horrible violence against women – Groce violently forced vulnerable victims into commercial sex,” said U.S. Attorney Vaudreuil. “The Department of Justice will not tolerate the exploitation of sex-trafficked women and children and we will continue to bring traffickers to justice on their behalf. These crimes, which took place in a small city, demonstrate that sex trafficking is not just a big city issue; it is happening in rural America too.”
“Human traffickers like Monta Groce, who prey on vulnerable women and children, will be aggressively investigated by the FBI from major cities to rural communities such as Sparta, Wisconsin, so the victims may be rescued and the perpetrators brought to justice,” said FBI Special Agent in Charge Shields.
Evidence presented during the four-day trial, including the testimony of the three victims identified in the indictment as Jane Does 1 through 3, revealed that the defendant sold heroin in Sparta between December 2012 and April 2013. During that time, he enticed the victims to begin prostituting for his profit by providing them with heroin and pretending to be in love with them. As their dependency on him increased, he turned to violence and threatened to cut off their heroin supply if they disobeyed him, withheld money earned from prostitution or otherwise refused to prostitute. Groce further kept some of the victims in perpetual debt by fronting them heroin and charging fines as punishment. He advertised the victims on Backpage.com and paid other addicts to drive them from Wisconsin to Minnesota to prostitute. On one occasion, he gave heroin to a male heroin-addict to sell and then accused the man of stealing some of the heroin when he returned after the sale fell through. Groce beat the man in front of two of the victims, pointed a gun at him and threatened to kill him unless he paid Groce for the purportedly missing drugs.
According to her testimony, Jane Doe 1 began using heroin when she was 15 and met the defendant when she was 19, around January 2013. She testified that Groce was initially kind to her, called her beautiful and offered her a place to stay when she had nowhere else to go. He started selling her heroin, and shortly after, he manipulated her emotions to convince her to start prostituting for him. Groce required her to prostitute before giving her heroin, and if she disobeyed him, he punished her by cutting her off, causing her to suffer intense and painful withdrawal symptoms. On one occasion, he burned her face with a cigarette because she withheld money from him. She escaped with the help of Jane Doe 2. Later on in April 2014, the defendant beat, punched and kicked her while calling her a snake and a snitch because she had previously cooperated with law enforcement. After the beating, she was covered in blood and bruises.
Jane Doe 2 testified that she met the defendant when she was 21, around December 2012, after her mother died from a drug overdose. Her mother’s death caused her to start using heroin and the defendant became her dealer. She helped Jane Doe 1 escape from the defendant and then was forced herself to prostitute because, as the defendant put it, she caused him to lose money. On one occasion, when Jane Doe 2 refused to answer a prostitution call, Groce told her that she had to do the call to get her heroin. When she told him that he was not giving her a choice, he pointed to his gun and responded that she always has a choice. On another occasion, the defendant beat Jane Doe 2, throwing her into a bathtub because she had sex with a prostitution customer in his bed, rather than the designated bed for prostitution, which was occupied by another victim and customer.
Jane Doe 3 testified that on one occasion she misplaced a debit card containing money belonging to Groce. In response, Groce ordered her to do a prostitution call to pay him back. Jane Doe 3 had to work that evening at her regular job and told Groce that she did not want to do the call. Groce insisted and told her that if she refused then he would cut off her entire supply of heroin. Jane Doe 3 testified concerning the debilitating symptoms of heroin withdrawal and stated that she did the call for Groce because she feared suffering those symptoms.
The case was investigated by FBI’s Milwaukee Division with assistance from the Sparta Police Department and Monroe County, Wisconsin, Joint Investigative Task Force. The case is being prosecuted by Assistant U.S. Attorney Julie S. Pfluger of the Western District of Wisconsin and Trial Attorney Shan Patel of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Justice Department Files Proposed Settlement of Fair Housing Act Lawsuit Against Landlord for Housing Discrimination Based on DisabilityRead the Press Release
The Justice Department filed a proposed settlement of a lawsuit alleging that a Waunakee, Wisconsin, landlord and apartment complex owner violated the Fair Housing Act by discriminating against two residents of Applewood Apartments based on disability.
“Persons with disabilities, like all Americans, have the right to live in housing free of discrimination and harassment from both landlords and tenants,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division. “The Civil Rights Division remains committed to enforcing the Fair Housing Act and ensuring that all individuals are able to enjoy the rights it guarantees.”
“The Fair Housing Act prohibits discrimination on many bases, including disability,” said U.S. Attorney John W. Vaudreuil of the Western District of Wisconsin. “Persons living with disabilities have an equal right to protection under the Act and we will enforce the Act when such offensive conduct interferes with their rights to use and enjoyment of their home.”
“No family should have to endure degrading insults and comments in the place they call home,” said Gustavo Velasquez, HUD’s Assistant Secretary for Fair Housing and Equal Opportunity. “Today’s settlement reflects HUD and the Justice Department’s ongoing commitment to taking appropriate action against individuals who violate the housing rights of persons with disabilities.”
The lawsuit, filed today along with a proposed settlement in the U.S. District Court of the Western District of Wisconsin, alleges that defendants Applewood of Cross Plains LLC (ACP) and William Ranguette discriminated against two residents of Applewood Apartments, a mother and daughter living together, and denied them rights by refusing to renew the residents’ lease because of their disabilities; demanding that they develop a “plan” to deal with the daughter’s purported disability-related behavior (she is a person with Down Syndrome); and pressuring them to move.
Furthermore, the United States alleges that all defendants, which include the residential apartment manager of the building, discriminated against the two residents by failing to take prompt action to correct and end disability-related harassment by other tenants. From the moment the residents moved into the building, other tenants made such statements as calling the daughter “mentally retarded,” and stating “You don’t belong here. . . you belong in an institution.” Complaints to the landlord and building manager, including that other tenants continued with offensive comments, followed them around the building, and interfered with their use of the premises, went unaddressed.
Under the terms of the settlement, which is subject to approval by the U.S. District Court, defendants will pay the complainants $40,000 in damages. Although denying the allegations, defendants ACP and Ranguette have also agreed to maintain non-discrimination housing policies, advertise that they are equal opportunity housing providers and attend fair housing training.
Fighting housing discrimination is a top priority of the Justice Department. The federal Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex familial status, national origin and disability. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Individuals who believe that they have been victims of housing discrimination can call the Housing Discrimination Tip Line at 1-800-896-7743, e-mail the Justice Department at [email protected] or contact the Department of Housing and Urban Development at 1-800-669-9777.
This case was handled by the Civil Rights Division’s Housing and Civil Enforcement Section and Assistant U.S. Attorney Leslie Herje of the Western District of Wisconsin.
Applewood Complaint
Applewood Consent Decree
Applewood Joint Motion to Enter Consent Decree
Justice Department Obtains $100,000 Settlement in Lawsuit Against Wisconsin Mobile Home Park for Discriminating Against Families with ChildrenRead the Press Release
The Justice Department announced today that the owners and operators of Twin Oaks Mobile Home Park in Whitewater, Wisconsin, have agreed to pay $100,000 to settle a Justice Department lawsuit alleging that they unlawfully excluded families with children from significant portions of their 230-lot mobile home park. The settlement must still be approved by the U.S. District Court for the Western District of Wisconsin.
“Families with children should be free to choose housing that meets their needs and their budget,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division. “They should not face discrimination when they are looking for a home for their families.”
“The U.S. Department of Justice is committed to fighting illegal discrimination and ensuring the fair housing rights of families wherever they are challenged,” said U.S. Attorney John W. Vaudreuil of the Western District of Wisconsin.
The lawsuit, filed in October 2014, arose as a result of a complaint filed with the U.S. Department of Housing and Urban Development (HUD) by a single mother and a former resident who had tried to complete the sale of a mobile home in the park. The defendants refused to approve the application for residency of the single mother who planned to purchase the mobile home and live there with her then-two-year-old child because the home was located in an area of the park where they did not allow children. After conducting an investigation, HUD found that the defendants had violated the Fair Housing Act and referred the matter to the Department of Justice. The defendants in the case include Twin Oaks Mobile Home Park Inc.; Merrill Eugene Gutzmer, the owner of the park; and Dennis Hansen, the resident manager. After the lawsuit was filed, the defendants approved the residency of the single mother who had filed the HUD complaint and she was able to purchase the mobile home.
“Unless a mobile home park meets the very specific requirements to be designated housing for older persons, the owner cannot refuse to sell or rent a home to a family because they have a child,” said Gustavo Velasquez, HUD’s Assistant Secretary for Fair Housing and Equal Opportunity. “Today’s settlement reaffirms HUD’s determination to work with the Justice Department to ensure that occupancy standards established by housing providers do not violate the Fair Housing Act.”
Under the terms of the proposed settlement, the defendants will pay $45,000 in damages and rent credits to the two persons who filed HUD complaints, $45,000 to other persons who are identified later through a claims process established in the decree and $10,000 in a civil penalty. The settlement also requires the defendants to change their policies to allow families with children throughout the park. Anyone who believes that they have been discriminated against by Twin Oaks because they have children should call the Justice Department at 1-800-896-7743, mailbox number 9997 or email the department at [email protected].
The federal Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, familial status and disability. Among other things, the Fair Housing Act makes it illegal to refuse to rent housing and to discriminate in the terms or conditions of housing rentals because of familial status, except in specified categories of housing that are reserved for older persons. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Individuals who believe that they may have been victims of housing discrimination can call the Justice Department at 1-800-896-7743, email the Justice Department at [email protected], or contact HUD at 1-800-669-9777 or through www.hud.gov.
Twin Oaks Consent Decree
Twin Oaks Joint Motion for Entry of Consent Decree