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Newest first across public DOJ and U.S. Attorney press releases.
Friday 1 March 2024
Bucks County, Pennsylvania, Registered Sex Offender Charged with Sexually Exploiting and Online Enticement of MinorRead the Press Release
TRENTON, N.J. – A Bucks County, Pennsylvania, man made his initial appearance on charges of producing videos and images depicting child sexual abuse and coercing and enticing a minor to engage in criminal sexual conduct, U.S. Attorney Philip R. Sellinger announced today.
Gregory J. Barger, 38, of Morrisville, Pennsylvania, was indicted on Feb. 15, 2024, on one count of sexual exploitation of a child – production of child pornography – and one count of coercion and enticement – online enticement of a minor. Barger had previously been charged by criminal complaint with the production offense. Barger was arraigned on Feb. 28, 2024, before U.S. District Judge Michael A. Shipp in Trenton federal court and was detained pending trial.
According to documents filed in this case and statements made in court:
From Aug. 5, 2020, through April 7, 2022, Barger – a previously convicted, registered sex offender – used an electronic messaging application to communicate with a minor victim located in the United Kingdom. He induced, enticed, and coerced the minor victim to engage in sexual conduct with Barger. In February 2022, Barger traveled to the United Kingdom and produced images and videos of Barger engaged in sexual conduct with the minor victim. Law enforcement later recovered those images and videos from Barger’s cellular phone, which was seized from Barger at the time of his arrest on April 7, 2022, in Hamilton, New Jersey.
Because of Barger’s prior conviction, the charge of production of child pornography carries a mandatory minimum penalty of 25 years in prison and a maximum potential penalty of 50 years in prison, as well as a $250,000 fine. The charge of online enticement of a minor carries a mandatory minimum penalty of 10 years in prison and a maximum potential penalty of life in prison, as well as a $250,000 fine.
U.S. Attorney Sellinger credited special agents of Homeland Security Investigations Newark, under the direction of Acting Special Agent in Charge Michael Alfonso, and members of the Mercer County Prosecutor’s Office, under the direction of Prosecutor Angelo J. Onofri, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney Alexander E. Ramey of the U.S. Attorney’s Office Criminal Division in Trenton.
The charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
barger.indictment.pdfBeckley Woman Pleads Guilty to Federal Drug CrimeRead the Press Release
BECKLEY, W.Va. – Savannah Elizabeth Todd, 31, of Beckley, pleaded guilty today to possession with intent to distribute fentanyl, cocaine and heroin.
According to court documents and statements made in court, on February 8, 2022, Todd sold approximately 3.5 grams of fentanyl for $550 to a confidential informant at her residence in Beckley. On February 17, 2022, law enforcement officers executed a search warrant at Todd’s residence and seized 189 grams of fentanyl, 56 grams of cocaine, 27 grams of heroin, a Ruger LCP .380-caliber handgun, a Taurus model 22LR handgun, a Sig Sauer model 1911 .45-caliber handgun, a Glock model 42 .380-caliber handgun, and $13,046.
Todd is scheduled to be sentenced on June 28, 2024, and faces a maximum penalty of 20 years in prison, at least three years of supervised release, and a $1 million fine.
United States Attorney Will Thompson made the announcement and commended the investigative work of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Beckley/Raleigh County Drug and Violent Crime Unit.
United States District Judge Frank W. Volk presided over the hearing. Assistant United States Attorney Brian D. Parsons is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 5:23-cr-163.
Beaver County Man Sentenced to 120 Months for Child Exploitation CrimeRead the Press Release
SCRANTON – The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Richard Rader, age 61, a resident of New Galilee, Beaver County, Pennsylvania, was sentenced to 120 months’ imprisonment by United States District Court Judge Malachy E. Mannion, for attempted online enticement of a minor.
According to the United States Attorney Gerard M. Karam, between June 20, 2022, and July 8, 2022, Rader used the internet and an electronic device to attempt to persuade, induce, entice, and coerce a person who he believed to be a 12-year-old child to engage in sexual conduct and to produce images of child pornography. During that period, on two occasions, Rader transmitted obscene photographs of himself to the purported child.
The investigation was conducted by Homeland Security Investigations – Philadelphia Division. Assistant United States Attorneys Michelle Olshefski and Tatum Wilson prosecuted the case.
The maximum penalty under federal law for this offense is life imprisonment, a term of supervised release following imprisonment, and a fine. A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
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Arizona Resident Charged with Bomb Hoax Against Sacramento Area ChurchRead the Press Release
salah_complaint.pdfSACRAMENTO, Calif. — A federal grand jury returned a one-count indictment Thursday against Zimnako Salah, 44, of Phoenix, Arizona, charging him with false information and hoaxes, U.S. Attorney Phillip A. Talbert announced.
According to court documents, on Nov. 12, 2023, Salah entered a church in Roseville and left a backpack affixed to a toilet in the church restroom. Evidence indicates that Salah intended to convey that the backpack contained a bomb. According to court documents, Salah also left a backpack in the sanctuary of an Arizona church in September 2023, and attempted to do the same at a La Mesa, California, church in October 2023 and a Colorado church in November 2023.
This case is the product of an investigation by the Federal Bureau of Investigation with assistance from state and local partners. Assistant U.S. Attorney Angela Scott is prosecuting the case.
If convicted, Salah faces a maximum statutory penalty of five years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charge is only an allegation; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Activists Charged in Red Powder Attack on U.S. Constitution at the U.S. ArchivesRead the Press Release
WASHINGTON – Donald Zepeda, 35, of Maryland, and Jackson Green, 27, of Utah, were charged in a superseding indictment, unsealed yesterday in U.S. District Court, with the February 14, 2024, attack on the U.S. Constitution housed at the National Archives in Washington D.C.
Zepeda and Green are charged with felony destruction of government property for dumping a fine red powder over the document’s display case in the Rotunda of the Archives building. The cost of cleaning up after the stunt, which was intended to draw attention to Climate Change, has already exceeded $50,000. In addition, the act closed the Rotunda for four days.
Green previously was charged in a separate act of vandalism at the National Gallery of Art that occurred on November 14, 2023. Green was charged with one count of destruction of National Gallery of Art property for that offense. As a result of that offense, U.S. District Court Judge Amy Berman Jackson had ordered Green to stay away from the District of Columbia and stay away from all museums or public monuments. On February 22, Judge Berman Jackson ordered that Green be held in the D.C. jail for violating the conditions of his release.
Both incidents were videotaped by supporters of Green and released online.
When he was arrested on February 28, 2024, Zepeda was headed to Raleigh, North Carolina, to meet up with another environmental protestor.
The case is being investigated by the FBI’s Washington Field Office, specifically the FBI’s Art Crime Team, and the National Archives Records Administration OIG, with assistance from the National Gallery of Art Police and U.S. Park Police. The case is being prosecuted by Assistant U.S. Attorney Cameron A. Tepfer of the U.S. Attorney’s Office for the District of Columbia.
An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Thursday 29 February 2024
دادستان ایالات متحده اتهاماتی بر علیه تبعه ایرانی برای کارزارسایبری چند ساله هدف قرار دادن پیمانکاران دفاعی ایالات متحده وشرکت های بخش خصوصی اعلام میکندRead the Press Release
دیمین ویلیامز، دادستان ایالات متحده برای منطقه جنوبی نیویورک؛ متیو جی. اولسن، دستیار دادستان کل برای امنیت ملی؛ برایان ورندرن، دستیار مدیر بخش سایبری اداره تحقیقات فدرال («اف بی ای»)؛ و جیمز اسمیت، دستیار مدیر مسئول دفتر منطقهای نیویورک اف بی آی، امروز بازکردن کیفرخواستی را اعلام کردند که شهروند و ساکن ایران علیرضا شفیعی نسب را متهم میکند به دست داشتن در یک کارزار سایبری برای به مخاطره انداختن دولت ایالات متحده و نهادهای خصوصی، از جمله وزارتهای خزانه داری و امور خارجه ایالات متحده، پیمانکاران دفاعی، و دو شرکت مستقر در نیویورک. این پرونده به قاضی منطقه ای ایالات متحده مری کی ویسکوسیل محول شده است. شفیعی نسب هنوز آزاد است.
دیمین ویلیامز، دادستان ایالات متحده گفت: «همانطور که ادعا میشود، علیرضا شفیعی نسب در یک کارزار سایبری با به کاربردن فیشینگ نیزهای و سایر فنون هک برای آلوده کردن بیش از ۰۰۰/۲۰۰ دستگاه قربانی شرکت کرد، که بسیاری از آنها حاوی اطلاعات دفاعی حساس یا محرمانه بودهاند. طرحهای نفوذ سایبری مانند جرمی که ادعا شده است، امنیت ملی ما را تهدید میکنند و من به شرکای مجری قانونمان و دادستانهای
حرفه ای این دفتر افتخار میکنم که با به کاربردن فناوریهای نوآورانه و اقدامات تحقیقاتی، این مجرمان سایبری را مختل و ردیابی میکنند.»متیو جی. اولسن، دستیار دادستان کل برای امنیت ملی گفت: «ادعا میشود که آقای شفیعی نسب در حالی که در ظاهر به عنوان یک کارشناس امنیت سایبری برای مشتریان مستقر در ایران کار میکرد، در یک کارزار مداوم برای به مخاطره انداختن سامانههای رایانهای بخش خصوصی و دولتی ایالات متحده شرکت داشت. اتهامات امروز روشنگر بومسازگان سایبری فاسد ایران است که در آن مجرمان آزادند که سامانههای رایانهای خارج از کشور را هدف قراردهند و اطلاعات و زیرساختهای حساس ایالات متحده را تهدید کنند. قسمت سایبری امنیت ملی ما همچنان تمرکز دارد که این طرحهای هک فرامرزی را مختل، و با آنهایی که مسئول هستند برخورد کند.»
برایان ورندرن، دستیار مدیر بخش سایبری اف بی آی گفت: «اف بی آی اهرم همه تواناییهایش را در مبارزه با سازمانهای هکری ایرانی که بخش دولتی و خصوصی آمریکا را تهدید میکنند به کار خواهد برد. ما همه را تشویق میکنیم که با رعایت بهداشت سایبری احتمال آسیبپذیری از عاملان بدخواهی مثل شفیعی نسب را تعدیل کنند. همکاری نزدیک با شرکا که امروز منجر به باز کردن این کیفرخواست شد اینجا تمام نمیشود، و ما مشتاقانه در انتظار ادامه همکاری در این فضا هستیم.»
جیمز اسمیت، دستیار مدیر مسئول دفتر منطقهای نیویورک اف بی آی گفت: «مجرمان سایبری مخاصم مصمم هستند که با به کار بردن کارزار هک به ایمنی عمومی ما آسیب بزنند و امنیت ملی ما را تهدید کنند. ادعا میشود که علیرضا شفیعی نسب در طول چندین سال در یک کارزار تهاجمی برای هدف قراردادن نهادهای دولتی ایالات متحده، پیمانکاران دفاعی، و شرکتهای مستقر در نیویورک که از نزدیک با وزارت دفاع کار میکنند شرکت میکرد. این پرونده یادآور این است که لازم است همه ما در امنیت سایبری آگاه و کوشا باشیم تا قربانی عاملان بدخواه نشویم. برای مبارزه با عاملان متخاصم دولت-ملت که در تلاش به آسیب زدن به کشورمان در فصای سایبری هستند، اف بی آی همچنان به رهبری ادامه خواهد داد.»
بر پایه اتهامات موجود در کیفرخواستی که امروز در دادگاه فدرال منهتن باز شد:۱
دست کم از سال ۲۰۱۶ تا حدود آوریل ۲۰۲۱، علیرضا شفیعی نسب و دیگر توطئهگران عضو یک سازمان هکری بودند که در یک کارزار چند ساله هماهنگ برای انجام و تلاش برای انجام نفوذهای کامپیوتری شرکت داشتند. این نفوذها بیش از دوازده شرکت آمریکایی و وزارت خزانههای داریی و امور خارجه ایالات متحده را هدف قرار دادند.
قربانیان بخش خصوصی این گروه هکری در درجه اول پیمانکاران دفاعی بودهاند که شرکتهایی هستند که برنامههای وزارت دفاع ایالات متحده را حمایت میکنند. علاوه بر این، این گروه یک شرکت حسابداری مستقر در نیویورک و یک شرکت مهماننوازی مستقر در نیویورک را هدف قرار داد.
در انجام کارزار هک خود، این گروه از فیشینگ نیزهای برای آلوده کردن رایانه های قربانی با بدافزار
استفاده کرد - یعنی فریب دادن دریافت کننده یک رایانامه برای کلیک کردن روی یک پیوند مخرب. در جریان کارزار خود علیه یک قربانی، این گروه بیش از ۰۰۰/۲۰۰ هزار حساب کاربری کارکنان را به مخاطره انداخت. در یک قربانی دیگر، توطئهگران حسابهای کاربری ۰۰۰/۲ کارمند را هدف قرار دادند. به منظور مدیریت کارزار فیشینگ نیزهای خود، این گروه یک برنامه کامپیوتری خاص ساخت و به کاربرد که توطئهگران را قادر به سازماندهی و استقرار حملات فیشینگ نیزهای کرد.در جریان این حملات فیشینگ نیزهای، توطئهگران یک حساب مدیریتی رایانامه متعلق به یک پیمانکار دفاعی («پیمانکار دفاعی-۱») را هک کردند. دسترسی به این حساب مدیریتی توطئهگران را قادر به ایجاد حساب های غیر مجاز پیمانکار دفاعی-۱ کرد، که سپس توطئهگران از آنها برای فرستادن کارزار فیشینگ نیزهای به کارکنان یک پیمانکار دفاعی دیگر و یک شرکت مشاوره استفاده کردند.
علاوه بر فیشینگ نیزهای، توطئهگران مهندسی اجتماعی به کار بردند، از جمله جا زدن خود به نام دیگران، معمولا زنان، تا اعتماد قربانیان را بدست بیاورند. این تماسهای مهندسی اجتماعی شیوه دیگر توطئه برا
شفیعی نسب در این طرحها شرکت میکرد. در طول مشارکت خود در آن طرح، او در استخدام محک رایان افراز، یک شرکت مستقر در ایران که در ظاهر خدمات امنیت سایبری ارائه میداد، اما در واقع چهرهای برای عملیات توطئهگران بود. شفیعی نسب مسئول تهیه زیرساختهای مورد استفاده توطئه بود. در طول انجام این کارها شفیعی نسب با به کاربردن هویت دزدیده شده یک فرد حقیقی یک سرور و حسابهای رایانامهای ثبت کرد که در طول عملیات سایبری به کاربرده شدند.
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شفیعی نسب، ۳۹ ساله از ایران، متهم به یک فقره توطئه برای ارتکاب تقلب کامپیوتری است که حداکثر مجازات آن پنج سال زندان است؛ یک فقره توطئه برای ارتکاب کلاهبرداری سیمی، که حداکثر مجازات آن ۲۰ سال زندان است؛ یک فقره کلاهبرداری سیمی، که حداکثر مجازات آن ۲۰ سال زندان است؛ و یک فقره سرقت هویت وخیم، که مجازات آن یک دوره پیدرپی اجباری دو سال زندان است.
حداکثر مجازاتهای بالقوه در این مورد توسط کنگره مقرر میشود و در اینجا فقط برای اطلاع ارائه شده، زیرا هر گونه مجازات متهم توسط قاضی تعیین خواهد شود.
همزمان با باز کردن کیفرخواست، برنامه «پاداش برای عدالت» وزارت امور خارجه پاداشی تا
۱۰ میلیون دلار برای اطلاعاتی که منجر به شناسایی شفیعی نسب یا مکان او میشود ارائه میدهد. هر کسی که اطلاعاتی در باره شفیعی نسب و فعالیتهای سایبری بدخواهانه او دارد با «پاداش برای عدالت» از راه کانال تور آن وزارتخانه تماس بگیرد: he5dybnt7sr6cm32xt77pazmtm65flqy6irivtflruqfc5ep7eiodiad.onion(مرورگر تور نیاز دارد).
آقای ویلیامز از کار تحقیقاتی برجسته اف بی ای، از جمله کار بخش سایبری اف بی ای، ستایش کرد.
این پرونده توسط واحد تقلبها و جرایم سایبری پیچیده اجرا می شود. دستیاران دادستان ایالات متحده رایان ب. فینکل، داینا مک کلود، و دنیل جی. نسیم مسئولین پیگرد قانونی هستند، با کمک از وکیل محاکمه متیو چنگ از قسمت سایبری بخش امنیت ملی.
اتهامات مندرج در کیفرخواست صرفا اتهام هستند، و متهم بیگناه فرض می شود مگر اینکه و تا زمانی که گناهکار بودنش ثابت شود.
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۱همانگونه که سرفصل بیان میکند، تمام متن کیفرخواست و توصیفی که کیفرخواست در اینجا مطرح میکند فقط ادعا است، و هر واقعیتی که توصیف شده است فقط باید به عنوان یک ادعا تلقی شود.
استقرار بدافزار روی رایانههای قربانی و به مخاطره انداختن آن دستگاهها و حسابها بود.
Worcester Tax Preparer Sentenced to Prison for False Tax Returns SchemeRead the Press Release
BOSTON – A tax preparer was sentenced today in federal court in Worcester for preparing false tax returns in the names of taxpayers.
Kwasi Kwarteng, 51, of Worcester, was sentenced by U.S. District Judge Margaret R. Guzman to one year and one day in prison, to be followed by one year of supervised release. Kwarteng was also ordered to pay restitution to the Internal Revenue Service in the amount of $346,186 and a special assessment of $1,300. In addition, Kwarteng was placed under a permanent injunction barring him for life from preparing or assisting in the filing of federal tax returns for any other person or entity. In April 2023, Kwarteng pleaded guilty to 13 counts of aiding and assisting in the filing of false federal tax returns.From at least 2014 through 2018, Kwarteng operated under the name KK Tax Service –despite not being registered with the IRS as required by law – filing more than 1,195 tax returns in the names of clients, charging approximately $150 per return. Kwarteng added false information to hundreds of the returns to claim deductions for fictitious medical expenses, personal property taxes, gifts to charity, Individual Retirement Account (IRA) contributions and unreimbursed employee business expenses. The false returns resulted in some clients paying lower taxes than they owed and, in most cases, resulted in clients receiving tax refunds to which they were not entitled. Kwarteng caused more than half a million dollars in losses to the IRS.
Acting United States Attorney Joshua S. Levy and Harry Chavis, Jr., Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston made the announcement today. Assistant U.S. Attorney Victor A. Wild of the Securities, Financial & Cyber Fraud Unit prosecuted the case.
Woman Pleads Guilty to Trafficking Meth, Fentanyl from MexicoRead the Press Release
ALPINE, Texas – A Mexican national pleaded guilty in a federal court in Pecos to possession with intent to distribute fentanyl and methamphetamine.
According to court documents, Sandra Araceli Diaz Vazquez, 37, of Chihuahua, Mexico, was suspected of delivering narcotics within the U.S. On Dec. 5, 2023, law enforcement officers conducted a traffic stop along Interstate 20 near Colorado City after observing Diaz Vazquez commit two moving violations. Diaz Vazquez consented to a vehicle search, which resulted in the discovery of approximately 20.2 kilograms of methamphetamine and 5.6 kilograms of fentanyl concealed within the fuel tank.
Diaz Vazquez is scheduled to be sentenced on May 29 and faces 10 years to life in prison and a $10 million fine. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney Jaime Esparza for the Western District of Texas made the announcement.
HSI and the 32nd Judicial District Attorney’s Office are investigating the case.
Assistant U.S. Attorney Amy Greenbaum is prosecuting the case.
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United States Reaches Settlement of Law Enforcement, Tax, and Healthcare Cost Claims in Endo International Bankruptcy CaseRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York; Brian M. Boynton, the Principal Deputy Assistant Attorney General and head of the Department of Justice’s Civil Division; Patrizia Cavazzoni, M.D., the Director of the Center for Drug Evaluation and Research of the Food and Drug Administration (“FDA”); Michael Rogers, the Associate Commissioner for Regulatory Affairs of the FDA; Christi A. Grimm, the Inspector General of the Department of Health and Human Services (“HHS-OIG”); Robert P. Storch, the Inspector General of the Department of Defense (“DOD”); Michael J. Missal, the Inspector General of the Department of Veterans Affairs (“VA”); and Derek M. Holt, the Special Agent in Charge of the Office of Personnel Management – Office of Inspector General (“OPM OIG”), announced today that the United States has reached an agreement to resolve its monetary claims — including claims arising from criminal and civil investigations — against ENDO INTERNATIONAL PLC and its affiliates (together, “ENDO”), a large pharmaceutical company that previously manufactured Opana ER, a powerful branded opioid drug, in its Chapter 11 bankruptcy proceeding. As part of ENDO’s bankruptcy plan, a group of ENDO’s secured lenders will purchase ENDO’s assets and operate the business under a new corporate structure. The agreement provides that this new business will pay the United States $364.9 million over 10 years, which can be prepaid at $200 million on the bankruptcy plan’s effective date, plus up to an additional $100 million contingent on the business performance of the new company. The bankruptcy settlement, which is subject to court approval, resolves multiple federal claims against ENDO, including criminal and civil fraud claims, healthcare agency claims, and tax claims.
As part of the overall settlement, the Department of Justice announced that Endo Health Solutions, Inc. (“EHSI”), one of ENDO’s affiliates, has agreed to resolve criminal and civil investigations related to the company’s sales and marketing of the opioid drug Opana ER with INTAC (“Opana ER”). The payments required by the civil and criminal agreements will be paid as claims in the Chapter 11 bankruptcy proceedings.
Under the proposed global resolution, EHSI agreed to plead guilty in federal court in the Eastern District of Michigan to a one-count misdemeanor information charging it with violating the Federal Food, Drug, and Cosmetic Act (“FDCA”) by introducing misbranded drugs into interstate commerce. The criminal resolution includes the second-largest set of criminal financial penalties ever levied against a pharmaceutical company, including a criminal fine of $1.086 billion and an additional $450 million in criminal forfeiture. The proposed resolution includes a corporate criminal release regarding conduct relating to the sale, marketing, and distribution of Opana ER, but does not release any individual criminal liability.
EHSI also has agreed to a civil settlement of $475.6 million to resolve its civil liability under the False Claims Act. The civil settlement will address alleged losses to federal healthcare programs that paid for Opana ER.
When ENDO filed for bankruptcy in August 2022, it proposed to sell substantially all of its assets in a manner that contravened key requirements of the Bankruptcy Code. ENDO’s original proposal would have provided virtually no recovery to the federal government on account of its claims, while improperly paying several other creditor groups on account of their claims, even though they were entitled to lower or equal priority as the Government’s claims. This settlement was achieved after the Government objected to the proposed sale in Bankruptcy Court. Through the settlement, the Government has ensured both that it is compensated for its claims and that ENDO does not run afoul of the Bankruptcy Code by paying only certain of its creditors or violating the Bankruptcy Code’s priority scheme.
U.S. Attorney Damian Williams said: “Chapter 11 is an important tool for businesses to preserve value for their stakeholders. Bankruptcy protections are not a free pass to evade responsibility for criminal misconduct, civil fraud, or taxes. Today’s settlement ensures that Endo takes responsibility for its past misconduct, pays its federal debts, helps abate the nation’s opioid crisis by funding evidence-based treatment programs at the state and local level, and distributes payments to individuals harmed by the opioid epidemic.”
Principal Deputy Assistant Attorney General Brian M. Boynton said: “Companies that profit from the opioid abuse epidemic by misrepresenting the safety of their opioid products and using reckless marketing tactics to increase sales threaten the health and safety of Americans. With today’s announcement of a criminal guilty plea and a substantial civil settlement, the Department of Justice re-affirms its commitment to holding accountable those whose illegal conduct contributed to the opioid crisis.”
FDA Director Patrizia Cavazzoni, M.D. said: “Combatting the opioid epidemic remains a top public health priority for the FDA. This case demonstrates FDA and DOJ’s commitment to work collaboratively to hold drug manufacturers accountable if they fail to share accurate information with health care professionals about the risks and benefits of opioids.”
FDA Associate Commissioner Michael Rogers said: “The metrics of the opioid crisis are staggering. When companies do not provide accurate information about the safety and abuse potential of their products, they put patients at risk of abuse and addiction. Such conduct will not be tolerated, and we will aggressively pursue and bring to justice those who endanger the public health in this manner.”
HHS-OIG Inspector General Christi A. Grimm said: “The opioid crisis remains a public health emergency nationwide, and those impacted are at the forefront of our work. HHS-OIG is staunchly committed to protecting the millions of people served by federal healthcare programs from schemes such as this, while also striving to ensure they have access to necessary treatment.”
DOD Inspector General Robert P. Storch said: “The misbranding of opioids negatively impacts the integrity of TRICARE, the military’s healthcare system relied on by more than nine million service members, retirees, and their families. Today’s settlement demonstrates the ongoing commitment of the Defense Criminal Investigative Service and its law enforcement partners to promote accountability and transparency throughout the pharmaceutical industry and prosecute those who put profits ahead of patient welfare. The delivery of quality healthcare is too important to let a single dollar go to waste.”
VA Inspector General Michael J. Missal said: “Veterans and their families expect and deserve the highest quality health care delivered in a safe and accountable setting. False or misleading claims about potentially dangerous drugs put veterans’ care at risk. The VA Office of Inspector General is committed to working with our law enforcement partners to ensure the safety of those who entrust their health care to the providers and staff at VA’s 1,300 medical facilities.”
OPM OIG Special Agent in Charge Derek M. Holt said: “Protecting the health and safety of Federal employees, annuitants, and their families is a top priority for OPM OIG. Today’s criminal and civil resolutions demonstrate the exemplary work of our investigative staff, law enforcement partners, and colleagues at the Department of Justice in holding manufacturers accountable for actions that contribute to the opioid epidemic.”
The Bankruptcy Resolution
As part of ENDO’s bankruptcy plan, a group of ENDO’s secured lenders will purchase ENDO’s assets and operate the business under a new corporate structure. The agreement provides that this new business will pay the United States $364.9 million over 10 years, which can be prepaid at $200 million on the bankruptcy plan’s effective date, plus up to an additional $100 million contingent on the business performance of the new company. The bankruptcy settlement resolves multiple federal claims against ENDO, including the criminal and civil fraud claims, as well as additional healthcare agency claims and tax claims.
In addition to the Justice Department’s criminal and civil claims, the HHS Centers for Medicare and Medicaid Services (“CMS”), HHS’s Indian Health Service, and the VA have asserted claims against ENDO for the costs these programs incurred in providing medical care to treat individuals who suffer from opioid-use disorder as a result of their use of Opana ER and other opioids manufactured and sold by ENDO. CMS has also filed a claim to recover costs it incurred based on Medicare beneficiaries’ use of other ENDO products, including transvaginal mesh and ranitidine.
Finally, the Internal Revenue Service (“IRS”) filed substantial tax claims against ENDO based on ongoing audits. These audits concerned, among other things, ENDO’s valuation of assets it transferred to foreign affiliates and its payment of a large loan pre-payment penalty to a foreign affiliate for which it sought a tax deduction. A substantial majority of these payments were entitled to priority in bankruptcy over ENDO’s other unsecured claims. The health care agency and IRS claims have also been resolved though the bankruptcy settlement.
In the settlement agreement, the Government will receive up to a total of $464.9 million to satisfy all of these categories of claims in the bankruptcy. First, the Government will receive $364.9 million in 10 annual payments that can be prepaid at either party’s request. If prepaid on the effective date of the bankruptcy plan, the Government will receive $200 million. The Government will also receive up to an additional $100 million if the new company substantially exceeds its revenue projections in the next several years. The settlement agreement further precludes the new company from acquiring any unused tax credits or other beneficial tax attributes of ENDO.
Besides paying government claims, the bankruptcy plan has other significant features. Earlier in the bankruptcy case, ENDO agreed to stop promoting opioids to prescribers and to turn over millions of documents related to its role in the opioid crisis for publication in a public online archive. The new ENDO business will also make significant payments to state, local, and tribal governments to fund programs to help abate the opioid crisis. The Government has agreed to credit these payments, which will support programs to treat and prevent opioid-use disorder, against ENDO’s criminal forfeiture judgment.
In addition, one important condition in the resolution is that ENDO would cease to operate in its current form and would not emerge from the bankruptcy. Moreover, as part of its resolution with bankruptcy opioid claimants, ENDO’s affiliates have agreed to a Voluntary Operating Injunction that restrains opioid marketing and sales and requires ENDO to turn over millions of documents related to its role in the opioid crisis for publication in a public online archive.
The settlement is contingent on Bankruptcy Court approval of ENDO’s Chapter 11 plan. U.S. Bankruptcy Judge James M. Garrity has scheduled a hearing on March 19, 2024, to consider approving this plan.
The Criminal Plea
As part of the criminal plea, EHSI will admit that from April 2012 through May 2013, certain EHSI sales representatives marketed Opana ER to prescribers by touting Opana ER’s purported abuse deterrence, tamper resistance, and/or crush resistance, despite a lack of clinical data supporting those claims. According to the plea agreement, certain EHSI sales managers were aware that the sales representatives were making claims of purported abuse deterrence, tamper resistance, and/or crush resistance during sales calls, including hitting demonstration “blister packs” of non-medicated sample pills with hammers and conducting other demonstrations to convey the message that Opana ER was, in fact, crush proof and tamper resistant. The approved labeling for Opana ER did not provide adequate information for healthcare providers to safely prescribe Opana ER for use as an opioid that is abuse deterrent. According to the plea agreement, EHSI was responsible for the misbranding of Opana ER by marketing the drug with a label that failed to include adequate directions for its claimed abuse deterrence use, in violation of the FDCA.
EHSI voluntarily withdrew Opana ER from the market in 2017.
The Civil Settlement
The civil settlement announced today resolves allegations that, from 2011 to 2017, EHSI used a marketing scheme that targeted healthcare providers that EHSI knew were prescribing Opana ER for non-medically accepted indications. Aware that fewer than 10% of Opana ER prescribers wrote more than half of all Opana ER prescriptions, EHSI allegedly sought to increase its revenue from Opana ER prescriptions by focusing its marketing on those healthcare providers who prescribed the highest levels of opioids in general and Opana ER in particular. When EHSI employees raised concerns about prescribers believed to be engaged in abuse, diversion, or pill mill prescribing, EHSI allegedly ignored or minimized such concerns and continued to directly market Opana ER to such prescribers.
The allegations resolved by the civil settlement relating to EHSI’s marketing activities include that in 2015, after marketing the reformulated Opana ER for years, EHSI sought to further increase prescriptions by partnering with a consulting company to “pull[] all the levers” it could “to drive incremental growth” of Opana ER prescriptions. In what it termed a “sales force blitz,” EHSI allegedly added 3,000 priority targets to its sales representatives’ call lists, with nearly all of these priority targets chosen because they prescribed a high volume of opioids in general or Opana ER in particular. EHSI allegedly used sales goals and contests to ensure that its sales representatives targeted these outlier prescribers, including prescribers who previously had been excluded from EHSI’s call lists as posing risks of abuse and diversion.
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Mr. Williams thanked the U.S. Department of Justice’s Tax Division and Civil Division’s Commercial Litigation Branch, Corporate/Financial Litigation and Civil Fraud Sections, and Consumer Protection Branch; the U.S. Attorney’s Office for the Southern District of Florida; the IRS; the Office of the U.S. Trustee for Region 2; the HHS Office of General Counsel, CMS, and Indian Health Service; and the VA for their assistance in achieving this settlement agreement.
This bankruptcy case is being handled by the Office’s Tax & Bankruptcy Unit. Assistant U.S. Attorneys Jean-David Barnea, Peter Aronoff, and Tara Schwartz are in charge of the case.
Except to the extent that EHSI’s admissions are part of its criminal resolution, the claims resolved by the civil settlement are allegations only and there has been no determination of liability.
U.S. Attorney’s Office staff stress importance of making smart choices to local studentsRead the Press Release
MIAMI – Students from Bowman Ashe/Doolin K-8 Academy in Miami recently attended a Making Smarter Choices Field Trip at the U.S. Attorney’s Office for the Southern District of Florida.
Staff from the Law Enforcement Coordination and Community Outreach Section (LEC/COS) provided real-world examples to show students the perils of doing the wrong thing and how easy it can be to stray from the correct path.
Incarcerated inmate testimonial videos focused on lives wasted, regret and the desire for redemption.
“If I could be the good for you then maybe you could be the good for me,” said an inmate doing 25 years to life for the murder of a husband/father. “All I’m asking for is a little redemption.”
Unfortunately for him, time for redemption has passed. And that is what LEC/COS
Chief J.D. Smith stressed to the students. One mistake can change everything.
“Each day you have a choice to make,” said Smith. “Am I going to be a good person or a bad person? It’s a daily decision that is in your hands.”
The field trip is designed to motivate children to work hard, uplift themselves and their communities, and do things about which they feel passion.
“If you’re going to fail, you may as well fail at something you love,” said Smith.
The second part of the field trip consisted of a mock trial whereby students tried a murder case in a federal courtroom. Hands shot up as Smith asked who would like to be defense and prosecution attorneys. Roles also included bailiff, court clerk and jury—in which the majority of students participated. Assistant U.S. Attorney Michele S. Vigilance played the judge role.
The case centered on fraternity hazing that went too far and ended in a student’s death. Each student with a speaking role was provided a script and advised to speak clearly, loudly, and confidently.
“The team that wins will be the one that can step up to the microphone and deliver,” said Smith.
The mock trial challenges students to come out of their shells and play the part. Post field trip evaluation forms from the students routinely sing the praises of the trial, from the roles to the décor and serious nature of the courtroom.
“Many of the students we receive throughout the school year are interested in becoming lawyers,” said Smith. “Our field trip gives them a sense of what it’s like.”
You may find a copy of this press release (and any updates) on the website of the United States Attorney’s Office for the Southern District of Florida at www.justice.gov/usao-sdfl.
Community Outreach Specialist John Hampton gets sworn in by a Bowman Ashe/Doolin K-8 Academy student prior to testifying during a recent mock trial. This trial was part of the U.S. Attorney’s Office for the Southern District of Florida’s Making Smarter Choices Field Trip.
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U.S. Attorney Announces Charges Against Iranian National for Multi-Year Cyber Campaign Targeting U.S. Defense Contractors and Private Sector CompaniesRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York; Matthew G. Olsen, the Assistant Attorney General for National Security; Bryan Vorndran, the Assistant Director of the Cyber Division of the Federal Bureau of Investigation (“FBI”); and James Smith, the Assistant Director in Charge of the New York Field Office of the FBI, announced today the unsealing of an Indictment charging Iranian citizen and resident ALIREZA SHAFIE NASAB for his involvement in a cyber-enabled campaign to compromise U.S. government and private entities, including the U.S. Departments of the Treasury and State, defense contractors, and two New York-based companies. The case has been assigned to U.S. District Judge Mary Kay Vyskocil. NASAB remains at large.
U.S. Attorney Damian Williams said: “As alleged, Alireza Shafie Nasab participated in a cyber campaign using spearphishing and other hacking techniques to infect more than 200,000 victim devices, many of which contained sensitive or classified defense information. Cyber intrusion schemes such as the one alleged threaten our national security, and I’m proud of our law enforcement partners and the career prosecutors of this Office for using innovative technologies and investigative measures to disrupt and track down these cybercriminals.”
Assistant Attorney General for National Security Matthew G. Olsen said: “While purporting to work as a cybersecurity specialist for Iran-based clients, Mr. Nasab allegedly participated in a persistent campaign to compromise U.S. private sector and government computer systems. Today’s charges highlight Iran’s corrupt cyber ecosystem, in which criminals are given free rein to target computer systems abroad and threaten U.S. sensitive information and critical infrastructure. Our National Security Cyber Section remains focused on disputing these cross-border hacking schemes and holding those responsible to account.”
FBI Cyber Division Assistant Director Bryan Vorndran said: “The FBI will leverage all of our capabilities in combatting the threat waged by Iranian hacker organizations against America’s public and private sector. We encourage everyone to practice proper cyber hygiene to mitigate the risk of becoming vulnerable to malicious actors like Nasab. The close collaboration with partners that led to today’s unsealed indictment does not end there, and we are looking forward to continued teamwork in this space.”
FBI New York Assistant Director in Charge James Smith said: “Hostile cybercriminals are determined to use hacking campaigns to harm public safety and threaten our national security. Alireza Nasab, over an extended number of years, allegedly participated in an aggressive campaign of cyberattacks targeting U.S. government agencies, defense contractors, and New York-based companies working closely with the Department of Defense. This case is a reminder that we all need to maintain proper cybersecurity and awareness to avoid falling victim to malicious cyber actors. The FBI will continue to lead the fight against hostile nation state actors attempting to harm our country in cyberspace.”
According to the allegations contained in the Indictment unsealed today in Manhattan federal court:[1]
From at least in or about 2016 through at least in or about April 2021, ALIREZA SHAFIE NASAB and other conspirators were members of a hacking organization that participated in a coordinated multi-year campaign to conduct and attempt to conduct computer intrusions. These intrusions targeted more than a dozen U.S. companies and the U.S. Departments of the Treasury and State.
The hacking group’s private sector victims were primarily cleared defense contractors, which are companies that support U.S. Department of Defense programs. In addition, the group targeted a New York-based accounting firm and a New York-based hospitality company.
In conducting their hacking campaigns, the group used spearphishing — that is, tricking an email recipient into clicking on a malicious link — to infect victim computers with malware. In the course of their campaigns against one victim, the group compromised more than 200,000 employee accounts. At another victim, the conspirators targeted 2,000 employee accounts. In order to manage their spearphishing campaigns, the group created and used a particular computer application, which enabled the conspirators to organize and deploy their spearphishing attacks.
In the course of these spearphishing attacks, the conspirators compromised an administrator email account belonging to a defense contractor (“Defense Contractor-1”). Access to this administrator account empowered the conspirators to create unauthorized Defense Contractor-1 accounts, which the conspirators then used to send spearphishing campaigns to employees of a different defense contractor and a consulting firm.
In addition to spearphishing, the conspirators utilized social engineering, which involved impersonating others, generally women, in order to obtain the confidence of victims. These social engineering contacts were another means the conspiracy used to deploy malware onto victim computers and compromise those devices and accounts.
NASAB took part in these schemes. During his participation in the scheme, he was employed by Mahak Rayan Afraz, an Iran-based company that purported to provide cybersecurity services, but which was, in fact, a front for the conspirators’ operations. NASAB was responsible for procuring infrastructure used by the conspiracy. During the course of this conduct, NASAB used the stolen identity of a real person in order to register a server and email accounts used in the course of the cyber campaigns.
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NASAB, 39, of Iran, is charged with one count of conspiracy to commit computer fraud, which carries a maximum sentence of five years in prison; one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison; one count of wire fraud, which carries a maximum sentence of 20 years in prison; and one count of aggravated identity theft, which carries a mandatory consecutive term of two years in prison.
The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the assigned judge.
Concurrent with the unsealing of the Indictment, the Department of State’s Rewards for Justice Program is offering a reward of up to $10 million for information leading to the identification or location of NASAB. Anyone with information on NASAB and his malicious cyberactivity should contact Rewards for Justice via their Tor-based tips-reporting channel at: he5dybnt7sr6cm32xt77pazmtm65flqy6irivtflruqfc5ep7eiodiad.onion (the Tor browser is required).
Mr. Williams praised the outstanding investigative work of the FBI, including the work of the FBI Cyber Division.
The case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Ryan B. Finkel, Dina McLeod, and Daniel G. Nessim are in charge of the prosecution, with assistance from Trial Attorney Matthew Chang of the National Security Division’s Cyber Section.
The charges contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation.
U.S. Attorney Announces Capture of Fugitive Charged in Connection with Shooting of Five-Year-Old GirlRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York; Ralph Sozio, the U.S. Marshal for the Southern District of New York; and Edward A. Caban, the Commissioner of the New York City Police Department (“NYPD”), announced today the arrest of AUSTIN MORRISHOW, who was charged with possessing ammunition after conviction of a felony. MORRISHOW and a co-defendant, CURTIS WHITE, were congregated outside on a busy sidewalk in the Bronx the Friday before the July Fourth holiday weekend last year when they fired multiple shots at three cars in the Bronx, New York, hitting and seriously injuring a five-year-old child sitting in the backseat of one of the cars. MORRISHOW, who had been on the run since June 30, 2023, following the shooting, was arrested yesterday afternoon in the Bronx, New York. MORRISHOW’s and WHITE’s cases are assigned to District Judge Loretta A. Preska. MORRISHOW was presented and arraigned before U.S. Magistrate Judge Jennifer E. Willis today, and WHITE was previously arrested and arraigned before District Judge Paul A. Crotty.
U.S. Attorney Damian Williams said: “As alleged, Austin Morrishow recklessly fired multiple rounds of illegally possessed ammunition at innocent New Yorkers, striking and injuring a young child and endangering the lives of other bystanders. Instead of turning himself in, Morrishow fled for over seven months. Today’s arrest keeps our promise to work relentlessly with our law enforcement partners to track down and capture fugitives—whether it takes seven days, seven weeks, or seven months—and bring them to justice.”
U.S. Marshal Ralph Sozio said: “This was another successful takedown of an alleged dangerous fugitive, who was involved in the shooting of an innocent 5-year-old girl. I want to thank the Southern District of New York Warrant Squad, the NY/NJ Regional Fugitive Task Force and the NYPD for their relentless pursuit in apprehending him without incident. This is a true testament that we will be relentless in our pursuit to bring you to justice, making our city streets safe.”
NYPD Commissioner Edward A. Caban said: “This arrest is about intelligence-driven crime-fighting and, above all else, consequences. If you commit a violent felony in New York City, we will find you, we will arrest you, and we will build a case to prosecute you to the fullest extent of the law. I thank our unremitting NYPD detectives, and all the members of the U.S. Marshals Service Regional Fugitive Task Force, for taking another alleged criminal off our streets.”
As alleged in the Indictment and the Complaint:[1]
On June 30, 2023, MORRISHOW and WHITE were gathered outside at a makeshift memorial for an individual who had been shot and killed the day before. A tan sedan was parked nearby with a five-year-old girl in the backseat and her father in the front seat, waiting for two friends to arrive so that they could attend a car show. After the two friends arrived in a silver sedan and red minivan, the driver of the silver sedan pulled next to the tan sedan, revving his engine and causing it to backfire. The sound of the backfire caused MORRISHOW, WHITE, and others to scatter.
MORRISHOW took cover behind a parked vehicle and fired a .40 caliber pistol multiple times at the three cars, which began fleeing from the gunfire. A still image from surveillance video footage is below with MORRISHOW circled in red.
WHITE ran down the street after the fleeing cars, firing a .380 caliber pistol. A still image from surveillance video footage is below with WHITE circled in red.
After the victim’s father drove his daughter to safety a couple blocks away, he got out of his car to check on his daughter. Realizing that she had been shot in the back, he held her in his arms and yelled for somebody to call an ambulance. The driver of the silver car called 911. Minutes later, NYPD officers arrived and transported the victim to the hospital.
The NYPD subsequently recovered seven .40 caliber shell casings from the vicinity of the parked car near where MORRISHOW fired his gun, two .380 caliber shell casings from the street near where WHITE fired his gun, and a .380 caliber firearm from an apartment that WHITE was seen entering immediately after the shooting. MORRISHOW was not permitted to possess a firearm or ammunition because of his prior federal conviction for using and carrying a firearm during and in relation to a narcotics conspiracy, and WHITE was not permitted to possess a firearm or ammunition because of his prior state conviction for attempted first-degree assault with intent to cause serious injury with a weapon.
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MORRISHOW, 26, and WHITE, 26, both of the Bronx, New York, are each charged with one count of possession of ammunition after a felony conviction, which carries a maximum sentence of 15 years in prison.
The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.
Mr. Williams praised the outstanding work by the U.S. Marshals Service and the NYPD to apprehend MORRISHOW. Mr. Williams also thanked the Bureau of Alcohol, Tobacco, Firearms, and Explosives for their participation in the investigation.
The prosecution of this case is being handled by the Office’s General Crimes Unit. Assistant U.S. Attorney Jerry J. Fang is in charge of the prosecution.
The charges contained in the Complaint and Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Two Southeastern Colorado Farmers Sentenced to Federal Prison and Will Pay over $6.5 Million for Defrauding Federal Crop Insurance ProgramsRead the Press Release
DENVER—U.S. Attorney Cole Finegan announced today that Patrick Esch and Ed Dean Jagers of Springfield, Colorado, have agreed to pay over $6.5 million to resolve allegations that they defrauded federal crop insurance programs by tampering with and damaging rain gauges.
One way the United States Department of Agriculture supports farmers and ranchers is by providing federal funding for crop insurance programs that pay indemnities when there is less than the usual amount of precipitation. Mr. Esch and Mr. Jagers concocted a scheme to defraud these insurance programs by making it appear that there was less precipitation in their area than there actually was. To carry out that scheme, the members of the conspiracy, including Mr. Esch and Mr. Jagers, tampered with and damaged rain gauges in southeast Colorado between July 2016 and June 2017 to prevent those gauges from accurately measuring rainfall. Some of the rain gauges that were tampered with belonged to the National Oceanic and Atmospheric Administration and were operated by the National Weather Service.
The conspirators used various means and methods to tamper with the rain gauges. Mr. Esch covered gauges in southeastern Colorado with agricultural equipment and used other means as well, such as filling gauges with silicone to prevent them from collecting moisture, cutting wires on the gauges, or detaching and then tipping over the bucket that collected precipitation. Mr. Jagers typically used an agricultural disc blade to cover up a rain gauge in Lamar, Colorado. This tampering created false records making it appear that less rain had fallen than was the case.
The United States investigated Mr. Esch and Mr. Jagers using civil tools, including the False Claims Act, which imposes civil penalties for certain types of fraud on the federal government, and the Financial Institutions Reform, Recovery, and Enforcement Act, which imposes civil penalties for a variety of misconduct, including knowingly making any false statement or report for the purpose of influencing in any way the action of the Federal Crop Insurance Corporation. The United States alleges that this conduct violated both statutes. Mr. Esch and Mr. Jagers have agreed to pay a combined $3.5 million to settle these civil allegations.
The United States also indicted Mr. Esch and Mr. Jagers criminally for their roles in the conspiracy. Mr. Esch and Mr. Jagers both pled guilty and were sentenced to pay a combined $3.1 million in restitution. Mr. Esch was also sentenced to be imprisoned for a term of two months. Mr. Jagers was sentenced to be imprisoned for a term of six months. The criminal action is United States v. Esch, 23-cr-00259-CNS (D. Colo.).
“Hardworking farmers and ranchers depend on USDA crop insurance programs, and we will not allow these programs to be abused,” said U.S. Attorney Cole Finegan. “This case also shows the full measure of justice that can be achieved when our office uses both civil and criminal tools to protect vital government programs.”
“The OIG works steadfastly to uphold the integrity of Federal programs, and we’ll relentlessly investigate those who defraud the American taxpayers and the Federal Government,” said Special Agent-in-Charge Shawn Dionida with the U.S. Department of Agriculture, Office of Inspector General. “We thank the U.S. Attorney’s Office and our law enforcement partners for pursuing justice until the conspirators were held accountable for tampering with government equipment for the purpose of exploiting the Federal Crop Insurance Program to fraudulently receive funds they were not entitled to receive.”
“The Department of Commerce OIG is dedicated to working with the Department of Justice and our law enforcement partners to curb fraud, waste, and abuse. We continue to vigorously investigate those individuals who seek to compromise the integrity of National Weather Service equipment and data in an effort to defraud the Federal Government. We greatly appreciate the cooperation and effort of the United States Attorney’s Office and our law enforcement partners in ensuring justice is served in this matter,” said Jeffrey Lysaght, Special Agent in Charge, U.S. Department of Commerce, Office of Inspector General.”
“These defendants orchestrated a scheme to defraud the federal government. Holding them accountable would not have been possible without assistance from our partners at the U.S. Attorney’s Office for Colorado and the Offices of the Inspector General at U.S. Department of Agriculture and U.S. Department of Commerce,” said FBI Denver Special Agent in Charge Mark Michalek. “The FBI will continue to track down opportunists who try to cheat the system for personal benefit.”
The claims resolved in the civil settlements are allegations. In agreeing to settle, Mr. Esch and Mr. Jagers did not admit liability except to the extent admitted in their guilty pleas.
The civil settlements also resolve qui tam allegations against Mr. Esch and Mr. Jagers brought in federal court by private party. The qui tam or whistleblower provisions of the False Claims Act allow a private party known as a “relator” to file an action on behalf of the United States and receive a portion of the recovery. In this case, the relator has passed away, and the relator’s estate will receive approximately $500,000. The qui tam action is United States ex rel. Fox v. Esch, 20-cv-03744-MDB (D. Colo.).
The investigations into this crop insurance fraud scheme were a coordinated effort by the U.S. Attorney’s Office for the District of Colorado, the U.S. Department of Agriculture, Office of Inspector General, the U.S. Department of Commerce, Office of Inspector General, and the FBI. The criminal matter was handled by Assistant United States Attorney Bryan Fields. The civil matter was handled by Assistant United States Attorney Jasand Mock.
Two Men Plead Guilty to Drug Trafficking ConspiracyRead the Press Release
BOSTON – Two men pleaded guilty yesterday in federal court in Boston to participating in a North Shore-based drug trafficking organization (DTO) that allegedly distributed tens of thousands of counterfeit prescription pills containing fentanyl and methamphetamine.
Isaac Clayton, 77, and Christopher Tejeda, 22, both of Lynn, pleaded guilty to one count each of conspiring to distribute and to possess with intent to distribute controlled substances. U.S. District Court Chief Judge F. Dennis Saylor IV scheduled sentencings for May 28, 2024 and July 9, 2024, respectively.
According to court documents, the DTO distributed counterfeit oxycodone pills containing fentanyl and counterfeit Adderall pills containing methamphetamine, among other things, to various individuals in the Lynn area.
As part of the conspiracy, Clayton stored various controlled substances including marijuana, cocaine, cocaine base (crack cocaine) and counterfeit oxycodone pills containing fentanyl at his apartment on behalf of the DTO. A search of his apartment in October 2022 resulted in seizure of various quantities of marijuana, cocaine base and fentanyl, as well as three loaded firearms, additional rounds of ammunition, $2,640 in drug proceeds and materials used to package and distribute controlled substances.
Additionally, on behalf of the DTO, Tejada picked up, transported and delivered controlled substances to various individuals as well as collected and delivered proceeds from drug sales.
Acting United States Attorney Joshua S. Levy; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Division; and John E. Mawn Jr., Interim Colonel of the Massachusetts State Police made the announcement today. Valuable assistance was provided by the Beverly, Everett, Peabody, Revere, Salem, Saugus and Swampscott Police Departments. Assistant U.S. Attorneys James E. Arnold and Evan D. Panich of the Narcotics & Money Laundering Unit are prosecuting the case.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
The details contained in the indictment are allegations. The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Two Men Accused of Fatal St. Louis RobberyRead the Press Release
ST. LOUIS – Two men are facing federal drug charges after a fatal shooting in St. Louis in January.
Derrick Darnell Clark, 19, and Jeremiah Martez Sutton, 22, were each indicted Wednesday on one count of conspiracy to possess with the intent to distribute controlled substances and one count of aiding and abetting the discharge of a firearm in furtherance of a drug trafficking crime. The indictment alleges that the shooting occurred on Jan. 28, 2024, during the drug conspiracy.
Both men were originally charged by complaint in U.S. District Court in St. Louis February 9. Charging documents accuse the men of fatally shooting one person and seriously wounding another during a robbery in an apartment in the 900 block of Goodfellow Boulevard in St. Louis.
Clark was arrested February 22. Sutton is still being sought by authorities.
The drug conspiracy charge carries a possible penalty of up to 20 years in prison, a $1 million fine or both. The aiding and abetting the discharge of a firearm in furtherance of a drug trafficking crime carries a penalty of at least 10 years and up to life in prison, a $250,000 fine or both.
Charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
The St. Louis Metropolitan Police Department and the FBI investigated the case.
Toledo man sentenced to decade in prison for armed robbery in Columbus, during which he shot a victimRead the Press Release
COLUMBUS, Ohio – Juarvez Reemos Juan Whitfield-Neeley, 25, of Toledo, was sentenced in U.S. District Court today to 121 months in prison for armed robbery.
According to court documents, in March 2020, Whitfield-Neeley shot three people during two separate robberies.
“For the sake of a few dollars, Whitfield-Neeley forever altered the life of at least three victims through gun violence,” said U.S. Attorney Kenneth L. Parker. “The resulting federal cases against him should send a clear message to Whitfield-Neeley and others that it is not worth it, and you will ultimately pay by serving time in federal prison.”
While robbing the Berkeley & Main Market in Columbus on March 15, 2020, he shot the store clerk in the back of the knee. A brief struggle ensued, and a gun in the clerk’s pocket fell to the floor. Whitfield-Neeley stole the clerk’s gun and fled.
Two weeks later, in Toledo, Whitfield-Neeley used the gun he had stolen from Columbus and fired several shots at two clerks in a corner store in Toledo. He shot both clerks in the torso, stole a gun from one of the injured clerks and took the cash from the register.
In June 2020, Whitfield-Neeley was charged in the Southern District of Ohio for the Columbus robbery and shooting. He was later taken into custody in the Northern District of Ohio, where he pleaded guilty to crimes associated with the Toledo robbery and was sentenced there to 207 months in prison. The defendant will serve his sentence for the Southern District of Ohio consecutively to the sentence he is already serving.
Kenneth L. Parker, United States Attorney for the Southern District of Ohio; Daryl S. McCormick, Special Agent in Charge, U.S. Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF); and Columbus Police Chief Elaine Bryant announced the sentence imposed by U.S. District Court Judge Edmund A. Sargus, Jr. Assistant United States Attorneys David J. Twombly and Elizabeth A. Geraghty are representing the United States in this case.
Superseding Indictment Charges Hartford Man with Drug Trafficking, Gun Possession OffensesRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, today announced that a federal grand jury in New Haven has returned a superseding indictment charging LUIS DeJESUS, 29, of Hartford, with narcotics distribution and firearm possession offenses.
As alleged in court documents and statements made in court, DeJesus’s criminal history includes felony convictions in state court for criminal possession of a firearm and burglary in the third degree. In 2022, members of the Connecticut State Police’s Statewide Narcotics Task Force – North Central Office conducted a series of controlled purchases of narcotics from DeJesus. DeJesus was arrested on state charges on December 16, 2022. On that date, a court-authorized search of his Hartford residence revealed approximately 500 grams of fentanyl, 97 grams of crack cocaine, approximately one kilogram of marijuana, drug processing and packaging materials, a loaded Glock 45 9mm handgun, and approximately $52,000 cash. The case was adopted for federal prosecution and, on March 7, 2023, a grand jury returned an indictment charging DeJesus with one count of possession with intent to distribute 400 grams or more of fentanyl and a quantity of cocaine, and one count of unlawful possession of a firearm by a felon.
It is further alleged that, after his federal arrest, DeJesus was released on a $100,000 bond and into home confinement at residence of a family member on Warren Street in Hartford. DeJesus was arrested on November 20, 2023, after law enforcement executed a search warrant at the residence. As investigators entered the residence, DeJesus threw fentanyl out of a window. A search of the residence revealed an additional quantity of fentanyl, a small quantity of cocaine, and drug processing and packaging materials. In total, DeJesus is alleged to have possessed more than 400 grams of fentanyl on that date.
On February 20, 2024, the grand jury returned a superseding indictment charging DeJesus with an additional count of possession with intent to distribute 400 grams or more of fentanyl.
If convicted, DeJesus faces a mandatory minimum term of imprisonment of 10 years and a maximum term of imprisonment of life for each of the narcotics offenses, and maximum term of imprisonment of 15 years for the firearm offense.
DeJesus, who has been detained since November 20, 2023, appeared today in Hartford federal court and pleaded not guilty to the charges in the superseding indictment.
U.S. Attorney Avery stressed that an indictment is not evidence of guilt. Charges are only allegations, and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the Drug Enforcement Administration’s Hartford Resident Office and the Connecticut State Police’s Statewide Narcotics Task Force – North Central Office. The case is being prosecuted by Assistant U.S. Attorney Reed Durham.
Sacramento Man Sentenced to 12 Years for Methamphetamine TraffickingRead the Press Release
SACRAMENTO, Calif. — Roberto Daniel Gomez Gonzalez, 27, of Sacramento, was sentenced today to 12 years in prison for possession with intent to distribute at least 500 grams of methamphetamine, U.S. Attorney Phillip A. Talbert announced.
According to court documents, on March 30, 2020, law enforcement agents searched Gomez Gonzalez’s residence and seized more than 3 kilograms of 95% pure methamphetamine, 1,000 fentanyl pills, 228 grams of heroin, a loaded firearm, and over $8,000 in cash.
This case is the product of an investigation by the Drug Enforcement Administration, the Federal Bureau of Investigation, Homeland Security Investigations, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorneys Cameron L. Desmond and Alexis Klein prosecuted the case.
This prosecution is part of the Organized Crime Drug Enforcement Task Forces (OCDETF) Strike Force Initiative, which provides for the establishment of permanent multi-agency task force teams that work side-by-side in the same location. The Sacramento Strike Force is a co-located model enables agents from different agencies to collaborate on intelligence-driven, multi-jurisdictional operations to disrupt and dismantle the most significant drug traffickers, money launderers, gangs, and transnational criminal organizations. The specific mission of the Sacramento Strike Force is to identify, investigate, disrupt, and dismantle the most significant drug trafficking organizations (DTOs) and transnational criminal organizations (TCOs) shipping narcotics, firearms, and money through the Eastern District of California, thereby reducing the flow of these criminal resources in California and the rest of the United States. The Sacramento Strike Force leads intelligence-driven investigations targeting the leadership and support elements of these DTOs and TCOs operating within the Eastern District of California, regardless of their geographic base of operations.
Sacramento Man Indicted for Being a Felon in Possession of a GunRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned indictment today against John Damian, 30, of Sacramento, charging him with being a felon in possession of a firearm, U.S. Attorney Phillip A. Talbert announced.
According to court documents, on Nov. 8, 2023, Damian was detained by law enforcement during execution of a search warrant. During the search, detectives located a loaded Glock 27 .40‑caliber semi-automatic firearm in his sweatshirt pocket. Damian is prohibited from possessing a firearm due to prior felony convictions for assault with force likely to produce great bodily injury, being a felon in possession of a firearm, assault with a semi-automatic firearm, and negligent discharge of a firearm.
This case is the product of an investigation by the Sacramento Police Department and the Federal Bureau of Investigation’s Safe Streets Task Force. Special Assistant U.S. Attorney Matthew De Moura is prosecuting the case.
If convicted, Damian faces a maximum statutory penalty of 15 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the U.S. Department of Justice launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results. For more information about Project Safe Neighborhoods, please visit Justice.gov/PSN.
Russian International Money Launderer Pleads Guilty to Illicitly Procuring Large Quantities of U.S.-Manufactured Dual-Use, Military Grade Microelectronics for Russian EntitiesRead the Press Release
Maxim Marchenko, 51, a Russian citizen who has resided in Hong Kong, pleaded guilty today to charges of money laundering and smuggling goods from the United States. Marchenko was arrested in September 2023.
According to court documents, Marchenko operated several Hong Kong-based shell companies, including Alice Components Co. Ltd. (Alice Components), Neway Technologies Limited (Neway) and RG Solutions Limited (RG Solutions). Marchenko and two co-conspirators (CC-1 and CC-2), who are also Russian nationals, operate an illicit procurement network in Russia, Hong Kong, and elsewhere overseas. This procurement network has fraudulently obtained from U.S. distributors large quantities of dual-use, military grade microelectronics, specifically OLED micro-displays, on behalf of Russia-based end users. To carry out this scheme, Marchenko, CC-1, and CC-2 used shell companies based in Hong Kong and other deceptive means to conceal from U.S. Government agencies and U.S. distributors that the OLED micro-displays were destined for Russia. The technology that Marchenko and his co-conspirators fraudulently procured have significant military applications, such as in rifle scopes, night-vision googles, thermal optics and other weapon systems.
“By his own admission, Mr. Marchenko conspired to smuggle military-grade technology to Russia, using a complex network of front companies to hide his illicit activity,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “Today, once again, the Justice Department is holding accountable those who would enable the Kremlin and its unjust war of aggression against Ukraine.”
“Today, Maxim Marchenko admitted in court that he illicitly sought to procure U.S.-manufactured, military grade microelectronics to deliver to end users in Russia,” said U.S. Attorney Damian Williams for the Southern District of New York. “Marchenko concealed his scheme to funnel these microelectronics – which had application for use in rifle scopes, night-vision goggles, thermal optics and other weapons systems – by using shell companies and other elaborate money laundering techniques. Today’s guilty plea should send a strong message to those who attempt to break the law by supplying Russia with U.S. military technology that this office will vigorously pursue such smuggling schemes and hold those involved to full account.”
“Today’s guilty plea demonstrates the FBI’s relentless pursuit of justice as we put yet another individual who tried to illegally transport military-grade U.S. technology to Russia behind bars,” said Executive Assistant Director of the FBI's National Security Branch Larissa L. Knapp. “We will continue to collaborate with our partners to protect our national security and prevent the smuggling of such goods which could benefit authoritarian adversaries.”
“The Russian military relies on illicit procurement networks, including the one Marchenko operated here, to perpetrate their brutal war against the Ukrainian people,” said Matthew Axelrod, Assistant Secretary of Commerce for Export Enforcement. “We will continue to leverage all of our authorities to combat the transshipment of U.S. parts through third countries, like the People’s Republic of China, to the Russian military.”
To perpetrate the scheme, Marchenko and other members of the conspiracy acquired the dual-use OLED micro-displays from U.S.-based distributors using Marchenko’s Hong Kong-based shell companies, including Alice Components, Neway and RG Solutions. Members of the conspiracy, including Marchenko, procured these sensitive microelectronics by falsely representing to the U.S. distributors (who, in turn, are required to report to U.S. agencies) that Alice Components was sending the shipments to end users located in China, Hong Kong and other countries outside of Russia for use in electron microscopes for medical research. In reality, the OLED micro-displays were destined for end users in Russia. Marchenko and other members of the conspiracy concealed the true final destination (Russia) from U.S. distributors for the purpose of causing false statements to the U.S. agencies.
To conceal the fact that these OLED micro-displays were destined for Russia, Marchenko and other members of the conspiracy worked together to transship the illicitly procured OLED micro-displays by using pass-through entities principally operated by Marchenko in third countries, such as Hong Kong. Marchenko then caused the OLED micro-displays to be shipped to the ultimate destination in Russia using, among other entities, a freight forwarder known to provide freight forwarding services to Russia. In addition, Marchenko and other members of the conspiracy used Hong Kong-based shell companies, principally operated by Marchenko, to conceal the fact that payments for the OLED micro-displays were coming from Russia. In total, between in or about May 2022 and in or about August 2023, Marchenko’s shell companies funneled a total of more than $1.6 million to the United States in support of the procurement network’s efforts to smuggle the OLED micro-displays to Russia.
Marchenko pleaded guilty to one count of money laundering, which carries a maximum penalty of 20 years in prison, and one count of smuggling goods from the United States which carries a maximum penalty of up to 10 years in prison. He is scheduled to be sentenced on May 29 in Manhattan. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The FBI and Commerce Department’s Bureau of Industry and Security are investigating the case.
Assistant U.S. Attorneys Jennifer N. Ong and Shiva H. Logarajah for the Southern District of New York are in charge of the prosecution, with assistance from Trial Attorney Garrett Coyle of the Counterintelligence and Export Control Section.
Today’s actions were coordinated through the Justice Department’s Task Force KleptoCapture and the Justice and Commerce Departments’ Disruptive Technology Strike Force. Task Force KleptoCapture is an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export restrictions and economic countermeasures that the United States has imposed, along with its allies and partners, in response to Russia’s unprovoked military invasion of Ukraine. The Disruptive Technology Strike Force is an interagency law enforcement strike force co-led by the Departments of Justice and Commerce designed to target illicit actors, protect supply chains, and prevent critical technology from being acquired by authoritarian regimes and hostile nation states.
Russian International Money Launderer Pleads Guilty to Illicitly Procuring Large Quantities of U.S.-Manufactured Dual-Use, Military Grade Microelectronics for Russian EntitiesRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Matthew G. Olsen, the Assistant Attorney General of the Justice Department’s National Security Division, announced today that MAXIM MARCHENKO pled guilty to charges of money laundering and smuggling goods from the U.S. MARCHENKO was arrested in September 2023 and pled guilty earlier today before U.S. Magistrate Judge Victoria Reznik.
U.S. Attorney Damian Williams said: “Today, Maxim Marchenko admitted in court that he illicitly sought to procure U.S.-manufactured, military grade microelectronics to deliver to end users in Russia. Marchenko concealed his scheme to funnel these microelectronics – which had application for use in rifle scopes, night-vision goggles, thermal optics, and other weapons systems – by using shell companies and other elaborate money laundering techniques. Today’s guilty plea should send a strong message to those who attempt to break the law by supplying Russia with U.S. military technology that this Office will vigorously pursue such smuggling schemes and hold those involved to full account.”
Assistant Attorney General Matthew G. Olsen said: “By his own admission, Mr. Marchenko conspired to smuggle military-grade technology to Russia, using a complex network of front companies to hide his illicit activity. Today, once again, the Justice Department is holding accountable those who would enable the Kremlin and its unjust war of aggression against Ukraine.”
According to the allegations contained in the Information, the allegations in the Complaint, and other filings and statements made in public court proceedings:
At all relevant times, MARCHENKO was a Russian national who resided in Hong Kong and operated several Hong Kong-based shell companies. MARCHENKO and two co-conspirators (“CC-1” and “CC-2”), who are also Russian nationals, operated an illicit procurement network in Russia, Hong Kong, and elsewhere overseas. This procurement network fraudulently obtained from U.S. distributors large quantities of dual-use, military grade microelectronics, specifically OLED micro-displays, on behalf of Russia-based end users. To carry out this scheme, MARCHENKO, CC-1, and CC-2 used shell companies based in Hong Kong and other deceptive means to conceal from U.S. government agencies and U.S. distributors that the OLED micro-displays were destined for Russia. The technology that MARCHENKO and his co-conspirators fraudulently procured had significant military applications, such as in rifle scopes, night-vision googles, thermal optics, and other weapon systems.
To perpetrate the scheme, MARCHENKO and other members of the conspiracy acquired the dual-use OLED micro-displays from U.S.-based distributors using MARCHENKO’s Hong Kong-based shell companies. Members of the conspiracy, including MARCHENKO, procured these sensitive microelectronics by falsely representing to the U.S. distributors (who, in turn, are required to report to U.S. agencies) that the Hong Kong shell entity was sending the shipments to end users located in China, Hong Kong, and other countries outside of Russia for use in electron microscopes for medical research. In reality, the OLED micro-displays were destined for end users in Russia. MARCHENKO and other members of the conspiracy concealed the true destination (Russia) from U.S. distributors for the purpose of causing false statements to the U.S. agencies.
To conceal the fact that these OLED micro-displays were destined for Russia, MARCHENKO and other members of the conspiracy worked together to transship the illicitly procured OLED micro-displays by using pass-through entities principally operated by MARCHENKO in third countries, such as Hong Kong. MARCHENKO then caused the OLED micro-displays to be shipped to the ultimate destination in Russia using, among other entities, a freight forwarder known to provide freight forwarding services to Russia. In addition, MARCHENKO and other members of the conspiracy used Hong Kong-based shell companies, principally operated by MARCHENKO, to conceal the fact that payments for the OLED micro-displays were coming from Russia.
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MARCHENKO, 51, a Russian citizen who resided in Hong Kong, pled guilty to one count of money laundering, which carries a maximum sentence of 20 years in prison, and one count of smuggling goods from the U.S., which carries a maximum sentence of 10 years in prison. MARCHENKO is scheduled to be sentenced on June 6, 2024, before the Honorable Nelson S. Román.
The maximum potential sentences in this case are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.
Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation (“FBI”) and its New York Field Office, Counterintelligence Division and the New York Field Office of the Bureau of Industry and Security of the Department of Commerce. Mr. Williams also thanked the FBI’s Legal Attaché office in Australia; the U.S. Department of State’s Diplomatic Security Service; the Department of Justice’s National Security Division, Counterintelligence and Export Control Section; and the Office of International Affairs of the Department of Justice’s Criminal Division for their assistance.
This case is being handled by the Office’s Illicit Finance & Money Laundering Unit and White Plains Division. Assistant U.S. Attorneys Jennifer N. Ong and Shiva H. Logarajah are in charge of the prosecution, with assistance from Trial Attorney Garrett Coyle of the National Security Division’s Counterintelligence and Export Control Section.
This case was coordinated through the Justice Department’s Task Force KleptoCapture, an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export controls and economic countermeasures that the U.S., along with its foreign allies and partners, has imposed in response to Russia’s unprovoked military invasion of Ukraine. Announced by the Attorney General on March 2, 2022, and under the leadership of the Office of the Deputy Attorney General, the task force will continue to leverage all of the department’s tools and authorities to combat efforts to evade or undermine the collective actions taken by the U.S. government in response to Russian military aggression.
Rockford Man Sentenced to Nine Years in Federal Prison for Trafficking Fentanyl and Illegally Possessing a FirearmRead the Press Release
ROCKFORD — A Rockford man has been sentenced to nine years in federal prison for trafficking fentanyl and crack cocaine and illegally possessing a firearm.
DERRICK A. MAYES JR., 32, pleaded guilty last year to knowingly and intentionally possessing more than 260 grams of fentanyl and nearly 97 grams of crack cocaine, and unlawfully possessing the firearm. U.S. District Judge Iain D. Johnston on Wednesday sentenced Mayes to 108 months in federal prison.
Mayes admitted in a plea agreement that he illegally possessed the drugs and firearm on April 29, 2021, in his apartment and vehicle. The firearm was a loaded Smith & Wesson MP9 Shield handgun. Mayes had previously been convicted of a felony and was prohibited from possessing the gun. Mayes further admitted that in 2020 and 2021 he sold distribution quantities of fentanyl and crack cocaine to confidential informants.
The sentence was announced by Morris Pasqual, Acting United States Attorney for the Northern District of Illinois, and Sheila G. Lyons, Special Agent-in-Charge of the Chicago Field Division of the U.S. Drug Enforcement Administration. The Winnebago County Sheriff’s Office assisted in the investigation. The government was represented by Assistant U.S. Attorney Robert S. Ladd.
Holding illegal firearm possessors accountable through federal prosecution is a centerpiece of Project Safe Neighborhoods (PSN) – the Department of Justice’s violent crime reduction strategy. In the Northern District of Illinois, the U.S. Attorney’s Office and law enforcement partners have deployed the PSN program to attack a broad range of violent crime issues facing the district, particularly firearm offenses.
Red Lake Man Sentenced to 83 Months in Prison for Sexual Abuse of a MinorRead the Press Release
MINNEAPOLIS – A Red Lake man has been sentenced to 83 months in prison followed by seven years of supervised release for sexually abusing a minor on the Red Lake Indian Reservation, announced U.S. Attorney Andrew M. Luger.
According to court documents, on August 27, 2022, Ronald Royce Pearson, 63, was visiting a residence on the Red Lake Indian Reservation. While there, Pearson engaged in a sexual act with a minor.
On September 6, 2023, Pearson pleaded guilty in U.S. District Court to one count of sexual abuse of a minor. He was sentenced yesterday by Judge Nancy E. Brasel.
This case is the result of an investigation conducted by the FBI, the Red Lake Police Department, and the U.S. Customs and Border Protection.
Assistant U.S. Attorney Lindsey E. Middlecamp prosecuted the case.
Recidivist Drug Trafficker Sentenced to 175 Months in Prison for Causing Overdose Death of 26-Year-Old VictimRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Edward A. Caban, the Commissioner of the New York City Police Department (“NYPD”), announced that ROY ESCOBAR was sentenced today to 175 months in prison by U.S. District Judge Andrew L. Carter Jr. for his years of fentanyl trafficking, which caused the overdose death of a 26-year-old man (the “Victim”) in Brooklyn, New York. ESCOBAR, who previously pled guilty to one count of conspiracy to distribute narcotics, operated his drug trafficking business alongside his two adult sons, Pablo Escobar and Roy Escobar Jr., who have also pled guilty and are awaiting sentencing.
U.S. Attorney Damian Williams said: “Roy Escobar’s actions have left a path of ruin in their wake. He contributed to the flood of fentanyl plaguing our communities, causing the death of a young man with a bright future ahead of him. He did all of this despite repeated prior drug trafficking charges and convictions, and he involved his own sons in this criminal activity. Escobar’s sentence is an important step toward bringing justice to his victims, and it reaffirms our unwavering commitment to combating this ongoing fentanyl crisis by holding drug traffickers like Escobar accountable.”
NYPD Commissioner Edward A. Caban said: “This meaningful prison sentence assures New Yorkers that the NYPD and our law enforcement partners refuse to tolerate the illegal distribution of these poisons in our neighborhoods. I commend our courageous undercover officer in this case, and I thank our colleagues at the Office of the U.S. Attorney for the Southern District of New York, for continuing to be highly effective partners in our public safety mission.”
According to the sentencing papers and the Court’s determinations at the sentencing hearing:
On May 13, 2022, ROY ESCOBAR texted with the Victim to arrange a sale of what the Victim understood to be heroin. The Victim confided to ESCOBAR that he was “scared about the fent,” i.e., fentanyl, but ESCOBAR reassured the Victim that he understood the concern, and that he had heroin for sale. At approximately 10:30 p.m. that night, ESCOBAR arrived outside the Victim’s apartment and sold the Victim the drugs. Three days later, the Victim was found dead in his apartment, having overdosed the day prior on the drugs sold to him by ESCOBAR. Unbeknownst to the Victim, the drugs that he purchased from ESCOBAR in fact contained no heroin, but rather fentanyl and fentanyl analogue — far more potent, and deadly, substances — and the Victim died as a result of having consumed them.
Following the Victim’s death, officers with the NYPD recovered the Victim’s phone and discovered his communications with ESCOBAR. An undercover NYPD officer (the “UC”) subsequently contacted ESCOBAR and began discussions concerning the purchase of narcotics.
ESCOBAR sold fentanyl to the UC eight times over the next several months. Each time, the UC requested heroin and was led to believe that he was buying heroin, but the drugs that ESCOBAR sold in fact contained fentanyl and fentanyl analogue — the same fatal drugs that ESCOBAR sold to the Victim.
Although ESCOBAR was the primary point of contact for the UC, ESCOBAR also involved his young adult sons, co-defendants Pablo Escobar and Roy Escobar Jr., in the narcotics trafficking. ESCOBAR explained to the UC that if ESCOBAR was ever unavailable, Pablo Escobar would be available to sell narcotics to the UC on ESCOBAR’s behalf. And, on two separate occasions, ESCOBAR sent Roy Escobar Jr. to deliver the drugs to the UC in ESCOBAR’s place.
On October 18, 2022, ESCOBAR and his sons were arrested in connection with this investigation. Later that day, NYPD officers conducted searches of ESCOBAR’s residence in East Rockaway, New York, and a nearby storage unit rented in Roy Escobar Jr.’s name. During their searches, the officers recovered approximately 4.5 kilograms of cocaine, 198 grams of fentanyl analogue, five grams of crack cocaine, 163 grams of methamphetamine, and drug trafficking paraphernalia, including drug packaging materials that matched packaging recovered from the Victim’s apartment, near the Victim’s body.
The investigation further revealed that ESCOBAR had been significantly involved in this pattern of narcotics trafficking since at least as early as April 2018. Specifically, the evidence showed that beginning in April 2018, a Venmo account used by ESCOBAR for drug sales received more than 2,000 separate payments, with an average transaction amount of $168.74 and a total amount of $347,772.25.
ESCOBAR engaged in much of this conduct, including the sale of fatal drugs to the Victim, while he was already facing pending drug charges in New York state court. ESCOBAR had also previously been convicted for narcotics offenses in 2015 and 2002.
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In addition to the prison term, ESCOBAR, 46, a Bolivian national residing in East Rockaway, New York, was sentenced to five years of supervised release, ordered to forfeit $55,803, and ordered to pay a $100 mandatory special assessment.
Mr. Williams praised the outstanding investigative work of the NYPD, as well as the Special Agents and Task Force Officers from the U.S. Attorney’s Office for the Southern District of New York involved in this investigation.
This case is being handled by the Office’s Narcotics Unit. Assistant U.S. Attorneys Jonathan L. Bodansky and Andrew Jones are in charge of the prosecution.
Port Charlotte Man Pleads Guilty to Wire Fraud Related to NASA’s Space Launch SystemRead the Press Release
Orlando, FL – United States Attorney Roger B. Handberg announces that Steven Lukens (54, Port Charlotte) has pleaded guilty to wire fraud. Lukens faces a maximum penalty of 20 years in federal prison and has agreed to forfeit $271,024.35, which are traceable to proceeds of the offense. The sentencing hearing is scheduled for May 22, 2024.
According to the plea agreement, Lukens was the Chief Executive Officer of Gulf Atlantic International Supply, LLC (Gulf Atlantic). Gulf Atlantic entered into a sub-contract with Company-1 to procure materials needed for NASA’s space launch system at the Kennedy Space Center. However, Lukens submitted products that did not meet the quality standards and specifications required under the contract. Lukens then fraudulently led Company-1 to believe that the products met the required standards by submitting forged quality control documentation.
In total, Lukens submitted at least 191 fraudulent quality control documents to Company-1. These included fraudulent Certificates of Compliance, fraudulent Pressure Testing Certificates, and fraudulent test reports. Lukens’s materially false, fraudulent, and misleading representations caused Company-1 to pay Gulf Atlantic at least $271,024.35 for the parts it submitted.
This case was investigated by the NASA Office of Inspector General. It is being prosecuted by Special Assistant United States Attorney Rachel Lyons, with assistance from Assistant United States Attorney Shannon Laurie.
Poplar Bluff Man Sentenced to Serve 10 Years in Federal Prison on Drug and Firearm ChargesRead the Press Release
CAPE GIRARDEAU – A Poplar Bluff, Missouri man on Wednesday was sentenced to serve 10 years in federal prison after pleading guilty to drug-trafficking and firearm related charges.
Samuel D. Moore, 27, appeared for his sentencing hearing before U.S. District Judge Stephen N. Limbaugh, Jr. at the federal courthouse in Cape Girardeau.
According to court documents, law enforcement officers were dispatched to Moore’s residence in Poplar Bluff last July in response to a reported domestic assault. Officers obtained a search warrant for the premises after observing multiple firearms and drug paraphernalia items inside the residence. Large quantities of various controlled substances were subsequently discovered inside Moore’s Chevy Tahoe, including a box containing 30 pounds of marijuana divided into one-pound bags. Inside that same box, officers found a 9mm semi-automatic pistol with an attached 50-round high-capacity drum magazine. At his guilty plea hearing last November, Moore admitted that he intended to sell the marijuana for profit and that he possessed the firearm in furtherance of his drug-trafficking activities.
After serving the 10-year sentence, Moore will be placed on supervised release for three years.
Felony state charges for domestic assault remain pending in the Circuit Court of Butler County, Missouri. As in all criminal cases, Moore is presumed to be innocent unless and until proven guilty.
This case was investigated by the Butler County Sheriff’s Department. Assistant U.S. Attorney Jack Koester prosecuted the case.
Pennsylvania Man Pleads Guilty to Maintaining Fictitious "SuperPac," and Credit Card FraudRead the Press Release
WASHINGTON – Christopher Richardson, 37, of Langhorne, Pennsylvania, pleaded guilty today to falsifying a report filed with the Federal Election Commission (FEC) and credit card fraud, both felony offenses, announced U.S. Attorney Matthew M. Graves, Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division, Assistant Director in Charge David Sundberg of the FBI Washington Field Office, and Special Agent in Charge Scott Moffit of the Treasury Inspector General for Tax Administration (TIGTA) – Cybercrime Investigations Division.
According to court documents, in March of 2020, Richardson created an independent expenditure-only political action committee, or “SuperPAC,” named Americans for Progressive Action USA (AFPA) using fictitious names for AFPA’s treasurer and designated agent. Richardson then filed a falsified quarterly report with the FEC claiming that AFPA had raised $4.8 million. Several weeks later, he filed a report of expenditures that falsely claimed that the SuperPAC spent over $1.5 million to purchase advertisements and media production opposing certain candidates for the United States Senate. AFPA’s quick fundraising and spending attracted media scrutiny, questioning the veracity of the FEC reports. Richardson then filed another FEC report that falsely stated that AFPA has refunded the non-existent $4.8 million in donations. For his knowing falsification of the FEC report claiming to make $1.5 million in expenditures, Richardson pleaded guilty to making a false entry in a record. He, separately, pleaded guilty to credit card fraud for the falsification of a credit card application using a stolen social security number.
U.S. District Court Judge Trevor N. McFadden scheduled sentencing for June 13, 2024. Richardson faces a maximum penalty of 20 years in prison on the false entry count and a maximum penalty of 10 years in prison on the credit card fraud count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
This case was investigated by the FBI’s Washington Field Office and the TIGTA Cybercrime Investigations Division. It is being prosecuted by Assistant U.S. Attorney Joshua Gold of the U.S. Attorney’s Office for the District of Columbia and Trial Attorney Ryan R. Crosswell of the Criminal Division’s Public Integrity Section with assistance from Assistant U.S. Attorney Ahmed Baset of the U.S. Attorney’s Office for the District of Columbia.
Pennsylvania Man Pleads Guilty to Bribing a Federal Official and Defrauding the Federal Aviation Administration in Moses Lake, WashingtonRead the Press Release
Spokane, Washington – Yesterday, Vanessa R. Waldref, the United States Attorney for the Eastern District of Washington, announced that Christopher Hamilton Clemens, age 42, currently of Harrisburg, Pennsylvania, and formerly of Clarkston, Washington, pleaded guilty to Conspiracy to Defraud the United States in connection with bribing a federal contracting official with the Department of Interior’s Bureau of Indian Affairs (“BIA”) and fraudulently obtaining a contract with the Federal Aviation Administration (“FAA”) in Moses Lake, Washington.
According to the plea agreement, Calandra Charging Eagle was a contracting official at the BIA, in its Albuquerque, New Mexico office. BIA is a federal agency that, among other things, provides funding and oversight for improvement projects on American Indian land and facilities. One of Defendant Clemens’ companies, Hamilton’s West, was a government contracting company owned and operated by Clemens, which competed and sought to compete for BIA and other federal government contracts.
According to court documents, through her position as a contracting official at BIA, Charging Eagle had access to internal and confidential BIA estimates and other information regarding potential contracts, and had a role in approving contracts, modifications, and invoices. In 2018, between June and October, according to the plea agreement, Clemens and Charging Eagle engaged in a bribery scheme in which Clemens agreed to pay a $10,700 debt owed by Charging Eagle to the Sandia Resort and Casino, a resort, casino, and event center located in Albuquerque. In return, according to court documents, Charging Eagle agreed to use her position to steer BIA contracts, including an over half-million dollar contract to provide lightning protection improvements at the Navajo Nation’s Pine Hill School in New Mexico, to Clemens and his companies. According to court documents, Charging Eagle provided Clemens and his companies with inside confidential information regarding BIA’s procurement process, including, but not limited to, providing Clemens and his companies with confidential and internal BIA information in order to provide Clemens and his companies with an unfair competitive advantage in obtaining the Pine Hill School lightning protection contract and other BIA contracts.
On October 21, 2020, a grand jury returned an indictment charging Clemens and Charging Eagle with Conspiracy to Defraud the United States and felony counts of paying and accepting a bribe, respectively. On December 9, 2021, Charging Eagle pleaded guilty to one count of violating 18 U.S.C. Sec. 201(b)(2), Public Official Accepting a Bribe, as a result of her role in the scheme and conspiracy with Clemens, and on March 17, 2022, Charging Eagle was sentenced to two-years of probation. United States v. Charging Eagle, Case No. 2:20-CR-00142-TOR.
Prior to Charging Eagle pleading guilty to bribery, Clemens entered into a pre-trial diversion agreement with regard to the bribery scheme where he agreed to, and was ordered by the Court to, among other things, not commit any more crimes and to not engage in any federal contracting or subcontracting for a period of five years. According, to court documents, in January 2022, approximately two months after being ordered to not engage in federal contracting, Clemens falsely certified, through a new company, that he was not prohibited from engaging in federal contracting.
Based on Clemens’ false and fraudulent certification, according to the plea agreement, in August of 2022 Clemens went on, through the new company, to fraudulently obtain a design-build contract in Moses Lake, Washington, with the Federal Aviation Administration (FAA). According to Clemens’ plea, between August of 2022 and October of 2023, while Clemens held himself out as the vice president of the new company, the FAA paid $479,818 to the new company under the design-build contract that it would not have paid had it known that Clemens had falsely and fraudulently represented that he was eligible to engage in federal contracting. Clemens admitted in his plea agreement that he conspired with others to perpetrate the fraud on the FAA as part of his overall conspiring to defraud the United States including his earlier bribe to Charging Eagle to get BIA contracts.
“Bribing a federal official is a serious violation that undermines the basic fairness that we all expect and deserve from our government,” said United States Attorney Waldref. “Similarly, ignoring a court order and continuing to fraudulently engage in federal contracting cannot and will not be tolerated,” said U.S. Attorney Waldref. “I want to thank our law enforcement partners, especial the Department of Interior, Office of Inspector General, Western Region, for their tremendous and longstanding efforts in rooting out this conspiracy.”
This case was investigated by the Department of Interior, Office of Inspector General Western Region. Assistant United States Attorneys Tyler Tornabene and Dan Fruchter are prosecuting the case on behalf of the United States. Sentencing in this matter is scheduled for May 29, 2024, at 11:00 am in the Thomas Foley Federal Building and U.S. Court House in Spokane, Washington.
United States v. Christopher Hamilton Clemens, Case No: 2-24-CR-00030-TOR.
Orleans Parish Man Sentenced for Concealment of Bankruptcy AssetsRead the Press Release
NEW ORLEANS – JOSHUA BORGES (“BORGES”), age 38 and a resident of New Orleans, was sentenced on February 28. 2024 by U.S. District Court Judge Carl J. Barbier to 2 years probation after BORGES previously pleading guilty to concealment of assets in connection with a bankruptcy, announced U.S. Attorney Duane A. Evans.
According to court records, on or about April 17, 2018, BORGES knowingly and fraudulently failed to disclose property that belonged to him in a bankruptcy case. Specifically, he knowingly and fraudulently failed to disclose to the trustee charged with control of the debtor’s property and from the creditors and the United States Trustee, $9,000.00 in cash on hand, and his business interest in Elite Enterprise Holding, LLC, which had a value of at least approximately $89,771.08.
In addition to the sentence, BORGES was sentenced to payment of a $5,5000 fine and a mandatory special assessment fee of $100. A restitution hearing has been set for May 9, 2024, to determine the loss to the victims in his bankruptcy proceeding.
The U.S. Attorney’s Office would also like to acknowledge the assistance of the Federal Bureau of Investigation, the Internal Revenue Service – Criminal Investigations, and the Office of the U.S. Trustee for the Eastern District of Louisiana with this matter. The prosecution of this case is being handled by Assistant U.S. Attorneys Edward Rivera of the Financial Crimes Unit and Andre Lagarde of the Public Integrity Unit.
Opioid Manufacturer Endo Health Solutions Inc. Agrees to Global Resolution of Criminal and Civil Investigations into Sales and Marketing of Branded Opioid DrugRead the Press Release
Endo Health Solutions Inc. (EHSI), which is in bankruptcy, has agreed to resolve criminal and civil investigations related to the company’s sales and marketing of the opioid drug Opana ER with INTAC (Opana ER), the Justice Department announced today. The United States has also reached an agreement in Endo’s bankruptcy case to settle its monetary claims arising from the criminal and civil settlements, as well as additional tax and healthcare related claims. Under the bankruptcy agreement, the government will be paid up to $464.9 million over 10 years. EHSI’s entry into all of these agreements is subject to the approval of the U.S. Bankruptcy Court in the Southern District of New York.
Under the proposed criminal resolution, EHSI agreed to plead guilty in federal court in the Eastern District of Michigan to a one-count misdemeanor information charging it with violating the Federal Food, Drug and Cosmetic Act (FDCA) by introducing misbranded drugs into interstate commerce. The criminal resolution includes the second-largest set of criminal financial penalties ever levied against a pharmaceutical company, including a criminal fine of $1.086 billion and an additional $450 million in criminal forfeiture. The proposed resolution includes a corporate criminal release regarding conduct relating to the sale, marketing, and distribution of Opana ER, but does not release any individual criminal liability.
EHSI also has agreed to a civil settlement of $475.6 million to resolve its civil liability under the False Claims Act (FCA). The civil settlement will address alleged losses to federal healthcare programs that paid for Opana ER.
Endo International plc and several of its affiliates, including EHSI (together, Endo), commenced Chapter 11 bankruptcy proceedings in the Southern District of New York on Aug. 16, 2022. Today, the United States announced that it also reached an agreement to resolve all of its monetary claims against the debtors — including the claims arising from the criminal plea and civil settlement — in Endo’s bankruptcy cases. In addition to the criminal and civil settlement resolutions, the bankruptcy settlement provides payment for claims for unpaid taxes and for costs incurred by federal healthcare agencies to treat individuals harmed by Endo’s products. As noted, under the bankruptcy agreement, the government will be paid up to $464.9 million over 10 years.
“Companies that profit from the opioid abuse epidemic by misrepresenting the safety of their opioid products and using reckless marketing tactics to increase sales threaten the health and safety of Americans,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “With today’s announcement of a criminal guilty plea and a substantial civil settlement, the Justice Department re-affirms its commitment to holding accountable those whose illegal conduct contributed to the opioid crisis.”
“Chapter 11 is an important tool for businesses to preserve value for their stakeholders. Bankruptcy protections are not a free pass to evade responsibility for criminal misconduct, civil fraud, or taxes,” said U.S. Attorney Damian Williams for the Southern District of New York. “Today’s settlement ensures that Endo takes responsibility for its past misconduct, pays its federal debts, helps abate the nation’s opioid crisis by funding evidence-based treatment programs at the state and local level and distributes payments to individuals harmed by the opioid epidemic.”
“Combating the opioid epidemic remains a top public health priority for the Food and Drug Administration (FDA),” said Director Patrizia Cavazzoni, M.D. of FDA’s Center for Drug Evaluation and Research. “This case demonstrates FDA and the Justice Department’s commitment to work collaboratively to hold drug manufacturers accountable if they fail to share accurate information with health care professionals about the risks and benefits of opioids.”
“The metrics of the opioid crisis are staggering. When companies do not provide accurate information about the safety and abuse potential of their products, they put patients at risk of abuse and addiction,” said Associate Commissioner Michael Rogers of FDA’s Regulatory Affairs. “Such conduct will not be tolerated, and we will aggressively pursue and bring to justice those who endanger the public health in this manner.”
One important condition in the resolution is that Endo would cease to operate in its current form and would not emerge from the bankruptcy. Moreover, as part of its resolution with the opioid claimants, Endo’s affiliates have agreed to a Voluntary Operating Injunction that restrains opioid marketing and sales and requires Endo to turn over millions of documents related to its role in the opioid crisis for publication in a public online archive.
The Criminal Plea
As part of the plea, EHSI will admit that from April 2012 through May 2013, certain EHSI sales representatives marketed Opana ER to prescribers by touting Opana ER’s purported abuse deterrence, tamper resistance, and/or crush resistance, despite a lack of clinical data supporting those claims. According to the plea agreement, certain EHSI sales managers were aware that the sales representatives were making claims of purported abuse deterrence, tamper resistance, and/or crush resistance during sales calls, including hitting demonstration “blister packs” of non-medicated sample pills with hammers and conducting other demonstrations to convey the message that Opana ER was, in fact, crush proof and tamper resistant. The approved labeling for Opana ER did not provide adequate information for healthcare providers to safely prescribe Opana ER for use as an opioid that is abuse deterrent. According to the plea agreement, EHSI was responsible for the misbranding of Opana ER by marketing the drug with a label that failed to include adequate directions for its claimed abuse deterrence use, in violation of the FDCA.
EHSI voluntarily withdrew Opana ER from the market in 2017.
The Civil Settlement
The civil settlement announced today resolves allegations that, from 2011 to 2017, EHSI used a marketing scheme that targeted healthcare providers that EHSI knew were prescribing Opana ER for non-medically accepted indications. Aware that fewer than 10% of Opana ER prescribers wrote more than half of all Opana ER prescriptions, EHSI allegedly sought to increase its revenue from Opana ER prescriptions by focusing its marketing on those healthcare providers who prescribed the highest levels of opioids in general and Opana ER in particular. When EHSI employees raised concerns about targeting prescribers believed to be engaged in abuse, diversion or pill mill prescribing, EHSI allegedly ignored or minimized such concerns and continued to directly market Opana ER to such prescribers.
The allegations resolved by the civil settlement relating to EHSI’s marketing activities include that in 2015, after marketing the reformulated Opana ER for years, EHSI sought to further increase prescriptions by partnering with a consulting company to “pull[] all the levers” it could “to drive incremental growth” of Opana ER prescriptions. In what it termed a “sales force blitz,” EHSI allegedly added 3,000 priority targets to its sales representatives’ call lists, with nearly all of these priority targets chosen because they prescribed a high volume of opioids in general or Opana ER in particular. EHSI allegedly used sales goals and contests to ensure that its sales representatives targeted these outlier prescribers, including prescribers who previously had been excluded from EHSI’s call lists as posing risks of abuse and diversion.
The Bankruptcy Resolution
As part of Endo’s bankruptcy plan, a group of Endo’s secured lenders will purchase Endo’s assets and operate the business under a new corporate structure. Under the bankruptcy agreement negotiated by the United States to resolve its claims against Endo, this new business will pay the United States $364.9 million over 10 years, which can be prepaid at $200 million on the bankruptcy plan’s effective date, plus up to an additional $100 million contingent on the business performance of the new company.
The bankruptcy agreement resolves multiple federal claims against Endo, including the claims arising from the criminal and civil settlements, as well as tax claims and the claims of various federal healthcare agencies. The settlement agreement further precludes the new company from acquiring any unused tax credits or other beneficial tax attributes of Endo. Additionally, the new company will fund voluntary trusts in settlement of opioid-related claims against Endo, including public trusts that will pay over $450 million to state, municipal and Tribal entities to help fund programs to abate the opioid crisis. The department will credit up to $450 million of such payments against the agreed forfeiture amount.
In addition to the criminal and civil claims described above, the Internal Revenue Service (IRS) filed substantial tax claims in the bankruptcy proceeding against Endo based on ongoing audits. These audits concerned, among other things, Endo’s valuation of assets it transferred to foreign affiliates and its payment of a large loan pre-payment penalty to a foreign affiliate for which it sought a tax deduction. A substantial majority of these payments were entitled to priority over Endo’s other unsecured claims.
Finally, HHS’s Centers for Medicare and Medicaid Services (CMS), HHS’s Indian Health Service and the Department of Veterans Affairs (VA) asserted claims in the bankruptcy proceeding against Endo for the costs these programs incurred in providing medical care to treat individuals who suffer from opioid-use disorder as a result of their use of Opana ER and other opioids manufactured and sold by Endo. CMS has also filed a claim to recover costs it incurred based on beneficiaries’ use of other Endo products, including transvaginal mesh and ranitidine.
When Endo filed for bankruptcy in August 2022, it proposed to sell substantially all of its assets in a manner that contravened key requirements of the Bankruptcy Code. Endo’s original proposal would have provided virtually no recovery to the federal government on account of its claims, while improperly paying several other creditor groups on account of their claims, even though they were entitled to lower or equal priority as certain government claims. The current bankruptcy settlement was achieved after the government objected to the proposed sale in Bankruptcy Court. Through this settlement, the government has ensured both that it is compensated for its claims and that Endo does not run afoul of the Bankruptcy Code by paying only certain of its creditors or violating the Bankruptcy Code’s priority scheme.
“The opioid crisis remains a public health emergency nationwide, and those impacted are at the forefront of our work,” said the Honorable Christi A. Grimm, HHS Inspector General. “The HHS Office of Inspector General (HHS-OIG) is staunchly committed to protecting the millions of people served by federal healthcare programs from schemes such as this, while also striving to ensure they have access to necessary treatment.”
“The misbranding of opioids negatively impacts the integrity of TRICARE, the military’s healthcare system relied on by more than nine million service members, retirees and their families,” said the Honorable Robert P. Storch, Department of Defense Inspector General. “Today’s settlement demonstrates the ongoing commitment of the Defense Criminal Investigative Service and its law enforcement partners to promote accountability and transparency throughout the pharmaceutical industry and prosecute those who put profits ahead of patient welfare. The delivery of quality healthcare is too important to let a single dollar go to waste.”
“Veterans and their families expect and deserve the highest quality health care delivered in a safe and accountable setting. False or misleading claims about potentially dangerous drugs put veterans’ care at risk,” said the Honorable Michael J. Missal, VA Inspector General. “The VA Office of Inspector General is committed to working with our law enforcement partners to ensure the safety of those who entrust their health care to the providers and staff at VA’s 1,300 medical facilities.”
“Protecting the health and safety of Federal employees, annuitants, and their families is a top priority for OPM OIG,” said Special Agent in Charge Derek M. Holt of the Office of Personnel Management Office of Inspector General (OPM-OIG). “Today’s criminal and civil resolutions demonstrate the exemplary work of our investigative staff, law enforcement partners, and colleagues at the Justice Department in holding manufacturers accountable for actions that contribute to the opioid epidemic.”
The criminal investigation was conducted by the Federal Bureau of Investigation, Drug Enforcement Administration, HHS-OIG, Food and Drug Administration Office of Criminal Investigations, VA Office of Inspector General, OPM-OIG, Defense Criminal Investigative Service and Amtrak Office of Inspector General.
The criminal matter was handled by Assistant Director Gabriel H. Scannapieco and Trial Attorneys Ben Cornfeld and Tara M. Shinnick of the Civil Division’s Consumer Protection Branch.
The civil investigation and settlement were handled by Senior Trial Counsel Christopher Terranova and Assistant Director Natalie Waites of the Civil Division’s Commercial Litigation Branch, Fraud Section and Matthew Feeley, Deputy Chief & Healthcare Fraud Coordinator for the Southern District of Florida, with assistance from the HHS Office of General Counsel and Office of Counsel to the Inspector General.
The Endo bankruptcy case is being handled by Assistant U.S. Attorneys Jean-David Barnea, Peter Aronoff and Tara Schwartz for the Southern District of New York and Assistant Directors Mary Schmergel and Kevin VanLandingham of the Civil Division’s Commercial Litigation Branch, Corporate/Financial Litigation Section.
For more information about the Consumer Protection Branch and its enforcement efforts, visit www.justice.gov/civil/consumer-protection-branch. For more information about the Civil Fraud Section and its enforcement efforts, visit www.justice.gov/civil/fraud-section.
Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to HHS at 1-800-HHS-TIPS (800-447-8477).
Except to the extent that EHSI’s admissions are part of its criminal resolution, the claims resolved by the civil settlement are allegations only and there has been no determination of liability.
View the agreements here, here and here.
Okmulgee Resident Sentenced for Attempted RobberyRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Raithiele Robinson, age 50, of Okmulgee, Oklahoma, was sentenced to 150 months in prison for one count of Attempted Robbery.
The charges arose from investigations by the Federal Bureau of Investigation, the Okmulgee County Sherriff’s Office, and the Okmulgee Police Department.
On December 15, 2022, Robinson pleaded guilty to one count of Attempted Robbery. According to investigators, on December 2, 2016, Robinson attempted to rob the victim of valuables by force as the victim sat in a vehicle at the intersection of Kern and Kiowa in Okmulgee.
The Honorable Ronald A. White, Chief Judge in the United States District Court for the Eastern District of Oklahoma, presided over the hearings. Robinson will remain in custody of the U.S. Marshal pending transportation to a designated United States Bureau of Prisons facility to serve a non-paroleable sentence of incarceration.
Assistant United States Attorney Edith A. Singer represented the United States.
Ohio Man Sentenced to 126 Months for Trafficking LSDRead the Press Release
COVINGTON, Ky. – A Cincinnati man, Kyle A. Vanderpool, 36, was sentenced on Thursday, to 126 months in federal prison, by U.S. District Judge David Bunning, for possession with the intent to distribute 10 grams or more of LSD.
According to his plea agreement, law enforcement received a report that an identified drug trafficker was traveling to Northern Kentucky to meet a source of supply. Law enforcement observed the individual meet with Vanderpool on July 26, 2021. A drug dog alerted for the presence of drugs in Vanderpool’s vehicle. Law enforcement then searched the car and discovered $26,642 in cash and various controlled substances, including 8100 doses of LSD on blotter paper, over 33 grams of liquid LSD, and 20.6 grams of ketamine.
Under federal law, Vanderpool must serve 85 percent of his prison sentence. Upon his release from prison, he will be under the supervision of the U.S. Probation Office for five years.
Carlton S. Shier, IV, United States Attorney for the Eastern District of Kentucky; and Erek Davodowich, Acting Special Agent in Charge, DEA, Louisville Field Division; jointly announced the sentence.
The investigation was conducted by the DEA. Assistant U.S. Attorney Tony Bracke is prosecuting the case on behalf of the United States.
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Oahu Man Sentenced to Forty Years in Prison for Producing Child PornographyRead the Press Release
HONOLULU – Chief United States District Judge Derrick K. Watson sentenced Daniel Brito, 33, of Honolulu, today to forty years in prison and lifetime of supervised release for production of child pornography. He must also pay the four identified minor victims $3,000 each in restitution. Brito has been detained in custody since he was arrested in December 2021. Brito pleaded guilty to the child pornography production offense on November 2, 2023. At the time of the offenses in the federal case, Brito was on State probation and a registered as a sex offender due to a prior State of Hawaii conviction for sexual assault in the third degree of a minor relative.
According to information produced to the court, from around 2019 through 2021, Brito communicated on multiple internet-based social media applications with at least four minor females, as young as twelve years old, for the purpose of directing and soliciting them to send him sexually explicit images and videos of themselves. In addition to the sexually explicit materials Brito solicited from those minors, Brito also possessed thousands of images of child pornography, to which he had access from his phone on the date of his arrest. The videos included those of adults engaged in sexual acts with young children.
“This substantial sentence reflects the horrifying fact that while on probation for sexually assaulting a child family member, Brito victimized at least four additional children,” said United States Attorney Clare E. Connors. “No child should suffer the incalculable damage from such abuse, and we will continue to identify perpetrators, prosecute them and help victims find healing through the justice system.”
“This sentence highlights how important it is to the FBI and our community to protect our keiki from predators such as Brito who, despite being a registered sex offender, continued to victimize others,” said FBI Special Agent in Charge Steven Merrill. “The public should know that we will continue to vigorously pursue and investigate those who prey on our children and bring them to justice.”
This investigation was conducted by the Federal Bureau of Investigation. Assistant U.S. Attorney Rebecca Perlmutter handled the prosecution.
North Louisiana Men Sentenced on Illegal Possession of Drug and Firearm ChargesRead the Press Release
MONROE, La. – United States Attorney Brandon B. Brown announced that two North Louisiana men were sentenced today by United States District Judge Terry A. Doughty on drug and firearms charges.
Nicholas D. Moore, 31, of Ruston, was sentenced to 132 months in prison, followed by 3 years of supervised release, for possession with intent to distribute methamphetamine. Between August 2022 and January 2023, agents with the Drug Enforcement Administration (DEA) and Lincoln Parish Sheriff’s Office performed five controlled purchases of methamphetamine from Moore. The purchased narcotics were sent to the DEA Laboratory for analysis and the results came back that they were methamphetamine. Law enforcement agents subsequently obtained a search warrant for a residence in Ruston where Moore had lived for several days. During the execution of the search warrant, agents discovered multiple bags of methamphetamine, small bags of cocaine, and marijuana and over $8,000 in cash. The seized narcotics were tested at the DEA Laboratory and determined to contain methamphetamine.
The case was investigated by the DEA and Lincoln Parish Sheriff’s Office and was prosecuted by Assistant United States Attorney Robert F. Moody.
Demartinas Edwards, 42, of Monroe, was sentenced to 21 months in prison, followed by 3 years of supervised release, for being a convicted felon in possession of a firearm. In addition, Edwards was ordered to pay a fine of $1,000. According to information presented in court, on November 30, 2022, officers with the Monroe Police Department’s HEAT Team obtained a search warrant for a residence in Monroe and Edwards was found on the premises. Edwards had an outstanding warrant and was arrested at that time. Inside the residence, officers found a firearm in the bedroom along with other possessions that belonged to Edwards. He later admitted to officers that the firearm belonged to him and that he had found it on the street. Because of Edwards’ prior felony conviction, he was prohibited from possessing any firearm or ammunition. Edwards pleaded guilty to the charge of being a felon in possession of firearms on December 8, 2023.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and Monroe Police Department and was prosecuted by Assistant United States Attorney Robert F. Moody.
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New Orleans Man Pleads Guilty to Federal Gun and Drug OffensesRead the Press Release
NEW ORLEANS, LOUISIANA – DATAYNA HOWARD, age 22, a resident of New Orleans, pleaded guilty on February 28, 2024, before U.S. District Judge Ivan L.R. Lemelle to two counts of possession with intent to distribute controlled substances—fentanyl, tapentadol, and marijuana—in violation of Title 21, United States Code, Sections 841(a)(1), 841(b)(1)(C), and 841(b)(1)(D), and two counts of possession of a firearm in furtherance of a drug trafficking crime, in violation of Title 18, United States Code, Section 924(c).
According to court documents, on January 19, 2022, HOWARD was arrested at the Oakwood Shopping Center in Gretna, La. in possession of fentanyl, marijuana, drug trafficking supplies, and two loaded handguns. On June 8, 2023, law enforcement executed a search warrant at HOWARD’s residence in New Orleans and discovered over 700 tapentadol pills, marijuana, drug trafficking supplies, three handguns, and additional ammunition.
HOWARD faces up to 20 years in prison, up to a $1,000,000 fine, and at least three years of supervised release on each of his convictions for possession with intent to distribute controlled substances. As to each of his convictions for possession of a firearm in furtherance of a drug trafficking crime, HOWARD faces a minimum sentence of five years and up to life in prison, which must run consecutively to any other sentence, up to a $250,000 fine, and up to five years of supervised release. As to each count, HOWARD also faces payment of a $100 mandatory special assessment fee.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
This case was investigated by the Federal Bureau of Investigation, the Jefferson Parish Sheriff’s Office, and the New Orleans Police Department. It is being prosecuted by Assistant United States Attorney David Berman of the Violent Crime Unit.
New Orleans Man Pleads Guilty for Theft from Interstate ShipmenRead the Press Release
NEW ORLEANS, LOUISIANA – United States Attorney Duane A. Evans announced that MALIK MACK, age 26, a resident of New Orleans, pleaded guilty on February 28, 2024 to theft from an interstate shipment and aiding and abetting in that theft, in violation of Title 18, United States Code, Sections 659 and 2.
According to court documents, on the evening of March 29, 2023, MACK and three other suspects entered the Norfolk Southern Railyard, a freight consolidation facility that houses interstate shipments, to steal Ford F-150 Rapture Crew Cab trucks. MACK was apprehended by law enforcement officers and admitted to the crime.
At sentencing, MACK faces a maximum term of imprisonment of ten (10) years, up to a $250,000 fine, up to three (3) years of supervised release, and a mandatory special assessment fee of $100.
U.S. Attorney Evans praised the work of Norfolk Southern Railway Police, the United States Department of Homeland Security, the New Orleans Police Department, and the Louisiana State Police. The case is being prosecuted by Assistant United States Attorney Troy Bell of the Violent Crime Unit.
New Bern Man Arrested Following Threats of Violence Sentenced to 17 Years for Federal Firearms ChargeRead the Press Release
WILMINGTON, N.C. –Isaiah Emmanuelle Gibbs, 25, of New Bern was sentenced today to 204 months in prison for illegal possession of a firearm and ammunition. Gibbs was arrested after threatening to retaliate for the shooting of a young child in July of 2023. Gibbs pled guilty to the charges on September 25, 2023.
“Given this defendant’s previous criminal history, and pending state charges for firearm and drug violations, federal agents worked quickly to take him into custody after learning of credible threats to commit a shooting,” said U.S. Attorney Michael Easley. “Those who are engaging in gun violence will be held accountable and brought to justice.”
“The senseless murder of a 19-month-old reminds us that gun violence is indiscriminate. The New Bern Police Department and our community greatly value the relationship we have built with our local, state, and federal law enforcement partners. U.S. Attorney Michael Easley, his team and all the other law enforcement professionals have shown a commitment to a common goal to make our community safe.”
“Arresting and prosecuting violent criminals who illegally use firearms is a priority of the Craven County Sheriff's Office,” said Sheriff Chip Hughes. “We appreciate the cooperation and work of ATF agents and the U.S. Attorney's Office in removing this dangerous criminal from our community. We will continue to work closely with our federal law enforcement partners to identify, arrest and prosecute violent felons.”
According to court records and other evidence presented in court, Gibbs was found with guns on five occasions between September 7, 2021, and March 11, 2023, by law enforcement officers from the New Bern and Emerald Isle Police Department’s and the Craven County Sheriff’s Office. Gibbs was federally indicted for an October 4, 2022, incident where the Craven County Sheriff’s office completed a traffic stop on a vehicle occupied by Gibbs and others. A backpack carried by Gibbs contained a loaded 9mm handgun and multiple rounds of 9mm ammunition. A search of the vehicle located a stolen, loaded 9mm handgun with a large capacity magazine underneath Gibbs’ seat.
On July 4, 2023, a vehicle was shot at in New Bern, and an adult male and his 19-month-old daughter were struck. The child succumbed to her injuries two days later. Gibbs was identified on scene immediately after the shooting. Shortly after the shooting, law enforcement learned that Gibbs intended to retaliate for the shooting. Due to the credible threat of violence combined with Gibbs’ history of violence, a federal complaint was filed, and Gibbs was arrested by Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) agents on July 7, 2023, and has remained in detention since that arrest. During an interview with agents following his arrest, Gibbs admitted that he had been in possession of a firearm and ammunition during the October 2022 traffic stop.
Gibbs was previously convicted of three common law robberies in 2020 making him an Armed Career Criminal subject to enhanced penalties for possessing a firearm or ammunition, including a 15-year mandatory minimum sentence of incarceration. State charges for five counts of possession of a firearm by a felon, one count of robbery with a dangerous weapon, second degree kidnapping, possession with intent to manufacture, sell, or deliver a schedule II-controlled substance, and two counts of resisting a public officer remain pending.
Michael Easley, U.S. Attorney for the Eastern District of North Carolina made the announcement. The New Bern and Emerald Isle Police Departments, the Craven County Sheriff’s Office, and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated the case and Assistant U.S. Attorney Phil Aubart prosecuted the cases.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 4:23-cr-00037-M-BM-1.
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Nashua Man Indicted on Firearm OffensesRead the Press Release
CONCORD – A Nashua man was indicted in connection with unlawful possession of firearms and ammunition, U.S Attorney Jane E. Young announces.
Robert Reidy, age 32, was indicted on one count of possession of firearms and ammunition by a prohibited person and one count of possession of unregistered firearms. Reidy is in state custody on related charges. Reidy will appear in federal court on March 6th, 2024 at 2:00p.m.
According to the charging documents, on December 5, 2023, Reidy possessed three pistols, a short-barreled rifle, and a silencer, as well as 160 rounds of ammunition. As a previously convicted felon, Reidy is prohibited from possessing firearms and ammunition under federal law. The short-barreled rife and silencer were unregistered firearms.
The charge of possession of firearms and ammunition by a prohibited person provides for a maximum sentence of up to 15 years in prison, up to a three-year term of supervised release and a fine of up to $250,000. The charge of possession of unregistered firearms provides for a sentence of no greater than 10 years in prison, 3 years of supervised release, and a fine of $10,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
The Nashua Police Department and the Bureau of Alcohol, Tobacco, Firearms, and Explosives led the investigation. Valuable assistance was provided by the Manchester Police Department. Assistant U.S. Attorney Tiffany Scanlon is prosecuting the case.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
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Murphy, N.C. Woman Sentenced to 18 Years for Production of Child PornographyRead the Press Release
ASHEVILLE, N.C. – Alyssa Danielle Seabolt, 26, of Murphy, N.C., was sentenced today to 18 years in prison followed by a lifetime of supervised release for production of child pornography, announced Dena J. King, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Martin Reidinger also ordered Seabolt to register as a sex offender after she is released from prison.
Ronnie Martinez, Special Agent in Charge of Homeland Security Investigations (HSI) in North Carolina and South Carolina, joins U.S. Attorney King in making today's announcement.
According to court documents and court proceedings, in 2021, Canadian law enforcement investigating the online trading of child pornography notified HSI about an individual in the United States, later identified as Seabolt, using Snapchat to distribute files depicting the sexual abuse of children. In June 2022, during an interview with HSI agents, Seabolt admitted to producing the child pornography she had shared online.
On April 19, 2022, Seabolt pleaded guilty to using a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of such conduct.
U.S. Attorney King commended HSI for their investigation that led to today’s sentence.
Assistant U.S. Attorney Alexis Solheim with the U.S. Attorney’s Office in Asheville prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Montgomery Man Sentenced to 64 Months in Federal Prison for Identity Theft and Cashing Stolen ChecksRead the Press Release
Montgomery, Alabama – Today, Acting United States Attorney Jonathan S. Ross announced that a federal judge sentenced 40-year-old William Hayden Searcy, from Montgomery, Alabama, to 64 months in prison. The sentence follows Searcy’s entry of a guilty plea to charges of bank fraud and aggravated identity theft.
According to the plea agreement and other court records, in March and April of 2022, Searcy cashed fraudulent checks at various locations around Montgomery. Details discussed during Searcy’s sentencing hearing on February 22, 2024, revealed that Searcy: (1) stole checks from mailboxes; (2) washed the checks using chemicals that removed ink; (3) wrote new information on the checks making them payable to accounts he controlled; and (4) went to financial institutions and cashed the altered checks. Searcy also used the identities from some of the stolen checks to print checks of his own.
The federal judge also ordered Searcy to pay restitution in the amount of $8,203.42. A co-defendant in the scheme, Tyler Scott Kidd, 27, from Millbrook, Alabama, pleaded guilty to bank fraud and is scheduled to be sentenced on May 15, 2024. Kidd will be jointly liable with Searcy for the restitution amount.
“Mail theft and check fraud are nationwide problems,” said Acting United States Attorney Ross. “Although the Postal Service works diligently to ensure that mail is delivered securely, individuals frequently find ways to exploit the mail system. Individuals should be mindful of the receptacles used to mail checks and check bank accounts regularly for suspicious transactions.”
“When identity thieves use the U.S. Mail to further their scheme, Postal Inspectors work tirelessly with federal prosecutors to bring them to justice,” said Scott Fix, Inspector-in-Charge of the Houston Division. “Fraud and identity theft are not victimless crimes and individuals such as Searcy who commit these crimes face significant penalties as a result of their criminal activity. Postal Inspectors will continue to pursue these individuals in order to preserve the financial integrity of innocent Americans. We extend our appreciation to the Montgomery Police Department that assisted with this investigation.”
The United States Postal Inspection Service and the Montgomery Police Department investigated this case, which Assistant United States Attorney Michelle R. Turner prosecuted.
Mexican National Sentenced to over 11 Years in Prison for Trafficking MethRead the Press Release
ALPINE, Texas – A Mexican national was sentenced in a federal court in Pecos to 135 months in prison for possession with intent to distribute methamphetamine.
According to court documents, U.S. Border Patrol agents inspected a vehicle driven by Jorge Alberto Garcia-Gamez, 45, at a checkpoint near Marfa. During the inspection, agents discovered 76 vacuum-sealed bundles containing 37.85 kilograms of methamphetamine in the vehicle’s fuel tank. An investigation by Homeland Security Investigations revealed that Garcia-Gamez was transporting the methamphetamine for a Mexican drug trafficking organization. Garcia-Gamez was arrested Sept. 29, 2023 and pleaded guilty Nov. 17.
“This case is reflective of the essential roles Border Patrol and HSI agents play in the mission to protect our communities across the nation,” said U.S. Attorney Jaime Esparza for the Western District of Texas. “Thanks to our partners, this prosecution has taken another drug trafficker off the streets for more than a decade, further disrupting the operations of Mexican cartels.”
“This sentence should serve to dissuade anyone considering smuggling narcotics into our country,” said Acting Special Agent in Charge Eric McLoughlin for the HSI El Paso Division. “HSI special agents will continue to collaborate with our federal, local, and state law enforcement partners to stop the funneling of highly addictive and lethal drugs across the southern border.”
HSI and the USBP investigated the case.
Assistant U.S. Attorney Scott Greenbaum prosecuted the case.
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Mexican National Pleads Guilty to Illegal Re-entry of a Deported Alien Previously Convicted of a FelonyRead the Press Release
NEW ORLEANS, LOUISIANA – U.S. Attorney Duane A. Evans announced that JOSE MANUEL CHENO, age 55, a citizen of Mexico, pleaded guilty on February 28, 2024 to illegal reentry of a deported alien previously convicted of a felony, in violation of Title 8, United States Code, Sections 1326(a)and (b)(2).
According to court documents, JOSE MANUEL CHENO (“CHENO”) admitted to reentering the United States after being previously deported on January 27, 2018. Furthermore, on May 5, 2005, CHENO was convicted of Conspiracy to Possess with the Intent to Distribute Marijuana in United States District Court, District of Arizona.
CHENO faces a maximum term of imprisonment of twenty (20) years, followed by up to three (3) years of supervised release, a fine of up to $250,000, and a mandatory $100 special assessment fee.
U.S. District Court Judge Sarah S. Vance has set sentencing for June 26, 2024.
U.S. Attorney Evans praised the work of the United States Department of Immigration and Customs Enforcement, Enforcement and Removal Operations and the Jefferson Parish Sheriff’s Office in investigating this matter. Assistant U.S. Attorney Jon Maestri of the General Crimes Unit is in charge of the prosecution.
Mescalero Man Sentenced to 2 Years Supervised Release for Domestic AbuseRead the Press Release
ALBUQUERQUE – Alexander M.M. Uballez, United States Attorney for the District of New Mexico, announced that Danny Deron Morgan was sentenced to a time-served sentence of 53 days and 2 years of supervised release. Morgan, 51, of Mescalero, an enrolled member of the Mescalero Apache Tribe, pled guilty on Oct. 25, 2023, to assault of a spouse, intimate partner, or dating partner resulting in substantial bodily injury in Indian Country.
A federal grand jury returned a superseding indicted against Morgan on Aug. 16, 2023. According to publicly available court records, on Feb. 20, 2023, Morgan invited Jane Doe to the residence he had been staying at in Mescalero. After she arrived, Morgan became upset with Jane Doe, and she attempted to leave the residence. This upset Morgan more and he grabbed Jane Doe by her hair, pushed her down on to the bed, straddled her chest and pushed down on her throat with his hands. Hearing a commotion, the owner of the residence forced his way into the bedroom and pulled Morgan off Jane Doe, who fled the residence. As a result of the assault, Jane Doe suffered short-term disfigurement including bruising, lacerations, and petechiae.
The Bureau of Indian Affairs investigated the case. Assistant U.S. Attorney Eliot Neal is prosecuting the case.
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Medical Doctor to Pay $60,000.00 to Resolve Civil Liability for Alleged Violations of the False Claims ActRead the Press Release
HARRISBURG, PA —The United States Attorney’s Office for the Middle District of Pennsylvania announced that Dr. Peter J. Baddick, III has agreed to pay the United States $60,000.00 to resolve civil liability for alleged violations of the False Claims Act.
According to the United States Attorney, Gerard M. Karam, between April 2015 and December 2015, Dr. Baddick prescribed the opioid medication Subsys to patients who did not have a cancer diagnosis without a legitimate medical purpose outside the usual course of professional practice. Dr. Baddick then billed Medicaid and Tricare for the visits associated with the prescription of Subsys to these patients. A civil action was filed in April of 2022 and is docketed as United States v. Dr. Peter J. Baddick, III.; Civ. No. 3: 22-512 (M.D. Pa.)
“This office is dedicated to combatting fraud and abuse impacting taxpayer-funded programs,” said United States Attorney Karam. “We use every tool at our disposal to do so, and this resolution reflects that commitment.”
This Settlement Agreement is neither an admission of liability by Dr. Baddick nor a concession by the United States that its claims are not well founded.
This matter was investigated by the U.S. Department of Health and Human Services Office of Inspector General and the Office of the Inspector General for the Defense Health Agency. The investigation was handled by Assistant United States Attorneys, B. Craig Black and Tamara Haken, and the Affirmative Civil Enforcement (ACE) Unit within the U.S. Attorney’s Office.
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Marshall County Man Sentenced for Federal Drug ChargeRead the Press Release
WHEELING, WEST VIRGINIA – David Lee McCracken, age 39, of Moundsville, West Virginia, was sentenced today to 90 months in federal prison to be followed by three years of supervised release for possession with intent to distribute methamphetamine.
According to court documents and statements made in court, Ohio County Sheriff’s deputies arrested McCracken at a hotel in Triadelphia, West Virginia, on four outstanding drug trafficking warrants from Belmont County, Ohio. Investigators searched the hotel room and found two safes containing methamphetamine, cash, and drug paraphernalia.
Assistant U.S. Attorney Clayton Reid prosecuted the case on behalf of the government.
The Ohio County Sheriff’s Office investigated.
U.S. District Judge John Preston Bailey presided.
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Man Pleads Guilty to Maintaining Fictitious Super PAC and Credit Card FraudRead the Press Release
A Pennsylvania man pleaded guilty today to filing documents with the Federal Election Commission (FEC) that contained false and fictitious information about a political action committee, or Super PAC, and credit card fraud.
According to court documents, in March 2020, Christopher Richardson, 37, of Langhorne, created an independent, expenditure-only Super PAC named Americans for Progressive Action USA (AFPA) that used fictitious names for AFPA’s treasurer and designated agent. Richardson then filed a falsified quarterly report with the FEC claiming that AFPA had raised $4.8 million from several fictitious individuals. Several weeks later, he filed a report of expenditures that falsely claimed that the Super PAC spent over $1.5 million to purchase advertisements and media production opposing certain candidates for the U.S. Senate. Richardson filed another FEC report that falsely stated that AFPA refunded the non-existent $4.8 million in donations.
Richardson also used the alias of one of the fictitious donors to AFPA to obtain a credit card, and then used that card to conduct approximately 200 transactions.
Richardson pleaded guilty to one count of making a false entry in a record and one count of access device fraud. He is scheduled to be sentenced on June 13. He faces a maximum penalty of 20 years in prison on the false entry count and a maximum penalty of 10 years in prison on the access device fraud count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division, U.S. Attorney Matthew M. Graves for the District of Columbia, Assistant Director in Charge David Sundberg of the FBI Washington Field Office, and Special Agent in Charge Scott Moffit of the Treasury Inspector General for Tax Administration’s (TIGTA) Cybercrime Investigations Division made the announcement.
The FBI Washington Field Office and TIGTA Cybercrime Investigations Division investigated the case.
Trial Attorney Ryan R. Crosswell of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Joshua Gold for the District of Columbia are prosecuting the case, with assistance from Assistant U.S. Attorney Ahmed Baset for the District of Columbia.
Man Pleads Guilty to Firebombing Planned Parenthood Clinic and Plotting to Attack Electrical SubstationRead the Press Release
A California man pleaded guilty today to a firebombing attack on a Planned Parenthood clinic in Costa Mesa in March 2022 and planning to attack an electrical substation in Orange County, and further admitted to plotting an attack on Dodger Stadium last year on a night celebrating LGBTQI+ pride.
Tibet Ergul, 22, of Irvine, pleaded guilty to one felony count of conspiracy to damage an energy facility and one misdemeanor count of intentional damage to a reproductive health services facility. He is scheduled to be sentenced on May 30 and faces a maximum penalty of 21 years in prison.
According to his plea agreement, in February and March 2022, Ergul and Chance Brannon, 24, of San Juan Capistrano, California, agreed to use a Molotov cocktail to damage a Planned Parenthood clinic in Orange County. Ergul and Brannon, who at the time was an active-duty U.S. Marine, targeted the clinic because it provided reproductive health services and they wanted to encourage others to engage in similar violent acts. Ergul and Brannon also wanted to make a statement about abortion; scare pregnant women away from obtaining abortions; deter doctors, staff and employees at the clinic from providing abortions; and intimidate the clinic’s patients.
On March 12, 2022, in Ergul’s garage, Ergul and Brannon knowingly assembled a Molotov cocktail. During the early morning hours of March 13, 2022, Ergul and Brannon – disguised in dark clothing, masks, hoods and gloves – drove to a Planned Parenthood clinic in Costa Mesa, ignited the Molotov cocktail and threw it at the clinic’s entrance, intentionally starting a fire. Due to the fire and the damage it caused, the clinic was forced to temporarily close and reschedule approximately 30 patient appointments.
Ergul further admitted that in June 2022, following the Supreme Court’s decision to overturn Roe v. Wade, he and Brannon planned to use a second Molotov cocktail to attack another Planned Parenthood clinic. Ergul and Brannon abandoned this plan after seeing law enforcement near the targeted clinic.
Ergul also conspired with others, including Brannon, to damage a Southern California Edison electrical substation to debilitate Orange County’s power grid. Ergul and his accomplices planned to attack the substation by using firearms or a Molotov cocktail that Ergul possessed in his garage. Ergul and Brannon consulted with an associate about surveillance, drone operations and firearms. In March 2023, Ergul messaged an associate to say he had found a substation in Orange to target. Ergul sent the associate aerial photographs of the substation and suggested doing a “drive-thru” at 3 a.m. Ergul also sent Brannon a letter in which he wrote: “The rifle is in a box in my room waiting to be used in the upcoming race war,” and he discussed a desire to murder politicians and journalists. Ergul and Brannon did not carry out this attack prior to their arrest in this case.
During the early summer of 2023, Ergul and Brannon also discussed and researched how to attack the Dodger Stadium parking lot or the stadium’s electrical room on a night celebrating LGBTQI+ pride, including by using a device that could be detonated remotely, Ergul admitted in his plea agreement. Brannon and Ergul exchanged sabotage manuals and discussed doing “dry runs” to “case” the stadium. Law enforcement arrested Ergul and Brannon two days before Dodger Stadium’s scheduled “Pride Night.”
Ergul, who has been in federal custody since June 2023, is the third and final defendant to plead guilty in this case.
Brannon, who also has been in federal custody since June 2023, pleaded guilty in November to four crimes: conspiracy, malicious destruction of property by fire and explosives, possession of an unregistered destructive device and intentional damage to a reproductive health services facility – a violation of the Freedom of Access to Clinic Entrances Act. Brannon’s sentencing hearing is scheduled for April 15.
Xavier Batten, 21, of Brooksville, Florida, who has been in federal custody since July 2023, pleaded guilty on Jan. 19 to one count of possession of an unregistered destructive device and one count of intentional damage to a reproductive health services facility. Batten’s sentencing hearing is scheduled for May 15.
The FBI’s Joint Terrorism Task Force and the Naval Criminal Investigative Service investigated this matter. The Costa Mesa Police Department and the Costa Mesa Fire Department provided substantial assistance.
Assistant U.S. Attorney Kathrynne N. Seiden for the Central District of California is prosecuting this case, with valuable assistance from the National Security Division’s Counterterrorism Section.
Maine Man Indicted for Lacing Ice Cream with THC at Newmarket CaféRead the Press Release
CONCORD – A Maine man was indicted in connection with tampering with consumer products, First Assistant United States Attorney Jay McCormack announces.
Marc Flore, 43, was indicted on one count of tampering with consumer products. Flore will appear in federal court in Concord at a later date.
According to the charging documents, Flore laced a batch of coffee-Oreo flavored ice cream with tetrahydrocannabinol (THC), a schedule I controlled drug, and stored the THC-laced ice cream with other batches of ice cream in a freezer at the Roots Café in Newmarket, New Hampshire, where the ice cream was then sold to public consumers.
The charge of tampering with consumer products provides for a sentence of up to 10 years in prison, up to three years of supervised release and a fine of up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
The Food and Drug Administration Office of Criminal Investigations (FDA-OCI) led the investigation. Valuable assistance was provided by the Newmarket Police Department. Assistant U.S. Attorney Geoffrey Ward is prosecuting the case.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
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Louisiana Physician Sentenced for Tax EvasionRead the Press Release
A Louisiana physician was sentenced today to 52 months in prison for tax evasion.
According to court documents and evidence presented at trial, Dr. Melissa Rose Barrett, of Baton Rouge, owned and operated two urgent care clinics — Central STAT Care and STAT Care Clinic — and owed the IRS approximately $1.6 million in income taxes, excluding interest and penalties. The IRS notified Dr. Barrett that she owed taxes by letter correspondence, telephone calls, bank account and property seizures as well as interviews with IRS agents.
Dr. Barrett sought to thwart the IRS’ collection efforts by submitting to the IRS a false IRS Form 433-A, Collection Information Statement that underreported her income and inaccurately detailed her assets, by not making cash deposits into banks and instead accumulating those funds in a safe, and by using nominees to purchase millions of dollars in real estate and personal property, including a personal residence, a boat, an airplane and several parcels of farmland.
In addition to the term of imprisonment, U.S. District Judge Brian A. Jackson ordered Dr. Barrett to serve one year of supervised release and to pay a $200,000 fine.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Ronald C. Gathe Jr. for the Middle District of Louisiana made the announcement.
IRS Criminal Investigation investigated the case.
Trial Attorney Wilson Stamm of the Tax Division and Deputy Criminal Chief Edward Warner and Assistant U.S. Attorney Elizabeth White for the Middle District of Louisiana prosecuted the case.
Long Island Drug Trafficker Sentenced to 60 Months in PrisonRead the Press Release
ALBANY, NEW YORK – Kenny Gonzalez, age 30, of Bayshore, New York, was sentenced today to 60 months in prison after previously pleading guilty to conspiracy to possess with intent to distribute a controlled substance and possession with intent to distribute a controlled substance.
United States Attorney Carla B. Freedman and Frank A. Tarentino III, Special Agent in Charge of the U.S. Drug Enforcement Administration (DEA), New York Division, made the announcement.
As part of his prior guilty plea, Gonzalez admitted that he and his co-conspirator drove from Long Island to Queens where they picked up approximately two kilograms of cocaine from their drug supplier. Gonzalez and his co-conspirator intended to distribute the cocaine in the Northern District of New York.
United States District Judge Glenn T. Suddaby also imposed a 4-year term of supervised release to follow Gonzalez’s prison term.
The case was investigated by DEA Albany with the assistance DEA Long Island and members of the Suffolk County Police Department. Assistant U.S. Attorney Ashlyn Miranda prosecuted the case.