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Thursday 1 February 2024
Members of U.S. Attorney's Office Honored at Attorney General's Awards in Washington D.C.Read the Press Release
BOSTON –Members of the U.S. Attorney’s Office for the District of Massachusetts were recognized yesterday by Attorney General Merrick B. Garland at the 70th and 71st Annual Awards Ceremony in Washington, D.C. for their extraordinary contributions to the enforcement of our nation’s laws. Award recipients from both 2022 and 2023 were selected from a group of more than 800 Justice Department employees nominated from across the country.
“Each of today’s recipients has served with distinction, and in so doing, they have enabled the Justice Department to advance its work on behalf of the American people,” said Attorney General Garland. “Their exceptional leadership, heroism, and dedication have benefited people and communities across the country.”
The following individuals were presented with the Distinguished Service Award, the Department’s second highest award for employee performance, for their investigation and prosecution in a Higher Education Admissions Fraud Case:
- Stephen E. Frank, Assistant U.S. Attorney, U.S. Attorney’s Office;
- Kristen A. Kearney, Assistant U.S. Attorney, U.S. Attorney’s Office;
- Leslie A. Wright, Assistant U.S. Attorney, U.S. Attorney’s Office;
- Ian J. Stearns, Assistant U.S. Attorney, U.S. Attorney’s Office;
- Kriss R. Basil, Assistant U.S. Attorney, U.S. Attorney’s Office;
- Alexia R. DeVincentis, Assistant U.S. Attorney, U.S. Attorney’s Office;
- Carol E. Head, Assistant U.S. Attorney, U.S. Attorney’s Office;
- Justin D. O’Connell, Assistant U.S. Attorney, U.S. Attorney’s Office;
- Lauren M. George, Financial Investigator, U.S. Attorney’s Office;
- Laura C. Smith, Special Agent, Federal Bureau of Investigation, Boston Field Office;
- Kaitlyn A. Cedrone, Special Agent, Federal Bureau of Investigation, Boston Field Office;
- Keith T. Brown, Special Agent, Federal Bureau of Investigation, Boston Field Office;
- Chris Gianakura, Special Agent, Federal Bureau of Investigation, Boston Field Office;
- Elizabeth A. Keating, Special Agent, Internal Revenue Service, Criminal Investigation, Boston Field Office; and
- Mark G. Deckett, Special Agent, Office of the Inspector General, U.S. Department of Education, Boston Field Office.
“This outstanding team of individuals worked tirelessly to investigate, prosecute and hold accountable dozens of individuals who sought to cheat the college admissions process. From the outset, this case has stood for the principle that we do not have a two-tiered system of justice in this country and that everyone – regardless of wealth, power or fame – must operate under the same set of rules. This case reaffirmed that principle,” said Acting United States Attorney Joshua S. Levy. “This case resulted in concrete changes to make the college admissions process more fair. We are deeply proud of this team, and of the lasting and far-reaching impact their extraordinary work has had.”
In March 2019, dozens of individuals from across the country were arrested and charged for their involvement in a nationwide conspiracy, led by William “Rick” Singer, that facilitated cheating on college entrance exams and the admission of students to elite universities as purported athletic recruits.
Hector Radhames Gonzalez, an Information Technology Specialist for the U.S. Attorney’s Office, was honored posthumously with the Attorney General’s Award for Excellence in Administrative Support. This distinguished award recognizes Justice Department employees who have demonstrated outstanding administrative or managerial achievements. Mr. Gonzalez’s wife and oldest son attended the ceremony and received the award on Mr. Gonzalez’s behalf.
“Hector’s expertise and knowledge as well as his friendly and comforting manner of providing confident support allowed our Office to focus on their own areas of expertise. His approach to his responsibilities embodied excellence – both as an Information Technology professional and as a public servant,” said Acting U.S. Attorney Levy. “Hector Gonzalez was an exceptional colleague who made a difference in our lives on a daily basis. His collegiality, friendship and technical skills touched each of us and made us all better.”
Mcconnellsburg Man Sentenced to 20 Years’ Imprisonment for Production of Images Containing the Sexual Exploitation of A ChildRead the Press Release
HARRISBURG- The United States Attorney’s Office for the Middle District of Pennsylvania announced that Kenneth W. Harr, age 54, formerly of McConnellsburg, Pennsylvania, was sentenced yesterday by U.S. District Court Judge Jennifer P. Wilson to serve 20 years’ imprisonment, 15 years of supervised released, and to pay $5,100 in financial penalties based upon his previously entered guilty plea to producing images containing the sexual exploitation of a child.
According to United States Attorney Gerard M. Karam, in June 2021, the victim disclosed to her pastor that Harr had been sexually abusing her since 2016, when she was 14 years old. The abuse was reported to law enforcement authorities and the investigation corroborated the allegations and numerous images of child sexual abuse were found on Harr’s cellphone.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc.
The case was investigated by the Pennsylvania State Police and the Federal Bureau of Investigation (FBI) and was prosecuted by Assistant U.S. Attorney Bruce D. Brandler and former Assistant U.S. Attorney Paul J. Miovas.
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Manlius Man Pleads Guilty to Possessing Child PornographyRead the Press Release
SYRACUSE, NEW YORK – William Gladney, age 41, of Manlius, New York, pled guilty today to multiple charges of possession of child pornography. United States Attorney Carla B. Freedman, Matthew Scarpino, Special Agent in Charge of Homeland Security Investigations (HSI), Buffalo Field Office, and New York State Police (NYSP) Acting Superintendent Steven G. James made the announcement.
As part of his guilty plea, Gladney admitted that he possessed thousands of videos and images of child pornography on several of his personal devices. Gladney has a previous conviction for possession of child pornography in Texas.
Sentencing is scheduled for June 12, 2024, before United States District Glenn T. Suddaby. Gladney faces a mandatory minimum sentence of ten years in prison, a maximum sentence of 20 years in prison, a fine of up to $250,000, and a term of supervised release of between five years and life, to begin after imprisonment. Gladney will also be required to register as a sex offender upon his release from prison. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors.
HSI, the NYSP Internet Crimes Against Children Task Force, the NYSP Troop D Computer Crime Unit, and the Auburn Police Department investigated the case and Special Assistant U.S. Attorney Paul Tuck and Assistant U.S. Attorney Tamara Thomson prosecuted Gladney as part of Project Safe Childhood.
Launched in May 2006 by the Department of Justice, Project Safe Childhood is led by United States Attorney’s 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 https://www.justice.gov/psc.
Man Who Manufactured and Trafficked Kilos of Fentanyl Pills Sentenced to 12 Years in PrisonRead the Press Release
BOSTON – A man from the Dominican Republic, who resides in the Boston area, was sentenced yesterday for running a wide-ranging fentanyl trafficking conspiracy that trafficked multiple kilograms of counterfeit pills, including pills that contained fentanyl, through the mail.
Quenty Ogando, 45, was sentenced by U.S. District Court Judge Angel Kelley to 144 months in prison and five years of supervised release. In October 2023, Ogando pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute fentanyl.
Between September 2022 and November 2022, Ogando ran a large-scale pill press operation that manufactured, sold and mailed counterfeit pills, including pills containing fentanyl, among other drugs. Many of the packages were seized and found to contain counterfeit fentanyl pills. In total, nearly two kilograms of counterfeit fentanyl pills were seized from packages over the course of the investigation.
In November 2022, a search of Ogando’s apartment revealed over 20 kilograms of pills in various colors, over 20 kilograms of loose powder, numerous packages and mailing labels and three industrial grade pill presses. In total, over 11 kilograms of fentanyl was recovered from the apartment as well as amounts of heroin, cocaine and methamphetamine.
Acting United States Attorney Joshua S. Levy; Michael J. Krol, Special Agent in Charge for Homeland Security Investigations in New England; and Ketty Larco-Ward, Inspector in Charge of the U.S. Postal Inspection Service’s Boston Division made the announcement today. The Boston Police Department; Massachusetts State Police; United States Customs and Border Protection; Drug Enforcement Administration; and U.S. Food and Drug Administration provided valuable assistance. Assistant U.S. Attorneys J. Mackenzie Duane and Jennifer Zacks of the Narcotics & Money Laundering Unit prosecuted the case.
Malden Man Sentenced to Decade in Prison for Distributing MethamphetamineRead the Press Release
BOSTON – A Malden man was sentenced today to 10 years in prison for distributing methamphetamine to an undercover law enforcement officer.
David Desousa, 33, was sentenced by U.S. District Court Judge Richard G. Stearns to 10 years in prison to be followed by five years of supervised release. In September 2022, Desousa pleaded guilty to one count of distributing 50 grams or more of methamphetamine, one count of distributing five grams or more of methamphetamine, one count of distributing a mixture or substance containing methamphetamine and three counts of possessing 50 grams or more of methamphetamine with intent to distribute.
In February 2020, an investigation began into DeSousa’s methamphetamine distribution activities. On three separate occasions in February, March and July 2020, Desousa met with and sold various quantities of methamphetamine to an undercover agent. Desousa was arrested on Aug. 6, 2020 in Medford while he was travelling to deliver two ounces of methamphetamine to the undercover agent. More than 55 grams of 99% pure methamphetamine and 10.814 grams of cocaine base were seized from Desousa’s vehicle. During a subsequent search of Desousa’s residence, more than 75 grams of methamphetamine, a loaded Remington .380 caliber pistol and $5,000 in cash was seized. An additional 83 grams of 99% pure methamphetamine and $90,000 in cash were also seized from Desousa’s storage unit.
Acting United States Attorney Joshua S. Levy; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration’s New England Field Division; Ketty Larco-Ward, Inspector in Charge of the U.S. Postal Inspection Service’s Boston Division; Arlington Police Chief Juliann Flaherty; Medford Police Chief Jack Buckley; and Malden Police Chief Glenn Cronin made the announcement. Assistant U.S. Attorneys Philip C. Cheng and James E. Arnold of the Narcotics & Money Laundering Unit prosecuted 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.
Louisville Man Sentenced to over 14 Years in Federal Prison for Child Exploitation OffensesRead the Press Release
Louisville, KY – A Louisville man was sentenced yesterday to 14 years and 7 months in federal prison for receipt and possession of child pornography.
U.S. Attorney Michael A. Bennett of the Western District of Kentucky and Special Agent in Charge Rana Saoud of the Homeland Security (HSI) Investigations Nashville made the announcement.
According to court documents, Rudy Osorio-Rodas, 38, was sentenced to 14 years and 7 months in federal prison, followed by 15 years of supervised release, for three counts of receipt of child pornography and one count of possession of child pornography. In December 2022 and January 2023, Osorio-Rodas knowingly received child sexual abuse material on his cellular phone when he downloaded it from multiple online chat applications that specifically existed to receive and distribute child sexual abuse material. Osorio-Rodas also possessed thousands of images and thousands of videos of child sexual abuse material on his phone.
There is no parole in the federal system.
Osorio-Rodas was also ordered to pay $39,000.00 in restitution to multiple victims in the case.
The United States Department of Homeland Security, Homeland Security Investigations (HSI), assisted by the United States Immigration and Customs Enforcement and the Jeffersontown Police Department, investigated the case.
Assistant U.S. Attorney Christopher Tieke prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
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Land O’ Lakes Man Pleads Guilty to Naturalization and Passport FraudRead the Press Release
Tampa, Florida –United States Attorney Roger B. Handberg announces that Jaiprakash Gulvady (51, Land O’ Lakes) today pleaded guilty to procuring citizenship or naturalization unlawfully, misusing evidence of citizenship or naturalization, and making false statements in a passport application and using a passport secured by false statements. Gulvady faces a maximum penalty of 10 years in federal prison. His conviction for unlawfully procuring citizenship or naturalization also results in the automatic revocation of his U.S. citizenship at the time of sentencing. A sentencing date has not yet been set.
According to court records, Gulvady, an Indian national, came to the United States in 2001 on a temporary business visa. In August 2008, less than two weeks after divorcing his wife, a U.S. citizen whom he had married the year before, Gulvady married another U.S. citizen. Based on that marriage, Gulvady was able to adjust status and became a lawful permanent resident in June 2009. Two months later, in August 2009, Gulvady traveled to India for the first time since he had arrived in 2001. While in India, Gulvady married an Indian woman before returning to the United States. On a subsequent visit to India, Gulvady and his Indian spouse conceived their first and only child, who was born in January 2011.
In August 2013, Gulvady’s marriage to his U.S. citizen wife was dissolved. The following year, Gulvady filed an Application for Naturalization in which he falsely stated under penalty of perjury that he was not currently married; that he did not have any children; and that he had never been married to more than one person at the same time. Based on that application, Gulvady became a naturalized U.S. citizen in August 2014. Using his fraudulently obtained Certificate of Naturalization as evidence of U.S. citizenship, Gulvady filed an application for a U.S. passport, in which he falsely omitted his Indian spouse. The Department of State issued Gulvady a U.S. passport, which he then used to reenter the United States on at least three occasions.
This case was investigated by Homeland Security Investigations (HSI), with assistance from United States Citizenship and Immigration Services and the U.S. Department of State’s Diplomatic Security Service. It is being prosecuted by Assistant United States Attorney Risha Asokan.
Kenyan Citizen Found Guilty of Advance Fee and Investment Fraud SchemeRead the Press Release
WASHINGTON – Paul Maucha, 58, a Kenyan national, was found guilty today of perpetrating an advance fee and investment scheme that defrauded numerous victims.
The jury verdict, in U.S. District Court for the District of Columbia, was announced by U.S. Attorney Matthew M. Graves, Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division, and FBI Special Agent in Charge Keri Farley of the FBI Atlanta Field Office.
According to court documents and evidence presented at trial, Maucha, along with a co-conspirator, engaged in a scheme through a shell company Maucha controlled, American Eagle Services Group Inc. (AESG), to make numerous misrepresentations to victims about AESG, its assets, and its access to money and capital.
In particular, Maucha—through AESG—promised victims who were seeking loans that AESG would provide them with these loans, so long as victims first provided AESG with an advanced fee while misrepresenting the purpose of that fee. AESG also told victims falsely that these advance fees could be refunded if AESG did not fund the loan. As proven at trial, however, Maucha and his co-conspirator knew that AESG did not have the capital to make these loans at the time the lending agreements were executed, and refunds to victims could not be assured because Maucha and his co-conspirator were splitting the fees between themselves and spending them, such that there was no money left to be refunded.
The jury convicted Maucha of one count of conspiracy to commit wire fraud, two counts of wire fraud, and one count of engaging in monetary transactions in criminally derived property. He is scheduled to be sentenced on May 16, 2024, and faces a maximum penalty of 20 years in prison for each of the conspiracy and wire fraud counts and 10 years in prison for each count of engaging in monetary transactions in criminally derived property. 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, and Special Agent in Charge Keri Farley of the FBI Atlanta Field Office made the announcement.
The FBI investigated the case, with substantial assistance from Homeland Security Investigations.
Trial Attorneys Tian Huang and Tamara Livshiz of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Christine M. Macey for the District of Columbia are prosecuting the case. Assistant Chief William E. Johnston of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Joshua S. Rothstein for the District of Columbia previously provided valuable assistance in the investigation.
KC Man Implicated in Murder Sentenced to 20 Years for Fentanyl Trafficking and Illegal Firearms, including Machine GunsRead the Press Release
KANSAS CITY, Mo. – A Kansas City, Mo., man implicated in a Westport murder has been sentenced in federal court for fentanyl trafficking, illegally possessing firearms, and illegally possessing a machine gun.
Yesterday afternoon, Ban N. To, 20, was sentenced by U.S. District Judge Greg Kays on Wednesday, Jan. 31, to 20 years in federal prison without parole. This sentence reflects the government’s request for a significant upward variance from the federal sentencing guidelines range.
On June 21, 2023, To pleaded guilty to one count of possessing fentanyl with the intent to distribute, one count of carrying firearms during and related to a drug-trafficking crime, and one count of possessing a machine gun.
Beyond those crimes, however, evidence and testimony were introduced during yesterday’s sentencing hearing regarding To’s involvement in an April 15, 2023, shooting murder in the Westport Entertainment District for which he has not been charged, including surveillance video that showed To carrying out the homicide with another suspect. In imposing the upward variance to a 240-month sentence, Judge Kays made a finding of fact that, based on the evidence presented at the hearing, To committed the murder on April 15, 2023.
This investigation began in April 2023, when the Kansas City, Mo., Police Department placed a felony vehicle alert on a red Toyota Highlander due to its association with a homicide that occurred on April 15, 2023. The vehicle had been caught on surveillance video pulling into a parking lot near West 40th Terrace and Pennsylvania Avenue in the Westport area. Two occupants of the vehicle began walking to the northeast end of the parking lot when they exchanged gunfire with another person. The firefight continued to the intersection of West 40th Street and Washington Street where the two suspects surrounded the victim, shooting him multiple times. The victim was shortly thereafter confirmed deceased. The two suspects ran away but eventually returned to the vehicle and drove away. Multiple spent shell casings were recovered in the area of the homicide.
Kansas City police officers stopped the red Toyota Highlander, which was being driven by To, on April 21, 2023. Officers searched the Toyota Highlander and found a loaded Taurus .45-caliber handgun, which had been reported stolen, under the driver’s seat. They also found a zip lock bag that contained 75 fentanyl pills near the steering wheel. Officers found three additional firearms inside the locked glove compartment – a Glock 9mm handgun that had been reported stolen, a Polymer80 9mm handgun without a serial number, and a Glock .40-caliber handgun equipped with a Glock switch to make it fully automatic.
Kansas City police detectives also were able to recover nine more firearms associated with To while he was being detained in the Jackson County Detention Center. To, in a monitored telephone call, asked his girlfriend to go to his storage locker and remove some bags. Detectives were able to track down those bags, which contained a Mossberg .22-caliber rifle, a Romarm/Cugir Mini-Draco 7.62x39mm pistol, a Radical Firearms 7.62x39mm rifle, a Sigarms .357-caliber pistol, a Glock 9mm pistol, two Glock .357-caliber pistols, and two Glock .40-caliber pistols equipped with Glock switches to make them fully automatic.
Ballistics analysis confirmed the above-noted Romarm/Cugir Mini-Draco 7.62x39mm pistol fired the shell casings recovered from the scene of the April 15, 2023, homicide. Further lab analysis revealed To’s DNA on the trigger of that firearm.
According to court documents, To is a known associate of the Money Gang, an active violent gang in the metropolitan area.
This case was prosecuted by Assistant U.S. Attorney Jeffrey Q. McCarther. It was investigated by the Kansas City, Mo., Police Department.
Project Safe Neighborhoods
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.
Justice Department Secures Agreement with Pennsylvania Courts to Resolve Lawsuit Concerning Discrimination Against People with Opioid Use DisorderRead the Press Release
The Justice Department announced today that it has secured an agreement with the Unified Judicial System of Pennsylvania (UJS) to resolve allegations that UJS courts violated the Americans with Disabilities Act (ADA) by preventing individuals under court supervision from taking lawfully prescribed medication to treat opioid use disorder (OUD).
Under the agreement, UJS courts will pay $100,000 to victims, and encourage all its component courts to adopt new policies and train personnel on the ADA’s anti-discrimination requirements regarding OUD and report on their compliance efforts.
“People with opioid use disorder caught up in the criminal justice system should be supported in seeking treatments that can help them attain recovery,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “Under this agreement, courts that categorically restricted the use of opioid treatment medication are required to allow people with opioid use disorder to take proven medications that can put them on a path toward recovery and rehabilitation. Ensuring that courts are employing science-driven and data-informed approaches to the opioid crisis is an important priority for the Civil Rights Division. We will continue to enforce our federal civil rights laws, including the ADA, to ensure that people with disabilities are protected from discrimination.”
“My office is dedicated to fighting the opioid epidemic with every tool that we have,” said U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania. “That includes enforcing the ADA to remove discriminatory barriers to treatment for OUD. All too often, people taking medication to treat their OUD are subjected to discrimination based on unfounded stigma associated with these medications. It is a violation of the ADA to deny someone access to programs and services simply because they are taking medication their doctors have prescribed to get and keep their OUD in remission. My office will hold entities that violate the ADA’s anti-discrimination protections accountable.”
“The battle against the opioid epidemic requires not only the vigorous prosecution of those who traffic in and profit from drugs like heroin and fentanyl, but also requires ensuring individuals with opioid use disorder can take their medically prescribed treatment,” said U.S. Attorney Gerard M. Karam for the Middle District of Pennsylvania. “This agreement with the Commonwealth will help ensure that individuals participating in Pennsylvania’s courts who have opioid use disorder will be allowed to follow their providers’ course of treatment, which may include medication that dramatically reduces opioid overdose deaths. This office will enforce the ADA to protect all individuals with disabilities, and this includes our citizens in recovery from addiction.”
The settlement agreement resolves the department’s lawsuit against the UJS, Supreme Court of Pennsylvania and Blair, Jefferson, Lackawanna and Northumberland County Courts of Common Pleas. The department’s complaint, filed in 2022, alleged that UJS courts in multiple counties caused significant harm through the enforcement of their discriminatory administrative policies. The department further alleged that those affected by the UJS court policies were put to an agonizing choice: take their medication and face incarceration or termination from their treatment court program or forgo their medication and suffer painful withdrawal symptoms while risking relapse, overdose and death. As a result, they suffered significant harm. The complaint alleged that the named county courts and other UJS courts had likely harmed many other individuals with OUD through the enforcement of their discriminatory policies.
Under the settlement agreement, the UJS courts will compensate the victims identified in the complaint. They will train all Pennsylvania state court criminal judges and treatment court professionals on the ADA and OUD medication. Several of the named county courts will adopt a robust anti-discrimination policy related to OUD medication. The Administrative Office of Pennsylvania Courts will recommend and encourage all other county courts to adopt the same policy. Finally, the UJS courts will report on their efforts to comply with the agreement, including detailing any complaints about access to OUD medication submitted to any UJS courts during the agreement’s two-year term.
The settlement agreement announced today advances the Justice Department’s efforts to combat discrimination against individuals with OUD and to remove discriminatory barriers to treatment. The department has issued public guidance and filed statements of interest on the ADA’s protections for those with OUD. It has entered into multiple settlements with jails and prisons to increase access to OUD medication, including recent agreements in Allegheny County, Pennsylvania; Eastern Kentucky and Massachusetts. It has undertaken enforcement efforts to combat discrimination against individuals with OUD in court supervision programs in Massachusetts. It has also entered numerous settlements to address discriminatory barriers to treatment for OUD outside of the criminal justice context, including barriers related to employment, professional licensing, social services and healthcare.
The Justice Department’s Civil Rights Division handled this matter in collaboration with the U.S. Attorneys’ Offices for the Eastern and Middle Districts of Pennsylvania.
The Justice Department plays a central role in advancing the nation’s goal of equal opportunity, full participation, independent living and economic self-sufficiency for people with disabilities. For more information about the Justice Department’s work to address discrimination against individuals with opioid use disorder, please visit www.ada.gov/topics/opioid-use-disorder/. For more information on the ADA, please call the department’s toll-free ADA Information Line at 800-514-0301 (TDD 800-514-0383) or visit ada.gov. Members of the public may report possible civil rights violations at civilrights.justice.gov/report.
Jury Convicts “Biggest Pill Dealer in Chambersburg” for Causing Overdose DeathRead the Press Release
HARRISBURG – The United States Attorney’s Office for the Middle District of Pennsylvania announced that a federal jury convicted two Chambersburg men for their roles in a drug trafficking ring that distributed fentanyl, oxycodone, and cocaine. A delivery of fentanyl killed one of the customers and sickened others.
According to United States Attorney Gerard M. Karam, the jury convicted Bruce David Darby, age 45, of Chambersburg, Pennsylvania, of drug trafficking, firearms, and money laundering charges. Darby was also convicted of delivering pills that killed one of his customers in August of 2019. The jury also convicted Malik Bonds, age 42, of Chambersburg, of being a part of Darby’s conspiracy and with delivering cocaine. U.S. District Court Judge Christopher C. Conner presided over the trial.
The jury heard evidence of the Pennsylvania Office of Attorney General’s investigation of Darby and his drug trafficking crew. Darby brought oxycodone pills from New York City and resold them in the Chambersburg area from 2018 to 2019. The jury heard evidence that police monitored Darby’s telephone calls, during which Darby described himself as “the biggest pill dealer in Chambersburg.”
“These two defendants prioritized monetary profits over the lives of everyone they distributed to,” Pennsylvania Attorney General Michelle Henry said. “The jury was told about a loss of life and a serious injury directly caused by this trafficking operation, but we may never know the full scope of devastation caused by these predatory dealers. The collaborative work of law enforcement was essential to stop the flow of deadly substances that put this community at grave risk.”
“The FBI remains committed to keeping our communities safe from predators like Bruce David Darby and Malik Bonds,” said Wayne A. Jacobs, FBI Philadelphia's Special Agent in Charge. Darby’s actions and that of his co-conspirator are particularly heinous given that they trafficked in dangerous narcotics and lethal fentanyl. Today’s conviction sends the message to drug organizations and gang members that if you traffic in illegal drugs, the FBI, along with our law enforcement partners, will bring you to justice."
The case was investigated by the Pennsylvania Office of Attorney General, the Pennsylvania State Police, the Franklin County Drug Task Force, and the Federal Bureau of Investigation. Special Assistant U.S. Attorney Robert Smulktis and Assistant United States Attorney Michael Consiglio are prosecuting the case.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of opioids. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin and fentanyl traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state, and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
This case is also 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.
As a result of his conviction, Darby faces a mandatory sentence of at least 25 years in prison, a term of supervised release following imprisonment, and a fine. Bonds faces a maximum of 40 years’ 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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Jury Convicts Tampa Woman of Defrauding Government of Federal BenefitsRead the Press Release
Tampa, Florida – United States Attorney Roger B. Handberg announces that a federal jury has found Shirin Marshall (55, Tampa) guilty of four counts of mail fraud. Marshall faces a maximum penalty of 20 years in federal prison on each count. Her sentencing hearing is scheduled for April 30, 2024. A grand jury had returned an indictment against Marshall on February 24, 2022.
According to the testimony and evidence presented at trial, in August 2000, Marshall claimed a back and shoulder injury while working as a U.S. Postal Service letter carrier. In July 2001, she filed a subsequent claim related to workplace stress. Marshall later began receiving disability benefits and wage compensation from the Department of Labor’s Office of Workers’ Compensation Program (“DOL-OWCP”) mailed to her in monthly checks. An investigation by the U.S. Postal Service - Office of Inspector General revealed that Marshall concealed her physical capabilities, emotional state, and employment activities from the DOL-OWCP to continue receiving federal workers’ compensation benefits. Marshall also misrepresented her true medical condition to her treating physicians and made false representations on forms she annually submitted to DOL-OWCP. As result of Marshall’s fraudulent scheme, the DOL-OWCP provided her at least $500,000 in wage compensation she was not entitled to receive.
This case was investigated by the U.S. Postal Service - Office of Inspector General. It is being prosecuted by Assistant United States Attorney Greg Pizzo.
Jones County Man Pleads Guilty to Assault in the Bogue Homa Community of the Mississippi Band of Choctaw IndiansRead the Press Release
Jackson, Miss. – A Jones County man pleaded guilty to assault with intent to commit a kidnapping.
According to court documents, in July of 2023, Tyreese Khalia Kejuan Smith, 23, assaulted an adult female in the Bogue Homa Community of the Mississippi Band of Choctaw Indians. Smith was indicted by a federal grand jury in September 2023.
Smith is scheduled to be sentenced on April 30, 2024, and faces up to ten years in prison. A federal district judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The conviction was a result of an investigation by the Federal Bureau of Investigation’s Safe Trails Task Force which is comprised of officers from the Federal Bureau of Investigation, Choctaw Police Department, Jones County Sheriff’s Department, and various state and local law enforcement agencies.
U.S. Attorney Todd Gee and Acting Special Agent in Charge Rebekah Day of the Federal Bureau of Investigation made the announcement.
Assistant U.S. Attorney Kevin J. Payne and Special Assistant U.S. Attorney Brian K. Burns prosecuted the case.
Johnstown Woman Pleads Guilty to Methamphetamine ChargesRead the Press Release
JOHNSTOWN, Pa. – A resident of Johnstown, Pennsylvania, pleaded guilty in federal court to a charge of violating federal narcotics laws, United States Attorney Eric G. Olshan announced today.
Debra Bailey, 60, pleaded guilty to Count One of the Superseding Indictment before Senior United States District Judge Kim R. Gibson.
In connection with the guilty plea, the Court was advised that, from in and around February 2021 to July 2021, in the Western District of Pennsylvania, Bailey conspired to distribute and possess with intent to distribute 50 grams or more of a mixture and substance containing a detectable amount of methamphetamine. Bailey was intercepted on a federal wiretap obtaining quantities of methamphetamine that she distributed to others.
Judge Gibson scheduled sentencing for May 23, 2024. The law provides for a maximum total sentence of at least five years and up to 40 years in prison, a fine of $5 million, or both. Under the federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Maureen Sheehan-Balchon is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation, Laurel Highlands Resident Agency and Homeland Security Investigations conducted the investigation that led to the prosecution of Bailey. Additional agencies participating in this investigation include the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Internal Revenue Service – Criminal Investigation, the United States Postal Inspection Service, Pennsylvania Office of the Attorney General, Pennsylvania State Police, Cambria County District Attorney’s Office, Indiana County District Attorney’s Office, Cambria County Sheriff’s Office, Cambria Township Police Department, Indiana Borough Police Department, Johnstown Police Department, Upper Yoder Township Police Department, Richland Police Department, Ferndale Police Department and other local law enforcement agencies.
This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
International fraudster convicted in multi-million dollar advance-fee schemeRead the Press Release
HOUSTON – A 57-year-old Nigerian national has pleaded guilty for his role in a fraud conspiracy perpetrated against victims in more than 20 countries, announced U.S. Attorney Alamdar S. Hamdani.
Uche Victor Diuno helped orchestrate a scam in which fraudsters abroad lured victims with false promises of millions in investment funding and inheritances.
Diuno and others posed as executives and employees of well-known U.S. banks to deceive victims into making payments to secure purported investment and money transfer agreements. Other members of the conspiracy then laundered these payments through U.S. bank accounts and directed them back to the scheme’s leaders in Nigeria.
Diuno admitted he and his co-conspirators used multiple aliases to convince victims the scam was authentic. Diuno also admitted to his role in the laundering of victim funds.
Acting on instructions from the scheme’s leader, Diuno directed a co-conspirator to disburse victim funds after receiving them. This included transferring funds to other bank accounts through currency exchangers and purchasing vehicles that were shipped back to scammers in Nigeria.
From October 2014 to September 2018, Diuno and his co-conspirators caused losses of nearly $5.7 million.
U.S. District Judge Alfred H. Bennett accepted the guilty plea and has set sentencing for May 9. At that time, Diuno faces up to 20 years in federal prison for each charge and a possible maximum fine of either $500,000 or up to twice the value of the victims’ losses.
Diuno will remain in custody pending sentencing.
The FBI and Department of State – Office of Inspector General conducted the investigation. Assistant U.S. Attorney Christian Latham and Trial Attorney Philip Trout of the Criminal Division’s Fraud Section are prosecuting the case.
Insurance Agent Sentenced to 15 Years in Federal Prison for Defrauding Elderly Investors and Tax EvasionRead the Press Release
Tampa, Florida – U.S. District Judge Charlene Edwards Honeywell has sentenced Phillip Roy Wasserman (67, Sarasota) to 15 years in federal prison for conspiracy to commit wire fraud and mail fraud, substantive counts of wire fraud and mail fraud, and evasion of payment of income taxes. As part of his sentence, the court also entered an order of forfeiture in the amount of $6,318,299.75, the proceeds of the criminal conduct.
A federal jury had found Wasserman guilty of the fraud charges on May 15, 2023. Wasserman pleaded guilty to tax evasion on October 23, 2023.
According to court documents and evidence presented at trial, Wasserman, a former lawyer and licensed insurance agent, and his co-conspirator Kenneth Rossman, a Florida certified public accountant and licensed insurance agent, made false and fraudulent misrepresentations and concealed material information in order to convince elderly victim-investors to put their money into Wasserman’s new insurance venture, “FastLife.” Some victim-investors were persuaded to liquidate traditional investments, such as annuities, and/or to borrow funds against existing life insurance policies to generate cash to invest in the venture. These victim-investors were not told about surrender fees and other costs associated with said liquidations, and Rossman prepared income tax returns for victim-investors in a manner designed to conceal negative personal tax consequences that resulted from liquidations. Wasserman paid Rossman a percentage of the victim-investors’ money as compensation for his role in the conspiracy. Wasserman also used victim-investors’ money to make Ponzi-style payments to earlier victim-investors in the FastLife venture, as well as to victim-investors in his earlier hedge fund and real estate fund ventures. Wasserman spent a significant amount of the victim-investors’ money to finance a lavish lifestyle that included a luxury personal residence, a beach house on Casey Key, professional hockey season and playoff tickets, concerts and other shows, vehicles, jet skis, jewelry, including a diamond ring, personal celebrity entertainment, gambling, retail shopping, home improvements, personal insurance, and a host of other expenses for his personal benefit and the benefit of family members.
The evidence also established that Wasserman took numerous steps to evade payment of more than $900,000 in taxes, and to conceal a multitude of civil judgments and other debts pending against him at the time he solicited victim-investors to put their money into FastLife. In addition, Wasserman took steps to conceal FastLife’s mounting business debts to various business vendors and service providers, employees and independent contractors, and victim-investors.
The evidence further showed that in response to the investigation, Wasserman created a second set of books and fabricated a compensation agreement in an effort to convince investigators that he had not made improper personal use of victim-investors’ funds. Moreover, he urged one witness to lie to investigators, attempted to dissuade several victim-investors from cooperating with law enforcement, and requested that one victim-investor make a baseless complaint against an investigator. In a further effort to thwart the investigation, Wasserman falsely and fraudulently represented that he had an audit from a highly-regarded financial services firm that would show that neither he nor FastLife had committed any wrongdoing. Evidence at trial showed that Wasserman had never engaged the firm to perform an audit and had never received any final work product from the firm.
“With false promises of riches and security, Mr. Wasserman exploited the most vulnerable in our society. Investment schemes that target the elderly are especially heinous and will not be tolerated by the justice system. IRS Criminal Investigators will leave no stone unturned to protect elderly victims and bring some justice to those who might prey upon them,” said Special Agent in Charge Brian Payne of IRS-Criminal Investigation. “False allegations against our investigators, coverups of financial documents, or witness tampering will not deter us. Wasserman called himself the Annuity King but his actions and crimes have earned him another name: Convicted Felon.”
This case was investigated by the Internal Revenue Service - Criminal Investigation and the Florida Office of Financial Regulation. It was prosecuted by Assistant United States Attorneys Rachelle DesVaux Bedke and Rachel K. Jones. The forfeiture is being handled by Assistant Suzanne Nebesky.
Hannibal Man Who Hid Camera in Bathroom Sentenced to 25 Years in PrisonRead the Press Release
ST. LOUIS – U.S. District Judge Sarah E. Pitlyk on Thursday sentenced a man who hid a video camera in a bathroom to capture images of a young girl to 25 years in prison.
Stephen A. Marquez, 35, pleaded guilty in U.S. District Court in St. Louis in November to attempted production of child pornography. He admitted placing a video camera disguised as a cell phone charger in a bathroom. He captured nude images of a young girl, who was 13 and 14 when the videos were made. Marquez also had videos of the girl stored on his iPhone.
The investigation began in August of 2022, when the victim reported to law enforcement that Marquez had been sexually abusing her since she was 9 or 10 and had used his cell phone to record her in the shower. The victim said she told Marquez to stop many times but was scared to tell someone about the sexual abuse. She also said she was scared Marquez would hurt her while he was sexually abusing her.
The Hannibal Police Department, the FBI and the St. Charles County Cyber Crime Task Force investigated the case. Assistant U.S. Attorney Jillian Anderson 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 Department of Justice Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Gang member sentenced to 35 years for racketeering conspiracyRead the Press Release
Oxford, MS – A Mississippi inmate and gang member was sentenced today to 35 years in prison for racketeering (RICO) conspiracy, including murder, related to his participation in the Simon City Royals (SCR) gang.
According to court documents, Dillon Heffker, 33, of New Orleans, Louisiana participated in the criminal activities of the Simon City Royals, a violent national prison gang operating primarily in the Mississippi Department of Corrections, but with members and associates acting on their behalf outside of prisons throughout Mississippi, Louisiana, and elsewhere. Through an alliance with the violent Gangster Disciples gang, the Simon City Royals engaged in a host of criminal activities, including murder, attempted murder, assault, kidnapping, robbery, extortion, witness tampering, money laundering, interstate travel in aid of racketeering, large-scale drug trafficking, and fraud. The Simon City Royals were responsible for murders, attempted murders, and other violent acts committed in the state prison system and throughout the state of Mississippi.
Court records reflect that Heffker stabbed another subordinate gang member, B.F., to death and was involved in drug trafficking and money laundering. More specifically, beginning in 2016, SCR leaders and Heffker began planning the murder of B.F., a SCR member who they believed was involved in murdering another SCR member.
On January 31, 2018, B.F. was released from solitary confinement (at Wilkinson County Correctional Facility) and into the prison pod where SCR members were located, including Heffker. A SCR leader passed down orders from other SCR members to Heffker to attack and kill B.F. Subsequently, B.F. was attacked and stabbed to death by Heffker and another SCR member. According to court documents, the two inmates attacked the victim on the second floor of the housing unit and continued stabbing him as the altercation went to the first-floor shower area. The incident was video recorded. Responding medical personnel found the victim, covered in blood and lying in a fetal position, on the shower floor. Witnesses then saw one of the inmates pass the homemade shanks to a SCR leader who hid the murder weapons. The investigation revealed the organization paid Heffker and the other SCR member for the murder.
On October 5, 2023, Heffker pleaded guilty to Count One of an indictment charging him with RICO conspiracy. At a sentencing hearing on Thursday, U.S. District Judge Michael P. Mills remarked that this violent crime is “one of the more serious crimes I have had to deal with on this bench,” and sentenced Heffker to 420 months in prison followed by 5 years of supervised release.
“Several years ago, the Simon City Royals, a violent criminal gang, were the driving force behind an explosion of violence in Mississippi prisons,” said U.S. Attorney Clay Joyner. “Today’s sentence, as well as the almost 50 other recent prosecutions of the gang and its affiliates, should send a clear message that we will use every tool at our disposal to prosecute those who commit such heinous acts from behind bars or elsewhere.”
“Sending a career criminal like this to prison is another example of our commitment to work tirelessly to protect our communities and hold accountable those who threaten our safety,” said ATF New Orleans Special Agent in Charge Joshua Jackson. “The sentence imposed today sends a message to the community that violent gang members will be held accountable as we work to keep our neighborhoods safe as a top priority for ATF.”
“Today’s sentence underscores DEA’s dedication to dismantling violent drug trafficking organizations,” said Drug Enforcement Administration (DEA) Assistant Special Agent in Charge Anessa Daniels-McCaw . “We’re sending a clear message to criminal gangs: Mississippi has zero tolerance for their illegal activities. Your time here is up.”
This case has been investigated by ATF, DEA, U.S. Marshals Service, U.S. Secret Service, FBI Jackson Field Office, Mississippi Department of Corrections, and dozens of local law enforcement agencies across multiple states.
The case was prosecuted by Assistant U.S. Attorney Sam Stringfellow from the Northern District of Mississippi and Trial Attorney Ben Tonkin of the DOJ’s Violent Crime and Racketeering Section.
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 is also part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Four Suspected Drug Traffickers Face Federal Charges After Law Enforcement Seize 370 Gallons of Liquid HeroinRead the Press Release
PORTLAND, Ore.—Four suspected drug traffickers with apparent ties to a Mexico-based transnational criminal organization are facing federal charges today after they were caught transporting nearly 370 gallons of liquid heroin.
Marco Antonio Magallon, 44; Luis Deleon Woodward, 26; and Jorge Luis Amador, 25, all of Yakima, Washington, and Santos Alisael Aguilar Maya, 32, whose place of residence is unknown, have been charged by criminal complaint with conspiracy to distribute and possess with intent to distribute heroin and possess with intent to distribute heroin.
According to court documents, on January 24, 2024, as part of an ongoing, multi-agency drug trafficking investigation, law enforcement obtained information that several individuals working for a transnational criminal organization were transporting a large load of illegal narcotics into the District of Oregon. Late in the evening of January 24 and in the early morning hours of January 25, 2024, investigators observed a rented moving truck driven by Amador and an accompanying red pickup truck traveling west on Interstate 84 near Bonneville, Oregon. Investigators observed the vehicles travel together to a motel in Tigard, Oregon, making one brief stop in a commercial parking lot in Beaverton, Oregon.
Later on January 25, investigators executed federal search warrants on the defendants’ motel room and two vehicles. They located and seized eight 55-gallon barrels containing approximately 370 gallons of a liquid narcotic inside the moving truck and two loaded handguns inside the motel room. All four defendants were arrested without incident. Investigators transported the seized narcotic, which weighed approximately 1.4 metric tons, to the Washington County Sheriff’s Office (WCSO) narcotics room. Lab tests later confirmed the barrels contained liquid heroin.
This case is being investigated by Homeland Security Investigations (HSI), WCSO, and the Westside Interagency Narcotics Team (WIN). It is being prosecuted by Scott M. Kerin, Assistant U.S. Attorney for the District of Oregon.
WIN is a Washington County, Oregon-based High Intensity Drug Trafficking Area (HIDTA) task force that includes members from the Washington County Sheriff’s Office, Beaverton and Hillsboro Police Departments, Oregon National Guard Counter Drug Program, U.S. Drug Enforcement Administration (DEA), FBI, and HSI.
A criminal complaint is only an accusation of a crime, and defendants are presumed innocent unless and until proven guilty.
Former chairman of 1 Global sentenced to five years in prison for running $250 million securities fraud schemeRead the Press Release
MIAMI – On Jan. 31, the former chairman of 1 Global Capital LLC (“1 Global”) was sentenced to five years in prison for carrying out a $250 million securities fraud conspiracy scheme.
The sentence comes after Carl R. Ruderman, 82, of Aventura, Florida, entered his guilty plea in October 2023. Chief U.S. District Judge Cecilia M. Altonaga also ordered Ruderman to pay a forfeiture money judgment in the amount of $285,599,532, as agreed in his plea agreement. Ruderman’s restitution order is still pending.
Ruderman was the chairman of 1 Global, a commercial lending business based in Hallandale Beach, Florida, that made the equivalent of “pay day” loans to small businesses at high interest rates, termed merchant cash advance loans (“MCAs”).
Ruderman admitted that he and others made false and misleading representations to investors and potential investors as to the profitability of 1 Global’s business in marketing materials and periodic account statements. According to plea documents, investors were falsely told that 1 Global had audited financials by a public accounting firm, that the investor’s money would be spent on the MCAs, and that they could expect double-digit returns on their investments, among other things.
Ruderman admitted that he spent 1 Global’s investor’s money on credit card payments, vacation travel, insurance payments for his art collection and valuable jewelry, drivers, nannies, housekeepers, mortgage payments for his house, tuition, and payments for a luxury car. Ruderman also admitted that he diverted 1 Global investor money to businesses benefitting him and his family, without the investors’ knowledge.
Questions arose during the operation of the business as to whether 1 Global was offering or selling a security and whether the investment offering was required to be registered with the U.S. Securities and Exchange Commission. Ruderman admitted in plea documents that he knew that if 1 Global’s investment offering were determined to be a security, it would undermine the ability of 1 Global to raise funds from retail investors and to continue to operate without substantial additional expenses and reporting requirements. Ruderman also admitted that he directed a lawyer, Jan Atlas, to author two opinion letters in 2016 containing false information that allowed 1 Global to skirt federal securities laws.
Four of Ruderman’s co-conspirators, all from South Florida, previously pleaded guilty and were sentenced for their roles in the fraud scheme, including two lawyers who provided Ruderman with false legal cover to skirt federal securities laws. The co-conspirators cases are referenced below:
Alan G. Heide, the former chief financial officer of 1 Global pleaded guilty to conspiracy to commit securities fraud (case no. 19-cr-60231) and was sentenced to 60 months in prison by U.S. District Judge Roy K. Altman. Judge Altman also ordered Heide to pay over $57 million in restitution to the victims of the scheme.
Attorney Andrew Dale Ledbetter pleaded guilty to conspiracy to commit wire fraud and securities fraud (case no. 20-cr-60103) and was sentenced by Judge Altman to 60 months in prison. Judge Altman also ordered Ledbetter to pay over $148 million to the victims of the scheme.
Steven Allen Schwartz, the former chief operating officer of 1 Global pleaded guilty to conspiracy to commit wire fraud and securities fraud (case no. 20-cr-60003) and was sentenced to 24 months in prison by Judge Altman. Judge Altman also ordered Schwartz to pay over $36 million in restitution to the victims of the scheme.
Attorney Jan Douglas Atlas pleaded guilty to conspiracy to commit wire fraud and securities fraud (case no. 19-cr-60258) and was sentenced to eight months in prison by Judge Altman. Judge Altman also ordered Atlas to pay over $29 million in restitution to the victims of the scheme.
1 Global filed for bankruptcy on July 27, 2018. As of that time, according to documents from related cases, 1 Global had more than 3,400 investors and had raised more than $250 million during the scheme. The bankruptcy case, In re: 1 Global Capital LLC, et al., No. 18-19121-RBR (S.D. Fla.), remains pending.
The SEC previously filed civil fraud actions related to the 1 Global fraud, captioned, SEC v. 1 Global Capital LLC and Carl C. Ruderman, Case No. 18-61991-CV-BB (S.D. Fla.); SEC v. Alan G. Heide, Case No. 19-62047-CV-FAM (S.D. Fla.); SEC v. Jan Douglas Atlas, 19-62303-CV-WPD (S.D. Fla.); SEC v. Steven A. Schwartz, Case No. 20-80008-CV-DMM (S.D. Fla.); and SEC v. Andrew Dale Ledbetter, Esq., Case No. 20-61972-CV (S.D. Fla.).
U.S. Attorney Markenzy Lapointe for the Southern District of Florida, Special Agent in Charge Jeffrey B. Veltri of FBI, Miami Field Office, Special Agent in Charge Matthew D. Line of IRS Criminal Investigation (IRS-CI), Miami Field Office, and Special Agent in Charge Quenton Sallows of the Federal Deposit Insurance Corporation Office of Inspector General (FDIC-OIG), Miami Region, made the announcement.
FBI Miami, IRS-CI, Miami Field Office, and FDIC-OIG, Miami Region investigated the case. Assistant U.S. Attorneys Elizabeth Young and Amanda Perwin prosecuted it. Assistant U.S. Attorney Nicole Grosnoff is handling asset forfeiture.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov, under case number 23-cr-20303.
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Former U.S. Border Patrol Agent Pleads Guilty to Attempting to Distribute Methamphetamine and Receiving BribesRead the Press Release
SAN DIEGO – Former U.S. Border Patrol Agent Hector Hernandez pleaded guilty in federal court today, admitting that he used his official position to smuggle unauthorized immigrants and illegal drugs across the border in exchange for money.
According to his plea agreement, Hernandez admitted to using his official position to open border fences and allowing undocumented immigrants and controlled substances to enter the United States from Mexico. Hernandez also admitted to moving the drugs from the Southern District of California to other locations within the United States.
“Agent Hernandez betrayed his badge and his country,” said U.S. Attorney Tara McGrath. “Instead of providing protection from smugglers and drug traffickers, he joined them.”
“Border Patrol Agent Hernandez broke the public’s trust and abandoned his oath,” said DEA Special Agent in Charge Shelly Howe. “Law enforcement officers are required to uphold the law, not break it.”
“It’s always disheartening when individuals misuse their positions of trust within our government for nefarious activities,” said FBI San Diego Special Agent in Charge Stacey Moy. “Let this be a clear message, that we are absolutely resolved with our partners to rigorously investigate and pursue justice in all cases---even when they involve one of our own.”
“Department of Homeland Security Office of the Inspector General is grateful for the continued collaboration with our law enforcement partners as we root out corruption and crime along the Southwest Border. Today’s plea agreement sends a clear message that federal employees will be held accountable for their actions,” said the DHS Inspector General, Dr. Joseph V. Cuffari.
Hernandez admitted to taking Mexico-based smugglers on a tour of the US/Mexico border, identifying the best locations to sneak unauthorized immigrants into the United States, and sharing the locations of monitoring devices and cameras near the border to help them evade detection. Hernandez also admitted to opening restricted border fences on at least five occasions and allowing immigrants to enter the United States for cash payments of $5,000 each time.
On May 9, 2023, Hernandez met with someone he believed to be a drug trafficker but who was, in fact, an undercover federal agent. During this meeting, Hernandez agreed to pick up a bag full of narcotics that would be hidden near the border fence and bring it to the undercover agent in exchange for $20,000. Undercover agents loaded the bag with 10 kilograms of fake methamphetamine, one pound of real methamphetamine, and a tracking device, before placing the bag in a storm drain near the border fence.
Later that evening and while on duty, Hernandez drove his official vehicle to the storm drain and retrieved the bag. He drove the bag to his residence in Chula Vista and left it there for the remainder of his work shift. On May 10, 2023, after his shift was over, Hernandez returned home, retrieved the bag, and drove to meet with the undercover agent. He was arrested at that meeting. Upon arrest, investigators confirmed the bag still contained both the fake and real methamphetamine.
After Hernandez was arrested, agents searched his residence and found close to $140,000 in cash and 9 grams of cocaine. By Hernandez’s own admission, at least $110,000 of the seized cash represented proceeds from narcotics trafficking and bribery.
As part of his plea agreement, Hernandez forfeited his personal vehicle used to bring the drugs to the undercover agent; $110,000 of the seized cash; and his interest in the residence where the drugs were maintained.
This case is being prosecuted by Assistant U.S. Attorneys Sean Van Demark and Lawrence A. Casper.
Hernandez is scheduled to be sentenced on April 19, 2024 at 9 a.m. before U.S. District Judge Janis L. Sammartino.
DEFENDANTS Case Number 23cr1114-JLS
Hector Hernandez Age: 55 Chula Vista, CA
SUMMARY OF CHARGES
Attempted Distribution of Methamphetamine – 21 U.S.C., Sections 841(a)(1) and 846
Maximum penalty: Life imprisonment with a 10-year mandatory minimum
Receiving Bribe by Public Official – 18 U.S.C., Section 201(b)(2)
Maximum penalty: Fifteen years in prison
INVESTIGATING AGENCIES
Department of Homeland Security, Office of the Inspector General
Drug Enforcement Administration
Federal Bureau of Investigation
IRS Criminal Investigation
Former Professor Pleads Guilty to Setting Multiple Fires Behind Firefighters Responding to the Dixie FireRead the Press Release
SACRAMENTO, Calif. — Gary Stephen Maynard, 49, of San Jose, pleaded guilty today to three counts of arson on federal property, U.S. Attorney Phillip A. Talbert announced.
According to court documents, Maynard engaged in an arson spree in the Shasta Trinity National Forest and in the vicinity of the then-ongoing Dixie Fire in the Lassen National Forest. Maynard set some of his fires behind firefighters who were actively fighting the Dixie Fire, effectively surrounding these firefighters as they responded to one of the largest wildfires in California history. Maynard admitted to setting the following fires during this arson spree: the Cascade Fire (July 20, 2021), the Everitt Fire (July 21, 2021), the Ranch Fire (Aug. 7, 2021), and the Conard Fire (Aug. 7, 2021).
This case is the product of an investigation by the U.S. Forest Service with assistance from the Federal Bureau of Investigation, CalFire, the California Highway Patrol, and the Lassen County Sheriff’s Department. Assistant U.S. Attorneys Shea Kenny, Sam Stefanki, and Michael Anderson are prosecuting the case.
Maynard is scheduled to be sentenced on May 9, 2024, by U.S. District Judge Daniel J. Calabretta. Maynard faces a maximum statutory penalty of 20 years in prison and a $250,000 fine for each count to which he pleaded guilty. Arson to federal property carries a mandatory minimum sentence of five years in prison. The actual sentence, however, will 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.
maynard_plea_agreement.pdfFormer Police Officer Pleads Guilty to PPP FraudRead the Press Release
WILMINGTON, Del. – David C. Weiss, U.S. Attorney for the District of Delaware announced today that a Bear, DE man pleaded guilty to bank fraud in connection with obtaining a Payroll Protection Plan (“PPP”) loan.
According to court documents, Michael Coleman, 43, a former Sergeant with the Wilmington Police Department, pled guilty to fraudulently obtaining a $150,000 PPP loan from the Small Business Administration in 2021 for a personal business he purportedly operated. The Small Business Administration funded loans to small businesses as part of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”).
U.S. Attorney Weiss stated, “Mr. Coleman was a public servant who took federal funds from a public program that was meant to provide financial support to struggling businesses during a global pandemic when he did not qualify for those funds. My office, in partnership with our federal, state, and local law enforcement partners, will continue to identify and prosecute individuals who illegally obtained CARES Act funding.”
“These assistance programs may have ended, but our commitment to seeking out those who defrauded them has not,” said Acting Special Agent in Charge R. Joseph Rothrock of the FBI'S Baltimore Field Office. “The FBI and our partners remain focused on making sure stolen funds are returned to taxpayers, and individuals involved in this type of criminal behavior are held responsible for their actions.”
Coleman faces a maximum penalty of 30 years in prison. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
This case was investigated by the FBI Baltimore Field Office’s Wilmington Resident Agency with assistance from the Delaware Department of Justice and is being prosecuted by Assistant U.S. Attorney Alexander Ibrahim.
For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the District of Delaware. Related court documents and information is located on the website of the District Court for the District of Delaware or on PACER by searching for Case No. 23-cr-083.
Former Local Labor Union President Pleads Guilty to Bank FraudRead the Press Release
A former local labor union president who embezzled union funds pled guilty on January 25, 2024, in federal court in Cedar Rapids. Brock A. Willson, also known as Brock A. Cligrow, age 42, from Linn County and Cedar County, Iowa, was convicted of one count of bank fraud.
In a plea agreement, Willson admitted that, from no later than about March 2020, and continuing through at least October 2021, he served in various capacities as a local labor union’s president, business manager/financial secretary, and coordinator of its joint apprenticeship training committee. By virtue of his high‑level positions within the union, Willson had access to its bank accounts. From the bank accounts, the labor organization entrusted Willson with making authorized payments for certain authorized expenses, including its training committee. Willson abused his position of trust at the union to cause the local bank to make payments for his own person expenses, including but not limited to payments on his personal vehicle loan and purchases at department stores. Willson admitted stealing at least $6,500 in union funds.
Sentencing before United States District Court Judge C.J. Williams will be set after a presentence report is prepared. Willson remains free on bond previously set pending sentencing. Willson faces a possible maximum sentence of 30 years’ imprisonment, a $1 million fine, and five years of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorney Timothy L. Vavricek and was investigated by the United States Department of Labor, Office of Labor-Management Standards. The Mount Vernon-Lisbon Police Department assisted the investigation.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 23-CR-67.
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Former Fayette County High School Teacher Sentenced to 30 Years for Production and Possession of Child PornographyRead the Press Release
LEXINGTON, Ky. – A Lexington man, Kevin Daniel Lentz, 49, was sentenced on Thursday, by U.S. District Judge Karen C. Caldwell, to 30 years in prison, for the production and possession of child pornography.
Lentz admitted in his plea agreement that he began an online conversation with a 9-year-old victim, on March 19, 2023. Within minutes, the chat became sexual. Lentz sent the victim 85 images or videos of adult pornography, including sexually explicit images and videos of Lentz. Lentz also persuaded the victim to create multiple sexually explicit videos and images of himself, and to send them to Lentz via the internet. Lentz acknowledged that, at the time, he knew the victim was a minor. The conduct was discovered after the victim’s parents located the sexually explicit conversations and images on the victim’s phone. The parents then contacted law enforcement.
A search warrant was executed at Lentz's residence in Lexington, on August 8, 2023. The search resulted in the seizure of numerous electronic devices, including a computer, a cellular phone, and multiple hard drives. A search of these devices revealed several hundred additional images and videos of prepubescent minors engaged in sexually explicit conduct that Lentz obtained from the internet.
Under federal law, Lentz 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 life. Lentz was also ordered to pay $33,000 in restitution and $22,000 in special assessments.
Carlton S. Shier, IV, United States Attorney for the Eastern District of Kentucky; Rana Saoud, Special Agent in Charge, Department of Homeland Security, Homeland Security Investigations (HSI); and Chief Lawrence Weathers, Lexington Police Department, jointly announced the sentence.
The investigation was conducted by HSI and Lexington Police Department. Assistant U.S. Attorney Erin Roth is prosecuting the case on behalf of the United States.
The U.S. Attorney’s Office prosecuted this case as part of Project Safe Childhood, a nationwide initiative launched in 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. 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.
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Former Employee at Skilled Nursing Facility Sentenced for Criminal Abuse of a Vulnerable AdultRead the Press Release
WASHINGTON – Kevin Thomas, 57, of Washington, D.C., was sentenced today in Superior Court for one count of criminal abuse of a vulnerable adult or elderly person, announced U.S. Attorney Matthew M. Graves for the District of Columbia, and Daniel W. Lucas, Inspector General for the District of Columbia.
Superior Court Judge Deborah J. Israel accepted Thomas’ guilty plea today and ordered 180 days in jail, suspended, 18 months of supervised probation, mental health and drug treatment services as deemed necessary, and ordered that Thomas make a $50 payment to the Victims of Violent Crimes Fund.
According to court documents, Thomas was employed as a customer service representative and smoking aide at Capital City Skilled Nursing Facility (CCSNF), a residential rehabilitation and healthcare center, located in Southeast Washington. Thomas’ job duties included taking individuals outside of the facility to their designated smoking area.
On November 29, 2021, a resident of the facility reported that a staff member pushed him from his wheelchair while he was attempting to enter CCSNF’s smoking area. The victim has physical and psychological disabilities that would classify him as a “vulnerable adult” under D.C. Code § 22-932. During a subsequent interview, the victim stated that the staff member, identified as Thomas, pushed him and he fell out of his wheelchair and onto the ground, where he laid for several minutes without assistance from the defendant. After reviewing video of the incident, Thomas was immediately suspended from CCSNF, who then reported the abuse to the District’s Department of Health.
This prosecution is indicative of the continued collaboration between the U.S. Attorney’s Office and the D.C. Office of the Inspector General (D.C. OIG) to protect vulnerable adults. The D.C. OIG operates the District’s Medicaid Fraud Control Unit (MFCU), which is statutorily responsible for investigating and prosecuting District Medicaid provider fraud as well as abuse or neglect of residents in health care facilities and board and care facilities and of beneficiaries in noninstitutional or other settings. The government urges the public to provide tips and assistance to stop health care fraud and abuse, neglect, or exploitation of vulnerable adults. If you have information about individuals committing these types of offenses, please call the D.C. Office of the Inspector General at 202-724-TIPS [202-724-8477].
In announcing the guilty plea, U.S. Attorney Graves, and Inspector General Lucas commended the work of those who investigated the case from the D.C. OIG MFCU. They also acknowledged the efforts of the D.C. Department of Health for their initial response. They commended the work of Special Assistant United States Attorney Jason Facci, on detail from the D.C. OIG, who prosecuted the case.
Former CIA Officer Joshua Adam Shulte Sentenced to 40 Years in Prison for Espionage and Child Pornography ChargesRead the Press Release
Joshua Adam Schulte, 35, of New York, New York, was sentenced today to 480 months in prison for crimes of espionage, computer hacking, contempt of court, making false statements to the FBI, and child pornography. Schulte’s theft is the largest data breach in the history of the CIA, and his transmission of that stolen information to WikiLeaks is one of the largest unauthorized disclosures of classified information in the history of the United States.
Today’s sentencing followed Schulte’s convictions at trials that concluded on March 9, 2020, July 13, 2022, and Sept. 13, 2023.
“Mr. Schulte severely harmed U.S. national security and directly risked the lives of CIA personnel, persisting in his efforts even after his arrest,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “As today’s sentence reaffirms, the Department of Justice is committed to investigating, prosecuting, and holding accountable those who would violate their constitutional oath and betray the trust of the American people they pledged to protect.”
“Joshua Schulte betrayed his country by committing some of the most brazen, heinous crimes of espionage in American history," said U.S. Attorney Damian Williams for the Southern District of New York. "He caused untold damage to our national security in his quest for revenge against the CIA for its response to Schulte’s security breaches while employed there. When the FBI caught him, Schulte doubled down and tried to cause even more harm to this nation by waging what he described as an ‘information war’ of publishing top secret information from behind bars. And all the while, Schulte collected thousands upon thousands of videos and images of children being subjected to sickening abuse for his own personal gratification. The outstanding investigative work of the FBI and the career prosecutors in this office unmasked Schulte for the traitor and predator that he is and made sure that he will spend 40 years behind bars – right where he belongs.”
“Joshua Schulte caused grave harm to U.S. national security and contributed to the abuse of scores of innocent children,” said Executive Assistant Director Larissa L. Knapp of the FBI’s National Security Branch. “Using his expertise, Schulte stole and exposed classified national security information including some of the U.S. government’s most sensitive techniques and personnel, but he didn’t only exploit the U.S. government – he also exploited vulnerable children by collecting images and videos capturing their horrific abuse for his own pleasure. Together with our partners, the FBI will remain steadfast in our pursuit of those who put the security of the American people and its most vulnerable citizens at risk.”
According to court documents, from 2012 to 2016, Schulte was employed as a software developer in the Center for Cyber Intelligence (CCI), which conducts offensive cyber operations: cyber espionage relating to terrorist organizations and foreign governments. Schulte and other CCI developers worked on tools that were used in, among other things, human-enabled operations: cyber operations that involved a person with access to the computer network being targeted by the cyber tool. In addition to being a developer, Schulte was also temporarily one of the administrators of one of the servers and suite of development programs used to build cyber tools.
In March 2016, Schulte was moved within branches of CCI as a result of personnel disputes between Schulte and another developer. Following that transfer, in April 2016, Schulte abused his administrator powers to grant himself administrator privileges over a development project from which he had been removed as a result of the branch change. Schulte’s abuse of administrator privileges was detected, and CCI leadership directed that administrator privileges would immediately be transferred from developers, including Schulte, to another division. Schulte was also given a warning about self-granting administrator privileges that had previously been revoked.
Schulte had, however, secretly opened an administrator session on one of the servers before his privileges were removed. On April 20, 2016, after other developers had left the CCI office, Schulte used his secret server administrator session to execute a series of cyber-maneuvers on the CIA network to restore his revoked privileges, break in to the backups, steal copies of the entire CCI tool development archives (the Stolen CIA Files), revert the network back to its prior state, and delete hundreds of log files in an attempt to cover his tracks. Schulte’s theft of the Stolen CIA Files is the largest data breach in CIA history.
From his home computer, Schulte then transmitted the Stolen CIA Files to WikiLeaks, using anonymizing tools recommended by WikiLeaks to potential leakers, such as the Tails operating system and the Tor browser. On May 5, 2016, having transmitted the Stolen CIA Files to WikiLeaks, Schulte wiped and reformatted his home computer’s internal hard drives.
On March 7, 2017, WikiLeaks began publishing classified data from the Stolen CIA Files. Between March and November 2017, there were a total of 26 disclosures of classified data from the Stolen CIA Files that WikiLeaks denominated as Vault 7 and Vault 8 (the WikiLeaks Disclosures). The WikiLeaks Disclosures were one of the largest unauthorized disclosures of classified information in the history of the United States, and Schulte’s theft and disclosure immediately and profoundly damaged the CIA’s ability to collect foreign intelligence against America’s adversaries; placed CIA personnel, programs, and assets directly at risk; and cost the CIA hundreds of millions of dollars. The effect was described at trial by the former CIA Deputy Director of Digital Innovation as a “digital Pearl Harbor,” and the disclosure caused exceptionally grave harm to the national security of the United States.
Following the WikiLeaks Disclosures, Schulte was voluntarily interviewed on multiple occasions by the FBI in March 2017. During those interviews, Schulte repeatedly lied, including denying being responsible for the theft of the Stolen CIA Files or for the WikiLeaks Disclosures, and spinning fake narratives about ways the Stolen CIA Files could have been obtained from CIA computers, in the hope of deflecting suspicion away from Schulte and diverting law enforcement resources to false leads.
In March 2017, the FBI searched Schulte’s apartment in New York pursuant to a search warrant and recovered, among other things, multiple computers, servers, and other electronic storage devices, including Schulte’s personal desktop computer (the Desktop Computer), which Schulte built while living in Virginia and then transported to New York in November 2016. On the Desktop Computer, FBI agents found layers of encryption hiding tens of thousands of videos and images of child sexual abuse materials, including approximately 3,400 images and videos of disturbing and horrific child pornography and the rape and sexual abuse of children as young as two years old, as well as images of bestiality and sadomasochism. Schulte collected some of these files during his employment with the CIA and continued to stockpile child pornography from the dark web and Russian websites after moving to New York.
While detained pending trial, in approximately April 2018, Schulte sent a copy of the affidavit in support of the warrant to search his apartment, which a protective order entered by the court prohibiting Schulte from disseminating, to reporters from two different newspapers, and Schulte acknowledged in recorded phone calls that he knew he was prohibited from sharing protected material like the affidavit.
Despite being warned by the court not to violate the protective order further, in the summer and fall of 2018, Schulte made plans to wage what he proclaimed to be an “information war” against the U.S. government. To pursue these ends, Schulte obtained access to contraband cellphones while in jail that he used to create anonymous, encrypted email and social media accounts. Schulte also attempted to use the contraband cellphones to transmit protected discovery materials to WikiLeaks and planned to use the anonymous email and social media accounts to publish a manifesto and various other postings containing classified information about CIA cyber techniques and cyber tools. In a journal, Schulte wrote that he planned to “breakup diplomatic relationships, close embassies, [and] end U.S. occupation across the world[.]” Schulte successfully sent emails containing classified information about the CCI development network and the number of employees in particular CIA cyber intelligence groups to a reporter.
As a result of this conduct, on March 9, 2020, Schulte was found guilty at trial of contempt of court and making material false statements. On July 13, 2022, Schulte was found guilty at trial of eight counts: illegal gathering and transmission of national defense information in connection with his theft and dissemination of the Stolen CIA Files, illegal transmission and attempted transmission of national defense information, unauthorized access to a computer to obtain classified information and information from a department or agency of the U.S. in connection with his theft of the Stolen CIA Files, and two counts of causing transmission of harmful computer commands in connection with his theft of the Stolen CIA Files. Finally, on Sept. 13, 2023, Schulte was found guilty at trial on charges of receiving, possessing, and transporting child pornography.
The FBI Counterintelligence Division and Child Exploitation and Human Trafficking Task Force of the FBI New York Field Office investigated the case, with the extraordinary assistance of FBI computer scientists from the Cyber Action Team. The FBI Washington Field Office, CIA Office of General Counsel, and National Security Division’s Counterintelligence and Export Control Section provided significant assistance.
Assistant U.S. Attorneys David W. Denton Jr., Michael D. Lockard, and Nicholas S. Bradley for the Southern District of New York prosecuted the case.
Former CIA Officer Joshua Adam Schulte Sentenced to 40 Years in Prison for Espionage and Child Pornography CrimesRead 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; and James Smith, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that JOSHUA ADAM SCHULTE was sentenced to 40 years in prison by U.S. District Judge Jesse M. Furman for crimes of espionage, computer hacking, contempt of Court, making false statements to the FBI, and child pornography. SCHULTE’s theft is the largest data breach in the history of the CIA, and his transmission of that stolen information to WikiLeaks is one of the largest unauthorized disclosures of classified information in the history of the U.S. Today’s sentencing followed SCHULTE’s convictions at trials that concluded on March 9, 2020, July 13, 2022, and September 13, 2023.
U.S. Attorney Damian Williams said: “Joshua Schulte betrayed his country by committing some of the most brazen, heinous crimes of espionage in American history. He caused untold damage to our national security in his quest for revenge against the CIA for its response to Schulte’s security breaches while employed there. When the FBI caught him, Schulte doubled down and tried to cause even more harm to this nation by waging what he described as an ‘information war’ of publishing top secret information from behind bars. And all the while, Schulte collected thousands upon thousands of videos and images of children being subjected to sickening abuse for his own personal gratification. The outstanding investigative work of the FBI and the career prosecutors in this Office unmasked Schulte for the traitor and predator that he is and made sure that he will spend 40 years behind bars – right where he belongs.”
Assistant Attorney General Matthew G. Olsen said: “Mr. Schulte severely harmed U.S. national security and directly risked the lives of CIA personnel, persisting in his efforts even after his arrest. As today’s sentence reaffirms, the Department of Justice is committed to investigating, prosecuting, and holding accountable those who would violate their constitutional oath and betray the trust of the American people they pledged to protect.”
FBI Assistant Director in Charge James Smith said: “Today, Joshua Schulte was rightly punished not only for his betrayal of our country, but for his substantial possession of horrific child pornographic material. The severity of his actions is evident, and the sentence imposed reflects the magnitude of the disturbing and harmful threat posed by his criminal conduct. The FBI will not yield in our efforts to bring to justice anyone who endangers innocent children or threatens our national security.”
According to court documents and evidence at trial:
From 2012 to 2016, SCHULTE was employed as a software developer in the Center for Cyber Intelligence (“CCI”), which conducts offensive cyber operations: cyber espionage relating to terrorist organizations and foreign governments. SCHULTE and other CCI developers worked on tools that were used in, among other things, human-enabled operations: cyber operations that involved a person with access to the computer network being targeted by the cyber tool. In addition to being a developer, SCHULTE was also temporarily one of the administrators of one of the servers and suite of development programs used to build cyber tools.
In March 2016, SCHULTE was moved within branches of CCI as a result of personnel disputes between SCHULTE and another developer. Following that transfer, in April 2016, SCHULTE abused his administrator powers to grant himself administrator privileges over a development project from which he had been removed as a result of the branch change. SCHULTE’s abuse of administrator privileges was detected, and CCI leadership directed that administrator privileges would immediately be transferred from developers, including SCHULTE, to another division. SCHULTE was also given a warning about self-granting administrator privileges that had previously been revoked.
SCHULTE had, however, secretly opened an administrator session on one of the servers before his privileges were removed. On April 20, 2016, after other developers had left the CCI office, SCHULTE used his secret server administrator session to execute a series of cyber-maneuvers on the CIA network to restore his revoked privileges, break in to the backups, steal copies of the entire CCI tool development archives (the “Stolen CIA Files”), revert the network back to its prior state, and delete hundreds of log files in an attempt to cover his tracks. SCHULTE’s theft of the Stolen CIA Files is the largest data breach in CIA history.
From his home computer, SCHULTE then transmitted the Stolen CIA Files to WikiLeaks, using anonymizing tools recommended by WikiLeaks to potential leakers, such as the Tails operating system and the Tor browser. On May 5, 2016, having transmitted the Stolen CIA Files to WikiLeaks, SCHULTE wiped and reformatted his home computer’s internal hard drives.
On March 7, 2017, WikiLeaks began publishing classified data from the Stolen CIA Files. Between March and November 2017, there were a total of 26 disclosures of classified data from the Stolen CIA Files that WikiLeaks denominated as Vault 7 and Vault 8 (the “WikiLeaks Disclosures”). The WikiLeaks Disclosures were one of the largest unauthorized disclosures of classified information in the history of the U.S., and SCHULTE’s theft and disclosure immediately and profoundly damaged the CIA’s ability to collect foreign intelligence against America’s adversaries; placed CIA personnel, programs, and assets directly at risk; and cost the CIA hundreds of millions of dollars. The effect was described at trial by the former CIA Deputy Director of Digital Innovation as a “digital Pearl Harbor,” and the disclosure caused exceptionally grave harm to the national security of the U.S.
Following the WikiLeaks Disclosures, SCHULTE was voluntarily interviewed on multiple occasions by the FBI in March 2017. During those interviews, SCHULTE repeatedly lied, including denying being responsible for the theft of the Stolen CIA Files or for the WikiLeaks Disclosures and spinning fake narratives about ways the Stolen CIA Files could have been obtained from CIA computers, in the hope of deflecting suspicion away from SCHULTE and diverting law enforcement resources to false leads.
In March 2017, the FBI searched SCHULTE’s apartment in New York pursuant to a search warrant and recovered, among other things, multiple computers, servers, and other electronic storage devices, including SCHULTE’s personal desktop computer (the “Desktop Computer”), which SCHULTE built while living in Virginia and then transported to New York in November 2016. On the Desktop Computer, FBI agents found layers of encryption hiding tens of thousands of videos and images of child sexual abuse materials, including approximately 3,400 images and videos of disturbing and horrific child pornography and the rape and sexual abuse of children as young as two years old, as well as images of bestiality and sadomasochism. SCHULTE collected some of these files during his employment with the CIA and continued to stockpile child pornography from the dark web and Russian websites after moving to New York.
While detained pending trial, in approximately April 2018, SCHULTE sent a copy of the affidavit in support of the warrant to search his apartment, which a protective order entered by the Court prohibiting SCHULTE from disseminating, to reporters from two different newspapers, and SCHULTE acknowledged in recorded phone calls that he knew he was prohibited from sharing protected material like the affidavit.
Despite being warned by the Court not to violate the protective order further, in the summer and fall of 2018, SCHULTE made plans to wage what he proclaimed to be an “information war” against the U.S. government. To pursue these ends, SCHULTE obtained access to contraband cellphones while in jail that he used to create anonymous, encrypted email and social media accounts. SCHULTE also attempted to use the contraband cellphones to transmit protected discovery materials to WikiLeaks and planned to use the anonymous email and social media accounts to publish a manifesto and various other postings containing classified information about CIA cyber techniques and cyber tools. In a journal, SCHULTE wrote that he planned to “breakup diplomatic relationships, close embassies, [and] end U.S. occupation across the world[.]” SCHULTE successfully sent emails containing classified information about the CCI development network and the number of employees in particular CIA cyber intelligence groups to a reporter.
As a result of this conduct, on March 9, 2020, SCHULTE was found guilty at trial of contempt of court and making material false statements. On July 13, 2022, SCHULTE was found guilty at trial of eight counts: illegal gathering and transmission of national defense information in connection with his theft and dissemination of the Stolen CIA Files, illegal transmission and attempted transmission of national defense information, unauthorized access to a computer to obtain classified information and information from a department or agency of the U.S. in connection with his theft of the Stolen CIA Files, and two counts of causing transmission of harmful computer commands in connection with his theft of the Stolen CIA Files. Finally, on September 13, 2023, SCHULTE was found guilty at trial on charges of receiving, possessing, and transporting child pornography.
* * *
In addition to the prison term, SCHULTE, 35, of New York, New York, was sentenced to a lifetime of supervised release.
Mr. Williams praised the outstanding efforts of the Counterintelligence Division and the Child Exploitation and Human Trafficking Task Force of the FBI’s New York Field Office, as well as the extraordinary work of FBI computer scientists from the Cyber Action Team. Mr. Williams also thanked the FBI Washington Field Office, the CIA Office of General Counsel, and the National Security Division’s Counterintelligence and Export Control Section for their assistance.
This case is being handled by the Office’s National Security and International Narcotics Unit. Assistant U.S. Attorneys David W. Denton Jr., Michael D. Lockard, and Nicholas S. Bradley are in charge of the prosecution.
Former Assistant Superintendent and Former IT Director of Patterson Joint Unified School District Plead Guilty to $1 Million Embezzlement SchemeRead the Press Release
SACRAMENTO, Calif. — Jeffrey Menge, 43, of Copperopolis, and Eric Drabert, 44, of Modesto, pleaded guilty today to theft concerning programs receiving federal funds, U.S. Attorney Phillip A. Talbert announced.
According to court documents, from 2018 to 2022, Menge served as the Assistant Superintendent and Chief Business Officer of Patterson Joint Unified School District. In approximately 2020, Menge hired Drabert to serve as IT Director for the school district. Menge and Drabert conducted schemes to embezzle money from the school district. Among other things, they used CenCal Tech LLC, a Nevada company that Menge controlled, to carry out the scheme. Menge was limited in his ability to conduct interested party transactions with the school district, so he created a fictitious person, “Frank Barnes,” to serve as an executive for CenCal Tech. Menge and Drabert then used CenCal Tech to conduct more than $1.2 million in fraudulent transactions with the school district. The transactions involved double billing, over billing, and billing for items not delivered by CenCal Tech to the school district.
According to court documents, Menge and Drabert stole in additional ways as well. For example, they purchased high-end graphics cards and used those cards, together with other school district property and electricity, to operate a cryptocurrency “mining” farm at the school district. They then transferred the mined cryptocurrency to wallets under their own personal control. Menge also misused vehicles owned by the school district, including buying a Chevy truck at below-market value and selling it for a profit, and using a Ford Transit van as his own personal vehicle.
In total, Menge embezzled between $1 million and $1.5 million and Drabert stole between $250,000 and $300,000 during the scheme. Menge used stolen funds to remodel his home, to purchase luxury cars, including a Ferrari sports car, and for other personal uses. Drabert used stolen funds to remodel his vacation cabin, among other uses.
This case is the product of an investigation by the Federal Bureau of Investigation with assistance from the Stanislaus County District Attorney Bureau of Investigation and the Stanislaus County Sheriff’s Office. Assistant U.S. Attorney Jeffrey A. Spivak is prosecuting the case.
Menge and Drabert are scheduled to be sentenced by U.S. District Judge Troy L. Nunley on May 30, 2024. Menge and Drabert each face a maximum statutory penalty of 10 years in prison and a $250,000 fine. The actual sentences, however, will 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.
menge_reduced_filed.pdf drabert_reduced_filed.pdfForeign National Charged for International Money Laundering Conspiracy and Role in Operation of Unlicensed Digital Currency Exchange BTC-eRead the Press Release
An indictment was unsealed on Tuesday charging a Belarusian and Cypriot national with money laundering conspiracy and operation of an unlicensed money services business.
According to the indictment, between 2011 and July 2017, Aliaksandr Klimenka, 42, allegedly controlled BTC-e, a digital currency exchange, with Alexander Vinnik and others. Klimenka also allegedly controlled Soft-FX, a technology services company, and FX Open, a financial company.
The indictment alleges BTC-e was a significant cybercrime and online money laundering entity that allowed its users to trade in bitcoin with high levels of anonymity and developed a customer base heavily reliant on criminal activity. BTC-e allegedly facilitated transactions for cybercriminals worldwide and received criminal proceeds from numerous computer intrusions and hacking incidents, ransomware scams, identity theft schemes, corrupt public officials, and narcotics distribution rings, and allegedly was used to facilitate crimes ranging from computer hacking to fraud, identity theft, tax refund fraud schemes, public corruption, and drug trafficking. BTC-e’s servers, maintained in the United States, were allegedly one of the primary ways in which BTC-e and its operators effectuated their scheme. Those servers were allegedly leased to and maintained by Klimenka and Soft-FX.
Despite doing substantial business in the United States, BTC-e allegedly was not registered as a money services business with the U.S. Department of Treasury, had no anti-money laundering process, no system for appropriate “know your customer” or “KYC” verification, and no anti-money laundering program as required by federal law.
Klimenka was arrested in Latvia on Dec. 21, 2023, at the request of the United States and made his initial appearance in San Francisco yesterday. He is currently being held in custody.
If convicted, Klimenka faces a maximum penalty of 25 years in prison.
Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division, U.S. Attorney Ismail J. Ramsey for the Northern District of California, Special Agent in Charge William Mancino of the U.S. Secret Service (USSS) Criminal Investigative Division, Assistant Director Michael D. Nordwall of the FBI’s Criminal Investigative Division, Chief Jim Lee of IRS Criminal Investigation (IRS:CI), and Special Agent in Charge Tatum King of Homeland Security Investigations (HSI) San Francisco made the announcement.
The USSS; FBI; IRS:CI Oakland Field Office and Cyber Crime Unit in Washington, D.C.; and HSI are investigating the case.
Trial Attorney C. Alden Pelker of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Claudia Quiroz for the Northern District of California, both members of the National Cryptocurrency Enforcement Team (NCET), and Assistant U.S. Attorney Katherine Lloyd-Lovett for the Northern District of California are prosecuting the case.
The Justice Department’s Office of International Affairs worked with the Latvian government to secure the arrest of Klimenka.
The NCET was established to combat the growing illicit use of cryptocurrencies and digital assets. Within the Criminal Division’s Computer Crime and Intellectual Property Section, the NCET conducts and supports investigations into individuals and entities that are enabling the use of digital assets to commit and facilitate a variety of crimes, with a particular focus on virtual currency exchanges, mixing and tumbling services, and infrastructure providers. The NCET also works to set strategic priorities regarding digital asset technologies, identify areas for increased investigative and prosecutorial focus, and lead the department’s efforts to collaborate with domestic and foreign government agencies as well as the private sector to aggressively investigate and prosecute crimes involving cryptocurrency and digital assets.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Foreign National Charged for International Money Laundering Conspiracy and Role in Operation of Unlicensed Digital Currency Exchange BTC-eRead the Press Release
SAN FRANCISCO — An indictment was unsealed on Tuesday charging a Belarusian and Cypriot national with money laundering conspiracy and operation of an unlicensed money services business.
According to the indictment, between 2011 and July 2017, Aliaksandr Klimenka, 42, allegedly controlled BTC-e, a digital currency exchange, with Alexander Vinnik and others. Klimenka also allegedly controlled Soft-FX, a technology services company, and FX Open, a financial company.
The indictment alleges BTC-e was a significant cybercrime and online money laundering entity that allowed its users to trade in bitcoin with high levels of anonymity and developed a customer base heavily reliant on criminal activity. BTC-e allegedly facilitated transactions for cybercriminals worldwide and received criminal proceeds from numerous computer intrusions and hacking incidents, ransomware scams, identity theft schemes, corrupt public officials, and narcotics distribution rings, and allegedly was used to facilitate crimes ranging from computer hacking to fraud, identity theft, tax refund fraud schemes, public corruption, and drug trafficking. BTC-e’s servers, maintained in the United States, were allegedly one of the primary ways in which BTC-e and its operators effectuated their scheme. Those servers were allegedly leased to and maintained by Klimenka and Soft-FX.
Despite doing substantial business in the United States, BTC-e allegedly was not registered as a money services business with the U.S. Department of Treasury, had no anti-money laundering process, no system for appropriate “know your customer” or “KYC” verification, and no anti-money laundering program as required by federal law.
Klimenka was arrested in Latvia on Dec. 21, 2023, at the request of the United States and made his initial appearance in San Francisco yesterday. He is currently being held in custody.
If convicted, Klimenka faces a maximum penalty of 25 years in prison.
U.S. Attorney Ismail J. Ramsey for the Northern District of California, Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division, Special Agent in Charge William Mancino of the U.S. Secret Service (USSS) Criminal Investigative Division, Assistant Director Michael D. Nordwall of the FBI’s Criminal Investigative Division, Chief Jim Lee of IRS Criminal Investigation (IRS:CI), and Special Agent in Charge Tatum King of Homeland Security Investigations (HSI) San Francisco made the announcement.
The USSS; FBI; IRS:CI Oakland Field Office and Cyber Crime Unit in Washington, D.C.; and HSI are investigating the case.
Trial Attorney C. Alden Pelker of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Claudia Quiroz for the Northern District of California, both members of the National Cryptocurrency Enforcement Team (NCET), and Assistant U.S. Attorney Katherine Lloyd-Lovett for the Northern District of California are prosecuting the case.
The Justice Department’s Office of International Affairs worked with the Latvian government to secure the arrest of Klimenka.
The NCET was established to combat the growing illicit use of cryptocurrencies and digital assets. Within the Criminal Division’s Computer Crime and Intellectual Property Section, the NCET conducts and supports investigations into individuals and entities that are enabling the use of digital assets to commit and facilitate a variety of crimes, with a particular focus on virtual currency exchanges, mixing and tumbling services, and infrastructure providers. The NCET also works to set strategic priorities regarding digital asset technologies, identify areas for increased investigative and prosecutorial focus, and lead the department’s efforts to collaborate with domestic and foreign government agencies as well as the private sector to aggressively investigate and prosecute crimes involving cryptocurrency and digital assets.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Final Defendant Sentenced in a Gas Scheme that Cost Victims over $200,000Read the Press Release
SALT LAKE CITY, Utah – Emmanuel Dejesus Nina-Perez, 31, of Salt Lake City, was sentenced today to 27 months’ imprisonment by a U.S. District Court Judge as a result of a guilty plea. Nina-Perez is the sixth and final defendant in a three-year conspiracy that defrauded gas station customers and their banks by secretly using Bluetooth enabled skimming equipment to steal customers’ credit card information.
According to court documents and statements made at the change of plea hearing, Yarislani Padron-Cruz, 38, a foreign national living in Salt Lake City; Yofre Napoleon Almonte, 50, a foreign national living in Salt Lake City; Iraldo Pereda-Mendez, 36, of Salt Lake City; Jandry Artigas-Reyes, 38, a foreign national living in Salt Lake City; and Yosbel Delgado-Valdes, 44, of Salt Lake City, pleaded guilty to participating in a gas scheme conspiracy that began in 2017 and lasted through 2020. The defendants executed the conspiracy by using Bluetooth enabled skimming equipment that they installed onto gas pumps, specifically, on the motherboard of the internal computer that controls the gas pumps. Skimming equipment contains a Bluetooth card reader/recorder that records information – such as the customers’ credit card number, name and zip code associated with the card. After installation, the defendants would get within range of the Bluetooth skimming device to initiate a wireless Bluetooth connection at the gas pump. The defendants would then download the digital credit card/debit card information captured by and stored in their skimming device. The defendants then encoded the data captured onto duplicate cloned cards and would use them to purchase fuel and other items. Several of the co-conspirators, including Nina-Perez, were either long-haul truck drivers or had close connections to trucking transportation companies who operated fleets of long-haul trucks. Collectively, the defendants are responsible for over $200,000 in losses.
In addition to Nina-Perez’s sentence of imprisonment, Padron-Cruz was sentenced to 48 months imprisonment; Almonte was sentenced to 36 months’ imprisonment; Pereda-Mendez was sentenced to 39 months’ imprisonment; Artigas-Reyes was sentenced to 45 months’ imprisonment; and Delgado-Valdes was sentenced to 50 months’ imprisonment. Each has been ordered by the court to pay joint restitution to the victims. The court also ordered the forfeiture of $38,372 cash seized from Nina-Perez’s co-defendants’ residence in connection with their arrests.
“The theft of funds and identities imposed a serious burden and harm on the victims,” said U.S. Attorney Trina A. Higgins of the District of Utah. “My office is committed to seeking justice for victims and working with our investigative partners to crack down on this type of fraudulent behavior.”
“Filling up our gas tanks is a common, routine activity which means any one of us could have been a victim of this crime,” said Special Agent in Charge Shohini Sinha of the Salt Lake City FBI. “Fraud not only costs businesses and banks, but places an added burden on citizens to recover from identity theft. We encourage the public to regularly check their bank statements and report any potential fraud to local law enforcement or the FBI.”
The case was investigated jointly by the FBI Salt Lake City Field Office and an FBI Task Force Officer with the Salt Lake City Police Department.
Assistant United States Attorney Ruth Hackford-Peer and Special Assistant United States Attorney Sachiko J. Jepson of the U.S. Attorney’s Office for the District of Utah prosecuted the case.
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emmanuelninaperez.sentencingfactors.pdfFederal Inmate Pleads Guilty to Assaulting a Federal Corrections Officer at the Federal Transfer Center in Oklahoma CityRead the Press Release
OKLAHOMA CITY – Today, REYES LUIS HOLGUIN, 31, of Phoenix, Arizona, pleaded guilty to assaulting a federal officer, announced U.S. Attorney Robert J. Troester.
On November 7, 2023, a federal grand jury charged Holguin with assault on a federal officer or employee involving physical contact. According to public record, in August 2023 Holguin was a temporary inmate at the Federal Transfer Center in Oklahoma City when he assaulted a federal corrections officer.
At a change of plea hearing today, Holguin pleaded guilty to physically assaulting a federal corrections officer, after Holguin had entered the office of a corrections officer without permission.
At sentencing, Holguin faces up to eight years in federal prison and a fine of up to $250,000.00.
This case is the result of an investigation by the Bureau of Prisons Special Investigative Services. Assistant U.S. Attorney Bow Bottomly is prosecuting the case.
Reference is made to public filings for additional information.
Fall River Police Officer Found Guilty of Assaulting Man in CustodyRead the Press Release
BOSTON – A Fall River Police Officer was convicted today following a four-day jury trial of assaulting a man in custody with a baton and failing to report the assault in subsequent reports.
Nicholas M. Hoar, 37, was convicted of on one count of deprivation of rights under color of law and two counts of false reports. U.S. District Court Judge Allison D. Burroughs scheduled sentencing for April 24, 2024. Hoar was arrested and charged in November 2022.
“Police officers who abuse their power will continue to be held accountable by this office,” said Acting United States Attorney Joshua S. Levy. “This office has a huge amount of respect for the thousands of men and women in law enforcement who conduct their jobs with high integrity and put their lives at risk every day. The defendant’s conduct and lack of moral compass is an affront to all those members of law enforcement who serve with honor.”
“What Fall River Police Officer Nicholas Hoar did – in using his position of authority to assault a man in his custody and then try to cover it up by filing false reports– is utterly contemptible,” said Jodi Cohen, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division. “We in law enforcement are granted significant authority in order to effectively do our jobs, and when a police officer abuses those powers and deprives another human being of their civil rights, the FBI and our partners will ensure they are brought to justice for egregiously violating the public’s trust.”
On Dec. 21, 2020, while on duty as an officer with the Fall River Police Department, Hoar struck an individual who had been arrested in the forehead with a baton, resulting in bodily injury to the arrestee. Additionally, on Dec. 21 and Dec. 22, 2020, Hoar submitted two reports which omitted any mention of the fact that he had struck the arrestee in the forehead with a baton.
The charge of deprivation of rights under color of law resulting in bodily injury 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. The charge of false reports provides for a sentence of up to 20 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.
Acting U.S. Attorney Levy and FBI SAC Cohen made the announcement today. Assistant U.S. Attorneys Kristina E. Barclay and John J. Reynolds III of the Criminal Division are prosecuting the case.
FCI Schuylkill Inmate Sentenced to Six Months in Prison for Possession of A WeaponRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Tyrell Lockhart, age 26, a federal inmate incarcerated at FCI Schuylkill, was sentenced to six months’ imprisonment by United States District Court Judge Malachy E. Mannion, for his of possession of contraband in prison.
According to United States Attorney Gerard M. Karam, in July of 2023, a corrections officer observed inmate Lockhart in his cell where, pursuant to a search, the officer discovered that Lockhart was concealing a homemade knife, commonly referred to as a “shank.”
The case was investigated by the Federal Bureau of Investigations and the Special Investigative Services of the Federal Bureau of Prisons. Assistant U.S. Attorney Luisa Honora Berti is prosecuting the case.
The maximum penalty under federal law for this offense is up to 5 years of 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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El Paso Fentanyl Dealer Sentenced to More Than 10 Years in PrisonRead the Press Release
EL PASO, Texas – An El Paso man was sentenced in a federal court in El Paso to 130 months in prison for possession with intent to distribute fentanyl.
According to court documents, Gary Everett Rinker, 56, sold approximately 200 pills containing 19.8 grams of fentanyl to a buyer at an El Paso hotel. The criminal complaint filed July 12, 2023 alleged that over a separate three-day period Rinker sold quantities of counterfeit Oxycodone Hydrochloride 30 mg tablets to the buyer, totaling approximately 55 grams of fentanyl.
Rinker was arrested in July 2023 and pleaded guilty Nov. 1, 2023.
“This defendant was a prominent fentanyl dealer in the El Paso community who will spend the next decade off our streets, largely due to his extensive drug-related criminal history dating back to 2007,” said U.S. Attorney Jaime Esparza for the Western District of Texas. “I commend the joint efforts of our partners at FBI and the Drug Enforcement Administration, as well as the dedicated attorneys of the Western District who continue to aggressively prosecute these offenders.”
“Fentanyl continues to be a considerable threat to our communities, ending the lives of our neighbors, friends and loved ones who, in many cases, aren’t even aware they’re taking the drug,” said Special Agent in Charge John Morales for the FBI El Paso Field Office. “FBI El Paso and our Drug Enforcement Administration partners are working together will come after anyone supplying poison to innocent lives and bring them to justice.”
“Our Fentanyl Overdose Response Team (FORT) does not just investigate fatalities caused by fentanyl,” said Towanda Thorne-James, Special Agent in Charge of the DEA’s El Paso Division. “By putting Mr. Rinker behind bars, FORT worked proactively to potentially save lives. Rinker was not the first fentanyl dealer targeted by our FORT, and he won’t be the last.”
The FBI and DEA investigated the case.
Assistant U.S. Attorney Richard Watts prosecuted the case.
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Cumberland County Man Charged with Child Pornography OffensesRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Timothy Laird Boatman, age 39, of Mechanicsburg, Pennsylvania was indicted yesterday by a federal grand jury with child pornography offenses.
According to U.S. Attorney Gerard M. Karam, the indictment charges Boatman with multiple counts of sexually exploiting children to produce child pornography and coercing and enticing children to do the same. The offenses occurred between March 1, 2023 and July 1, 2023, in Cumberland County.
The case was investigated by Homeland Security Investigations. Assistant U.S. Attorney K. Wesley Mishoe prosecuted the case.
The case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims.
The maximum penalty upon conviction for the charged offenses is life imprisonment, a lifetime term of supervised release following imprisonment, a fine, a statutory assessment, and a special assessment. A sentence following a finding of guilt is imposed by a judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Indictments are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
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Convicted drug trafficker sentenced for illegally re-entering country after seven prior removalsRead the Press Release
LAREDO, Texas – A 43-year-old Mexican man has been sentenced following another conviction for illegally re-entering the United States, announced U.S. Attorney Alamdar S. Hamdani.
Gabino Escamilla pleaded guilty Nov. 8, 2023.
U.S. District Judge Micaela Alvarez has now ordered Escamilla to serve 40 months in federal prison. Not a U.S. citizen, Escamilla is again expected to face removal proceedings following his imprisonment. At the hearing, the court heard about Escamilla’s conviction in 2016 for conspiracy to distribute more than five kilograms of cocaine in Columbus, Ohio. Escamilla had already been removed from the United States six times prior to his conviction for drug trafficking.
On Aug. 30, 2023, law enforcement encountered Escamilla near Laredo. Escamilla was first ordered removed Jan. 25, 2010, and has subsequently been removed by authorities seven times from 2010 to 2019.
Escamilla will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Border Patrol conducted the investigation. Special Assistant U.S. Attorney Terence A. Check Jr. prosecuted the case.
Convicted Felon Sentenced to 46 Months in Prison for Possession of A FirearmRead the Press Release
Orlando, FL – U.S. District Judge Wendy W. Berger has sentenced Desha Cooper (32, Ocoee) to 3 years and 10 months in federal prison for possessing a firearm as a previously convicted felon. Cooper entered a guilty plea on October 24, 2023.
According to court records, on the night of February 3, 2023, an officer from the Orlando Police Department conducted a traffic stop of a vehicle that Cooper was driving. The officer observed a loaded firearm on the driver’s side floorboard of the vehicle, and Cooper fled on foot. The United States Marshals Service later located and arrested Cooper. At the time of his arrest, Cooper, a previously convicted felon, was in possession of a second loaded firearm. As a convicted felon who previously served time in federal prison for a firearm offense, Cooper is prohibited from possessing firearms or ammunition under federal law.
This case was investigated by the Federal Bureau of Investigation with valuable assistance from the Orlando Police Department and the United States Marshals Service. It was prosecuted by Assistant United States Attorney Richard Varadan.
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.
Convicted Felon Indicted for Possession of Firearm and Ammunition in Connection with St. Petersburg ShootingRead the Press Release
Tampa, FL - United States Attorney Roger B. Handberg announces the return of an indictment charging Daniel Gonzalez (23, St. Petersburg) with possessing a firearm and ammunition as a convicted felon. If convicted, Gonzalez faces up to 15 years in federal prison.
According to court proceedings, the charges arise from a January 1, 2023, shooting in a St. Peterburg parking garage during which a 16-year-old was shot. After the shooting, responding officers from the St. Petersburg Police Department observed a vehicle fleeing the parking garage. The officers followed the vehicle for a short period of time until the pursuit was terminated due to weather conditions. Soon after, a Springfield Armory Hellcat 9mm pistol was found in the road where officers had observed the vehicle fleeing. The firearm was swabbed for DNA and Gonzalez’s DNA was found on two different parts of the firearm.
At the time, Gonzalez had a prior felony conviction for sale or delivery of a controlled substance. As a convicted felon, he is prohibited from possessing a firearm or ammunition under federal law.
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by Bureau of Alcohol, Tobacco, Firearms and Explosives and the St. Petersburg Police Department. It will be prosecuted by Assistant United States Attorney Samantha Newman.
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.
Cleveland Area Brothers Indicted for Fraud and Money Laundering SchemesRead the Press Release
CLEVELAND – Rebecca C. Lutzko, United States Attorney for the Northern District of Ohio announced today that a federal grand jury sitting in Cleveland returned a twenty-two count indictment charging two Cleveland area brothers with multiple fraud and money laundering schemes.
Zubair Mehmet Abdur Razzaq Al Zubair, 41, recently of Bratenahl, Ohio, and his brother Muzzammil Muhammad Al Zubair, 30, recently of Pepper Pike, Ohio, face one count of conspiracy to commit wire fraud, 14 counts of wire fraud, one count of conspiracy to engage in money laundering, four counts of money laundering, and one count of theft of government funds. Zubair Al Zubair also faces one count of harboring a fugitive.
The indictment charges that from June 2020 through August 2023, the Al Zubair brothers engaged in multiple schemes, including an investment fraud scheme, a Small Business Administration COVID-19 relief Emergency Income Disaster Loan scheme, a cryptocurrency mining scheme, a commercial real estate lease scheme, and a residential real estate lease scheme. According to the facts alleged in the indictment, the Al Zubair brothers obtained funds and property from victims under false pretenses and spent the proceeds on luxury items, such as cars, travel, entertainment, firearms, and jewelry. They allegedly falsely claimed to have extraordinary wealth and government connections. Zubair Al Zubair also allegedly falsely claimed to be married to a princess and to be a member of a royal family in the United Arab Emirates. The defendants also allegedly made false claims about potential investments returns, about property they owned or controlled, and about their intentions, among other falsehoods alleged in the indictment. Through these false claims, the Al Zubair brothers allegedly obtained millions of dollars from their victims. In addition to the fraud and money laundering charges, Zubair Al Zubair is also charged with providing a place to stay and transportation to a fugitive wanted on federal criminal charges.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Matthew W. Shepherd.
Charleston Man Sentenced to More than 22 Years in Prison for Drug and Gun CrimesRead the Press Release
CHARLESTON, W.Va. – Samuel Pierre Joseph, 41, of Charleston, was sentenced today to 22 years and six months in prison, to be followed by five years of supervised release, for possession with intent to distribute 50 grams or more of a mixture containing methamphetamine, possession of firearms in furtherance of a drug trafficking crime, being a felon in possession of a firearm, possession with intent to distribute 50 grams or more of methamphetamine and a quantity of fentanyl, and possession with intent to distribute 500 grams or more of a mixture containing methamphetamine and 40 grams or more of a mixture containing fentanyl.
A federal jury found Joseph guilty on July 11, 2023, following a two-day trial. Evidence at trial proved that on December 27, 2021, law enforcement officers encountered Joseph as he left his room at the Knights Inn on MacCorkle Avenue in Charleston. Joseph dropped a black duffel bag he was carrying and attempted to flee. Officers apprehended Joseph and found approximately 267 grams of methamphetamine, a Smith & Wesson Model Bodyguard .380-caliber semi-automatic pistol, a Ruger model LC9s 9mm semi-automatic pistol and drug paraphernalia in the duffel bag. Officers also found $1,355 on Joseph’s person.
Federal law prohibits a person with a prior felony conviction from possessing a firearm or ammunition. Joseph knew he was prohibited from possessing a firearm because of his prior felony conviction for possession of marijuana, fourth offense, in the Second Judicial District Court for the Parish of Bienville, Louisiana, on April 14, 2015.
On March 17, 2022, Joseph was a passenger of a vehicle pulled over by law enforcement officers in a Dudley Avenue parking lot in Parkersburg. During the traffic stop, officers found approximately 152 grams of methamphetamine and 12.9 grams of a mixture containing fentanyl and heroin on Joseph’s person. Officers arrested Joseph and took him to the Parkersburg Police Department. While at the police department, Joseph attempted to dispose of a business card from a Charleston storage unit rental facility that included the number of a storage unit that Joseph rented at the facility. Officers recovered the card and obtained a search warrant for the rented storage unit. Officers found approximately 896.8 grams of methamphetamine and 83.6 grams of fentanyl in the rented storage unit when they executed the search warrant.
“This defendant has a criminal history that includes 15 prior convictions and was not deterred by his December 2021 arrest as the subsequent traffic stop demonstrates,” said United States Attorney Will Thompson. “Today’s sentence reflects not only his persistent criminal conduct, but also the dedication and teamwork of the law enforcement officers who brought him to justice.”
Thompson made the announcement and commended the investigative work of the Metropolitan Drug Enforcement Network Team (MDENT) and the Parkersburg Police Department, and the assistance provided by the Federal Bureau of Investigation (FBI), the Drug Enforcement Administration (DEA), the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and the Charleston Police Department.
Chief United States District Judge Thomas E. Johnston imposed the sentence. Assistant United States Attorneys Jeremy B. Wolfe and Troy D. Adams prosecuted 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. 2:22-cr-93.
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Cedar Rapids Contractor Pleads Guilty to Wire FraudRead the Press Release
A Cedar Rapids contractor who scammed victims of the 2020 Iowa derecho pled guilty today in federal court in Cedar Rapids, Iowa. Scott Gregory Adkins, age 48, who did business as “Adkins Home Improvements LLC,” was convicted of one count of wire fraud.
On August 10, 2020, a severe storm, commonly referred to as a derecho, struck multiple counties in the Northern District of Iowa, as well as other parts of the States of Iowa, Illinois, and Indiana. Media reporting on the event, citing public and private sources, have estimated that the derecho, with winds exceeding 100 mph, caused an estimated total of $7.5 billion in damage across the affected states. The derecho caused long-duration power outages across the Northern District of Iowa and the larger region, millions of acres of crops were damaged or destroyed, and numerous semi-trucks were blown off major interstate highways. Just within the city of Cedar Rapids, power was cut to nearly all of the city’s residents by the derecho, and damage estimates indicate that over 1,000 housing units were rendered unlivable while hundreds of additional homes suffered damage. Many of the city’s businesses were also damaged during the storm.
In a plea agreement, Adkins admitted that, from December 2020, through March 2022, he devised and perpetrated a scheme to defraud his customers, including victims of the 2020 Iowa derecho. Adkins organized “Adkins Home Improvements LLC” in October 2020, approximately two months after the derecho. By means of “Adkins Home Improvements LLC,” Adkins offered home repair services to victims of the derecho, as well as other individuals in the Cedar Rapids area who needed projects completed in the tight-labor, post-derecho construction market.
As a part of his scheme, Adkins offered to provide construction services and materials to prospective customers of “Adkins Home Improvements LLC,” including but not limited to victims of the derecho. Adkins provided estimates to those customers and demanded substantial advance deposits or downpayments before undertaking work on the projects. Instead of completing the projects, Adkins spent some of the advanced funds on personal expenses, including but not limited to food, and transferred other such funds to a family member by means of a mobile payment service. Adkins also made false statements and excuses to his customers about the status of their projects to conceal his illicit use of the funds and to lull his customers into a false sense of security. Adkins stole over $150,000 as part of his scheme, and one of his victims was an elderly widow who suffered roof damage to her Cedar Rapids residence from the derecho.
Sentencing before United States District Court Chief Judge Leonard T. Strand will be set after a presentence report is prepared. Adkins remains in custody of the United States Marshal pending sentencing. Adkins faces a possible maximum sentence of 20 years’ imprisonment, a $250,000 fine, and three years of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorney Timothy L. Vavricek and was investigated by the Federal Bureau of Investigation and the Cedar Rapids Police Department.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 23-CR-66.
Follow us on Twitter @USAO_NDIA.
Canadian Man Pleads Guilty to Role in Scheme that Manipulated Penny Stock Prices and Cost Hedge Fund Investors More Than $215 MillionRead the Press Release
LOS ANGELES – A trader for a group of hedge funds pleaded guilty this afternoon to participating in a scheme that manipulated penny stock prices to inflate the hedge fund’s reported profits – fraudulent gains that generated millions of dollars in management and performance fees – and caused investors to lose more than $215 million when the funds collapsed.
Colin Heatherington, 49, of Vancouver, Canada, pleaded guilty to one count of conspiring to commit securities fraud and wire fraud and admitted his role in the scheme run out of Absolute Capital Management Holdings (Absolute Funds), a Cayman Island-based company that managed eight hedge funds from offices in Mallorca, Spain.
Heatherington was a securities trader who worked closely with the founder and chief investment officer of Absolute Funds, Florian Wilhelm Jürgen Homm, 64, a German financier who was indicted in March 2013 and is currently a fugitive from justice.
As part of the scheme, Heatherington oversaw the purchase of billions of shares of United States-based penny stocks, which were then traded using various manipulative practices, such as cross trading, which fraudulently inflated the value of the stocks and, in turn, the value of the Absolute Funds.
Heatherington and others in the scheme also reaped profits through self-dealing trades in which they sold their own shares of artificially inflated penny stocks to the Absolute Funds.
After this case was indicted, Heatherington was in Canada, and the United States sought his extradition. After fighting extradition, Heatherington agreed last year to come to the United States.
Another defendant in this case – Todd Michael Ficeto, 57, a former Beverly Hills stockbroker – was sentenced to six years in federal prison after being convicted of 18 felonies relating to his managerial role in the scheme to manipulate penny stock prices, which garnered him many millions of dollars from fees and commissions and self-dealing trades. Ficeto also allowed members of the conspiracy to trade the manipulated penny stocks through his company, among other fraudulent acts.
Heatherington pleaded guilty before United States District Judge John A. Kronstadt, who scheduled a sentencing hearing for May 9, at which time, Heatherington will face a statutory maximum sentence of 25 years in federal prison.
The FBI investigated this matter. The Department of Justice’s Criminal Division’s Office of International Affairs, IRS Criminal Investigation, the United States Securities and Exchange Commission, and the Financial Industry Regulatory Authority (FINRA) provided assistance.
Assistant United States Attorneys Cassie D. Palmer of the Public Corruption and Civil Rights Section, Scott Paetty of the Major Frauds Section, and Ian V. Yanniello of the General Crimes Section are prosecuting this case.
California Drug Trafficker Sentenced to Federal PrisonRead the Press Release
PORTLAND, Ore.—A Fontana, California man was sentenced to federal prison Wednesday for his role in a local drug distribution ring responsible for trafficking large quantities of illegal narcotics from Mexico into the Portland metro area for redistribution and sale.
Javier Sarabia, 28, was sentenced to 151 months in federal prison and five years’ supervised release.
According to court documents, beginning in April 2019, special agents from the U.S. Drug Enforcement Administration (DEA) and other law enforcement agencies began investigating a drug trafficking organization operating in Portland and Vancouver, Washington. On April 22, 2019, investigators stopped a vehicle traveling north on Interstate 5 toward Portland. An initial search of the vehicle returned $23,000 in cash and what appeared to be hand-written drug ledgers. Later, while conducting a full search of the vehicles, investigators found two after-market compartments under the vehicle’s front seats concealing 100 pounds of crystal methamphetamine and eight pounds of heroin.
Further investigation revealed that the driver of the seized vehicle had recently communicated with Sarabia who served as a drug load coordinator, stash house operator, courier, and sub-distributor for the trafficking organization. It was later determined that Sarabia himself had arranged for the drugs to be loaded into the seized vehicle.
One month later, on May 28, 2019, as part of an unrelated law enforcement operation, police in Chino, California stopped Sarabia in a vehicle that was found to contain approximately ten pounds of methamphetamine. Sarabia confessed to his involvement in the drug trafficking organization and admitted to personally loading the drugs into the vehicle stopped and seized in Oregon.
On August 14, 2019, a federal grand jury in Portland returned a five-count indictment charging Sarabia and eleven others with conspiracy to possess with intent to distribute and distribute controlled substances, use a communication facility, and maintain drug-involved premises, and other related charges. On October 18, 2023, Sarabia pleaded guilty to the conspiracy charge.
Sarabia is the eleventh person in the conspiracy to be sentenced. The twelfth and final defendant is a fugitive.
This case was investigated by DEA with assistance from the Tigard Police Department. It was prosecuted by the U.S. Attorney’s Office for the District of Oregon.
Bristol Man Sentenced for Defrauding Consumers by Interstate WireRead the Press Release
Burlington, Vermont – The Office of the United States Attorney for the District of Vermont announced that David Conrad, 42, of Bristol, Vermont was sentenced on January 30, 2024 to a 5-year term of probation, following his guilty plea to conducting a wire fraud scheme between approximately January of 2022 and February 28, 2023. United States District Judge Christina Reiss also ordered Conrad to pay $58,430.52 in restitution to 43 victims, and to forfeit $58,430.52 of fraudulently obtained proceeds to the United States.
According to court records, David Conrad operated a custom woodworking business under the names “Old Camp Woodworking” and “Vermont Custom Designs.” Conrad was the sole employee of the business, which he ran out of the two-car garage attached to his residence in Bristol, Vermont. Conrad advertised his businesses on Facebook, and had stand-alone websites which allowed customers to place orders for custom wood items, such as dining tables, dressers, bedroom sets, desks, and other items. Parts of these websites were plagiarized from other woodworking websites, and some of the photographs on the websites were not original photographs of custom pieces crafted by Conrad, but rather copies of photographs from elsewhere on the internet. Conrad’s websites displayed strict cancelation and refund policies, listing a 25% processing fee for orders canceled within 24 hours; a 75% processing fee for orders canceled within 30 days; and no refunds for orders canceled after 30 days.
Between January 2022 and February 2023, Conrad accepted approximately $165,500 through various payment methods for over 100 different items ordered by customers in Vermont, New York, and New Hampshire. As part of the scheme to defraud, Conrad accepted payment for items he knew he could not complete within the 12-to-16-week timeframe he quoted customers. Conrad made numerous false statements to customers regarding the status of their orders and regarding why orders had not been completed (including false claims of having had a heart attack and cutting off a portion of his finger). Conrad used his strict refund policy as a reason to retain funds from customers, despite not having begun work on their orders. Conrad used funds obtained from customers to pay for his and his family’s personal expenses, while knowing that he would be unable to complete the custom-made wood item ordered by the customer.
United States Attorney Nikolas P. Kerest commended the investigatory efforts of Homeland Security Investigations, and thanks the Vermont Attorney General’s Consumer Assistance Program for its assistance in compiling consumer complaints and their collaborative work on the investigation.
The prosecutor was Assistant United States Attorney Jonathan A. Ophardt. Conrad was represented by Chandler Matson, Esq.
Boston Man Pleads Guilty to Unlawful Trafficking of Machinegun Conversion DevicesRead the Press Release
BOSTON – A Boston man pleaded guilty today in federal court in Boston to illegally selling a dozen machinegun conversion devices.
Michael Wilkerson, 23, pleaded guilty to one count of engaging in the business as a manufacturer or dealer in firearms. U.S. District Court Judge Denise J. Casper scheduled sentencing for April 30, 2024. Wilkerson was initially arrested and charged along with co-defendant Elijah Navarro in February 2023. The defendants were subsequently indicted by a federal grand jury in March 2023.
In January 2023, Navarro agreed to sell 12 machinegun conversion devices to an individual in exchange for $1,700. Following a series of communications, Navarro met the individual twice at a pre-arranged location. On Jan. 19, 2023, Navarro sold the first two machinegun conversion devices for $400 and later, on Jan. 25, 2023, Navarro sold the remaining 10 devices for an additional $1,300 out of Wilkerson’s residence.
During a search of Wilkerson’s residence in February 2023, two 3-D printers, 3-D printing material, machinegun conversion devices, a ballistic vest as well as firearms, ammunition and magazines were seized.
Neither Navarro nor Wilkerson possess licenses to import, manufacture, deal or possess firearms.
Navarro pleaded guilty to his role in the conspiracy in December 2023. He is scheduled to be sentenced on March 13, 2024.
The charge of engaging in the business as a manufacturer or dealer in firearms provides for a sentence of up to 10 years in prison, three years of supervised release and a fine of up to $10,000. The charge of unlawful transferring or possession of a machinegun 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.
Acting United States Attorney Joshua S. Levy; James M. Ferguson, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Boston Field Division; and Boston Police Commissioner Michael A. Cox made the announcement today. Assistant U.S. Attorney John T. Dawley of the Organized Crime & Gang Unit is prosecuting the case.
Boone County Man Sentenced to 136 Months for Methamphetamine TraffickingRead the Press Release
COVINGTON, Ky. – A Union, Ky., man, Paul Marcus Sitavich, 42, was sentenced on Thursday, to 136 months in federal prison, by U.S. District Judge David Bunning, for possession with the intent to distribute 50 grams or more of methamphetamine.
According to his plea agreement, in January 2023, Sitavich sold approximately 3.495 grams of methamphetamine to an informant, which was observed by law enforcement. Then, on February 14, 2023, law enforcement conducted a traffic stop on a vehicle driven by Sitavich. After a drug dog indicated that narcotics were present, law enforcement searched the vehicle and found approximately 58.1 grams of pure methamphetamine, as well as a digital scale, empty bags, and other drug trafficking paraphernalia. Sitavich later admitted to selling controlled substances to make money, during a recorded video visit while in the Boone County Jail.
Under federal law, Sitavich 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; J. Todd Scott, Special Agent in Charge, DEA, Louisville Field Division; and Chief Tom Grau, Florence Police Department, jointly announced the sentence.
The investigation was conducted by the DEA and the Florence Police Department. Assistant U.S. Attorney Tony Bracke is prosecuting the case on behalf of the United States.
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Baltimore County Serial Fraudster Sentenced to Five Years in Federal Prison and Ordered to Pay $4.2 Million in RestitutionRead the Press Release
Baltimore, Maryland – U.S. District Judge Richard D. Bennett sentenced Adeyanju Adewale, age 40, of Reisterstown, Maryland, to five years in federal prison, followed by one year of home detention as part of three years of supervised release, for a wire fraud conspiracy that resulted in a loss of millions of dollars to Medicaid, businesses, law firms, financial institutions, individuals, and to the state and federal governments. Judge Bennett also ordered that Adewale must pay restitution of $4,258,587.03.
The sentence was announced by United States Attorney for the District of Maryland Erek L. Barron; Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division; Special Agent in Charge Karen L. Brown Cleveland of the U.S. Department of State’s Diplomatic Security Service (“DSS”) – Washington Field Office; Special Agent in Charge James C. Harris of Homeland Security Investigations (“HSI”) Baltimore; and Special Agent in Charge Maureen Dixon, Office of Investigations, Office of Inspector General of the Department of Health and Human Services (“HHS-OIG”).
According to his plea agreement, between 2018 and 2022 Adewale coordinated a series of frauds with various co-conspirators. Adewale assisted co-conspirators to obtain fraudulent identification documents that were used to perpetrate the fraud. Co-conspirators created shell companies and used shell company names and false, forged and counterfeit identification documents, including passports, to open bank accounts. Adewale obtained the bank information from his co-conspirators and communicated with his foreign conspirators about where the fraud proceeds should be directed. The foreign co-conspirators caused the victims to be misled into sending their money to those accounts. Adewale also served as a go-between with conspirators outside the United States and the U.S.-based bank account holders.
For example, as detailed in the plea agreement, in January 2019, Adewale worked with co-conspirators to fraudulently obtain money through a business email compromise scheme that victimized a business in Virginia that was seeking to disburse settlement funds. The victim business sent more than $400,000 to the bank account of an individual in Maryland who used the funds from the victim to purchase $71,000 and $62,000 cashier’s checks and caused the cashier’s checks to be delivered to an address in Baltimore used by Adewale. Adewale caused checks to be deposited into bank accounts controlled by co-conspirators and provided information about the companies associated with those bank accounts to members of the conspiracy located outside the United States. Adewale shared in the proceeds of the fraud.
During 2020, Adewale also participated in hospital frauds targeting Medicaid. Specifically, Adewale and his co-conspirators obtained money that the Ohio and Colorado Medicaid programs and the state of Ohio, sought to pay hospitals in Ohio and Colorado, including as reimbursement for health care services. As part of the fraud, false information was sent to an Ohio government office and Colorado Medicaid regarding the bank accounts on file for the hospitals. As a result of the fraudulent representations, from July to September 2020, the state of Ohio transferred approximately $3.5 million to a bank account controlled by a co-conspirator. The majority of the funds were quickly removed by the co-conspirator, transferred via check to other accounts. Similarly, in September 2020, fraudulent information was provided to representatives of Colorado Medicaid regarding the bank account on file for the hospital in Colorado. Later that month, Colorado Medicaid sent approximately $610,000 to a bank account controlled by the conspirators. Again, Adewale shared in the proceeds of the fraud schemes.
Adewale admitted that as a result of the fraud schemes the actual fraud losses exceeded $4.2 million, including more than $1 million in actual losses to a federal health benefit program, specifically, Medicaid.
“The Diplomatic Security Service is pleased with the success of this case. This shows the positive outcome when federal agencies work together to stop criminals from exploiting U.S. passports for illegal profit,” said Karen L. Brown Cleveland, Special Agent-in-Charge of the Washington Field Office of the U.S. Department of State’s Diplomatic Security Service (DSS). “We’re committed to investigating U.S. business operators who acquire U.S. passports to carry out criminal activities.”
United States Attorney Erek L. Barron and Acting Assistant Attorney General Nicole M. Argentieri praised the DSS, HSI, and HHS-OIG for their work in the investigation and thanked the FBI for its assistance. Mr. Barron thanked Assistant U.S. Attorneys Harry M. Gruber and Tamera Fine and Justice Department Trial Attorneys Gary A. Winters and Christopher Wenger of the Criminal Division’s Fraud Section, who prosecuted the case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.
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Arlington Man Sentenced for Attempting to Disable Railroad EquipmentRead the Press Release
United States Attorney Susan Lehr announced that Allan J. Love, Jr., 50, of Arlington, Nebraska, was sentenced on January 31, 2024, in federal court in Omaha, Nebraska, for attempting to disable railroad equipment. United States District Judge Brian C. Buescher sentenced Love to 12 months’ and 1 day imprisonment. There is no parole in the federal system. After Love’s release from prison, he will begin a 2-year term of supervised release.
On September 3, 2019, west of the 16th Street railroad crossing in Blair, Nebraska, a Union Pacific Railroad track maintenance worker discovered an approximately 6-foot-long green metal pipe lodged in the space between the railroad track switch bar and rail, making it impossible to fully move the switch into position.
Through investigation and law enforcement contacts with Love, law enforcement seized a green metal pipe found in Love’s pickup truck on April 30, 2020. Forensics performed on the green pipe found lodged in the railroad track and the green pipe found in Love’s truck determined the paints used on both pipes were indistinguishable in color, texture, and chemical composition. A metallurgy examination of the pipes determined that both were sections of welded, low-carbon steel tube with similar outer diameter, wall thickness, and weld manufacturing features.
Law enforcement also executed a search warrant on Love’s Google account. Within the Google account law enforcement found a photo taken on July 20, 2019, of the 16th Street railroad crossing in Blair showing the stretch of railroad track where the green pipe was found.
This case was investigated by the Federal Bureau of Investigation.