Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
2 November 2023
Former Memphis Police Officer Pleads Guilty to Federal Civil Rights and Conspiracy Charges in Connection with Death of Tyre NicholsRead the Press Release
MEMPHIS – One of five former Memphis Police Department officers facing federal charges in the tragic killing of Tyre Nichols pled guilty in federal court today.
Desmond Mills, Jr., 33, appeared before U.S. District Court Judge Mark S. Norris today and pled guilty to civil rights and conspiracy charges arising out of the January 7 incident.
On September 12, a federal grand jury returned a four-count indictment against Mills and co-defendants Emmitt Martin III, 31; Tadarrius Bean, 24; Demetrius Haley, 30; and Justin Smith, 28. The charges included using excessive force resulting in the death of Nichols; aiding and abetting each other in using that excessive force; failing to intervene to stop the excessive force; failing to render medical aid; and conspiring or taking action to cover up their misconduct.
The remaining four defendants still face a federal trial scheduled for May 6, 2024.
In today’s court appearance, Mills pled guilty to counts one and three of the indictment. Count one charged Mills with using excessive force and failing to intervene in the unlawful assault. Count three charged Mills with conspiring to cover up his use of unlawful force by omitting material information and by providing false and misleading information to his supervisor and to others.
Mills admitted to additional facts that were presented in court in connection with his plea agreement:
- Mills admitted to repeatedly and unjustifiably striking Nichols with a baton and to failing to intervene in other officers’ use of force against Nichols. Mills said he watched another officer repeatedly punch Nichols in the head while two other officers restrained Nichols.
- Mills admitted that he did not provide any medical aid to Nichols after the beating, though he knew that Nichols had a serious medical need. He did not alert MPD or Memphis Fire Department EMTs that Nichols had been struck in the head and body.
- In addition, Mills participated in conversations with other officers in which they discussed, using force against Nichols, hitting Nichols to make him fall, and believing they were on the verge of killing Nichols when they saw that Nichols did not fall from the blows.
- Mills admitted to making false statements in connection with the arrest of Nichols, including telling his supervisor that they had done “everything by the book” and providing false information in his statements to an MPD detective tasked with writing the incident report.
- Finally, Mills submitted an MPD report that provided a false account of the force used on Nichols, including a claim that Mills saw Nichols “aggressively resisting” officers. Instead of admitting that he had seen an officer repeatedly punch Nichols in the head while Nichols was restrained by two other officers, Mills reported only that “Nichols was eventually put into custody.”
Pursuant to the terms of Mills’s plea agreement, the government will recommend a maximum penalty of fifteen years in prison.
The four remaining defendants face federal charges as set forth in the indictment, which is merely a formal accusation of criminal conduct. The defendants are presumed innocent unless and until they are proven guilty beyond a reasonable doubt in a court of law.
Attorney General Merrick B. Garland, FBI Director Christopher Wray, Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division, and U.S. Attorney Kevin Ritz for the Western District of Tennessee made the announcement.
The FBI Memphis Field Office investigated this case.
Assistant U.S. Attorneys David Pritchard and Elizabeth Rogers, Special Litigation Counsel Kathryn E. Gilbert, and Deputy Chief Forrest Christian of the Justice Department’s Civil Rights Division are prosecuting the case.
Former King County Jail guard and five others indicted for bribery scheme that brought meth and fentanyl into Seattle jailRead the Press Release
Seattle – A former King County Jail guard, two Department of Corrections inmates, and three co-conspirators were indicted by a federal grand jury for five federal felonies including bribery, drug possession with intent to distribute, and conspiracy. Those arrested today will appear in U.S. District Court in Seattle at 2:00 this afternoon.
“Fentanyl and meth are horribly destructive in our community, and our correctional institutions are not immune. The challenge of keeping inmates safe is made much more difficult when correctional staff betray their positions of trust and authority,” said Acting U.S. Attorney Tessa M. Gorman. “I credit King County law enforcement officials with working quickly and cooperatively with the FBI to identify those allegedly involved in this bribery and drug smuggling conspiracy.”
According to the indictment, former King County Jail Guard Mosses Ramos, 39, of Milton, Washington, worked as a correctional officer for 17 years - from June 2006 until he was fired in September 2023. According to the indictment, between March and May 2023, Ramos accepted bribes to bring methamphetamine and fentanyl into the jail for the benefit of inmates Michael Anthony Barquet, 37, and Francisco Montero, 25. Both men are currently incarcerated.
The web of bribes and drug trafficking extended outside the jail with coconspirators who are associates of the two inmates: Neca Silvestre, 38, of Kent; Katrina Cazares, 38, of Burien; and Kayara Zepeda Montero, 27, of Seattle.
“Impact in our community is built on the foundation of partnership and trust,” said Richard A. Collodi, Special Agent in Charge of FBI Seattle. “We are grateful for the exceptional collaboration with the King County Jail, King County Sheriff’s Office, King County Prosecutor’s Office, and the U.S. Attorney's Office for their shared commitment to holding public servants who violate trust accountable and for steadfast efforts to keep drugs out of our correctional facilities. Our partners identified the actions of an employee and brought the case to our attention which resulted in a successful joint investigation. This demonstrates the commitment by public safety professionals to hold those who violate this trust to the highest standards.”
Each of the defendants is charged with four counts in the five-count indictment. Ramos is charged with soliciting and accepting a bribe. The other defendants are charged with bribery for paying the bribes. All are charged with conspiracy to engage in bribery, conspiracy to distribute controlled substances, and possession of controlled substances with intent to distribute.
ramos_et_al_indictment.pdfFor Ramos, Barquet, and Montero, the charges carry mandatory minimum sentences if convicted of ten years in prison and up to life in prison. The other defendants face up to 20 years in prison if convicted.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The case was investigated by the FBI, the King County Sheriff’s Office, and the King County Prosecuting Attorney’s Office.
The case is being prosecuted by Assistant United States Attorneys Cindy Chang and Vince Lombardi.
Former Jackson Lawyer and Former Jackson Lobbyist Sentenced for Conspiracy to Defraud InvestorsRead the Press Release
Jackson, Miss. – A former Jackson lawyer and a former Jackson lobbyist were sentenced for conspiracy to defraud investors in a timber deed investment scheme.
On October 31, 2023, former lawyer Jon D. Seawright, 51, of Jackson was sentenced to serve twelve months and one day in prison, followed by two years of supervised release. Former lobbyist Ted Brent Alexander, 58, of Jackson was sentenced to serve five years of probation, which includes two years of home confinement with electronic monitoring. Seawright and Alexander were ordered to pay restitution joint and severally in the amount of $977,044.53. On separate dates, Alexander and Seawright entered guilty pleas to conspiracy to commit wire fraud.
Alexander and Seawright conspired in a scheme to defraud investors by soliciting millions of dollars under false pretenses and by failing to use investor funds as promised. They represented to investors that they were in the business of loaning funds to a “timber broker” to buy timber rights from landowners and then to sell the timber rights to lumber mills at a higher price. Alexander and Seawright promised investors a return of 10% or more over twelve or thirteen months on each unit of invested capital. They led their investors to believe that they were inspecting each tract of land and were vetting each document, deed, and contract in support of their investments, causing investors to believe that their investments were secured by valid assets and that the financial incentives and interests of Alexander and Seawright aligned with those of the investors. In fact, Alexander and Seawright failed to inspect each property related to the timber rights underlying each investment, and they failed to verify each executed lumber mill agreement related to each investment. They made few or no such inquiries, and if they had made such inquiries, they would have discovered that the timber deeds, lumber mill agreements, and related documents had been falsified and were not valid.
Alexander and Seawright also represented to their investors that Alexander and Seawright would only profit from each series of the investment if it performed as promised to the investors. This gave the investors the misleading impression that their interests were fully aligned with those of Alexander and Seawright. In fact, in addition to receiving a predetermined percentage of return on the investors’ funds, Alexander and Seawright also received undisclosed payments of approximately 3% for recruiting investments to the timber investment scheme immediately upon transferring the investment funds to the purported timber broker. They did not disclose to the investors: (a) the fact of these payments, (b) the amount of the payments in relation to the investments made, or (c) the timing of the undisclosed payments to Alexander and Seawright before any repayment was made to the investors.
U.S. Attorney Todd W. Gee and Special Agent in Charge Jermicha Fomby of the Federal Bureau of Investigation made the announcement.
The case was investigated by the Federal Bureau of Investigation.
The case was prosecuted by Deputy Criminal Chief Dave Fulcher and former Assistant United States Attorney Andrew Eichner.
Former Employee of Care Facility Sentenced for Criminal Negligence of a Vulnerable AdultRead the Press Release
WASHINGTON – Kelly Barry, 25, of Upper Marlboro, Maryland, was sentenced today in Superior Court for one count of criminal negligence of a vulnerable adult, announced U.S. Attorney Matthew M. Graves for the District of Columbia, and Daniel W. Lucas, Inspector General for the District of Columbia, made the announcement.
Superior Court Judge Heidi Pasichow accepted Barry’s guilty plea today and ordered 180 days in jail, with a portion of that time suspended, 14 months of supervised probation, 90 hours of community service, and ordered that Barry be prohibited from working with anyone who cannot care for themselves.
According to court documents, Barry, was a former Direct Support Professional for Community Options, Inc., a residential facility for persons with disabilities, located in Rockville, Maryland. Barry’s job duties included taking individuals on outings in the local community, such as bowling, etc. for approximately three to four hours a day, five times per week. Between June and October 2022, Barry provided care to a vulnerable adult, who is non-verbal, autistic, and unable to care for himself. Instead of going to various community outings, Barry used the Community Options van to make food deliveries with the vulnerable adult.
On October 19, 2022, Barry utilized the Community Options van to pick up the vulnerable adult. That day, Barry drove to Washington, D.C., and made a total of five food deliveries. While making the final delivery, Barry exited the vehicle and left the vulnerable adult unattended. After the delivery was completed, Barry observed a masked individual steal the vehicle while the vulnerable adult was still inside the van. During his initial call to 911, Barry failed to mention that the vulnerable adult was in the stolen vehicle and subsequently failed to notify the D.C. Metropolitan Police Department officer who arrived on scene of the same. After, Barry informed his employer that he did not notify police that the vulnerable adult was still in the vehicle, and the company advised him to provide that information to the authorities. However, Barry did not provide this information during his subsequent notification. Approximately three and a half hours after the theft of the van, the vulnerable adult was found by the Prince George’s County Police Department, barefoot and wandering in the middle of traffic on the I-495 Capital Beltway. The Prince George’s County Police Department transported the vulnerable adult to a local hospital for treatment.
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 both the D.C. Metropolitan Police Department and Prince George’s County Police Department 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 Crack Dealer Sent Back to Federal Prison for Derecho FraudRead the Press Release
A former crack dealer who received approximately $1,900 in Federal Emergency Management Agency (FEMA) benefits after falsely claiming to have suffered damage in the 2020 derecho storm in Cedar Rapids was sentenced on November 1, 2023, to 90 days in federal prison.
Melvin McKinney, age 41, from Cedar Rapids, received the prison term after a June 15, 2023, guilty plea to one count of theft of government funds. In a plea agreement, and at the sentencing hearing, McKinney admitted that he stole $1,902.62 in FEMA benefits, specifically personal property and rental assistance. McKinney spent the stolen funds at gas stations, restaurants, and Victoria’s Secret.
In August 2020, the derecho swept through the Northern District of Iowa. The derecho caused an estimated $7.5 billion in damage within the State of Iowa and other affected states. The Northern District of Iowa, including the City of Cedar Rapids, was particularly hard-hit from the derecho, with estimated 100‑130 mph straight-line winds.
FEMA declared Disaster No. 4557 for the State of Iowa on August 17, 2020. Derecho victims could apply to FEMA for disaster relief assistance to help meet repair and replacement expenses not otherwise covered by private insurance.
In September 2020, McKinney received the FEMA funds after a false and fraudulent application for derecho benefits was filed in his name. Specifically, the application falsely stated that (1) McKinney was living in an apartment in Cedar Rapids at the time of the derecho, and (2) McKinney suffered both home and personal property damage from the derecho. In conjunction with the application, McKinney provided FEMA with the name of a fictitious landlord, “Willie Davis,” and McKinney pretended to be the same individual when FEMA attempted to verify that McKinney was entitled to derecho benefits. McKinney also lied to a FEMA investigator on the telephone, falsely stating that (1) his apartment building had lost almost half of its shingles, (2) the building’s central air conditioning units were blown over and damaged, (3) the windows to his apartment were blown out, (4) there was drywall and ceiling damage in his apartment, and (5) McKinney’s personal furnishings were damaged. All of these representations and statements were false: McKinney was not even a tenant of the apartment building, which suffered no significant damage in the derecho. When confronted by law enforcement agents, McKinney initialed lied about the theft but eventually confessed.
McKinney has a serious criminal history. In 2006, McKinney was convicted of multiple crack cocaine conspiracy and distribution charges in the United States District Court for the Southern District of Iowa and sentenced to 78 months’ imprisonment. In 2015, after his release from federal prison, McKinney was convicted of domestic abuse.
McKinney was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. McKinney was sentenced to 90 days’ imprisonment. He was ordered to make $1,902.62 in restitution to FEMA. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
McKinney was released on the bond previously set and is to surrender to the United States Marshal on December 4, 2023, at 10 a.m.
The case was prosecuted by Assistant United States Attorney Timothy L. Vavricek and investigated by the United States Department of Homeland Security, Office of Inspector General.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 23-CR-38-CJW-MAR.
Follow us on Twitter @USAO_NDIA.
Former Corrections Officer Is Sentenced to 17 Years for Traveling from Tennessee to North Carolina to Engage in Sexual Activity with A MinorRead the Press Release
ASHEVILLE, N.C. – John Allen Biggins, 42, of Surgoinsville, Tennessee, was sentenced today to 17 years in prison followed by a lifetime of supervised release, for traveling to Western North Carolina to engage in illicit sex acts with a minor, announced Dena J. King, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Martin Reidinger also ordered Biggins to register as a sex offender after he is released from prison.
Ronnie Martinez, Special Agent in Charge of Homeland Security Investigations (HSI) in North Carolina and South Carolina, and Jeff Cassidy, Sheriff of the Sullivan County Sheriff's office in Tennessee, join U.S. Attorney King in making today's announcement.
"As a sworn officer of the law, Biggins compromised public trust and violated federal statutes," said U.S. Attorney King. "Protecting our children from harm is one of our highest priorities, and identifying and prosecuting predators like Biggins is at the forefront of our efforts to combat child sexual exploitation. I commend Homeland Security Investigations and the Sullivan County Sheriff's Office for taking swift action. Thanks to their work and coordination, children are safe from this dangerous predator."
“Thankfully, Biggins’ plan to exploit a child was thwarted and he will be held accountable for his heinous crime. Additionally, he also stole the public’s trust when he betrayed his oath to protect the community and enforce the law,” said Special Agent in Charge Martinez. “Finding and arresting predators involved in victimizing and exploiting children is one of HSI’s highest priorities and we are committed to working with our law enforcement partners to use all available resources to protect our communities.”
“I’m thankful for the work of Homeland Security Investigations agents who identified this predator and took immediate action,” said Sheriff Cassidy. “I hope this case sends a very clear message that no matter where you work or what title you hold, we have no tolerance for those seeking to sexually exploit and abuse children.”
According to filed court documents and today’s sentencing hearing, beginning in June 2022, Biggins communicated with undercover agents expressing interest in engaging in illicit sexual acts with a minor female child. On July 8, 2022, Biggins traveled from his home in Surgoinsville to the Western District of North Carolina for the purposes of engaging in sexual acts with a female toddler and was subsequently arrested. When law enforcement arrested Biggins, he was found to be in possession of child pornography images and videos as well as a personally owned Glock 17 9mm semi-automatic pistol and other police equipment. At the time of the offense, Biggins was employed in a position of public trust as a corrections officer at the Sullivan County Sheriff’s Office. Upon notification of the offense, Sheriff Cassidy immediately terminated Biggins from the Sullivan County Sheriff’s Office.
On February 27, 2023, Biggins pleaded guilty to traveling in interstate commerce to engage in illicit sexual conduct with a minor.
U.S. Attorney King credited HSI with the investigation leading to today’s sentence.
Assistant U.S. Attorney Alexis Solheim with the U.S. Attorney’s Office in Asheville prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Former Barksdale Air Force Base Civilian Employee Sentenced on Child Pornography ChargesRead the Press Release
SHREVEPORT, La. – Christopher Allen-Shinn, 44, of Shreveport, Louisiana, has been sentenced on child pornography charges, announced United States Attorney Brandon B. Brown. Allen-Shinn was sentenced by United States District Judge Elizabeth E. Foote to 210 months (17 years, 6 months) in prison, followed by 5 years of supervised release.
Allen-Shinn pleaded guilty on March 30, 2022, to a Bill of Information charging him with one count of receipt of child pornography. This charge was the result of an investigation by the Office of Special Investigations (“OSI”) of Barksdale Air Force Base (“BAFB”) into several cyber-tip reports received from the National Center for Missing and Exploited Children (“NCMEC”) in April 2021. These NCMEC reports indicated that a Dropbox account registered to a BAFB resident was being used to store child pornography on a cloud account. Investigators with the Louisiana State Attorney General’s Office and OSI reviewed 37 of the images forwarded by NCMEC and confirmed that the images contained child pornography. OSI confirmed that the internet service account that was used for the Dropbox account was registered to Christopher Allen-Shinn’s residence on BAFB. He was a civilian employed as a historian at BAFB.
A search warrant was executed at Allen-Shinn’s residence on April 16, 2021. During the search, OSI agents conducted an examination of some of Allen-Shinn’s computer devices and storage media. Agents identified multiple images of child pornography. Further examination of his computer revealed that the defendant received images of child pornography from December 2020 to April 2021. These images included sexually explicit images that the defendant solicited online from minor females in exchange for money. During this time period, Allen-Shinn resided at and was a full-time civilian employee at BAFB. Allen-Shinn admitted to downloading the child pornography and to soliciting underage females online for sexually explicit images in exchange for money.
The case was investigated by Barksdale Air Force Base’s Office of Special Investigations and Louisiana State Attorney General’s Office and prosecuted by Assistant United States Attorney Earl M. Campbell.
# # #
Florida Man Sentenced to 10 Years in Prison for Impersonating Federal Officers in Nationwide Elder Fraud SchemeRead the Press Release
NEW ORLEANS – U.S. Attorney Duane A. Evans announced that CHRISTOPHER L. KEEL, age 53, of Tampa, Florida, was sentenced today to 125 months in prison by United States District Judge Ivan L.R. Lemelle. KEEL was sentenced for his role in a nationwide elder fraud scheme in which KEEL, and his co-conspirators, falsely represented themselves to be U.S. Department of Treasury agents, in order to defraud victims of their savings.
According to court documents, KEEL was arrested on April 4, 2022, by Tangipahoa Parish Sheriff’s Office deputies in Hammond, Louisiana, while attempting to defraud a 77-year-old woman identified as “Victim A.” Deputies had received an earlier report from the victim’s son, that his mother had been contacted by people posing as U.S. Department of Treasury agents. These “agents” told Victim A that she should withdraw money from her bank accounts and send it to them for safekeeping because her accounts had been allegedly implicated in fraud or money laundering. Beginning in early March 2022, Victim A transferred approximately $60,000 via Green Dot cards to the “agents.” The “agents” also instructed Victim A to give an additional $60,000 to another “agent” on April 3rd. Victim A complied and handed over this sum to the “agent”, later identified as KEEL, at a mall in Hammond. The next day, the perpetrators called Victim A and instructed her to withdraw the remaining funds from her accounts and hand them over as well. Victim A’s bank contacted her son, who then called the police.
While deputies met with Victim A on April 4th, the “agents” called her again and gave her instructions to hand over the rest of her money. Deputies arranged a sting operation and arrested KEEL after he approached Victim A in the mall parking lot. Victim A identified KEEL as the same man she met with the prior day. Deputies seized a cell phone and hotel receipts from KEEL.
Agents with Homeland Security Investigations (HSI) continued the investigation and learned that KEEL and a co-conspirator, had traveled to New Orleans from Seattle within the past 48 hours using plane tickets purchased with the same credit card. HSI Agents identified another victim (“Victim B”), a 76-year-old woman, who had been defrauded out of $300,000. A search of KEEL’S phone showed that he sent a photograph of a box with Victim B’s name and address on it. Victim B said she used this box to deliver her money to the “agent” she met with in Tukwila, Washington.
HSI Agents also identified another victim (“Victim C”), an 80-year-old woman living in Bossier Parish, Louisiana. HSI Agents learned that Victim C had withdrawn $36,000 from her account because purported federal “agents” called and told her that her accounts had been compromised. However, prior to delivering the money, local police were contacted and waited at her home. Police observed a vehicle circle near Victim C’s house then depart. An officer recorded the vehicle’s license plate. Later, HSI Agents obtained rental records showing that the vehicle had been leased by a co-conspirator at the time of the attempted fraud.
The search of KEEL’S cell phone revealed his contacts with other co-conspirators, dating back to 2021, and his travel to other states, including Texas and Oklahoma, to further the conspiracy. HSI and Federal Bureau of Investigation Agents determined that, since October 2021, KEEL and his co-conspirators caused approximately $4,498,327 in losses, actual and attempted, to 31 victims located throughout the United States.
KEEL previously had pleaded guilty to both counts of the superseding indictment pending in this case. As to Count 1, conspiracy to commit wire fraud, Judge Lemelle sentenced KEEL to 125 months in prison and three years of supervised release. As to Count 2, false impersonation of an officer or employee of the United States, KEEL was sentenced to 36 months in prison and one year of supervised release, both terms to be served concurrently. KEEL was also ordered to pay $200 in mandatory special assessment fees. Judge Lemelle ordered that a restitution hearing be set on December 6, 2023.
Elder fraud complaints may be filed with the Federal Trade Commission at www.ftccomplaintassistant.gov or at 1-877-FTC-HELP. The Department of Justice provides a variety of resources relating to elder fraud victimization through its Office of Victims of Crime at www.ovc.gov. Additional elder justice resources, training, and outreach materials can be found at the Elder Justice Website at www.elderjustice.gov.
If you need assistance or to report elder abuse, please contact your local adult protective services agency through the Eldercare Locator or by call the helpline at 1-800-677-1116 Monday – Friday 9am - 8pm EST. To report elder fraud, please visit the FBI’s IC3 Elder Fraud Complaint Center or contact the dedicated National Elder Fraud Hotline at 833–FRAUD–11 or 833–372–8311 Monday – Friday, 10:00 am – 6:00 pm EST.
U.S. Attorney Evans praised the work of the Homeland Security Investigations, New Orleans Field Office, in investigating this matter. U.S. Attorney Evans also thanked the Federal Bureau of Investigation (Detroit Field Office,) the U.S. Attorney’s Office for the Western District of Michigan, Homeland Security Investigations (Seattle Field Office,) the Tangipahoa Parish Sheriff’s Office, and the Bossier Parish Sheriff’s Office, for their assistance in this successful prosecution. Assistant U.S. Attorney Matthew R. Payne, Senior Litigation Counsel, is in charge of the prosecution.
Florida Laboratory Agrees to Pay over $1.1 Million to Settle Kickback AllegationsRead the Press Release
NEWARK, N.J. – A clinical laboratory located in Orlando, Florida, has agreed to pay more than $1.1 million to resolve kickback allegations, U.S. Attorney Philip R. Sellinger for the District of New Jersey and Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division, announced today.
Genesis Reference Laboratories LLC (Genesis) has agreed to pay $1,195,845.82 to resolve False Claims Act allegations that its marketers paid illegal kickbacks to health care providers in violation of the Anti-Kickback Statute to induce the providers’ laboratory testing referrals. Genesis has agreed to cooperate with the Department of Justice’s investigations of, and litigation against, other participants in the alleged scheme.
U.S. Attorney Philip R. Sellinger“Kickbacks have no place in our healthcare system. Health care providers and clinical laboratories are on notice that benefits in exchange for referrals are improper and may violate the Anti-Kickback Statute. Our office is committed to holding responsible individuals and entities who commit and profit from health care fraud. We have pursued and will continue to pursue the laboratories who enter into unlawful financial arrangements that waste taxpayer dollars and improperly influence healthcare providers’ medical judgments by promising unjust financial enrichment.”
“The payment of kickbacks by laboratories or their representatives to induce laboratory test orders undermines the integrity of federal healthcare programs,” Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division, said. “We will pursue those who offer or receive kickbacks for patient referrals regardless of how those unlawful inducements are characterized or provided.”
“Certain violations of the Anti-Kickback Statute can induce medically unnecessary testing and influence physicians’ decision-making inappropriately,” Special Agent in Charge Naomi Gruchacz with the U.S. Department of Health and Human Services Office of Inspector General said. “Individuals and entities that participate in the federal healthcare system are required to obey the laws meant to preserve the integrity of program funds and the provision of appropriate, quality services to patients.”
The Anti-Kickback Statute prohibits offering, paying, soliciting, or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally funded healthcare programs. The Anti-Kickback Statute is intended to ensure that medical providers’ judgments are not compromised by improper financial incentives and are instead based on the best interests of their patients.
The settlement announced today resolves allegations that from 2019 to 2021, Genesis paid marketing companies Corum Group LLC, Provisional Medical Consultants LLC, and RMC Medical LLC to arrange for and recommend that health care providers in Missouri and Texas order Genesis’ laboratory tests, and the marketing companies kicked back a portion of those payments to referring health care providers, in violation of the Anti-Kickback Statute. The health care providers allegedly were paid using purported management services organizations (MSOs), which attempted to disguise the kickbacks as investment returns but actually offered the payments to health care providers to induce laboratory testing referrals to Genesis. The settlement resolves allegations that, despite knowing of the MSO kickbacks to health care providers and receiving those providers’ subsequent patient referrals, Genesis nevertheless submitted to Medicare the claims for laboratory testing ordered by those providers, in violation of the False Claims Act.
The settlements were the result of a coordinated effort between the U.S. Attorney’s Office for the District of New Jersey and the Civil Division’s Commercial Litigation Branch, Fraud Section, with assistance from HHS-OIG.
The government is represented by Assistant U.S. Attorney Kruti Dharia of the U.S. Attorney’s Office, District of New Jersey, Opioid Abuse Prevention and Enforcement Unit, and Senior Trial Counsel Christopher Terranova in the Civil Division’s Commercial Litigation Branch (Fraud Section).
The government’s pursuit of these matters illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 1-800-HHS-TIPS (800-447-8477).
The claims resolved by the settlements are allegations only, and there has been no determination of liability.
genesis.settlement.pdfFlorida Laboratory Agrees to Pay over $1.1 Million to Settle Kickback AllegationsRead the Press Release
Clinical laboratory Genesis Reference Laboratories LLC (Genesis), of Orlando, Florida, has agreed to pay $1,195,845 to resolve False Claims Act allegations that its marketers paid illegal kickbacks to healthcare providers in violation of the Anti-Kickback Statute to induce laboratory testing referrals. Genesis has agreed to cooperate with the Justice Department’s investigations of, and litigation against, other participants in the alleged scheme.
“The payment of kickbacks by laboratories or their representatives to induce laboratory test referrals undermines the integrity of federal healthcare programs,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will pursue those who offer or receive kickbacks for patient referrals regardless of how those unlawful inducements are characterized or provided.”
The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and other federally funded healthcare programs. The Anti-Kickback Statute is intended to ensure that medical providers’ judgments are not compromised by improper financial incentives and are instead based on the best interests of their patients.
The settlement announced today resolves allegations that from 2019 to 2021 Genesis paid marketing companies Corum Group LLC, Provisional Medical Consultants LLC and RMC Medical LLC to arrange for and recommend that healthcare providers in Missouri and Texas order Genesis’ laboratory tests, and the marketing companies kicked back a portion of those payments to referring healthcare providers, in violation of the Anti-Kickback Statute. The health care providers allegedly were paid using purported management services organizations (MSOs), which attempted to disguise the kickbacks as investment returns but actually offered the payments to health care providers to induce laboratory testing referrals to Genesis. The settlement resolves allegations that, despite knowing of the MSO kickbacks to health care providers and receiving those providers’ subsequent patient referrals, Genesis nevertheless submitted to Medicare the claims for laboratory testing ordered by those providers, in violation of the False Claims Act.
“Kickbacks have no place in our healthcare system,” said U.S. Attorney Philip Sellinger for the District of New Jersey. “Health care providers and clinical laboratories are on notice that benefits in exchange for referrals are improper and may violate the Anti-Kickback Statute. Our office is committed to holding responsible individuals and entities who commit and profit from health care fraud. We have pursued and will continue to pursue the laboratories who enter into unlawful financial arrangements that waste taxpayer dollars and improperly influence healthcare providers’ medical judgments by promising unjust financial enrichment.”
“Violations of the Anti-Kickback Statute can induce medically unnecessary testing and influence physicians’ decision-making inappropriately,” said Special Agent in Charge Naomi Gruchacz for the Department of Health and Human Services Office of Inspector General (HHS-OIG). “Individuals and entities that participate in the federal healthcare system are required to obey the laws meant to preserve the integrity of program funds and the provision of appropriate, quality services to patients.”
The settlement was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section and the U.S. Attorney’s Office for the District of New Jersey, with assistance from HHS-OIG. The settlement announced today was handled by Senior Trial Counsel Christopher Terranova in the Civil Division’s Commercial Litigation Branch (Fraud Section) and Assistant U.S. Attorney Kruti Dharia for the District of New Jersey. The United States has recovered over $36 million relating to conduct involving MSO kickbacks to health care providers, including False Claims Act settlements with 41 physicians, two laboratories, four medical practices, three healthcare executives and one office manager.
The government’s pursuit of these matters illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to HHS at 1-800-HHS-TIPS (800-447-8477).
The claims resolved by the settlements are allegations only, and there has been no determination of liability.
SettlementFitchburg Man Indicted for Firearm OffenseRead the Press Release
BOSTON – A Fitchburg man has been indicted by a federal grand jury in Worcester for unlawfully possessing a firearm as a convicted felon.
Satron Pridgen, 45, was charged with being a felon in possession of a firearm and ammunition. He will appear in federal court in Worcester on Nov. 6, 2023 before U.S. District Court Magistrate Judge David H. Hennessy.
According to the charging documents, at approximately 1:30 a.m. on Sept. 16, 2023, Pridgen was in an altercation outside of Mill City Pub in Fitchburg. It is alleged that, during the altercation, Pridgen pulled out a loaded pistol which he used to beat another man in the head multiple times. When law enforcement intervened, Pridgen allegedly ran off and attempted to discard the firearm by a dumpster before being apprehended.
Pridgen is prohibited from possessing firearms and ammunition due to numerous prior convictions out of Worcester Superior Court including: a November 1999 conviction of assault and battery by means of a dangerous weapon for which he was sentenced to nine to 10 years in state prison; an October 2011 conviction of armed assault with intent to rob, assault and battery by means of a dangerous weapon causing serious bodily injury and possession of a firearm and ammunition as a career criminal for which he was sentenced to 12 years in state prison; and an October 2011 conviction of possession with intent to distribute a controlled substance and distribution of cocaine, for which he was sentenced to nine to 10 years in state prison.
The charge of being a felon in possession of a firearm provides for a sentence of up to 15 years in prison, up to three years of supervised release and a fine of $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 Division; and Fitchburg Police Chief Ernest F. Martineau made the announcement today. Assistant U.S. Attorney Kristen Noto of the Worcester Branch Office is prosecuting the case.
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.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Fentanyl Dealer Is Sentenced in Federal CourtRead the Press Release
CHARLOTTE, N.C. – Today, U.S. District Judge Kenneth D. Bell sentenced Antonio Morquett Phillips, 46, of Hickory, N.C., to seven years in prison followed by five years of supervised release for distribution of fentanyl, announced Dena J. King, U.S. Attorney for the Western District of North Carolina.
Alicia Jones, Acting Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division, Robert Schurmeier, Director of the North Carolina State Bureau of Investigation (SBI), and Chief Reed Baer of the Hickory Police Department join U.S. Attorney King in making today’s announcement.
According to court documents and today’s sentencing hearing, in February 2022, law enforcement initiated an investigation into Phillips for suspected distribution of fentanyl-based pressed pills. During the investigation, an ATF special agent acting in an undercover capacity conducted multiple controlled purchases of fentanyl-pressed pills from Phillips. On May 25, 2022, law enforcement executed a search warrant at Phillips’ residence. During the search, officers seized approximately 1,000 fentanyl pills, five firearms, and body armor.
On May 23, 2023, Phillips pleaded guilty to possession with intent to distribute fentanyl.
In making today’s announcement, U.S. Attorney King thanked the ATF, the SBI, and the Hickory Police Department for their investigation of this case.
Assistant U.S. Attorney Alfredo De La Rosa of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Fentanyl is a synthetic opioid that is 50 times more potent than heroin and remains the deadliest drug threat in the United States. According to the Drug Enforcement Administration’s (DEA) One Pill Can Kill public awareness campaign, the agency has seized a record 62 million fentanyl pills to date in 2023, which exceeds last year’s totals of 58 million pills. Laboratory testing indicates 7 out of 10 pills seized by DEA contain a lethal dose of fentanyl.
For information and resources related to substance use disorder, please call the Substance Abuse and Mental Health Services Administration helpline at 1-800-662-HELP (4357) or visit the online treatment locator.
Federal Jury Convicts Dual Resident Doctor of Tax EvasionRead the Press Release
United States Attorney Ronald C. Gathe, Jr., announced the conviction of Dr. Melissa Rose Barrett, age 49, of Baton Rouge, Louisiana, and Clive, Iowa, with tax evasion. Barrett was indicted by a federal grand jury on September 8, 2022.
After a seven-day trial before U.S. District Judge Brian A. Jackson, the jury unanimously convicted Barrett of one count of tax evasion. Barrett, a physician, owned and operated an urgent care clinic known as Stat Care Clinics, L.L.C. d/b/a Central Stat Care. As the evidence at trial demonstrated, for tax years 2007 through 2017, Barrett owed significant taxes totaling approximately $1.6 million, excluding interest and penalties. The IRS notified Dr. Barrett that she owed taxes multiple times and through various means.
Dr. Barrett undertook various steps to evade the payment of her outstanding tax liability, including preparing and filing with the IRS a false form underreporting income and inaccurately detailing her assets. Barrett also accumulated and concealed cash in a safe instead of depositing it in the bank. Finally, Barrett purchased millions of dollars of real estate and personal property in the names of nominees, including, but not limited to, a personal residence, a boat, an airplane, and thousands of acres of farmland and hunting land. The property purchased in the names of nominees totaled over $6.7 million.
As a result of the conviction, Dr. Barrett now faces a maximum penalty of five years in prison as well as a period of supervised release, restitution, and monetary penalties.
This case was investigated by the Internal Revenue Service, Criminal Investigations Unit and prosecuted by Assistant United States Attorneys Edward H. Warner and Elizabeth White, and Trial Attorney Wilson Stamm of the Department of Justice Tax Division.
Federal Contractor Sentenced for False ReportingRead the Press Release
An Abilene man and federal contractor with United States Probation and Pretrial Services Office (USPO) was sentenced today to 24 months in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Jacob William Kinkade, 44, was charged via criminal information on June 20. He pleaded guilty to one count of false and fraudulent claims against the United States and was sentenced today to 24 months in prison by U.S. District Judge James Wesley Hendrix, who also ordered him to pay $5,392 in restitution and a $6,000 fine.
According to plea documents, the investigation began in March 2023 when the Federal Bureau of Investigation received information that Mr. Kinkade was billing for individual therapy sessions, group therapy sessions, telephonic therapy sessions, and urinalysis collections that didn’t take place.
The investigation revealed several text messages between Kinkade and an individual, Witness 1, who was on supervised release with USPO. Witness 1 was provided counseling services by Kinkade Family Services (KFS), which is owned and operated by Mr. Kinkade. When text messages were compared to supervision records, multiple anomalies were discovered for services rendered that Mr. Kinkade billed to USPO.
When interviewed, Mr. Kinkade admitted that for the last three years, starting in 2020, he did not follow USPO’s reporting requirements and billed USPO for services not provided. KFS contract with USPO accounted for 80% of all KFS revenue.
The Federal Bureau of Investigation, with assistance from the Taylor County Sheriff’s Office, conducted the investigation. Assistant U.S. Attorneys Matthew Tusing prosecuted the case.
Fayette County Man Pleads Guilty to Federal Drug CrimeRead the Press Release
BECKLEY, W.Va. – Harland Lee Todd, 34, of Mount Hope, pleaded guilty today to possession with the intent to distribute a quantity of cocaine.
According to court documents and statements made in court, on June 2, 2022, law enforcement officers executed a search warrant at Todd’s residence and seized 163 grams of cocaine, a Glock Model 30 .45-caliber pistol, a Mossberg model 702 .22-caliber rifle, a Remington model 870 12-gauge shotgun, 16 ammunition magazines, 634 rounds of ammunition and $2,468. Todd admitted that he possessed the cocaine and intended to distribute it.
Todd is scheduled to be sentenced on February 22, 2024, and faces a maximum penalty of 20 years in prison, at least three years of supervised release, and a $1 million fine.
United States Attorney Will Thompson made the announcement and commended the investigative work of the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Central West Virginia Task Force.
United States District Judge Frank W. Volk presided over the hearing. Assistant United States Attorney Alexander A. Redmon is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 5:23-cr-124.
###
Fayette County Labor Union Official Pleads Guilty to EmbezzlementRead the Press Release
BECKLEY, W.Va. – Jason Todd Weaver, 50, of Mount Hope, pleaded guilty today to embezzlement of funds by an officer of a labor organization.
According to court documents and statements made in court, on October 29, 2021, Weaver used his position as secretary/treasurer of Local Union 1509 of the American Postal Workers Union to write out a check for $352.62 to himself from Local 1509’s Beckley bank account. Weaver signed his name as an authorized account signatory and forged the name of another union officer who was also an authorized account signatory.
Weaver admitted that he knew he was not entitled to the money, and that he deposited the check into his personal bank account. Weaver further admitted to writing 12 other checks totaling $2,679.32 from Local 1509’s bank account to himself and forging the names of other authorized account signatories between April 25, 2016, and May 19, 2021.
Weaver is scheduled to be sentenced on February 9, 2024, and faces a maximum penalty of five years in prison, three years of supervised release, and a $250,000 fine.
United States Attorney Will Thompson made the announcement and commended the investigative work of the United States Department of Labor, Office of Labor-Management Standards (OLMS).
United States District Judge Frank W. Volk presided over the hearing. Assistant United States Attorney Jonathan T. Storage is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 5:23-cr-130.
###
Espanola Man Pleads Guilty to Conspiracy to Commit KidnappingRead the Press Release
ALBUQUERQUE – Alexander M.M. Uballez, United States Attorney for the District of New Mexico, and Raul Bujanda, Special Agent in Charge of the FBI Albuquerque Field Office, announced today that Luis Mariscal-Lopez pled guilty to conspiracy to commit kidnapping. Mariscal-Lopez, 25, of Espanola, will remain in custody pending sentencing, which has not been scheduled.
According to court records, on January 14, 2018, Mariscal-Lopez and Jorge Dominguez, 28, of Espanola, conspired with Crystal Ramos, deceased, and another individual to kidnap, assault and murder Jane Doe because she stole and used Ramos’ ATM card. To that end, Ramos and the fourth individual lured Jane Doe from Buffalo Thunder Casino to Ramos’ house within the exterior boundaries of Santa Clara Pueblo where Mariscal-Lopez and Dominguez lay in wait. When Jane Doe entered the house, the group assaulted her, tied her to a chair and confined her to a bedroom where they had laid down plastic on the floor and walls. Mariscal-Lopez and Dominguez, and the others, continued to assault Jane Doe with various objects including a rifle butt and an axe handle, strangled her, and Ramos used a drill in her side until Jane Doe died. The group then wrapped Jane Doe’s body in plastic and loaded it into the trunk of a car.
A few days later, Ramos, Mariscal-Lopez, Dominguez and Johnny Black drove to a remote location near Velarde, New Mexico and attempted to dismember Jane Doe’s body with a chainsaw but were unsuccessful. Instead, they dug two shallow pits and set Jane Doe’s remains on fire. When the group noticed a helicopter in the air near their location, they extinguished the fire, moved Jane Doe’s remains to a toolbox and drove back to the house, where they poured concrete over her remains and left it stored in the garage.
Jane Doe was reported missing and her case was investigated as missing person case. A detective interviewed Ramos about Jane Doe’s disappearance in March of 2018. Following the interview, the toolbox was removed from Ramos’ house and buried near the Rio Ojo Caliente, north of Espanola. Statements made to law enforcement during an unrelated investigation led to the recovery of Jane Doe’s partial remains.
Johnny Black pled guilty on April 8, 2020, to using, carrying and brandishing a firearm during and in relation to a crime of violence and being an accessory after the fact in relation to the disposal of Jane Doe’s remains. Black was sentenced to 171 months in prison. Crystal Ramos died in a shootout with police in Denver, Colorado on June 14, 2018.
The FBI Albuquerque Field Office investigated this case with assistance from the Espanola Police Department, Santa Fe County Sheriff’s Office, Bureaus of Indian Affairs, and New Mexico State Police. Assistant United States Attorneys Nicholas J. Marshall and Caitlin L. Dillon are prosecuting the case.
# # #
23-257
Escape from Federal Custody Results in Prison SentenceRead the Press Release
A Waterloo man who escaped from federal custody at the Waterloo Residential Reentry Center was sentenced November 1, 2023, to more than two years in federal prison.
Chaston Fox, age 30, from Waterloo, Iowa, received the prison term after a May 18, 2023 guilty plea to escape from federal custody.
In a plea agreement, Fox admitted he was sentenced in May of 2020 to serve 47 months’ imprisonment in federal prison for possession of a firearm. In May 2022, Fox was placed in the Waterloo Residential Reentry Center to complete his federal sentence. On October 1, 2022, Fox escaped from the facility and remained a fugitive until he was arrested in December of 2022.
Fox was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Fox was sentenced to 27 months’ imprisonment and must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Fox is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Patrick J. Reinert and investigated by the United States Marshal’s Service and the Waterloo Police Department.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 23-CR-02032.
Follow us on Twitter @USAO_NDIA.
Elizabeth, New Jersey Man Pleads Not Guilty to Human Smuggling ChargesRead the Press Release
Burlington, Vermont – The United States Attorney’s Office stated that Jhon Reina-Perez, 34, of Elizabeth, New Jersey, was arraigned today in the District of Vermont before United States Magistrate Judge Kevin J. Doyle. He is charged in a three-count superseding indictment that alleges he and codefendants Simon Jacinto-Ramos and Victor Lopez-Padilla conspired to commit human-smuggling offenses and brought migrants without legal status to the United States for the purpose of private financial gain. Reina-Perez was arrested in Elizabeth, New Jersey on September 19, 2023, and was seen for an initial appearance in the United States District Court for the District of New Jersey before being transferred to the District of Vermont for further proceedings. He entered a plea of not guilty and was ordered to be detained pending further proceedings.
Lopez-Padilla had been arraigned in the District of Vermont on August 29, 2023, after he had likewise been transferred from the District of New Jersey. He is also detained pending further proceedings in the case. Jacinto-Ramos has not yet been arrested in conjunction with the indictment. An arraignment will be scheduled after his arrest.
According to court records, Lopez-Padilla, Reina-Perez, and Jacinto-Ramos worked together to bring migrants to, and smuggle them into, the United States for their personal profit, while knowing that the migrants lacked legal status to enter and remain in the United States. The defendants arranged transportation for the smuggled migrants from the Montreal area to remote areas of the border between the United States and Canada, predominantly near Richford, Vermont. The defendants then arranged transportation for the migrants in the United States in furtherance of their illegal entry. The United States Border Patrol intercepted at least five such smuggling events between April 2022 and July 2023 that appeared to agents to have been organized by the defendants based on phone data and witness interviews, and those events involved at least 25 smuggled migrants in total.
The United States Attorney’s Office emphasizes that an indictment contains allegations only and that Reina-Perez remains presumed innocent unless and until he is convicted of a crime. Reina-Perez faces a maximum sentence of 10 years of imprisonment and a minimum sentence of 3 years if convicted as charged. The actual sentence would be determined with reference to Federal Sentencing Guidelines.
U.S. Attorney Nikolas P. Kerest commended the investigative efforts of the United States Border Patrol and thanked Homeland Security Investigations and the New Jersey State Police for their support of Border Patrol in the apprehension of Reina-Perez.
Assistant U.S. Attorney Matthew Lasher is handling the prosecution of Lopez-Padilla, Reina-Perez, and Jacinto-Ramos. Lopez-Padilla is represented by Devin McLaughlin, Esq., and Reina-Perez is represented by Stephanie Greenlees, Esq. Counsel has not yet appeared or been appointed for Jacinto-Ramos.
Durham Man Sentenced to Six Life Terms in Prison for Sex TraffickingRead the Press Release
GREENSBORO – CHESTER FLETCHER WALLACE was sentenced today to life in prison after being convicted of sex trafficking, announced United States Attorney Sandra J. Hairston of the Middle District of North Carolina.
WALLACE, age 62, was convicted by a jury on July 14, 2023, at the conclusion of a four-day trial. He was convicted of conspiracy to commit sex trafficking by force, threats of force, fraud, and coercion and five counts of using force, threats of force, fraud, and coercion to cause five victims to engage in commercial sex acts.
Evidence at trial showed that WALLACE ran a sex trafficking ring based out of a three-bedroom house located in Durham that he rented from July 2021 until late spring of 2022. WALLACE recruited women who were homeless or suffering from substance abuse, promising them housing and drugs if they came to live at the residence. Once there, all five victims testified that they were photographed for advertisements posted for commercial sex posted on sites such as “Mega Personals” and “Skipthegames,” and that WALLACE and a co-defendant set up the “dates” for commercial sex. The victims further testified that WALLACE established certain house rules that all the victims had to obey and used violence and coercion to enforce the rules of the house. Two victims testified that they tried to run away but WALLACE either found them and brought them back to the house or sent others to do so.
WALLACE was sentenced today to six life terms of imprisonment, to run concurrent with one another, by the Honorable Catherine C. Eagles, Chief United States District Judge in the United States District Court for the Middle District of North Carolina. In addition to prison time, WALLACE was ordered to pay restitution in the amount of $68,000.00. A hearing to determine additional restitution will be held on November 14.
WALLACE’s co-defendant, Leslie Chevonne Stout, pleaded guilty on October 16, 2023, to the conspiracy count. Stout’s sentencing is scheduled for July 18, 2024.
“Today’s sentencing handed down just punishment, and it brings to an end the cruel and inhumane misogyny perpetrated by this defendant,” said United States Attorney Sandra Hairston. “We deeply appreciate the diligent law enforcement officers and prosecutors who worked on the case. Their efforts prevent the defendant and his co-defendant from claiming more victims and provide a measure of justice which we hope will allow the victims to begin healing from this terrible ordeal.”
“The reign of unimaginable terrors that Wallace viciously inflicted upon his victims is over and they can breathe easier knowing he will never again be able to victimize them or anyone else,” said Ronnie Martinez, Special Agent in Charge for HSI Charlotte, which covers North and South Carolina. “This is another example of the great results that are possible when law enforcement and community partners work together. In this case, we must recognize the DHS Center for Countering Human Trafficking and the Durham Police for the invaluable assistance they provided in bringing this monster to justice.”
The case was investigated by Homeland Security Investigations and the Durham Police Department, with support and assistance from the Durham County District Attorney’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant United States Attorney Nicole DuPré and former Assistant United States Attorney Tanner Kroeger.
###
Deadwood Man Receives 10 Years in Federal PrisonRead the Press Release
RAPID CITY - United States Attorney Alison J. Ramsdell announced today that U.S. District Judge Karen E. Schreier has sentenced a Deadwood, South Dakota, man convicted of Attempted Enticement of a Minor Using the Internet. The sentencing took place on October 24, 2023.
Donald William Laun, 62, was sentenced to 10 years in federal prison, followed by five years of supervised release, and ordered to pay a $100 special assessment to the Federal Crime Victims Fund. Laun will also be required to register as a sex offender under the Sex Offender Registration and Notification Act.
Laun was indicted for Attempted Enticement of a Minor Using the Internet by a federal grand jury in August of 2022. He pleaded guilty on August 11, 2023.
Laun was arrested as a result of an undercover sex trafficking operation conducted during the 2022 Sturgis Motorcycle Rally, targeting internet predators. Following multiple chats and sexually explicit text messages with a person Laun believed to be a 14-year-old girl, but who was in fact an undercover agent, Laun proceeded to negotiate a time and place he would meet the minor to engage in unlawful sex acts. When Laun went to the pre-determined location to meet the minor, he was instead met by law enforcement agents and placed under arrest.
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 the U.S. Attorneys’ Offices and the DOJ’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc.
This case was investigated by the Internet Crimes Against Children Taskforce, South Dakota Division of Criminal Investigation, Homeland Security Investigations, Pennington County Sheriff’s Office, and the Rapid City Police Department. Assistant U.S. Attorney Sarah B. Collins prosecuted the case.
Laun was immediately remanded to the custody of the U.S. Marshals Service.
Convicted alien smuggler sent to prison for recording sexual material and posting it on SnapchatRead the Press Release
LAREDO, Texas – A 22-year-old Laredo resident has been ordered to federal prison for production of child pornography, announced U.S. Attorney Alamdar S. Hamdani.
Victor Antonio Puente pleaded guilty July 5.
U.S. District Judge Lee H Rosenthal has now sentenced Puente to 180 months in federal prison. The court found he committed the offense while under supervised release for a previous alien smuggling offense which much be served consecutively for a total 192-month-term of imprisonment. In handing down the prison terms, the court noted the “horrific” events and that Puente was “not acting as a human being.” Puente will serve 10 years on supervised release following completion of his prison term. During that time, he will have to comply with numerous requirements designed to restrict his access to children and the internet. Puente will also be ordered to register as a sex offender.
A hearing date will be set in the near future to determine the amount that Puente will be ordered to pay in restitution to the victim.
“Victor Puente gave a 15-year old alcohol, got her drunk and sexually violated her in area motels, but the once-convicted alien smuggler didn’t stop there,” said Hamdani. “Not only did he violate her physically, he posted images and videos of his abhorrent behavior on SnapChat. As the father of a 15-year old daughter myself, I am thankful that this predator won’t come anywhere near my or any other daughter for a very long time to come.”
“This sentencing reflects the FBI's dedication to protecting children from those who choose to prey on the most innocent within our communities,” said Acting Special Agent in Charge Justin Garris for the FBI San Antonio Division. “We want to thank the Laredo Police Department for their unwavering support with this investigation.”
On June 5, 2022, Puente rented a motel room in Laredo. There, he engaged in sexual activity with a 15-year-old female victim. He used his personal cell phone to record and photograph sexually explicit conduct between him and the minor and then uploaded the content via social media.
A forensic analysis of Puente’s cell phone revealed videos of him engaging in intercourse with the victim. Other videos showed him fondling her while both are naked or were of her naked body while she slept.
The minor victim’s family was able to discover Puente’s location from a third-party and contacted law enforcement.
Puente denied that the minor victim was in the room. However, they located her and took her to a local hospital for observation and treatment.
Puente will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The FBI conducted the investigation with the assistance of the Laredo Police Department. Assistant U.S. Attorneys (AUSAs) Homero Ramirez and Michael P. Makens and former AUSA April Ayers-Perez prosecuted the case.
It was brought as part of Project Safe Childhood (PSC), a nationwide initiative the Department of Justice (DOJ) launched in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section leads PSC, which marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children and identifies and rescues victims. For more information about PSC, please visit DOJ’s PSC page. For more information about internet safety education, please visit the resources link on that page.
Convicted Sabine Parish Drug Dealer Receives 29 Year Federal Prison SentenceRead the Press Release
SHREVEPORT, La. – United States Attorney Brandon B. Brown announced that Scott William Wood, 41, of Noble, Louisiana, has been sentenced by United States District Judge S. Maurice Hicks, Jr. to a total of 29 years in prison, followed by 5 years of supervised release, on drug and firearm charges. Wood was sentenced to 22 years for possession with intent to distribute a controlled substance; 5 years for possession of a firearm in furtherance of drug trafficking; and an additional 2 years for revocation of his supervised probation, with each sentence to run consecutive, for a total of 29 years.
According to information presented in court, a deputy with the Sabine Parish Sheriff’s Office initiated a traffic stop on a vehicle in which Wood was the front seat passenger on December 26, 2022. On the front floorboard of the passenger side of the vehicle, the deputy found a small, zippered bag. The bag was located underneath where Wood had been seated. Inside the zippered bag, the deputy found a loaded Glock, Model 43X, 9mm pistol and a clear bag containing approximately 120 grams of methamphetamine. The firearm and the methamphetamine belonged to Wood, and he admitted to intending to distribute the methamphetamine to other individuals. Wood pleaded guilty to the offenses of possession with intent to distribute a controlled substance and possession of a firearm in furtherance of drug trafficking at the guilty plea hearing on May 26, 2023.
At the time of his arrest, Wood was on supervised release in the Western District of Louisiana. He was convicted of possession of a firearm by a convicted felon on November 21, 2013 and was previously sentenced to 120 months in prison for that offense.
This case was investigated by Federal Bureau of Investigation, Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Sabine Parish Sheriff’s Office and prosecuted by Assistant United States Attorney Seth D. Reeg.
The investigation and conviction of Wood 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.
# # #
Co-owner of Wasilla auto shop sentenced for violating Clean Air ActRead the Press Release
ANCHORAGE, Alaska – The co-owner of a vehicle repair shop in Wasilla was sentenced today to three years’ probation and a $50,000 fine for intentionally altering emission control systems in at least 144 diesel trucks, violating the Clean Air Act.
According to court documents, Daniel Aaron Chase, 39, of Wasilla, co-owns DC 907 Diesels LLC, which operates a vehicle repair shop specializing in diesel trucks. Starting in 2017, Chase performed and directed other shop employees to perform “deleting and tuning” on customers’ diesel trucks. Chase first removed emissions control systems designed to reduce vehicle pollution from the trucks. Then, he tampered with the trucks’ onboard diagnostic systems to allow the trucks to run normally despite their lack of emission controls. That tampering violated the Clean Air Act, a violation of 42 U.S.C. §7431(c)(2)(C).
Chase made over $349,000 performing unlawful work on diesel trucks over five years.
“Violations of the Clean Air Act can significantly affect the lives of Alaskans, and those who partake in these unlawful actions will face consequences,” said U.S. Attorney S. Lane Tucker for the District of Alaska. “Mr. Chase’s intentional actions to remove emission control systems will not be tolerated and our office will continue to support our partners’ efforts to enforce the Clean Air Act.”
“For years, the defendant intentionally and repeatedly violated the Clean Air Act by installing emissions defeat devices on well over a hundred diesel trucks,” said Special Agent in Charge Scot Adair of EPA’s Criminal Investigation Division in Alaska. “His actions will result in an excess of 144 tons of nitrogen oxides and more than a ton of particulate matter being emitted in the Mat-Su Valley, an area that already struggles with air quality issues. EPA will continue to investigate and prosecute the sale and installation of illegal defeat devices that contribute to serious health problems and put our communities at risk.”
The EPA Criminal Investigation Alaska Division investigated the case.
Assistant U.S. Attorney Jennifer Ivers and EPA Regional Criminal Enforcement Counsel Karla Perrin prosecuted the case.
###
Chatham County man sentenced to federal prison for forcibly taking mailbox keys from postal carrierRead the Press Release
BRUNSWICK, GA: A Chatham County man has been sentenced to prison after pleading guilty to robbing mailbox keys from a U.S. Postal Service employee.
Andre Rasheed Barnes, 24, of Garden City, Ga., was sentenced to 20 months in prison after pleading guilty to Robbery of Money, Mail, or Other Property of the United States, said Jill E. Steinberg, U.S. Attorney for the Southern District of Georgia. U.S. District Court Judge Lisa Godbey Wood also ordered Barnes to serve three years of supervised release upon completion of his prison term.
There is no parole in the federal system.
“The safety and security of our mail carriers is vitally important for the well-being of these employees and the smooth operation of our mail system,” said U.S. Attorney Steinberg. “It’s fortunate the mail carrier in this case was unhurt, and thanks to the work of our law enforcement partners Barnes and his co-defendant are being held accountable.”
As described in court documents and testimony, a carrier was delivering mail to community mailboxes at Chatham City Apartments in Garden City on July 16, 2022, when Barnes approached her and asked her to open a mailbox for him. She asked for his identification, and he then asked how to get a new key and left after she provided the information. Two days later, Barnes approached again with the same questions, and then fought with the carrier as he forcibly took her keys and fled.
Garden City police and the U.S. Postal Inspection Service later identified Barnes and an accomplice, Keyuhn Washington, 24, of Garden City, and found the stolen keys in Washington’s vehicle. After his arrest Washington was held in the Chatham County Detention Center and sentenced to time served after pleading guilty to Theft of Post Office Keys. He is now serving three years of supervised release.
“A large part of the Postal Inspection Service mission is the protection and safety of our postal employees,” said Tommy D. Coke, US Postal Inspector in Charge of the Atlanta Division. “This is a great example of Postal Inspectors working with our law enforcement partners to pursue criminals involved in violent acts in our local communities and bringing them to justice.”
The case was investigated by the U.S. Postal Inspection Service and the Garden City Police Department, and prosecuted for the United States by Assistant U.S. Attorney Marcela C. Mateo.
Charlotte Man Is Sentenced for Prescription Fraud and Pill DistributionRead the Press Release
CHARLOTTE, N.C. – U.S. District Judge Kenneth D. Bell sentenced Savonte Watkins, 46, of Charlotte, to 42 months in prison on drug charges yesterday, announced Dena J. King, U.S. Attorney for the Western District of North Carolina. Judge Bell also ordered Watkins to serve three years under court supervision after he is released from prison.
According to filed court documents and today’s sentencing hearing, in the spring of 2020, Watkins was involved in a scheme to get fraudulent prescriptions for oxycodone filled at local pharmacies in order to illegally distribute the pills. Court documents show that Watkins was responsible for at least 20 fraudulent prescriptions for approximately 1,200 pills of oxycodone. According to filed documents and court proceedings, Watkins recruited others, often suffering from opioid addiction, to get the prescriptions filled and would pay them with a portion of the filled prescription.
On May 31, 2023, Watkins pleaded guilty to conspiracy to obtain controlled substances by fraud and possession with intent to distribute oxycodone.
Watkins is currently released on bond. Upon designation of a federal facility, he will report to the federal Bureau of Prisons for his term of imprisonment.
In making today’s announcement, U.S. Attorney King commended the Drug Enforcement Administration’s Tactical Diversion Squad, the Charlotte Mecklenburg Police Department, and the Mooresville Police Department for their investigation of this case.
Assistant U.S. Attorney Nick J. Miller of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Cedar Rapids Man Convicted of Methamphetamine Distribution and Money Laundering CrimesRead the Press Release
A man who conspired with others to distribute methamphetamine and commit money laundering was convicted by a jury on November 2, 2023, after a four-day trial in federal court in Cedar Rapids, Iowa.
Albert McReynolds, age 35, from Cedar Rapids, Iowa, was convicted of one count of conspiracy to distribute methamphetamine, one count of conspiracy to commit money laundering, and one count of engaging in a monetary transaction in property derived from a specified unlawful activity. The verdict was returned following about an hour of jury deliberations.
The evidence at trial showed that McReynolds was a methamphetamine dealer in the Cedar Rapids, Iowa, area. Between September 2020 and continuing to about November 2021, McReynolds conspired with others to distribute methamphetamine in Cedar Rapids. The evidence at trial showed that McReynolds had a source of supply in California who was sending packages containing methamphetamine through the United States Postal Service to several addresses in Cedar Rapids. McReynolds would have the packages sent to other individuals’ addresses to avoid having the methamphetamine delivered directly to him. Investigators intercepted and searched three packages that were mailed from California to addresses associated with McReynolds in Cedar Rapids. In each of those packages, investigators located multiple pounds of methamphetamine. In total, investigators identified 46 packages mailed from California to the Cedar Rapids, Iowa, area between September 2020 and November 2021 that all shared similar characteristics to the packages investigators intercepted and searched. These 46 packages had a combined total mailing weight of over 700 pounds.
The evidence at trial showed that, between October 2020 and continuing to November 2021, McReynolds conspired with others to commit money laundering. McReynolds and others would distribute the methamphetamine McReynolds received from California. McReynolds would vacuum-seal the money that he made from selling methamphetamine, and McReynolds and others would send packages containing cash through the United States Postal Service to multiple different addresses associated with his methamphetamine source in California. McReynolds and others would place fake names and addresses on the return labels of the packages containing methamphetamine so law enforcement would not be able to link McReynolds and his co-conspirators to those packages. On July 28, 2021, McReynolds mailed a package from Cedar Rapids, Iowa, to an address associated with his source in California. Investigators intercepted and searched that package and located $56,470 in cash.
Sentencing before United States District Court Judge C.J. Williams will be set after a presentence report is prepared. McReynolds remains in custody of the United States Marshal pending sentencing. McReynolds faces a mandatory minimum sentence of 15 years’ imprisonment and a possible maximum sentence of life imprisonment, a $20,750,000 fine, and a lifetime of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorneys Adam J. Vander Stoep and Shawn S. Wehde and was investigated as part of the Organized Crime Drug Enforcement Task Force (OCDETF) program of the United States Department of Justice through a cooperative effort of the United States Postal Inspection Service, the Internal Revenue Service, and the Drug Enforcement Administration (DEA) Task Force. The DEA Task Force consists of the DEA, the Linn County Sheriff's Office, the Cedar Rapids Police Department, the Marion Police Department, and the Iowa Division of Narcotics Enforcement.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 22-CR-91-CJW.
Follow us on Twitter @USAO_NDIA.
Cary Man Accused of Making Threats to Children Now Faces Federal ChargesRead the Press Release
RALEIGH, N.C. – U.S. Attorney Michael Easley announced the filing of a criminal complaint against Kevin Edral Douglas, 46, alleging that he made threats to shoot or injure children. Douglas was originally arrested on Wednesday by the Cary Police Department and was rearrested on Thursday morning. He remains in custody at this time.
“The swift action by the Cary Police Department to mitigate this threat helped to keep the community safe,” said U.S. Attorney Michael Easley. “We are proud to partner with Chief Terry Sult and FBI’s Joint Terrorism Task Force to prioritize the investigation and prosecution of threats of violence before action is taken.”
“The safety and well-being of the public are our utmost priority, and we are committed to taking all necessary actions in coordination with all our public safety partners on the local, State, and Federal level to ensure their protection. We also want to extend our gratitude to the National Center for Missing and Exploited Children for their vigilance and quick reporting of this threat, which undoubtedly played a crucial role in resolving this situation before anyone was hurt,” said Cary Police Chief Terry Sult.
"The FBI has a strong partnership with the Cary Police Department. Special agents and task force officers work alongside one another every day. The swift action in this case is proof of exactly how important our joint mission is to the safety of our community," said Robert M. DeWitt, the Special Agent in Charge of the FBI in North Carolina.
According to an affidavit filed with the complaint, the National Center for Missing and Exploited Children (NCMEC) received a series of threatening communications via a cybertip reporting service on NCMEC’s public website. The communications that were reported included references to killing children. An investigation into the cybertips led law enforcement to believe that the threats were being made by Douglas, who was residing at the Extended Stay America Motel on Weston Parkway in Cary.
Douglas has a 2016 federal conviction for communicating interstate threats to the British Embassy in Washington, D.C., and an extensive history of threatening behavior beginning around 2002 and spanning at least eight states.
The complaint charges Douglas with knowingly and willfully transmitting in interstate and foreign commerce from North Carolina to Virginia, communications to NCMEC via the cybertip reporting service, and the communications contained a threat to kidnap and injure children.
Michael Easley, U.S. Attorney for the Eastern District of North Carolina made the announcement. The Federal Bureau of Investigation’s Joint Terrorism Task Force, the Cary and Raleigh Police Departments are investigating the case and Assistant U.S. Attorney Brad DeVoe is prosecuting the case.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No.5:23-MJ-2298.
A criminal complaint is merely an accusation. The defendant is presumed innocent until proven guilty.
Carrollton Fentanyl Trafficker Pleads GuiltyRead the Press Release
A fentanyl trafficker tied to the Carrollton and Flower Mound juvenile fentanyl overdose case pleaded guilty today to drug crimes, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Luis Eduardo Navarrete, 21, was charged via criminal complaint in February and subsequently indicted by a federal grand jury on March 29, 2023. Navarrete and ten other defendants were charged after multiple students attending schools in the Carrollton-Farmers Branch Independent School District overdosed after ingesting counterfeit M30 pills containing fentanyl. On Wednesday, Navarrete pleaded guilty to one count of conspiracy to distribute a Schedule II controlled substance (fentanyl) and one count of distribution of a Schedule II controlled substance (fentanyl) to a person under 21 years of age before U.S. Magistrate Judge Irma Carrillo Ramirez.
In related plea documents, codefendants admitted that Mr. Navarrete routinely dealt fentanyl-laced pills to juveniles from his Highland Drive residence in Carrollton, Texas. In December 2022, Navarrete was on bond in a criminal case out of Dallas County, was ordered to home confinement and was fitted with an ankle monitor that tracked his location and movements. Navarrete relied upon his coconspirators to pick up quantities of the counterfeit round blue pills from a Dallas-based source of supply and deliver them to Navarrete’s residence in Carrollton. Mr. Navarrete stored the counterfeit pills near the front door of his residence and distributed the pills to customers who came by the house – including a network of juvenile dealers who dealt the pills to other minor students that attended R.L. Turner High School, Dewitt Perry Middle School, and Dan F. Long Middle School in Carrollton. In December 2022, a thirteen year old Dewitt Perry Middle School student overdosed and died after ingesting a counterfeit M30 pill that contained fentanyl. In January 2023, a fourteen year old student at Dan F. Long Middle School overdosed and died after ingesting a counterfeit M30 pill. On February 1, 2023, a seventeen year old R.L. Turner High School student also overdosed and died after ingesting a counterfeit M30 pill.
Mr. Navarrete now faces up to 40 years in federal prison for each count and $7 million in fines. He will be sentenced on February 21, 2024.
The Drug Enforcement Administration’s Dallas Field Office and the Carrollton Police Department conducted the investigation with the assistance of School Resource Officers from the Carrollton – Farmer’s Branch Independent School District. Assistant U.S. Attorneys Rick Calvert and Phelesa Guy are prosecuting the case.
Canadian Resident Admits Conspiring with Convicted Ponzi Schemer and Others to Defraud Investors of Tens of Millions of DollarsRead the Press Release
TRENTON, N.J. – A resident of Canada today admitted conspiring with a twice-convicted fraudster to defraud investors of more than $35 million, U.S. Attorney Philip R. Sellinger announced.
Alaa Mohamed Hattab, 35, of Ottawa, Ontario, pleaded guilty before U.S. District Judge Michael A. Shipp in Trenton federal court to an information charging him with one count of conspiracy to commit securities fraud. Hattab admitted conspiring with others, including Eliyahu “Eli” Weinstein, whose 24-year federal prison sentence was commuted after being twice convicted of defrauding investors of a total of $230 million.“This defendant admitted scheming with others – including Eli Weinstein – to defraud investors of millions of dollars,” U.S. Attorney Sellinger said. “Using phony identities and empty promises of access to deals involving scarce medical supplies, baby formula, and first-aid kits supposedly destined for wartime Ukraine, they ripped off their victims. We will continue to pursue justice for everyone involved in this case. Securities and investment fraud enforcement is a top priority of this office, and this case reflects our firm commitment to protecting investors and our markets.”
“This defendant admitted scheming with others – including Eli Weinstein – to defraud investors of millions of dollars. Using phony identities and empty promises of access to deals involving scarce medical supplies, baby formula, and first-aid kits supposedly destined for wartime Ukraine, they ripped off their victims. We will continue to pursue justice for everyone involved in this case. Securities and investment fraud enforcement is a top priority of this office, and this case reflects our firm commitment to protecting investors and our markets.”
U.S. Attorney Philip R. Sellinger
“Fraudsters will use any and every method they can to steal as much as they can, even using a deadly war raging in Europe,” FBI – Newark Special Agent in Charge James E. Dennehy said. “Hattab aligned himself with another well-known, twice-convicted Ponzi schemer carrying out a plan to rip off investors who thought they were helping war victims in Ukraine. The FBI warns people about these types of criminals each time there is a natural disaster or tragic event in the U.S. or around the world for this very reason. Human suffering does not deter them from seeing dollar signs.”
Two of Hattab’s conspirators, Christopher Anderson, 47, and Richard Curry, 36, previously pleaded guilty to conspiracy to commit securities fraud and are awaiting sentencing.
Charges are still pending against Hattab’s other conspirators, Weinstein, Aryeh “Ari” Bromberg, Joel Wittels, and Shlomo Erez.
Weinstein was convicted two times in New Jersey federal court for defrauding investors. His first case involved a real estate Ponzi scheme, and his second case stemmed from additional fraud Weinstein committed while on pretrial release. For these crimes, which resulted in combined losses to investors of approximately $230 million, Weinstein was sentenced to serve 24 years in prison, followed by three years of supervised release. On Jan. 19, 2021, after Weinstein had served less than eight years, the President of the United States at that time commuted Weinstein’s term to time served, leaving intact the rest of his sentence.
Soon after being released from prison, Weinstein began orchestrating a new scheme to solicit money from investors through a company called Optimus Investments Inc. (Optimus). Using the fake name “Mike Konig,” Weinstein ran Optimus with Bromberg and Wittels. Hattab served as a broker for Optimus and helped conceal Weinstein’s involvement in various business ventures from investors.
According to documents filed in this case and statements made in court:
Hattab admitted that from February 2022 to July 2023, Hattab’s business partners raised money from investors to fund purported business ventures with Weinstein, including a company
called Saniton Plastic LLC. On Aug. 26, 2022, Hattab met with Curry, Anderson, Weinstein, and Bromberg at a hotel in Branchburg, New Jersey, and discussed continuing to conceal Weinstein’s identity from investors and others. Hattab admitted he became aware that Weinstein had raised money from investors for specific deals on medical supplies and baby formula and used that money for other purposes, including to fund Hattab’s business ventures. Hattab admitted he understood that information concerning Weinstein’s misappropriation from investors and others was important for investors to know, and that he agreed with others to mislead investors by not disclosing Weinstein’s misappropriations.
The count of conspiracy to commit securities fraud carries a maximum penalty of 20 years in prison and a $5 million fine. Sentencing is scheduled for March 20, 2024.
U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge Dennehy, with the investigation leading to today’s guilty plea. He also thanked the Securities and Exchange Commission, under the direction of Antonia Apps, Director of the SEC’s New York Regional Office.
The government is represented by Assistant U.S. Attorneys Jonathan Fayer, Emma Spiro, and Carolyn Silane of the Economic Crimes Unit in Newark.
The charges and allegations against Weinstein, Bromberg, Wittels, and Erez are merely accusations, and they are presumed innocent unless and until proven guilty.
hattab.information.pdfCambridge Man Sentenced to 10 Years in Prison for Drug Distribution Conspiracy and Possession of FirearmsRead the Press Release
BOSTON – A Cambridge man was sentenced today in federal court in Boston for federal drug and firearm charges.
Ahsan Arty, a/k/a/ “Hass,” 24, was sentenced by U.S. District Court Judge Richard G. Stearns to 10 years in federal prison, followed by three years of supervised release. In May 2023, Arty pleaded guilty to conspiracy to distribute and possess with intent to distribute controlled substances, and conspiracy to possess and use firearms during and in relation to a drug offense.
In February 2021, Arty conspired to sell crack cocaine to an undercover officer and was captured on recording brokering the drug deal. Intercepted communications revealed that Arty also conspired with others to distribute cocaine.
In August 2021, Arty travelled to California as part of a promotional music tour for an associate. While in California, Arty went to the residence of another associate and stole approximately four kilograms of cocaine. Text messages recovered during the investigation showed that Arty sent the kilograms of cocaine to Massachusetts and later began distributing them upon his return.
In December 2021, Arty and another man traveled to Lawrence to rob an individual who they suspected of having drugs and valuables in their residence. During this incident, Arty was armed with a handgun. They entered the residence and pistol-whipped one of the individuals and demanded the whereabouts of drugs and cash. Ultimately, the drugs and cash were not present. Arty was identified through surveillance video of the vehicle utilized in the incident and text messages proved his involvement.
In February 2022, Arty and two other accomplices broke into the residence of an individual in Everett that he suspected of having drugs and cash. The individual was not present. While inside the residence, Arty stole car keys and luxury brand clothing and recorded a livestream video that he published on the internet. Following the break-in, the victim posted a video online with jewelry and cash suggesting that the break-in was poorly executed. The next morning, after viewing the video, associates of Arty attempted to break-in and rob the victim at the same apartment and multiple rounds of gunfire were discharged during the incident. According to text messages recovered in the case, Arty came to pick up the robbers and ultimately taking them on a high-speed chase from responding law enforcement. The vehicle was later located and impounded. Text messages also captured Arty and the robbers developing an alibi for the vehicle’s use in the robbery and chase.
In April 2022, Arty was arrested outside of a Boston nightclub due to a report of him having a firearm. When law enforcement responded to the scene, Arty drove his vehicle at the officers and struck a nearby vehicle. Arty and another passenger were immediately taken into custody. Two firearms, including a 9mm firearm that was equipped with a selector switch, rendering it capable of firing fully automatic, were located in Arty’s vehicle. It was learned during the investigation that the target of the February 2022 burglary and robbery was believed to be inside of the nightclub and that Arty was outside of the premises waiting for an opportunity to rob him as he exited.
At the time of the offense, Arty was on pretrial release for multiple pending state firearm offenses. These included a January 2019 arrest for possessing a firearm in Boston and a July 2019 arrest for possessing a firearm in Revere. During the Revere incident, Arty fled the scene of an accident and later attempted to flee law enforcement.
Acting United States Attorney Joshua S. Levy; Jodi Cohen, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; John E. Mawn Jr., Interim Colonel of the Massachusetts State Police; Suffolk County District Attorney Kevin R. Hayden; Middlesex County District Attorney Marian T. Ryan; Boston Police Commissioner Michael Cox; Cambridge Police Commissioner Christine Elow; Everett Police Chief Steven A Mazzie; Lawrence Acting Police Chief William Castro; and Revere Police Chief David J. Callahan made the announcement. Assistant U.S. Attorney Philip A. Mallard of the Organized Crime & Gang Unit prosecuted the case.
Browning man admits sexual abuse, domestic assault chargesRead the Press Release
GREAT FALLS — A Browning man accused in two separate cases of sexually abusing a teenager and of domestic assault on the Blackfeet Indian Reservation admitted to charges on Nov. 1, U.S. Attorney Jesse Laslovich said today.
Merlyn Marceau, 40, pleaded guilty to aggravated sexual abuse and to domestic assault by habitual offender. Marceau faces a maximum of life in prison, a $250,000 fine and three years of supervised release for the crime of aggravated sexual abuse, and a maximum of five years in prison, a $250,000 fine and three years of supervised release for the crime of domestic assault by habitual offender.
A plea agreement reached in the cases calls for both matters to be sentenced at the same time and for the sentences in each case to run concurrent to each other.
Chief U.S. District Judge Brian M. Morris presided. The court will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. The court set sentencing for March 27, 2024. Marceau was detained pending further proceedings.
In court documents, the government alleged that on June 27, Marceau sexually abused a 13-year-old girl, identified as Jane Doe, in a shed at a residence. The government also alleged that on June 24, Marceau and a separate victim, also identified as Jane Doe and with whom he had been in a romantic relationship, began arguing. Marceau assaulted Jane Doe by striking her repeatedly. Marceau disclosed the assault to the FBI in an unrelated interview. Marceau had two prior domestic assault convictions from Browning Tribal Court.
Assistant U.S. Attorney Kalah A. Paisley is prosecuting the case. The FBI, Blackfeet Law Enforcement Services and Blackfeet Child Protective Services investigated the sexual abuse case, and the FBI and Blackfeet Law Enforcement Services investigated the domestic assault case.
XXX
Bridgeport Felon Pleads Guilty to Illegal Gun Possession ChargeRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, today announced that ORTEXIS RAMOS, 34, of Bridgeport, pleaded guilty yesterday before U.S. District Judge Omar A. Williams in Hartford to unlawful possession of a firearm by a felon.
According to court documents and statements made in court, on September 16, 2022, Bridgeport Police encountered Ramos, who was a passenger in an unregistered car that was stopped at the intersection of Ridge Avenue and Walnut Street in Bridgeport. When officers ordered Ramos to exit the vehicle, he attempted to flee. Ramos was apprehended a short distance away, and a search of his person revealed a loaded Taurus G2C 9mm semiautomatic handgun.
In 2005, Ramos was convicted of murder and sentenced to 25 years of imprisonment. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
Judge Williams scheduled sentencing for January 29, 2024, at which time Ramos faces a maximum term of imprisonment of 15 years.
Ramos has been detained since his arrest.
This matter is being investigated by the FBI’s Bridgeport Safe Streets Task Force and the Bridgeport Police Department. The case is being prosecuted by Assistant U.S. Attorneys Ross Weingarten and Karen L. Peck through Project Safe Neighborhoods (PSN), the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Bogue Chitto Woman Sentenced to over Five Years in Prison for Voluntary ManslaughterRead the Press Release
Jackson, Miss. – A Bogue Chitto woman was sentenced to 67 months in prison for voluntary manslaughter involving the stabbing of a man in the Bogue Chitto Community of the Mississippi Band of Choctaw Indian Reservation.
According to court documents, Bethany Thomas, 27, of Bogue Chitto, initiated an argument with the victim at a tribal home in the Bogue Chitto Community which resulted in an altercation between Thomas and the victim. Thomas armed herself with a knife and stabbed the unarmed victim causing the victim’s death.
A federal grand jury indicted Thomas for Second Degree Murder. Thomas entered a plea of guilty to the lesser included charge of voluntary manslaughter. As stated in court, Thomas admitted to using a knife to stab the victim following a verbal argument and a brief physical altercation.
U.S. Attorney Todd Gee of the Southern District of Mississippi and Special Agent in Charge Jermicha Fomby of the Federal Bureau of Investigation made the announcement.
The case was investigated by the Choctaw Police Department of the Mississippi Band of Choctaw Indians and the Federal Bureau of Investigation.
The case was prosecuted by Assistant United States Attorney Kevin J. Payne and Special Assistant United States Attorney Brian K. Burns.
Attorney General Merrick B. Garland Statement on Guilty Verdict in Jury Trial of Sam Bankman-FriedRead the Press Release
The Justice Department issued the following statement from Attorney General Merrick B. Garland on today’s jury conviction in the trial of Sam Bankman-Fried:
“Sam Bankman-Fried thought that he was above the law. Today’s verdict proves he was wrong. This case should send a clear message to anyone who tries to hide their crimes behind a shiny new thing they claim no one else is smart enough to understand: the Justice Department will hold you accountable. I am grateful to the U.S. Attorney’s Office for the Southern District of New York and the FBI for their outstanding work in bringing Mr. Bankman-Fried to justice.”
Armed Methamphetamine Trafficker Is Sentenced to 11 Years in Federal PrisonRead the Press Release
ASHEVILLE, N.C. – Today, U.S. District Judge Martin Reidinger sentenced Joel Wesley Creech, 45, of Brevard, N.C., to 132 months in prison for trafficking methamphetamine, announced Dena J. King, U.S. Attorney for the Western District of North Carolina. Judge Reidinger also imposed five years of supervised release following incarceration.
According to filed documents and information introduced at the sentencing hearing, between 2020 and 2022, Creech was responsible for trafficking large quantities of methamphetamine in McDowell, Haywood, Transylvania, and Buncombe Counties. Court documents show that Creech supplied the methamphetamine to other individuals for further local distribution. On June 22, 2021, law enforcement executed search warrant at Creech’s residence, where they seized more than 1.5 kilograms of methamphetamine buried in Creech’s backyard, and $2,950 in cash. Law enforcement also seized eight firearms, some of which were loaded, multiple high-capacity magazines, and multiple of rounds of ammunition. According to court records, over the course of the conspiracy, Creech was responsible for assisting and distributing multiple kilograms of methamphetamine.
On April 24, 2023, Creech pleaded guilty to conspiracy to distribute and to possess with intent to distribute methamphetamine, and aiding and abetting possession with intent to distribute methamphetamine. He remains in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement, U.S. Attorney King thanked the Drug Enforcement Administration, the Haywood County Sherriff’s Office, Transylvania County Sheriff’s Office, and the McDowell County Sheriff’s Office for their investigation of this case.
Assistant U.S. Attorney Christopher Hess, of the U.S. Attorney’s Office in Asheville, prosecuted the case.
Allen Man Sentenced to Federal PrisonRead the Press Release
RAPID CITY - United States Attorney Alison J. Ramsdell announced today that U.S. District Judge Karen E. Schreier has sentenced an Allen, South Dakota, man convicted of Abusive Sexual Contact and Possession of Child Pornography. The sentencing took place on October 26, 2023.
Joshua Isaac Sharp, 39, was sentenced to 30 years in federal prison, followed by five years of supervised release, and ordered to pay a $100 special assessment to the Federal Crime Victims Fund, following his conviction for Abusive Sexual Contact.
Sharp was also sentenced to 20 years in federal prison, followed by five years of supervised release, and ordered to pay another $100 special assessment to the Federal Crime Victims Fund, following his conviction for Possession of Child Pornography. The Court ordered that the sentences be run concurrently.
Sharp was indicted for the charges by a federal grand jury in July of 2022. He pleaded guilty on July 28, 2023.
The conviction stems from Sharp engaging in sexual contact with a child who was less than 12 years old in November of 2021 near Allen. Sharp also possessed child pornography on his cellular telephone during this time.
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 the U.S. Attorneys’ Offices and the DOJ’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc.
This matter was prosecuted by the U.S. Attorney’s Office because the Major Crimes Act, a federal statute, mandates that certain violent crimes alleged to have occurred in Indian country be prosecuted in Federal court as opposed to State court.
This case was investigated by the Oglala Sioux Tribe Department of Public Safety, Internet Crimes Against Children Taskforce, and the FBI. Assistant U.S. Attorney Megan Poppen prosecuted the case.
Sharp was immediately remanded to the custody of the U.S. Marshals Service.
Alaska Man Indicted in D.C. on Charges of Distribution of Child PornographyRead the Press Release
WASHINGTON – Brogan T. Welsh, 31, of Anchorage, Alaska, was indicted today in the District of Columbia on charges of distributing child pornography, announced U.S. Attorney Matthew M. Graves, Acting Chief Pamela Smith, of the Metropolitan Police Department (MPD), and Special Agent in Charge Wayne A. Jacobs, of the FBI Washington Field Office’s Criminal and Cyber Division.
According to court documents, Welsh allegedly was a member of a private group on an internet platform that was dedicated to discussing the sexual exploitation of children and to sharing child sexual abuse materials. In December 2020, Welsh – who was then living near Richmond, Va. – contacted someone on the platform that he believed was the father of a minor child. In actuality, the “father” was an undercover agent with the FBI’s Washington D.C. Field Office. Over the course of several weeks, Welsh allegedly posted links in the group containing numerous images and videos depicting adult males sexually abusing prepubescent boys. Welsh repeatedly expressed his sexual interest in children, and a desire to travel from Virginia to the District of Columbia, in order to sexually abuse the purported child.
In an investigation previously thought to be unrelated, agents in the FBI’s Anchorage Office discovered chats between two users on the same social media application again discussing the sexual exploitation of children. The investigation revealed that Welsh was one of the individuals using the social media application to discuss his interest in sexually abusing children.
On Oct.19, 2023, law enforcement executed a search warrant at Welsh’s Anchorage, Alaska, residence. Digital devices were recovered from the residence. Welsh was arrested in the early morning hours of Oct. 22, 2023. He has been ordered temporarily detained.
An indictment is merely a formal charge that a defendant has committed a violation of criminal laws and every defendant is presumed innocent until, and unless, proven guilty.
This case is being investigated by the Metropolitan Police Department and the FBI’s Washington and Anchorage Field Offices. It is being prosecuted by Assistant U.S. Attorney Amy Larson, with assistance from Assistant U.S. Attorney Morgan Walker of the U.S. Attorney’s Office of Alaska.
Activity in the U.S. Attorney's OfficeRead the Press Release
Drug Trafficking
Elexus Coral Lucero, age 24, of Tucson, Arizona, was sentenced to 18 months in federal prison following a guilty plea to possession with intent to distribute 630 grams or more of fentanyl. According to court documents, on Aug. 23, 2022, the Cheyenne Police Department discovered a bag containing 214 fentanyl pills following a traffic stop in which Lucero was a passenger. A review of Lucero’s cellphone showed evidence that was consistent with distribution of the pills. This crime was investigated by the Cheyenne Police Department, and the Drug Enforcement Administration. The case was prosecuted by Assistant U.S. Attorney Jonathan C. Coppom. U.S. District Court Judge Alan B. Johnson imposed the sentence on Nov. 2.
Illegal Re-entry of a Previously Deported Alien
Jose Alonso Bedolla-Vasquez, age 32 of Wilson, Wyoming, was sentenced to time served for illegal re-entry of a previously deported alien into the U.S. The defendant has been in federal custody for approximately six months and will be deported to Mexico. According to court documents, the defendant was born in Tlaxcala, Mexico, and is a citizen of Mexico. On Jan. 28 Bedolla-Vasquez was arrested by the Wyoming Highway Patrol in Teton County for driving under the influence. He admitted to being a citizen of Mexico and the U.S. Immigration and Customs Enforcement verified that he had been previously deported. The case was prosecuted by Michael J. Elmore. Chief U.S. District Court Judge Scott W. Skavdahl imposed the sentence on Oct. 31.
About the United States Attorney’s Office
United States Attorney’s Office is responsible for representing the federal government in virtually all litigation involving the United States in the District of Wyoming, including all criminal prosecutions for violations of federal law, civil lawsuits brought by or against the government, and actions to collect judgments and restitution on behalf of victims and taxpayers. The Office is involved in several programs designed to make our communities safer. They include:
Environmental Justice
The fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income with respect to the development, implementation, and enforcement of environmental laws, regulations, and policies.
Project Safe Childhood
Project Safe Childhood (PSC) is a DOJ initiative that combats the proliferation of technology-facilitated sexual exploitation crimes against children. The threat of sexual predators soliciting children for sexual contact is well-known and serious.
Project Safe Neighborhoods
Project Safe Neighborhoods (PSN) is a nationwide commitment to reducing gun and gang crime in America by networking existing local programs that target gun crime and providing these programs with additional tools necessary to be successful.
Victim Witness Assistance
The Victim Witness Coordinator for the United States Attorney’s Office for the District of Wyoming is dedicated to making sure that victims of federal crimes and their family members are treated with compassion, fairness, and respect.To report a federal crime, go to: https://www.justice.gov/actioncenter/report-crime#trafficking
###
1 November 2023
Yorktown Man Charged with Receipt, Distribution, and Possession of Child PornographyRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Ivan J. Arvelo, the Special Agent in Charge of the New York Field Office of Homeland Security Investigations (“HSI”), announced today the arrest of GIUSEPPI MICCIARI. MICCIARI is charged with distributing, receiving, and possessing child pornography. MICCIARI was presented today before U.S. Magistrate Judge Andrew E. Krause in White Plains federal court.
U.S. Attorney Damian Williams said: “Giuseppi Micciari’s alleged conduct is vile and disturbing, especially given that, as a teacher, Micciari was entrusted with the care of children. Investigating and prosecuting those who sexually exploit children remains of paramount importance to this Office, and we will do everything in our power to protect the children of our community.”
HSI Special Agent in Charge Ivan J. Arvelo said: “Giuseppi Micciari was entrusted with our most vulnerable segment of society – our children. His alleged depraved acts betrayed that trust. Not only is Micciari accused of collecting and sharing of these heinous acts, but also attempting to hack into a student’s social media. HSI New York and our law enforcement partners will continue to work tirelessly to ensure predators seeking to exploit children face just consequences for their actions.”
According to the allegations in the Complaint filed on October 31, 2023, in White Plains federal court and unsealed today:[1]
A review of MICCIARI’s phone revealed the existence of numerous videos and images containing child sexual abuse material.
MICCIARI’s phone revealed the use of Telegram, an internet and cloud-based instant messaging service that permits its users to exchange messages, share media and files, and hold private and group voice or video calls. Among the communications contained in the Telegram app were communications revealing a request by MICCIARI’s phone for an “account hack” of an individual’s Snapchat account, as well as communications in which another individual asked, “what age teen content you have,” and MICCIARI’s phone replied, “there one big Mega 10-17.”
A U.S. passport application submitted in connection with the issuance of a U.S. passport for GIUSEPPI MICCIARI identified MICCIARI’s occupation as “teacher.”
* * *
MICCIARI, 27, of Yorktown, New York, is charged with one count of receipt and distribution of child pornography and one count of possession of child pornography. Both counts carry a maximum sentence of 20 years in prison.
The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Williams praised the efforts of HSI, the U.S. Secret Service, the New York State Police, the New York City Police Department, the Westchester County District Attorney’s Office, the Rockland County District Attorney’s Office, and the Yorktown Police Department. He added that the investigation is ongoing.
The prosecution is being handled by the Office’s White Plains Division. Assistant U.S. Attorney Marcia S. Cohen is in charge of the prosecution.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
XTO Agrees to Pay $16 Million to Resolve Natural Gas Royalty Underpayments to the United StatesRead the Press Release
XTO Energy Inc. has agreed to pay $16 million to resolve False Claims Act allegations that it knowingly underpaid royalties owed on natural gas produced from federal and Native American lands. The settlement resolves allegations that the company improperly deducted costs necessary to put the gas in marketable condition, deducted costs of transporting carbon dioxide and failed to pay royalties on carbon dioxide.
“Mineral royalties provide an important source of income for the United States, Native Americans and various states,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “This settlement demonstrates that the department will hold accountable those who knowingly take improper advantage of our public resources.”
“Taxpayers expect that every penny of these royalties gets paid,” said U.S. Attorney Cole Finegan for the District of Colorado. “Our office will make sure that energy companies pay what they owe when they take natural gas from leases on Native American and federal lands.”
“This recovery of unpaid mineral royalties is the direct result of the Department of Justice, Department of Interior (DOI)’s Office of Inspector General (OIG), DOI’s Office of Natural Resources Revenue and DOI’s Office of the Solicitor working diligently to ensure that revenues generated from resources under Federal jurisdiction are properly accounted for and collected on behalf of the mineral owners and the American public,” said Special Agent in Charge Ron Gonzales of the DOI-OIG’s Energy Investigations Unit.
Congress allows federal and Native American lands to be leased for the production of natural gas in exchange for the payment of royalties on the value of the gas produced. Lessees must put the gas in marketable condition at no cost to the United States. The settlement resolves allegations that when reporting and paying royalties from January 2009 to August 2017, XTO knowingly deducted payments to third parties for gas transportation and processing that included costs to place the gas in marketable condition. The settlement also resolves claims that from January 2009 to June 2016, XTO knowingly and improperly deducted from federal royalty payments on natural gas the costs of transporting carbon dioxide entrained in that gas, and that from May 2010 to March 2016, XTO failed to pay federal royalties owed on carbon dioxide produced at the Castle Valley Plant in Utah. Through a series of settlements since 2017, the department and its agency partners have used the False Claims Act to recover $25 million from energy companies that improperly deducted the costs of putting their gas in marketable condition.
The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, the U.S. Attorney’s Office for the District of Colorado, DOI-OIG’s Energy Investigations Unit, DOI’s Office of the Solicitor and DOI’s Office of Natural Resources Revenue. The matter was handled by Senior Trial Counsel Gregory Pearson of the Civil Division and Assistant U.S. Attorney Amanda Rocque for the District of Colorado.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
XTO Agrees to Pay $16 Million to Resolve Natural Gas Royalty Underpayments to the United StatesRead the Press Release
XTO Energy Inc. has agreed to pay $16 million to resolve False Claims Act allegations that it knowingly underpaid royalties owed on natural gas produced from federal and Native American lands. The settlement resolves allegations that the company improperly deducted costs necessary to put the gas in marketable condition, deducted costs of transporting carbon dioxide and failed to pay royalties on carbon dioxide.
“Mineral royalties provide an important source of income for the United States, Native Americans and various states,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “This settlement demonstrates that the department will hold accountable those who knowingly take improper advantage of our public resources.”
“Taxpayers expect that every penny of these royalties gets paid,” said U.S. Attorney Cole Finegan for the District of Colorado. “Our office will make sure that energy companies pay what they owe when they take natural gas from leases on Native American and federal lands.”
“This recovery of unpaid mineral royalties is the direct result of the Department of Justice, Department of Interior (DOI)’s Office of Inspector General (OIG), DOI’s Office of Natural Resources Revenue and DOI’s Office of the Solicitor working diligently to ensure that revenues generated from resources under Federal jurisdiction are properly accounted for and collected on behalf of the mineral owners and the American public,” said Special Agent in Charge Ron Gonzales of the DOI-OIG’s Energy Investigations Unit.
Congress allows federal and Native American lands to be leased for the production of natural gas in exchange for the payment of royalties on the value of the gas produced. Lessees must put the gas in marketable condition at no cost to the United States. The settlement resolves allegations that when reporting and paying royalties from January 2009 to August 2017, XTO knowingly deducted payments to third parties for gas transportation and processing that included costs to place the gas in marketable condition. The settlement also resolves claims that from January 2009 to June 2016, XTO knowingly and improperly deducted from federal royalty payments on natural gas the costs of transporting carbon dioxide entrained in that gas, and that from May 2010 to March 2016, XTO failed to pay federal royalties owed on carbon dioxide produced at the Castle Valley Plant in Utah. Through a series of settlements since 2017, the department and its agency partners have used the False Claims Act to recover $25 million from energy companies that improperly deducted the costs of putting their gas in marketable condition.
The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, the U.S. Attorney’s Office for the District of Colorado, DOI-OIG’s Energy Investigations Unit, DOI’s Office of the Solicitor and DOI’s Office of Natural Resources Revenue. The matter was handled by Senior Trial Counsel Gregory Pearson of the Civil Division and Assistant U.S. Attorney Amanda Rocque for the District of Colorado.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
SettlementWolf Point man sentenced to more than 11 years in prison after armed carjackings spanning Yellowstone and Cascade countiesRead the Press Release
GREAT FALLS — A Wolf Point man who admitted to attempted carjacking and a firearms crime stemming from a violent crime spree that began with an armed carjacking in Yellowstone County and ended in Cascade County with another carjacking was sentenced today to 11 years and two months in prison, to be followed by five years of supervised release, U.S. Attorney Jesse Laslovich said.
Santana Cruz Ledeau, 27, pleaded guilty in May to attempted carjacking and to using, carrying and brandishing a firearm in furtherance of a crime of violence.
Chief U.S. District Judge Brian M. Morris presided. The court also ordered $500 restitution.
There is no parole in the federal system, however a defendant may be eligible for a reduced sentence not exceeding 15 percent of the overall sentence by earning credit for good behavior.
“Ledeau terrorized two communities during his armed carjacking rampage, causing schools and residents to shelter-in-place and putting people in fear of having their vehicles stolen at gunpoint. It is a miracle no one was killed or seriously injured. But Ledeau still inflicted severe trauma on the victims he randomly attacked, and he nearly ran over two deputies with the Cascade County Sheriff’s Office as they were attempting to stop him,” U.S. Attorney Laslovich said. “Ending Ledeau’s crime spree and holding him accountable would not have happened without the extraordinary dedication to public safety by local, state, and federal law enforcement, many of whom jeopardized their own lives to bring Ledeau to justice. I am grateful to and proud of the Great Falls Police Department, Cascade County Attorney’s Office, Cascade County Sheriff’s Office, Montana Highway Patrol, Montana Division of Criminal Investigation, Musselshell County Sheriff’s Office, Yellowstone County Sheriff’s Office, Yellowstone County Attorney’s Office, Billings Police Department and Bureau of Alcohol, Tobacco, Firearms and Explosives for their outstanding work on this case.”
The government alleged in court documents that on Sept. 30, 2022, in Billings, Ledeau accosted a woman as she tried to get out of her car in a hospital parking lot. Ledeau pointed a gun at her, demanded keys and sprayed pepper spray her in the face. He then carjacked the woman’s vehicle and fled. The woman described the gun as “red with some silver.” Law enforcement found the car a few days later in Musselshell County.
The government further alleged that a few weeks later, on Oct. 17, 2022, Ledeau and a female companion were driving around Great Falls in a white truck that was later discovered to be stolen from North Dakota. Ledeau got into a fight outside a motel and fired a pistol into the air. He fled the scene and was involved in a hit-and-run car accident. Great Falls police were unable to stop Ledeau, who drove south on Interstate 15 toward Ulm. When he neared Ulm, Ledeau exited the interstate, drove up behind a Buick sedan, got out of the truck and demanded the Buick from the man driving it. The driver refused to give up his car. Ledeau then pointed a pistol at the car and shot through the rear driver’s side window. The window shattered, and the bullet traveled into the trunk, where it was recovered. The driver sped away, and Ledeau took off down Interstate 15 in the stolen truck.
The government further alleged that Ledeau made it to Cascade where he ran out of gas. There, a man offered to take Ledeau to get gas, and Ledeau and his companion got into the man’s car. However, once in the car, Ledeau threatened the driver with a knife and demanded the vehicle. The driver jumped out of the car and noticed law enforcement beginning to arrive. Deputies attempted to stop Ledeau, but he drove the stolen car at the officers, who had to flee out of his path.
As deputies continued trying to stop Ledeau, Ledeau drove back onto Interstate 15 at a high rate of speed and traveled the wrong way on the interstate. Ledeau eventually exited the interstate and crashed near Simms. At the crash scene, officers found Ledeau in possession of a pistol that appeared to be the same gun he used in the Billings carjacking and a bottle of Southern Comfort whiskey. Ledeau was intoxicated and belligerent, and agents recovered numerous cartridges, ammunition and empty ammunition boxes from the truck. The gun had a red stock and dark colored slide and was determined to be a 9mm pistol.
Assistant U.S. Attorneys Jessica A. Betley and Jeffrey K. Starnes prosecuted the case. The Great Falls Police Department, Cascade County Attorney’s Office, Cascade County Sheriff’s Office, Montana Highway Patrol, Montana Division of Criminal Investigation, Musselshell County Sheriff’s Office, Yellowstone County Sheriff’s Office, Yellowstone County Attorney’s Office, Billings Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation.
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.
XXX
Western Massachusetts Man Sentenced to 14 Years for Attempted Enticement of MinorRead the Press Release
ALBANY, NEW YORK – James Macko, age 23, of North Adams, Massachusetts, was sentenced today to 14 years in prison for the attempted coercion and enticement of an 11-year-old child. United States Attorney Carla B. Freedman and Alfred A. Watson, Acting Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI), made the announcement.
Macko previously pled guilty and admitted that between November 29, 2022 and December 9, 2022, he exchanged text messages and phone calls with someone he believed to be an 11-year-old child. In those communications, Macko attempted to coerce and entice the child into sexual contact with him. Macko ultimately planned to meet the child in a state park in Western Massachusetts, where he intended to perform sexual acts on the child in a cave. On December 9, 2022, Macko left his home in North Adams to meet the child and was arrested shortly thereafter, carrying with him candy, liquor he planned to give the child, and a length of rope with which he intended to tie the child down.
United States District Judge Anne M. Nardacci also imposed a 20-year term of post-imprisonment supervised release. He will also be required to register as a sex offender upon his release from prison.
This case was investigated by the FBI and its Child Exploitation Task Force, which includes members of federal, state, and local law enforcement agencies, including the Colonie Police Department and the New York State Police. Assistant United States Attorney Benjamin S. Clark prosecuted the case 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.
Visiting Brazilian Attorney Pleads Guilty to Insider TradingRead the Press Release
WASHINGTON – A Brazilian national, previously working in the U.S. as a visiting international attorney, pleaded guilty today in U.S. District Court in the District of Columbia to a charge of insider trading charges for trading based on material, nonpublic information, announced U.S. Attorney Matthew M. Graves and Special Agent in Charge Wayne A. Jacobs, of the FBI Washington Field Office’s Criminal and Cyber Division.
Romero Cabral Da Costa Neto (Costa), 33, of Rio de Janeiro, had been residing and working as a visiting attorney in Washington D.C., on a one-year J-1 Visa, at a global U.S. law firm (the Law Firm). Costa was arrested on Aug. 22, 2023, by agents with the FBI’s Washington Field Office.
“This attorney stole material non-public information, betrayed his law firm, victimized its client companies, and monetized those insider secrets to gain an illegal advantage on other investors,” said U.S. Attorney Graves. “The FBI and the Department of Justice will move quickly to arrest and prosecute those who game the system to enrich themselves while, in the process, undermining the investing public’s confidence in the securities markets.”
Costa pleaded before U.S. District Judge Carl J. Nichols, who scheduled sentencing for Dec. 20, 2023
According to court documents, Costa began working in the U.S. for the Law Firm in September 2022. Until the FBI arrested him in August, Costa executed multiple stock trades in companies represented by the Law Firm. As confirmed by the Law Firm records, Costa accessed internal Law Firm files in advance of public market-moving announcement.
According to the plea agreement, one of these trades involved Company B, a Seattle-based biotech company represented by the Law Firm. In or around April of 2023, Company C, a Swedish international biopharmaceutical company, began negotiations to acquire Company B. Both Company B and C were public companies. Company B’s Board of Directors held several meetings throughout April and into early May discussing transaction prices and terms of the sale. Representatives of the Law Firm attended these meetings and prepared documents relating to these meetings.
In early May 2023, Company B, whose stock was trading at around $4.80, informed Company C that they would sell to Company C for a price above $9.00 per share. On May 9, 2023, Company C relayed an offer to buy all outstanding common stock in Company B for $9.10 per share. The stock was trading at $4.82 on May 9, 2023. The Board of Directors approved the sale at $9.10 and both Company B and C announced the $1.7 billion transaction in the early morning hours of May 10, 2023. Trading in Company B opened at $8.91 per share on May 10, 2023.
According to public documents, Costa used two online trading firms to purchase 10,400 shares in Company B on May 9, 2023, for $49,976. Costa then sold his holdings in Company B on May 10, 2023, for $92,635.24, resulting in a one-day investment profit of $42,649.13.
According to the complaint, Costa improperly accessed Law Firm files related to Company B in the lead up to this merger. Costa was not assigned to this transaction and had no legitimate reason to access and view these files related to this matter. Costa accessed files over 100 times in advance of the sale.
The complaint further alleged that on June 2, 2023, Costa purchased stock in Company E – another company that was represented by the Law Firm – one day before Company E went public with information about drug treatment for patients with a specific cancer. The stock rose following the announcement. Costa sold his position on June 5, 2023.
On June 6, 2023, the Law Firm issued an opinion related to a secondary stock offering on behalf of Company E. The opinion had the effect of driving down the value of the stock. Costa was able to purchase shares of Company E immediately before a positive market event and then quickly sell before the subsequent negative market event, profiting by approximately $1,000 from these transactions. According to the complaint, Costa improperly accessed Law Firm files related to this matter in the lead up to the announcements. Costa was not assigned to this matter and had no legitimate reason for accessing these files.
In another instance, Costa allegedly improperly accessed Law Firm documents and files related to Company F, another firm client. On June 15, 2023, Company F and Company G announced a merger in an all-stock deal to create a $5.4 billion oilfield services firm. Between June 8, 2023, and June 12, 2023, Costa purchased approximately 7,000 shares of Company G in advance of this merger announcement. He subsequently sold the shares and profited approximately $8,500 from the transactions. Costa was not assigned to this matter and had no legitimate reason to access these files.
Insider trading carries a statutory maximum penalty of 20 years in prison. The charge also carries potential financial penalties. The maximum statutory sentence for federal offenses is prescribed by Congress and is provided here for informational purposes. The sentencing will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Costa also faces additional charges of securities violations in a parallel civil complaint filed by the U.S. Securities and Exchange Commission’s Philadelphia Regional Office.
The SEC's complaint, filed in U.S. District Court for the District of Columbia, charges Costa with violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and seeks injunctive relief, disgorgement with prejudgment interest, and civil penalties.
The SEC case originated from the SEC's Market Abuse Unit's Analysis and Detection Center, which uses data analysis tools to detect suspicious trading patterns. The SEC referred the matter to the U.S. Attorney's Office for the District of Columbia.
This case is being investigated by the FBI’s Washington Field Office. It is being prosecuted by Assistant U.S. Attorney Kevin Rosenberg, of the U.S. Attorney’s Office for the District of Columbia.
Virginia Business Owner Charged with Tax Evasion and Employment Tax OffensesRead the Press Release
ALEXANDRIA, Va. – A federal grand jury returned an indictment, unsealed today, charging a Great Falls man with income tax evasion and failure to pay employment taxes.
According to the indictment, Rick Tariq Rahim, 55, owned and operated two businesses, BV Management, LLC, an Amazon reseller, and BusinessVentures.com, LLC, which was an umbrella company over other businesses including laser tag facilities. Starting in at least 2012, Rahim allegedly took steps to evade IRS efforts to collect more than $1 million in federal income taxes he allegedly owed for tax years 2004 and 2011. The indictment charges that in November 2016, Rahim submitted a false form to the IRS that omitted valuable assets he owned, including a helicopter, a 2006 Bentley, a 2008 Lamborghini, and real property, the ownership of which he allegedly transferred to his wife two weeks after submitting the form. The indictment further alleges that Rahim also withdrew a total of more than $1.1 million in cash in amounts less than $10,000 to avoid triggering currency transaction reports from the bank and paid personal expenses from his businesses’ bank accounts, including more than $889,000 toward his mortgages and more than $669,000 to purchase or lease cars, including three different Lamborghinis.
In addition, the indictment charges that from 2015 to 2021, Rahim also did not pay to the IRS the taxes that his businesses withheld from employee paychecks or file quarterly tax returns reporting those withholdings.
If convicted, Rahim faces a maximum penalty of five years in prison for the tax evasion count and five years in prison for each count of failing to pay over employment tax withholdings. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Stuart M. Goldberg, Acting Deputy Assistant Attorney General of the Justice Department’s Tax Division, and Kareem A. Carter, IRS Criminal Investigation Special Agent in Charge of the Washington D.C. Field Office, made the announcement.
Assistant U.S. Attorney Kimberly Shartar and Trial Attorney William Montague of the Department of Justice’s Tax Division are prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:23-CR-173.
An indictment is merely an accusation. The defendant is presumed innocent until proven guilty.
Virginia Business Owner Charged with Tax Evasion and Employment Tax OffensesRead the Press Release
A federal grand jury in Alexandria, Virginia, returned an indictment, unsealed today, charging a Virginia man with income tax evasion and failure to pay employment taxes.
According to the indictment, Rick Tariq Rahim of Great Falls owned and operated two businesses, BV Management LLC, an Amazon reseller, and BusinessVentures.com LLC, an umbrella company over other businesses including laser tag facilities. Starting in at least 2012, Rahim allegedly took steps to evade IRS efforts to collect more than $1 million in federal income taxes he allegedly owed for tax years 2004 and 2011.
The indictment charges that in November 2016, Rahim submitted a false form to the IRS that omitted valuable assets he owned, including a helicopter, a 2006 Bentley, a 2008 Lamborghini and real property, the ownership of which he allegedly transferred to his wife two weeks after submitting the form. The indictment further alleges that Rahim also withdrew a total of more than $1.1 million in cash in amounts less than $10,000 to avoid triggering currency transaction reports from the bank and paid personal expenses from his businesses’ bank accounts, including more than $889,000 toward his mortgages and more than $669,000 to purchase or lease cars, including three different Lamborghinis.
In addition, the indictment charges that from 2015 to 2021, Rahim also did not pay to the IRS the taxes that his businesses withheld from employee paychecks or file quarterly tax returns reporting those withholdings.
If convicted, Rahim faces a maximum penalty of five years in prison for the tax evasion count and five years in prison for each count of failing to pay over employment tax withholdings. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Jessica D. Aber for the Eastern District of Virginia made the announcement.
IRS-Criminal Investigation is investigating the case.
Trial Attorney William Montague of the Tax Division and Assistant U.S. Attorney Kimberly Shartar for the Eastern District of Virginia are prosecuting the case.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
United States Attorney Freedman Announces First-Ever Settlement of False Claims Act Whistleblower Case Involving Grants for Restaurants and Similar Businesses Struggling During the COVID-19 PandemicRead the Press Release
ALBANY, NEW YORK – Feast American Diners LLC and Dawood “David” Beshay, the corporate owner and managing member of multiple Denny’s restaurants throughout Arizona and New York, including locations in Syracuse, Auburn, Camillus, Cicero, and Watertown, will pay $2 million to resolve allegations that Beshay falsely certified that Feast American Diners was eligible for a Restaurant Revitalization Fund (RRF) grant when he knew or should have known that his company owned and operated too many locations to qualify for the funding, announced United States Attorney Carla B. Freedman.
United States Attorney Freedman stated: “The Restaurant Revitalization Fund was meant to provide a financial lifeline to restaurants and other eligible entities that were struggling to stay afloat during the COVID-19 pandemic. Feast American Diners and Dawood Beshay are paying a steep price for falsely certifying their eligibility for these funds.”
Congress enacted the American Rescue Plan Act, in March 2021, as a continuation of the federal government’s efforts to provide relief to American individuals and businesses suffering the economic and public health effects of the pandemic. The Act allocated $28.6 billion toward an RRF, to be administered by the United States Small Business Administration (SBA), that could grant qualifying restaurants and other “eligible entities” monetary awards equal to revenue losses caused by the pandemic. Any restaurant that owned or operated more than 20 locations as of March 13, 2020 was not eligible for an RRF grant.
In April 2021, SBA released guidelines for completing RRF applications. The guidance reiterated that an entity was not an “eligible entity” if it owned or operated more than 20 locations as of March 13, 2020. At various points throughout the guidance, SBA explained that a restaurant was in “operation” if it was “making sales.”
In the settlement agreement, Feast American Diners and Beshay admit, acknowledge, and accept responsibility for the following facts: In May 2021, Beshay applied for an RRF grant on behalf of Feast American Diners, in the amount of $928,554. One of the questions on the application asked whether Feast American Diners owned or operated more than 20 locations as of March 13, 2020, to which Feast American Diners responded “no.” That same question indicated that an applicant who responded “yes” would not be eligible for the grant. Later in the application, Beshay affixed his initials next to the following statement: “The Applicant, together with its affiliates, does not own or operate more than 20 locations.” In fact, Feast American Diners owned 21 Denny’s locations as of March 13, 2020 and each of those locations made sales that day, facts that Beshay acknowledges that he should have known.
“Those who provide false information for the purpose of receiving and retaining SBA program funds meant for eligible small businesses will be held accountable,” said SBA Office of Inspector General (OIG) Eastern Region Special Agent in Charge Amaleka McCall-Brathwaite. “Today’s settlement sends a strong message that those responsible will be brought to justice. I want to thank the U.S. Department of Justice and our law enforcement partners for their dedication and pursuit of justice.”
The investigation began in December 2022, when a whistleblower filed a qui tam complaint under seal in the United States District Court for the Northern District of New York. When a whistleblower, or “relator,” files a qui tam complaint, the False Claims Act requires the United States to investigate the allegations and elect whether to intervene and take over the action or to decline to intervene and allow the relator to go forward with the litigation on behalf of the United States. The relator is generally able to then share in any recovery. Pursuant to the settlement agreement, the relator will receive $200,000 of the settlement.
The investigation and settlement were the result of a coordinated effort between the United States Attorney’s Office for the Northern District of New York, SBA-OIG, and SBA’s Office of General Counsel. The United States was represented by Assistant United States Attorney Adam J. Katz.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across the federal government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
U.S. Postal Service Employee Convicted of Theft of Postal Money Orders and Wire FraudRead the Press Release
BOSTON – A U.S. Postal Service (USPS) employee was convicted today by a federal jury in Boston of embezzling over $90,000 and fraudulently obtaining unemployment benefits.
Jamesa Rankins, 27, of Brockton, was convicted of one count of theft of government money and three counts of wire fraud. U.S. District Court Judge Richard G. Stearns scheduled sentencing for Feb. 2, 2024. In July 2022, Rankins was indicted by a federal grand jury.
“The public’s trust and confidence in our government is eroded when federal employees abuse their positions for personal gain. That is exactly what happened in this case. Ms. Rankins exploited her position to embezzle nearly $100,000 in money orders from her employer, the U.S. Postal Service, at the same time she was trying to fleece taxpayers by fraudulently claiming unemployment benefits,” said Acting United States Attorney Joshua S. Levy. “Today’s guilty verdict should be a stern warning to all who contemplate scamming the government – you will be identified, prosecuted and held accountable.”
“The Special Agents of the U.S. Postal Service Office of Inspector General are committed to maintaining the integrity of the Postal Service and its personnel. When a Postal Service employee abuses their position and decides to break the public’s trust, USPS OIG Special Agents will work tirelessly with their law enforcement partners to bring those responsible to justice. The dedicated work of Postal Service employees should never be overshadowed by those who compromise their integrity for personal gain. The USPS OIG is thankful for the great relationships we have developed with our law enforcement partners and with the District of Massachusetts U.S. Attorney’s Office,” said Matthew Modafferi, Special Agent in Charge of the United States Postal Service Office of Inspector General, Northeast Area Field Office.
“Jamesa Rankins violated the public trust placed in her as a U.S. Postal Service employee by fraudulently collecting unemployment insurance while she was employed by the U.S. Postal Service. Rankins stole taxpayer funds intended for those Americans who lost their job due to the COVID-19 pandemic. We will continue to work with our law enforcement partners to investigate these types of allegations,” stated Jonathan Mellone, Special Agent-in-Charge, Northeast Region, U.S. Department of Labor, Office of Inspector General.
Rankins began working for USPS around 2016, most recently as a Sales & Service Distribution Associate at the Montello Post Office in Brockton. In this role, Rankins had the ability to generate postal money orders, including replacement money orders. During the relevant period, customers could obtain replacement money orders without paying any additional fees if the original money orders were lost, damaged or erroneous. Rankins issued over $90,000 worth of replacement money orders to another individual where the original money orders were not erroneous and had not been lost or stolen. On at least one occasion, Rankins personally negotiated one of the replacement money orders at a check cashing business.
Rankins also applied for and obtained unemployment assistance from the Massachusetts Division of Unemployment Assistance despite being employed by USPS and thus being ineligible to receive unemployment assistance.
The charge of theft of government money provides a sentence of up to 10 years in prison, three years of supervised release and a fine of up to $250,000. The charge of wire fraud provides for a sentence of up to 20 years in prison, 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, USPS OIG SAC Modafferi and DOL OIG SAC Mellone made the announcement today. Assistant U.S. Attorney Eugenia M. Carris, Deputy Chief of the Public Corruption & Special Prosecutions Unit and Assistant U.S. Attorney Evan Panich of the Criminal Division are prosecuting the case.
Two Sentenced for Roles in Wide-Ranging Drug ConspiracyRead the Press Release
BOSTON – Two men were sentenced today in federal court in Worcester for their participation in a wide-ranging fentanyl, heroin, crack and cocaine trafficking conspiracy.
Adiangel Paredes, 37, was sentenced by U.S. Senior District Court Judge Timothy S. Hillman to 135 months in prison and five years of supervised release. In October 2022, Paredes was convicted by a federal jury of one count of conspiracy to distribute and possess with intent to distribute one kilogram or more of heroin, 400 grams or more of fentanyl, 500 grams or more of cocaine and 28 grams or more of cocaine base (commonly known as crack cocaine).
Jonathan Villot, 32, was sentenced by Judge Hillman to five years in prison and three years of supervised release. In March 2023, Villot pleaded guilty to one count of conspiracy to distribute and possess with intent to distribute cocaine.
Following a fatal fentanyl overdose in September 2018, an investigation began into a drug trafficking organization in the Fitchburg area. Intercepted communications, surveillance and controlled purchases identified Paredes as a fentanyl, heroin, and cocaine supplier and Villot as a cocaine distributor.
Between September 2018 and November 2019, Paredes conspired to distribute fentanyl, heroin, and cocaine as well as a fentanyl and heroin mixture. Nearly 850 grams of the fentanyl and heroin mixture supplied by Paredes in three controlled purchases was seized during the investigation. In addition, Paredes is responsible for distributing an additional 1.3 kilograms of fentanyl, 2.6 kilograms of cocaine and at least 550 grams of a fentanyl and heroin mixture.
Between January and July 2020, Villot distributed cocaine to a cooperating witness on three occasions. For two of those deals, Villot sent co-conspirator Ivan Torres to deliver the cocaine. Torres pleaded guilty to the indictment and was sentenced in September 2023 to 37 months in prison and three years of supervised release. In addition to the sales to the cooperating witness, Villot is responsible for distributing an additional two kilograms of cocaine in February 2020.
Over the course of the investigation, over 1.8 kilograms of a heroin and fentanyl mixture, over 3.6 kilograms of cocaine and over 50 grams of crack cocaine were seized, as well as a stolen, loaded handgun, drug manufacturing equipment and over $376,000.
The defendants are the 16th and 17th to be sentenced in this case. All 18 defendants have been convicted – either by guilty plea or jury conviction following trial. The remaining defendant is scheduled to be sentenced on Nov. 16, 2023.
Acting United States Attorney Joshua S. Levy; Jodi Cohen, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; Commissioner Carol Mici of the Massachusetts Department of Correction; and John E. Mawn Jr., Interim Colonel of the Massachusetts State Police made the announcement today. The Fitchburg and Lunenburg Police Departments and U.S. Postal Inspection Service provided valuable assistance. Assistant U.S. Attorneys Alathea Porter and Sarah Hoefle of the Criminal Division 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.