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Friday 30 June 2023
Macedon Business Owner Charged with Wire Fraud in Classic Car SchemeRead the Press Release
ROCHESTER, NY—U.S. Attorney Trini E. Ross announced today that Clark P. Rittersbach, 49, of Cape Coral, Florida, was charged by criminal complaint with wire fraud, which carries a maximum sentence of 20 years imprisonment and a fine of $250,000.
Assistant U.S. Attorney Katelyn M. Hartford, who is handling the case, stated that according to the complaint, Rittersbach owned and was the sole manager of Concours Classic Motor Cars in Macedon, NY, from approximately 2006 until at least approximately 2021. The company, which specializes in the restoration and sale of antique vehicles, has many long distance and international customers. According to the complaint, since at least 2017, Rittersbach has fraudulently billed three victims for acquisition and/or restoration work on their antique vehicles that he either did not complete or did not perform at all, despite communicating to them via email and text message that he had. As a result of this scheme, Rittersbach fraudulently obtained at least $1.15 million dollars from the three victims.
- Between April 2009 and April 2019, Victim 1, who resides in Pennsylvania, paid Rittersbach to purchase or restore numerous vehicles on his behalf, but eventually became aware of instances in which Rittersbach lied about work done or vehicles purchased in order to obtain money from Victim 1, including a 1932 Dusenburg Murphy.
- Between 2014 and May 2021, Victim 2, a Canadian resident, paid Rittersbach to acquire and/or restore six rare and high value antique automobiles in exchange for payments totaling $374,000. These automobiles included a 1964 Porsche 356C, which Victim 2 never received.
- In 2008, Victim 3, who lived in the United Kingdom and France, entered into an agreement with Rittersbach to restore a 1926 Rolls Royce “Silver Ghost” he had purchased from an acquaintance of Rittersbach. By December 2021, Victim 3 became suspicious that Rittersbach was not performing the restoration work and requested verification, at which time Rittersbach became unresponsive to Victim 3. Subsequently, Victim 3 hired a private investigator and an attorney, who were able to locate the Rolls Royce in late April 2022. However, very little restoration work had been done.
Murphy made an initial appearance this morning before U.S. Magistrate Judge Mark W. Pedersen and was released on conditions.
The complaint is the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Matthew Miraglia.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
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Louisville Man Sentenced to over 15 Years in Federal Prison for Possessing with Intent to Distribute Methamphetamine and FentanylRead the Press Release
Louisville, KY – A Louisville man was sentenced this week to 15 years and 8 months in prison for possessing with intent to distribute methamphetamine and fentanyl.
U.S. Attorney Michael A. Bennett of the Western District of Kentucky, Special Agent in Charge Jodi Cohen of the FBI Louisville Field Office, and Chief Jacquelyn Gwinn-Villaroel of the Louisville Metro Police Department made the announcement.
According to court records, On June 28, 2023, Brandon Hillard, 23, was sentenced to 15 years and 8 months, followed by a 5-year term of supervised release, for possessing with the intent to distribute more than 50 grams of methamphetamine and more than 40 grams of a fentanyl mixture. There is no parole in the federal system.
The case was investigated by the FBI Louisville Filed Office and the Louisville Metro Police Department.
Assistant U.S. Attorney Robert Bonar and Special Assistant U.S. Attorney Emily Lantz prosecuted the case.
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Louisville Man Charged with Online Enticement of 15-Year-Old GirlRead the Press Release
Louisville, KY –A federal criminal complaint and arrest warrant were issued earlier this week charging a local man with online enticement.
U.S. Attorney Michael A. Bennett of the Western District of Kentucky, Special Agent in Charge Jodi Cohen of the FBI Louisville Field Office, and Colonel Greg Smith, Chief of the Oldham County Police Department, made the announcement.
According to court records, in January and February of 2023, Richard Pelphrey, 33, met a minor female victim on a social networking application. The two subsequently met in person, and the victim told Pelphrey she was 15 years old. On more than one occasion, Pelphrey drove the victim to his home in Louisville, Kentucky, where they engaged in sexual activities.
Pelphrey made his initial appearance today before a U.S. Magistrate Judge in the U.S. District Court for the Western District of Kentucky. Pelphrey remains in federal custody and is scheduled for a detention hearing on July 5, 2023, at 2:30 p.m.
If convicted, Pelphrey faces a mandatory minimum sentence of 10 years in prison and maximum potential penalties of life in prison, a $250,000 fine, and at least five years of supervised release. A federal district court judge will determine any sentence after considering the sentencing guidelines and other statutory factors. There is no parole in the federal system.
The FBI and the Oldham County Police Department are investigating the case.
Assistant United States Attorney Jo E. Lawless is prosecuting the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
A criminal complaint is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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Lincoln Man Sentenced to 30 Months for Marijuana Charge Involving a ShootingRead the Press Release
United States Attorney Steven Russell announced that Xavier Lloyd Gary, 19, of Lincoln, Nebraska, was sentenced on June 29, 2023 by Senior United States District Court Judge John M. Gerrard to a 30-month term of imprisonment for attempted possession of marijuana with the intent to distribute. After he completes his prison sentence, Gary will serve a two-year term of supervised release. There is no parole in the federal system.
On August 2, 2021, Lincoln police responded to reports of a shooting occurring near the Edgewood Theaters and Target on the south side of Lincoln. Jayden Prentice, Christopher Duncan, and Riley Mills were present when police arrived. Duncan and Prentice had suffered gunshot wounds. First responders resuscitated Duncan using CPR. They were transported to the hospital. Duncan and Prentice each spent a month in the hospital being treated for their wounds, and Duncan had to have one of his legs amputated. The investigation would later reveal that a group of people, including Gary and Buongkhoy Wal, arranged to purchase a half-pound of marijuana from Prentice, Duncan, and Mills. The planned purchase was a ruse for a robbery. Gary’s car was used in the offense and Gary drove to and from the scene. Gary was not one of the persons who discharged a firearm.
Buongkhoy Wal pleaded guilty to discharging a firearm during a drug trafficking offense on March 21, 2023, and he is scheduled for sentencing on July 31, 2023. He faces a prison sentence of at least ten years.
Prentice, Duncan, and Mills each pleaded guilty to offenses involving the possession of controlled substances with the intent to distribute, and possession of firearms in furtherance of a drug trafficking offense. On June 24, 2022, Mills was sentenced to a 92-month term of imprisonment, to be followed by a three-year term of supervised release. Prentice was sentenced on July 6, 2022, to a 72-month term of imprisonment, and a three-year term of supervised release. Duncan is scheduled for sentencing on July 17, 2023.
The investigation was conducted by the Lincoln Police Department and the Federal Bureau of 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.
Lincoln Man Sentenced to 14 Years for Possession of Child PornographyRead the Press Release
United States Attorney Steven Russell announced that John Wade Burton, 67, of Lincoln, Nebraska, was sentenced today in Lincoln by Senior United States District Court Judge John M. Gerrard to a 14-year term of imprisonment for possession of child pornography. After he completes his prison sentence, Burton will serve a ten-year term of supervised release. There is no parole in the federal system. Burton was also ordered to pay $21,000 in restitution. Burton was convicted following a jury trial which concluded on February 15, 2023.
The Federal Bureau of Investigation (FBI) received a tip from a foreign law enforcement agency that an IP address originating from the United States had accessed a couple of child pornography websites on The Onion Router (TOR) network. The tip traced back to Burton’s residence in Lincoln. The FBI obtained a search warrant for Burton’s home, and the warrant was executed on November 17, 2020. Several electronic devices were seized from the home and later examined by the FBI. Devices found in Burton’s bedroom, basement, and a hard drive located in the garage all contained files depicting child pornography. In total, more than 200 videos, and more than 1,800 images depicting child pornography were discovered. Pictures of the defendant, a copy of his driver’s license, and his resume were also located on a couple of those same devices.
Burton was interviewed by an FBI agent. He said he used a program which is designed to access the TOR network, and which is supposed to avoid leaving evidence on the computer of having accessed the TOR network. The defendant said he used that program to access the TOR network at least 100 times between February 14, 2018, and November 17, 2020.
Burton was previously convicted in Missouri of having sexually assaulted a child who was less than 14 years old. He was sentenced to prison for that offense and was in custody from February 15, 2007, to February 14, 2018. When the search warrant was executed in this case, Burton was on parole for that offense.
At the time his home was searched, Burton lived with his then 89-year-old father. His father passed away on March 5, 2021, after the search warrant was served, and before Burton’s trial. At trial, Burton argued his deceased father was the person who was responsible for having downloaded all the child pornography. At today’s sentencing hearing, Judge Gerrard told Burton, “The jury did not believe you, and neither do I.”
The investigation was conducted by the Federal Bureau of Investigation, with assistance from the Nebraska State Patrol and the Sarpy County Sheriff’s Department. This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (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.
Jury Convicts Metairie Man of Federal Gun and Drug Charges and Lying to a Federal AgentRead the Press Release
NEW ORLEANS, LOUISIANA – On June 27, 2023, DAMION WILSON, age 23, a resident of Metairie, Louisiana, was found guilty by a federal jury of four counts in a six count indictment. Specifically, WILSON was found guilty of possession with the intent to distribute marijuana, possession of a firearm in furtherance of a drug trafficking crime, maintaining a drug involved premises, and lying to a federal agent. He was acquitted of two other related counts.
His sentencing is set for October 18, 2023.
As to Count 3 of the indictment, for which he was convicted of possession with the intent to distribute marijuana, in violation of United States Code, Section 841(a)(1) and (b)(1)(D), he faces up to five years in prison, a fine of up to $250,000.00, and a term of supervised release of up to two years.
As to Count 4 , for which he was convicted of possessing a firearm in furtherance of a drug trafficking crime, in violation of Title 18, United States Code, Section 924(c), he faces a mandatory minimum sentence of five years and a maximum of life in prison. Any sentence imposed in connection with this count must be served consecutively. He also faces payment of a fine of up to $250,000.00, and a term of supervised release of up to five years.
As to Count 5 , for which he was convicted of maintaining a drug involved premises, in violation of Title 18, United States Code, Section 856, he faces up to twenty years in prison, a fine of up to $250,00.00, and a term of supervised release of up to three years.
As to Count 6, for which he was convicted of lying to a federal agent, in violation of Title 18, United States Code, Section 1001, he faces up to five years in prison, a fine of up to $250,000.00, and up to one year of supervised release. As to each count of conviction, he also faces payment of a $100.00 mandatory special assessment fee.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
This case was investigated by the federal Bureau of Alcohol, Tobacco, Firearms, and Explosives (A.T.F.), the New Orleans Police Department, the Jefferson Parish Sheriff’s Office, and the United States Marshal’s Service. The case was prosecuted by Assistant United States Attorney Troy Bell of the General Crimes Unit and Assistant United States Attorney Maurice E. Landrieu, Jr. of the Narcotics Unit.
Jamestown Man Pleads Guilty to Methamphetamine ConspiracyRead the Press Release
BUFFALO, NY—U.S. Attorney Trini E. Ross announced today that Michael Murphy, 31, of Jamestown, NY, pleaded guilty before U.S. District Judge Richard J. Arcara to conspiracy to possess with intent to distribute, and to distribute, 50 grams or more of methamphetamine, which carries a mandatory minimum penalty of 10 years in prison and a maximum of life in prison.
Assistant U.S. Attorney Joshua A. Violanti, who is handling the case, stated that between June 2019 and October 2020, Murphy bought, sold, and distributed quantities of methamphetamine for profit. In July 2019, the United States Marshal’s Service and other law enforcement officers went to a Bishop Street residence in Jamestown, where Murphy was present, to apprehend a federal fugitive. When they arrived, law enforcement observed, in plain view, distribution amounts of methamphetamine. They seized the methamphetamine and $1,476 in cash. Subsequently, a search warrant was executed, and investigators seized another 223 grams of actual methamphetamine and drug paraphernalia. In November 2019, investigators executed a search warrant at Murphy’s Newland Avenue residence in Jamestown. Before execution of the warrant, Murphy ran away, dropping a digital scale. Inside the residence, law enforcement recovered methamphetamine, illicit mushrooms, other drug paraphernalia, two firearms and ammunition, and $1,642 in cash. The investigation also included four controlled purchases of drugs from Murphy.
Co-defendants Rocco Beardsley, Miller Hagga, and Austin Gordon are scheduled for trial on September 6, 2023. Co-defendants Kylie Reeves, Garland Beardsley, Tyler Tedesco, and Giselle Bennett were previously convicted and are awaiting sentencing.
The plea is the result of an investigation by the Jamestown Police Department and the Jamestown Metro Drug Task Force, under the direction of Jamestown Police Chief Timothy Jackson; the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Frank A. Tarentino III, New York Field Division; the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent-in-Charge John B. Devito, New York Field Division, and the Chautauqua County Sheriff’s Office, under the direction of Sheriff James Quattrone.
Sentencing is scheduled for October 17, 2023, before Judge Arcara.
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Jacksonville Convicted Felon Sentenced to Eight Years for Narcotics and Firearm PossessionRead the Press Release
Jacksonville, Florida – U.S. District Judge Marcia Morales Howard has sentenced Johnny Deangelo White (46, Jacksonville) to eight years and four months in federal prison for possessing with the intent to distribute fentanyl and possessing a firearm in furtherance of a drug trafficking offense. He had pleaded guilty in March 2023.
According to court documents, on April 27, 2022, officers from the Jacksonville Sheriff’s Office responded to a call from an individual who saw White waving a firearm outside of a grocery store. When White saw the officers, he fled into the store and threw the firearm into a shelf of potato chips. The loaded, stolen, firearm was recovered, and White was arrested. The officers found on White’s person a sunglasses case that contained fentanyl. The amount of fentanyl and the way it was packaged was indicative that White was selling fentanyl. White later admitted to selling fentanyl since the early part of 2022. White is a seven-time convicted felon and is prohibited from possessing a firearm or ammunition under federal law.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Jacksonville Sherriff’s Office. It was prosecuted by Assistant United States Attorney John Cannizzaro. The forfeiture will be handled by Assistant United States Attorney Mai Tran.
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.
Iowa Air National Guardsman Pleads Guilty to Possessing Child PornographyRead the Press Release
Kevin Swanson, 35, from Sioux City, Iowa, entered a guilty plea in federal court on May 4, 2023, to possession of child pornography.
In a plea agreement, Swanson admitted that between August 2020, and August 2021, he used an Internet-based, peer-to-peer (P2P) network to knowingly receive visual depictions of minors engaged in sexually explicit conduct, including depictions involving prepubescent minors who had not reached the age of 12. Swanson had over 1,168 images and 4 video files of child exploitation materials.
Sentencing before United States District Court Chief Judge Leonard T. Strand will be set for a later date after a presentence report is prepared. Swanson was taken into custody by the United States Marshal pending sentencing. Swanson faces a sentence of up to 20 years imprisonment without the possibility of parole, a fine of not more than $250,000, a mandatory special assessment of $100 and a term of supervised release of at least 5 years to life.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
The case was investigated by Homeland Security Investigations, the Sioux City Police Department, and the Nebraska State Patrol. The case is being prosecuted by Assistant United States Attorney Kraig R. Hamit.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 22-4080. Follow us on Twitter @USAO_NDIA.
Informational: Federal Court arraignmentsRead the Press Release
The U.S. Attorney’s Office announced that the following persons were arraigned or appeared this week before U.S. Magistrate judges on indictments handed down by the Grand Jury or on criminal complaints. The charging documents are merely accusations and defendants are presumed innocent until proven guilty beyond a reasonable doubt:
Appearing in Billings before U.S. Magistrate Judge Timothy J. Cavan and pleading not guilty on June 29 was:
Joshua James Groh, 41, of Billings, and Gary Michael Byrd, 52, of Billings, on charges of conspiracy to possess with intent to distribute methamphetamine and possession with intent to distribute meth. If convicted of the most serious crime, Groh and Byrd face a mandatory minimum of 10 years to life in prison, a $10 million fine and at least five years of supervised release. Groh and Byrd were detained pending further proceedings. The Billings Police Department and Drug Enforcement Administration investigated the case. PACER case reference. 23-74.
Appearing in Missoula before U.S. Magistrate Judge Kathleen L. DeSoto and pleading not guilty on June 29 was:
Matthew Cory Glen Robocker, 27, of Shelby, on charges of prohibited person in possession of a firearm. If convicted of the most serious crime, Robocker faces a maximum of 10 years in prison, a $250,000 fine and three years of supervised release. Robocker was detained pending further proceedings. The Bureau of Alcohol, Tobacco, Firearms and Explosives, Toole County Sheriff’s Office, Lincoln County Sheriff’s Office and Montana Probation and Parole investigated the case. PACER case reference. 21-48.
Heath Lynn Schmoeckel, 42, of Missoula, on charges of prohibited person in possession of a firearm. If convicted of the most serious crime, Schmoeckel faces a maximum of 15 years in prison, a $250,000 fine and three years of supervised release. Schmoeckel was detained pending further proceedings. The Montana Highway Patrol, Missoula County Sheriff’s Office, Missoula Police Department and Montana Probation and Parole investigated the case. PACER case reference. 23-22.
Appearing in Great Falls before U.S. Magistrate Judge John T. Johnston and pleading not guilty on June 27 was:
James Cleveland Manywhitehorses, 42, of Browning, on charges of prohibited person in possession of a firearm. If convicted of the most serious crime, Manywhitehorses faces a maximum of 15 years in prison, a $250,000 fine and three years of supervised release. Manywhitehorses was detained pending further proceedings. The FBI, Blackfeet Law Enforcement Services and Bureau of Alcohol, Tobacco, Firearms and Explosives investigated the case. PACER case reference.23-55.
Bradley Bear Standing Rock, 26, of Havre, on charges of sexual assault, a misdemeanor. If convicted of the most serious crime, Standing Rock faces a maximum of six months imprisonment and a $500 fine. Standing Rock was released pending further proceedings. The FBI investigated the case. PACER case reference. 23-59.
Jacqueline Rose Hydock, 33, of Great Falls, on charges of possession of stolen mail and wire fraud. If convicted of the most serious crime, Hydock faces maximum of 20 years in prison, a $250,000 fine and three years of supervised release. Hydock was released pending further proceedings. The U.S. Postal Service, Cascade County Sheriff’s Office and Great Falls Police Department investigated the case. PACER case reference. 23-54.
The progress of cases may be monitored through the U.S. District Court Calendar and the PACER system. To establish a PACER account, which provides electronic access to review documents filed in a case, please visit http://www.pacer.gov/register.html. To access the District Court’s calendar, please visit https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
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Houma Drug Dealer Sentenced for Violating the Federal Controlled Substances ActRead the Press Release
NEW ORLEANS, LOUISIANA – On Wednesday, June 28, 2023, LARANZA THOMAS, a/k/a “Dude,” age 28, a resident of Houma, Louisiana, was sentenced to 160 months in federal prison, five years of supervised release upon release from prison, as well as payment of a $100 mandatory special assessment fee for conspiring to distribute 500 grams or more of methamphetamine, announced U.S. Attorney Duane A. Evans.
This prosecution was a part of an extensive investigation by the Organized Crime Drug Enforcement Task Force (OCDETF). OCDETF is a joint federal, state, and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional level drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.
This case was investigated by the Drug Enforcement Administration, the Louisiana State Police, the Terrebonne Parish Sheriff’s Office, the Lafourche Parish Sheriff’s Office, the New Orleans Police Department, the St. Bernard Parish Sheriff’s Office, the Orleans Levee District Police Department, and the Louisiana Department of Public Safety and Corrections – Division of Probation and Parole. The prosecution was handled by Assistant United States Attorney Maurice E. Landrieu, Jr. of the Narcotics Unit.
Guatemalan National Sentenced to More Than Five Years in Prison for Deaths in Human Smuggling OperationRead the Press Release
ALPINE, Texas – A Guatemalan national was sentenced in federal court in Pecos Monday to 63 months in prison for one count of transportation of illegal aliens resulting in death.
According to court documents, David Alexander Gonzalez-Diaz, 24, of Santa Rosa, Guatemala, was transporting 14 undocumented noncitizens north of Van Horn on Oct. 29, 2021, when he lost control of the vehicle, crashing and ejecting several occupants. As a result, four of the migrants were killed and six were critically injured. Gonzalez-Diaz has remained in federal custody since his arrest the day of the crash.
“Human smuggling is extremely dangerous and, as displayed in this case, often results in serious injury or death,” said U.S. Attorney Jaime Esparza for the Western District of Texas. “This sentence is a reminder that violators are committing a serious crime with serious consequences and will be held accountable.”
"This case drives home a harsh message to anyone considering trusting a smuggler to attempt to enter the United States illegally: Anytime you trust a smuggler, you’re putting your life in grave danger,” said Special Agent in Charge Francisco B. Burrola for the Homeland Security Investigations (HSI) El Paso Division. “Human smugglers have a total disregard for their clients’ safety, welfare, and lives. They see them simply as cargo and a means to make a profit."
HSI investigated the case with assistance from the U.S. Border Patrol.
Assistant U.S. Attorney Scott Greenbaum prosecuted the case.
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Four Owensboro Residents Sentenced for Federal Methamphetamine Trafficking ConspiracyRead the Press Release
Owensboro, KY – This week, the fourth and final member of an Owensboro federal drug trafficking conspiracy was sentenced to over 15 years in federal prison.
U.S. Attorney Michael A. Bennett of the Western District of Kentucky, Special Agent in Charge Sheila Lyons of the DEA Chicago Field Division, and Chief Art Ealum of the Owensboro Police Department made the announcement.
On June 29, 2023, in the United States District Court for the Western District of Kentucky, Owensboro Division, Darrell Murphy, 48, of Owensboro, was sentenced to 15 years and 8 months in prison, followed by 5 years of supervised release, for conspiring to possess with the intent to distribute 500 grams or more of a methamphetamine mixture.
On March 29, 2023, Terry Cook, 45, of Owensboro, was sentenced to 10 years and 10 months in prison, followed by 5 years of supervised release, for conspiring to possess with the intent to distribute 500 grams or more of a methamphetamine mixture.
On March 16, 2023, William Darmell Murphy, 61, of Owensboro, was sentenced to 3 years and 6 months in prison, followed by 4 years of supervised release, for conspiring to possess with the intent to distribute 500 grams or more of a methamphetamine mixture.
On March 16, 2023, Elizabeth Breanne Harris, 41, of Owensboro, was sentenced to 3 years in prison, followed by 4 years of supervised release, for conspiring to possess with the intent to distribute 500 grams or more of a methamphetamine mixture.
There is no parole in the federal system.
The DEA Evansville Resident Office and Owensboro Police Department investigated the case, with assistance from the Daviess County Sheriff’s Office and the ATF.
The case was prosecuted by Assistant United States Attorney Frank Dahl.
This effort is part of an Organized Crime Drug Enforcement Task Force (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 www.justice.gov/OCDETF.
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Four Jefferson and St. Tammany Parish Men Indicted for Violations of the Federal Controlled Substances and Gun Control ActsRead the Press Release
NEW ORLEANS, LOUISIANA – JAMES MAGEE, age 31, DEON SHORT, age 26, and CHARLES WHITE, age 31, all residents of Jefferson Parish, Louisiana, and DENTRELL JOHNSON, age 28, a Slidell, Louisiana resident, were charged on June 22, 2023 in a sealed fourteen-count superseding indictment, announced U.S. Attorney Duane A. Evans. The case was unsealed on June 28, 2023.
The indictment charged MAGEE, JOHNSON, and WHITE with conspiracy to distribute 500 grams or more of cocaine and quantities of cocaine base, fentanyl, and methamphetamine, in violation of Title 21, United States Code, Section 841(a)(1), 841(b)(1)(B), 841(b)(1)(C), and 846. For this offense, they face a statutory mandatory minimum sentence of five years, up to forty years imprisonment, a fine of up to $5,000,000, and at least four years of supervised release following any term of imprisonment.
SHORT is also charged with conspiracy to distribute and possess with intent to distribute a quantity of cocaine, in violation of Title 21, United States Code, Section 841(a)(1), 841(b)(1)(C), and 846. For this offense, he faces up to twenty years imprisonment, a fine of up to $1,000,000, and at least three years of supervised release following any term of imprisonment.
The indictment also charged MAGEE, JOHNSON, WHITE and SHORT with distribution and possession with intent to distribute controlled substances, including but not limited to cocaine and cocaine base, in violation of Title 21, United States Code, Section 841(a)(1) and 841(b)(1)(C). For each of these offenses, the defendants face up to twenty years imprisonment, a fine of up to $1,000,000, and at least three years of supervised release following any term of imprisonment.
MAGEE is charged with two counts of possessing a firearm in furtherance of a drug trafficking crime, in violation of Title 18, United States Code, Sections 924(c)(1)(A)(i). JOHNSON is charged with one count of possessing a firearm in furtherance of drug trafficking. For each offense, the defendants face a mandatory minimum sentence of five years imprisonment, up to life, a fine of up to $250,000, and up to five years supervised release.
MAGEE is also charged with two counts of being a felon in possession of a firearm, in violation of Title 18, United States Code, Sections 922(g)(1) and 924(a)(8). For this offense, he faces up to fifteen years imprisonment, a fine of up to $250,000, and up to three years supervised release.
For each of the counts of the indictment in which they are charged , the defendants face payment of a $100 mandatory special assessment fee.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
U.S. Attorney Evans reiterated that the indictment is merely a charging document and that the guilt of the defendants must be proven beyond a reasonable doubt.
This case was investigated by the federal Drug Enforcement Administration and Jefferson Parish Sheriff’s Office. The prosecution is being handled by Assistant United States Attorney J. Benjamin Myers of the Narcotics Unit.
Fort Lauderdale Man Sentenced to 5+ Years for Bank Fraud, ID Theft and Firearms Offenses in Maine, Florida and OregonRead the Press Release
PORTLAND, Maine: A Fort Lauderdale, Florida man was sentenced in U.S. District Court in Portland yesterday for conspiracy to commit bank fraud, bank fraud, aggravated identity theft and unlawful possession of a firearm.
U.S. District Judge Nancy Torresen sentenced Leonardo Cameron, 28, to 61 months in prison followed by three years of supervised release. Cameron pleaded guilty on November 28, 2022.
According to court records, in November 2020, Cameron and coconspirators broke into unattended vehicles in southern Maine and New Hampshire and stole personal identifying information, such as driver’s licenses and checkbooks. They then used the identifications to cash stolen checks using multiple bank drive-through lanes in southern Maine. As part of the scheme, checks from one theft victim’s account were made payable to another identity theft victim, and another coconspirator impersonated the identity theft victims to cash the stolen checks.
In July 2020, Cameron engaged in similar conduct in Oregon with different coconspirators. In April 2021, when he was arrested in Florida for the Oregon federal bank fraud and identity theft charges, he was found in possession of a firearm and ammunition. A prior felony conviction precluded Cameron from possessing firearms or ammunition. Cameron agreed to transfer jurisdiction over the Florida and Oregon charges to the District of Maine for the purpose of entering guilty pleas to all pending federal charges.
COCONSPIRATOR IN MAINE CASE SENTENCED TO 3 YEARS: On May 3, Travis Paige (aka “Travis McNair” or “Sway”), 26, of Fort Lauderdale, Florida, was sentenced to three years in prison followed by three years of supervised release for conspiracy to commit bank fraud, bank fraud and aggravated identity theft for his part in the scheme.
The Eliot, Maine Police Department; the FBI in Portland, Maine; the U.S. Department of Homeland Security, Homeland Security Investigations (HSI) in Portland, Oregon; and HSI in Fort Lauderdale, Florida investigated these cases.
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Former chair of Ohio Republican Party sentenced to 5 years in prison for role in racketeering conspiracyRead the Press Release
CINCINNATI – Former Ohio Republican Party chair Mathew Borges, 51, of Bexley, Ohio, was sentenced in federal court today to 60 months in prison for participating in a racketeering conspiracy.
A jury found Borges and former Ohio House Speaker Larry Householder, 63, of Glenford, Ohio, guilty of violating the racketeering statute. The verdict was announced on March 8 following a six-week trial.
The government proved beyond a reasonable doubt at trial that Borges conspired with others to violate the racketeering statute in a conspiracy involving nearly $61 million in bribes paid to a 501(c)(4) entity to pass and uphold House Bill 6, a billion-dollar nuclear plant bailout.
“Borges willingly joined the criminal enterprise knowing its members were involved in a bribery conspiracy. He personally sought out, solicited, and bribed an individual for insider information,” said U.S. Attorney Kenneth L. Parker. “Borges has been involved in politics and worked with public officials for more than 20 years. He knew exactly where the lines were when he decided to cross them and participate in a criminal enterprise. Today’s sentence holds him accountable for that illegal conduct.”
Borges’ primary role in the enterprise was to deprive Ohioans of the opportunity to overturn what Borges knew was corrupt legislation. He was budgeted $25,000, which he laundered through his own bank accounts, to bribe a political operative for secret, real-time information.
The defendant created a new entity – 17 Consulting Group LLC – and agreed to funnel $1.62 million to 17 Consulting that had already been laundered through Householder’s 501(c)(4), Generation Now.
Borges gave the operative a $15,000 check in exchange for information on the number of signatures collected on the anti-House Bill 6 ballot referendum. Borges paid himself $360,000 of the laundered money.
Campaign and political strategist, Jeffrey Longstreth, and lobbyist Juan Cespedes, both of Columbus, Ohio, previously pleaded guilty to their roles in the racketeering conspiracy. They await sentencing. FirstEnergy Corp. signed a deferred prosecution settlement in July 2021, agreeing to pay a $230 million penalty for conspiring to bribe public officials and others.
Householder was sentenced in U.S. District Court yesterday to 240 months in prison. Both he and Borges have been remanded to the custody of the U.S. Marshals.
Kenneth L. Parker, United States Attorney for the Southern District of Ohio, and J. William Rivers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Division, announced the sentence imposed today by Senior U.S. District Judge Timothy S. Black. Deputy Criminal Chief Emily N. Glatfelter and Assistant United States Attorneys Matthew C. Singer, Megan Gaffney Painter and Timothy S. Mangan represented the United States in this case.
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Former Wausau Investment Advisor Sentenced to 8 Years for $1.9 Million Ponzi SchemeRead the Press Release
MADISON, WIS. – Timothy M. O’Shea, United States Attorney for the Western District of Wisconsin, announced that Anthony B. Liddle, 41, Wausau, Wisconsin was sentenced today by Chief U.S. District Judge James D. Peterson to 8 years in federal prison for wire fraud and money laundering. Liddle pleaded guilty to the charges on February 24, 2023.
Liddle served as an investment advisor for his own financial advisory firm, Prosper Wealth Management in Wausau. Between June 2019 and August 2022, he solicited money from his clients allegedly to place in low-risk investments. However, Liddle never actually invested the money. Instead, he kept the money and spent it on his businesses and on personal expenses, including travel. In total, he stole $1,937,817.92 from his clients.
Liddle maintained a high profile in the investment community, hosting seminars and marketing himself as a successful family man who cared about helping others. Many of the victims were individuals he befriended. When the Wisconsin Department of Financial Institutions began investigating Liddle, he falsely claimed that each of the stolen investments were loans to him, even going so far as creating false loan documents.
In selecting a sentence of 8 years, Judge Peterson said he hoped to provide some measure of justice for the victims, whom he described as “hard-working people who accumulated their wealth over a long period of time.” Judge Peterson called Liddle’s crimes “monstrous,” because he ruthlessly manipulated and stole from people that he knew well.
The charges against Liddle were the result of an investigation conducted by the Federal Bureau of Investigation, IRS Criminal Investigation, Securities and Exchange Commission, and the Wisconsin Department of Financial Institutions. Assistant U.S. Attorneys Zachary Corey and Meredith Duchemin prosecuted this case.
Former Sales Representative Sentenced to Five Years in Prison for Compound Prescription Drug SchemeRead the Press Release
NEWARK, N.J. – A former sales representative was sentenced to 60 months in prison for his role in a scheme to defraud public health benefits programs by billing for medically unnecessary compound prescriptions, U.S. Attorney Philip R. Sellinger announced today.
Matthew Puccio, 41, of Randolph, New Jersey, was convicted on July 19, 2022, of conspiracy to commit health care fraud following a seven-day jury trial before U.S. District Judge John Michael Vazquez, who imposed the sentence today in Newark federal court.
According to documents in this case and the evidence at trial:
Compound medications are specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Although compound drugs are not approved by the Food and Drug Administration (FDA), they are properly prescribed when a physician determines that an FDA-approved medication does not meet the health needs of a particular patient, such as if a patient is allergic to a dye or other ingredients in the prescription.
From November 2014 to March 2016, Puccio participated in a conspiracy that involved submitting fraudulent prescriptions for compound medications to public health benefits programs. Marketing companies recruited and paid sales representatives, such as Puccio, to obtain compound medications for themselves and others regardless of medical necessity, targeting health plans that reimbursed for compound medications at high rates.
Puccio exploited this opportunity through working as a sales representative for several compounding pharmacies. He targeted individuals who had health plans that covered compound medications and then convinced those individuals to obtain prescriptions for compound medications, regardless of medical necessity. Puccio and others induced two New Jersey-based physicians to sign medically unnecessary prescriptions for beneficiaries that Puccio and others had recruited.
Once the prescriptions were written, they were filled by the compounding pharmacies with which Puccio worked. The compounding pharmacies would then receive reimbursement from the health plans and would pay Puccio a percentage of the reimbursement amount. Puccio and his conspirators caused a significant loss to public health benefits programs.
In addition to the prison term, Judge Vazquez sentenced Puccio to three years of supervised release and ordered him to pay $2.65 million in restitution.
U.S. Attorney Sellinger credited special agents of the FBI, Newark Division, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to the sentencing.
The government is represented by Assistant U.S. Attorneys Emma Spiro and Shawn Barnes of the Criminal Division in Newark.
Former Police Officer Sentenced to 37 Months for Possession of Child PornographyRead the Press Release
ANCHORAGE – A Wasilla man was sentenced today to 37 months in federal prison for possessing child pornography in his home. According to court documents, Matthew William Schwier, 39, knowingly possessed over 100 still images and multiple videos depicting children being sexually abused. Schwier pled guilty on August 31, 2022, to knowingly possessing child pornography. After serving his sentence, Schwier will be on federal supervised release for 7 years. Schwier will have to pay $15,000.00 in restitution to his victims. Schwier must register as a sex offender and, after release, may not access the internet without permission of the U.S. Probation Office.
Schwier’s child pornography collection, which spanned multiple computers, included images depicting the sexual abuse of infants or toddlers, as well as children being violently abused. The evidence indicates that Schwier may have used specialized law enforcement training, and his advanced computer skills, to facilitate and attempt to hide his crimes.
Schwier’s previous employment included jobs in technical support, computer repair, and as a supervisor of video surveillance for a private security company. He failed to complete probationary employment as a police officer in Phoenix, Arizona; Roswell, New Mexico; and Elk Point, South Dakota, before working as a police officer in Nome, Alaska. The FBI investigation began in approximately 2016 when Schwier distributed child pornography to an undercover law enforcement officer over the internet. Schwier was employed as Justice Director for the Chickaloon Village Traditional Counsel when he was arrested in 2017. The Government indicated that, if this case had gone to trial, the prosecution was prepared to present evidence that Schwier had a reputation within the law enforcement community of being untruthful.
“The Department of Justice will relentlessly pursue, arrest, and prosecute offenders who traffic in child pornography,” said U.S. Attorney S. Lane Tucker of the District of Alaska. “This case demonstrates that the U.S. Attorney’s Office will hold criminals accountable without fear or favor, including corrupt former law enforcement officers like Mr. Schwier.”
“May this sentencing serve as a reminder that no one is above the law, and concealing evidence of child exploitation will not go undetected,” said Assistant Special Agent in Charge Donald W. Lee II of the FBI Anchorage Field Office. “As these crimes perpetuate the re-victimization of innocent children, the FBI remains steadfast in its commitment to identify and hold accountable those who contribute to the online sexual exploitation of children.”
The court proceedings were delayed for years for several reasons, including the COVID pandemic. Over the six years the case was active, it was prosecuted by Assistant U.S. Attorneys Adam Alexander, Charisse Arce, Kelly Cavanaugh, Kyle Reardon, Christopher Schroeder, and Jonas Walker. The FBI investigated the case.
This case was 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 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.
Please report online child exploitation to the FBI. https://www.fbi.gov/how-we-can-help-you/parents-and-caregivers-protecting-your-kids#:~:text=To%20report%20online%20child%20sexual,%2D800%2D843%2D5678.
Former Housing Authority Executive Director Sentenced to Federal Prison for Using Funds for Personal ExpensesRead the Press Release
BENTON, Ill. – A U.S. district judge sentenced the former executive director of the Jefferson County Housing Authority to spend 10 months in federal prison after he converted more than $20,000 in authority funds for personal expenses.
In addition to the prison sentence, Thomas J. Upchurch, 53, now of Rio Rancho, New Mexico, was ordered to pay $20,150 in restitution back to the housing authority, and he will serve one year of supervised release.
“To promote respect for the law, the defendant’s sentence sends a clear message to deter other organizational leaders from abusing their power and spending authority,” said U.S. Attorney Rachelle Aud Crowe.
“The actions of Thomas Upchurch undermined the ability of the housing authority to provide housing assistance to those who need their services,” said FBI Springfield Field Office Acting Special Agent in Charge Joe Rodriguez. “The FBI is particularly vigilant in instances where individuals take advantage of federal program funds.”
According to court documents, Upchurch linked the housing authority’s credit card to his personal Amazon account and made nearly 300 inappropriate charges for personal items. Over a three-year period, the charges totaled more than $20,000. To conceal his fraud, Upchurch blocked the members of JCHA’s Board of Commissioners from reviewing his spending records. The defendant was charged with one count of conversion of federal funds due to the JCHA’s funding from the U.S. Department of Housing and Urban Development.
The JCHA serves 712 residents over 425 housing units in Mt. Vernon, Dix, Ina, Waltonville and Woodlawn. Members of the Jefferson County Board appoint the JCHA’s Board of Commissioners who then appoint an executive director to oversee its operations.
The FBI Springfield Field Office conducted the investigation with assistance from the U.S. Department of Housing and Urban Development-Office of Inspector General. Assistant U.S. Attorney Steven D. Weinhoeft prosecuted the case.
Former Deputy U.S. Marshal Sentenced for Cyberstalking, Perjury, and ObstructionRead the Press Release
A former deputy U.S. Marshal was sentenced today to 10 years and one month in prison for conspiracy to commit cyberstalking, cyberstalking, perjury, and obstruction of justice.
According to court documents and evidence presented at trial, Ian R. Diaz, 45, of Glendora, California, and his then-wife, an unindicted co-conspirator (CC-1), posed as a person with whom Diaz was formerly in a relationship (Jane Doe). In that guise, they sent themselves harassing and threatening electronic communications that contained apparent threats to harm CC-1; solicited and lured men found through Craigslist “personal” advertisements to engage in so-called “rape fantasies” in an attempt to stage a purported sexual assault on CC-1 orchestrated by Jane Doe; and staged one or more hoax sexual assaults and attempted sexual assaults on CC-1. Diaz and CC-1 then reported this conduct to local law enforcement, falsely claiming that Jane Doe posed a genuine and serious threat to Diaz and CC-1. Their actions caused local law enforcement to arrest, charge, and detain Jane Doe in jail for nearly three months for conduct for which Diaz and CC-1 framed her.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, Special Agent in Charge Harry A. Lidsky of the Justice Department’s Office of the Inspector General (DOJ-OIG) Cyber Investigations Office, and Special Agent in Charge Zachary Shroyer of the DOJ-OIG Los Angeles Field Office made the announcement.
DOJ-OIG investigated the case.
Senior Litigation Counsel Marco A. Palmieri of the Criminal Division’s Public Integrity Section (PIN) and Senior Trial Attorney Mona Sedky of the Computer Crime and Intellectual Property Section prosecuted the case. Former PIN Trial Attorney Rebecca G. Ross provided significant assistance.
Former Atlanta business-owner sentenced to prison for obtaining millions of dollars in COVID-19 relief fraud, tax identity theft and credit card fraudRead the Press Release
ATLANTA – Jose Fernandez has been sentenced for seeking over $5 million by submitting fraudulent Paycheck Protection Program (“PPP”) applications, filing false tax returns using stolen identities, using credit cards he obtained with stolen identities, and check fraud. He ultimately obtained more than $2 million in fraudulent funds, which he then used for his personal benefit.
“Fernandez committed a litany of frauds, including an attempt to steal millions of dollars from a COVID relief program, financial institutions, and the IRS by stealing the identities of innocent victims to file false tax returns,” said U.S. Attorney Ryan K. Buchanan. “His sentence reflects the scope of his criminal conduct.”
“Fernandez will have many years in prison to think about his long list of crimes and greed. He not only hurt business owners in need of the Covid relief funding, but even stole the identities of family members,” said Keri Farley, Special Agent in Charge of FBI Atlanta. “With our law enforcement partners, we will continue to identify and hold accountable anyone who violates the law to siphon money from these programs into their own pockets.”
“People who commit PPP fraud and identity theft can expect to be held accountable just as Jose Fernandez has,” said Lisa Fontanette, acting Special Agent in Charge, IRS Criminal Investigation, Atlanta Field Office. “We will continue working with our law enforcement partners to bring to justice individuals who commit these types of crimes that financially harm honest law-abiding citizens and defrauds the U.S. Government.”
“This sentencing holds the defendant in this case accountable for seeking to fraudulently obtain millions of dollars from the Paycheck Protection Program, the IRS, and our Nation’s financial institutions,” said Special Agent in Charge Kyle A. Myles of the Federal Deposit Insurance Corporation Office of Inspector General (FDIC OIG). “The FDIC OIG remains committed to working with our law enforcement partners to investigate financial crimes and bringing to justice those who threaten to undermine the integrity our Nation’s financial system.”
“The Treasury Inspector General for Tax Administration aggressively pursues those who endeavor to defraud taxpayer-funded Coronavirus Aid, Relief, and Economic Security Act programs, which were established to provide assistance to American business owners during unprecedented times,” stated Inspector General J. Russell George. “We appreciate the efforts of the U.S. Department of Justice and our law enforcement partners in ensuring individuals engaged in criminal activity are held to account.”
According to U.S. Attorney Buchanan, the charges and other information presented in court: The Coronavirus Aid, Relief, and Economic Security Act (“CARES”) is a federal law enacted on March 29, 2020. It is designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding. Additional funding was authorized by Congress in December 2020. The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of one percent. PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities. The PPP allows the interest and principal to be forgiven if businesses spend the proceeds on these expenses within eight weeks of receipt and use at least 75 percent of the forgiven amount for payroll.
Fernandez operated multiple small businesses in the metro-Atlanta area from at least as early as 2016 through 2020. Fernandez submitted multiple PPP applications on behalf of several companies controlled by him or his associates that contained materially false information about the companies’ total number of employees, corporate expenses, and revenue. As a result of these false applications, he received over $1.6 million in fraudulent PPP funds. He then used these fraudulently obtained funds to make unauthorized expenditures, including purchases of a home, automobiles, and additional personal items.
Fernandez, who operated a tax preparation business for several years, also stole thousands of identities of his own clients, and of other individuals from a medical supply company, to file false tax returns claiming over $2 million in fraudulent refunds. The IRS was able to stop the vast majority of these funds from being issued to Fernandez.
In addition, Fernandez committed fraud against financial institutions. He obtained fraudulent credit cards in the names of family members and identity theft victims, which he then used to make hundreds of thousands of dollars in fraudulent purchases. Finally, Fernandez obtained blank check stock that was to be used to print tax refund checks for his tax preparation business clients. He used those checks to attempt to fraudulently write more than $900,000 worth of checks to businesses under his control and to pay personal expenses and debt.
Jose Fernandez, 36, of Winter Haven, Florida, has been sentenced to five years and ten months in prison to be followed by three years of supervised release. Fernandez was charged in a five-count criminal information on January 25, 2023, and pleaded guilty.
This case was investigated by the Federal Bureau of Investigation, Internal Revenue Service Criminal Investigation, the Federal Deposit Insurance Corporation Office of Inspector General, and the Treasury Inspector General for Tax Administration. Also, the Gwinnett County Police Department provided substantial assistance in this investigation.
Assistant U.S. Attorneys Thomas J. Krepp and Tracia M. King prosecuted the case.
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 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.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Florida Resident Sentenced to 36 Months in Prison for Conspiracy to Commit Wire Fraud and Money LaunderingRead the Press Release
PITTSBURGH, PA - A Florida resident has been sentenced in federal court to 36 months in prison, to be followed by three years of supervised release, plus restitution of $158,250 on his conviction for conspiracy to commit wire fraud and money laundering, United States Attorney Eric G. Olshan announced today.
United States District Judge J. Nicholas Ranjan imposed the sentence on Adrian Orozco Perez, 26, of Kissimmee, Florida.
According to information presented to the court, Orozco Perez was part of a scam that targeted elderly victims in Pennsylvania, Tennessee, and Georgia. As part of the scam, the elderly victims were falsely informed that their grandchildren were being detained by law enforcement and needed cash in order to pay their bail. Orozco Perez, who functioned as a courier for the scam, picked up cash from the elderly victims at their homes while posing as a bail-bondsman.
Prior to imposing sentence, Judge Ranjan stated that Orozco Perez’s conduct had been egregious and emphasized the emotional and financial harm done to vulnerable victims. Orozco Perez was taken into the custody of the United States Marshals at the conclusion of the hearing.
Assistant United States Attorney Jeffrey R. Bengel prosecuted this case on behalf of the government.
United States Attorney Olshan commended the Department of Homeland Security, Homeland Security Investigations for the investigation leading to the successful prosecution of Orozco Perez.
Florida Man Sentenced for BriberyRead the Press Release
BOSTON – A Florida man was sentenced yesterday in federal court in Springfield for paying bribes to receive contracts for work at a college in New York.
Willian Borges, 30, of Fort Lauderdale, Fla., was sentenced by U.S. District Court Judge Mark G. Mastroianni to two years of probation and forfeiture of $225,000. The government recommended a sentence of two years in prison. In October 2022, Borges pleaded guilty to one count of conspiracy to pay bribe payments and three counts of bribery concerning programs receiving federal funds.
Borges was a principal of DWD Builders, a general contracting firm, from 2018 to 2019. During this time, Borges paid bribes to co-conspirator Floyd Young, who held positions involving facility maintenance at a New York college, in exchange for preference in obtaining contracts for construction, repair, maintenance and other work for the college. The bribes Borges paid Young during face-to-face meetings were made in cash and worth 15% of the contract. In addition, as Borges received payment for work done at the college, he paid Young bribes on a periodic basis. Borges paid approximately $225,000 in exchange for approximately $2,250,000 in contracts.In August 2020, Young pleaded guilty to steering contracts for construction, repair, maintenance and other work for the colleges to favored contractors, including Borges, in exchange for bribe payments typically in the amount of 15% of the contract.
Acting United States Attorney Joshua S. Levy and Christopher DiMenna, Acting Special Agent in Charge of the Federal Bureau of Investigation, Boston Division made the announcement today. Assistant U.S. Attorney Steven H. Breslow of Levy’s Springfield Branch Office prosecuted the case.
Five Milwaukee Men Federally Indicted for Involvement in Armed Robberies of U.S. Postal CarriersRead the Press Release
Gregory J. Haanstad, United States Attorney for the Eastern District of Wisconsin, announced that on June 27, 2023, five Milwaukee men were indicted for their involvement in several armed robberies of U.S. postal carriers that occurred between October 2022 and March 2023. Huria H. Abu, age 20, was charged with four counts of Hobbs Act robbery, three counts of brandishing a firearm in furtherance of a crime of violence and one count of conspiracy.
Jessie L. Cook, age 19, was charged with two counts of Hobbs Act robbery, two counts of brandishing a firearm in furtherance of a crime of violence, and one count of conspiracy. Hussein A. Haji, age 21, was charged with one count of Hobbs Act robbery and one count of brandishing a firearm during a crime of violence. Darrion M. Allison, age 22, was charged with one count of Hobbs Act robbery, one count of brandishing a firearm in furtherance of a crime of violence, one count of theft of mail, and one count of conspiracy.
Abdi A. Abdi, age 22, was charged with two counts of Hobbs Act robbery, two counts of brandishing a firearm in furtherance of crime of violence, one count of theft of mail, and one count of conspiracy. As alleged in the indictment, the defendants robbed the U.S. postal carriers of arrow keys. They then used the arrow keys to steal U.S. mail from mail receptacles.
If convicted, each individual faces up to 20 years in prison on each robbery count and a minimum mandatory sentence of seven years and up to life in prison on each charge of brandishing a firearm during a crime of violence, which must run consecutive to any other sentence. If convicted of conspiracy, each individual faces up to five years in prison and if convicted of theft of mail, each individual faces up to five years in prison.
This matter is being investigated by the FBI’s Milwaukee Area Violent Crimes Task Force and the Milwaukee Police Department, in collaboration with the Milwaukee County District Attorney’s Office and the United States Postal Inspection Service. It is being prosecuted by Assistant United States Attorney Abbey M. Marzick.
The public is cautioned that an indictment is merely a charge, and the defendant is presumed innocent until and unless proven guilty.
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Federal Jury Convicts Former Louisiana Police Officer of Civil Rights Violation for Using Dangerous Weapons to Assault a Non-Violent Loitering SuspectRead the Press Release
After a four-day trial, a federal jury convicted a former Louisiana police officer on one charge of deprivation of rights under color of law for assaulting a non-violent loitering suspect.
The evidence at trial established that Dylan Hudson, 36, physically assaulted a loitering suspect during a daytime arrest in Shreveport, Louisiana. During the arrest, the defendant repeatedly struck the suspect in the head and face. The conduct described during the trial and played for the jury on video from police dashboard cameras included several applications of potentially deadly force. The defendant struck the suspect in the head with a loaded pistol, tased him at the base of the skull, and kicked him in the face. The defendant’s fellow officers testified that the loitering suspect was non-violent throughout the entire arrest, and that the defendant’s repeated violations of training and policy created a danger not only to the suspect, but to others as well.
“This defendant’s conduct, captured on video, was appalling,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “When an officer so grievously abuses the authority entrusted to him by his community, the Justice Department will respond with the full force of the law.”
“Dylan Hudson’s conduct during this incident was unacceptable and he does not deserve the honor of wearing the badge. I hope the victim, our Shreveport community and even the Shreveport Police Department can now begin to heal from Hudson’s unlawful conduct,” said U.S. Attorney Brandon B. Brown for the Western District of Louisiana. “This is the first trial resulting in a guilty verdict that we have ever had in the history of this district where the defendant was a member of the Shreveport Police Department. This administration is committed to aggressively investigating and prosecuting unjustified, use of force incidents to the fullest extent of the law.”
“Mr. Hudson’s despicable actions have no place in law enforcement,” said Special Agent in Charge Douglas A. Williams Jr. of the FBI New Orleans Field Office. “The FBI and its partners are dedicated to protecting the public from individuals who misuse the trust and authority of the badge.”
The maximum penalty for the charged crime is 10 years of imprisonment. Sentencing is scheduled for Oct. 26.
Assistant Attorney General Clarke, U.S. Attorney Brown and Special Agent in Charge Williams made the announcement.
The FBI the investigated the case.
Assistant U.S. Attorney Mary Mudrick for the Western District of Louisiana and Trial Attorney Thomas Johnson of the Civil Rights Division’s Criminal Section prosecuted the case.
Federal Grand Jury Indicts Two Louisville Men for Possession of Firearms as Convicted FelonsRead the Press Release
Louisville, KY – A federal grand jury in Louisville returned a two-count indictment on May 2, 2023, charging two local men with possession of a firearm by a convicted felon.
U.S. Attorney Michael A. Bennett of the Western District of Kentucky, Special Agent in Charge R. Shawn Morrow of the ATF Louisville Field Division, and Chief Jacquelyn Gwinn-Villaroel of the Louisville Metro Police Department made the announcement.
According to the indictment, John Lindsay, 35, and Rayshawn Lee, 35, both of Louisville, are each charged with one count of possession of a firearm by a convicted felon.
According to the indictment, on January 22, 2023, Lindsay possessed a Taurus, Model G3C, 9-millimeter pistol. Lindsay was prohibited from possessing a firearm because he had previously been convicted of the following felony offenses. On November 4, 2016, in Jefferson Circuit Court, Lindsay was convicted of burglary in the third degree. On November 28, 2017, in Jefferson Circuit Court, Lindsay was convicted of promoting contraband and tampering with physical evidence. On July 21, 2021, in Jefferson Circuit Court, Lindsay was convicted of possession of a firearm by a convicted felon (2 counts), trafficking in a controlled substance I schedule II cocaine less than four grams, wanton endangerment I (2 counts), illegal possession of a controlled substance schedule I marijuana while in possession of a firearm, illegal possession of drug paraphernalia while in possession of a firearm, intimidating a participant in the legal process, strangulation II, assault IV third or subsequent offense, and criminal mischief I.
Also, according to the indictment, on January 22, 2023, Lee possessed a Kel-Tec, Model PF-9, 9-millimeter pistol. Lee was prohibited from possessing a firearm because he had previously been convicted of the following felony offenses. On September 10, 2008, in Jefferson Circuit Court, Lee was convicted of assault second degree. On August 14, 2017, Lee was convicted of wanton endangerment in the second degree.
The defendants made their initial court appearance on June 28, 2023, before a U S. Magistrate Judge of the U.S. District Court for the Western District of Kentucky. Both defendants remain in federal custody. If convicted, both defendants face a maximum sentence of 15 years in prison. A federal district court judge will determine any sentence after considering the sentencing guidelines and other statutory factors. There is no parole in the federal system.
This case is being investigated by ATF and LMPD.
Assistant U.S. Attorney Frank Dahl 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.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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Federal Bureau of Prisons Nurse Sentenced for Contraband Smuggling and Bribery ConspiracyRead the Press Release
MIAMI – Ruben Montanez-Mirabal, 33, who worked as a registered nurse for the Federal Bureau of Prisons (“BOP”) at the Federal Detention Center – Miami (“FDC-Miami”) has been sentenced to 72 months in prison after pleading guilty to conspiring to receive bribes and introduce prohibited objects, including controlled substances, into a federal prison, and to introducing prohibited objects into a federal prison, arising from his illegal deliveries of contraband to inmates at FDC-Miami.
From November 2021 through late August 2022, Montanez-Mirabal solicited and obtained illegal payments from FDC-Miami inmates in exchange for violating his official duties and FDC-Miami rules by bringing in and delivering to them prohibited objects, including sheets of paper that were soaked with synthetic cannabinoids. In exchange for this illegal activity, Montanez-Mirabal accepted thousands of dollars in bribes from these inmates and their associates. Along with these payments, Montanez-Mirabal also solicited and received other things of value from inmates, including the free use of a Lamborghini and a Rolls-Royce.
Montanez-Mirabal would bring these drug-soaked pages and other prohibited items into FDC-Miami and then either deliver them directly to the inmates or hide them in places where the inmate paying him would be able to recover the contraband. Those inmates would then re-sell the pages to other inmates at a rate of $1,500 per page. Montanez-Mirabal made a number of these deliveries, providing over 100 drug-soaked pages, worth more than $150,000 in total, to inmates inside FDC-Miami in exchange for the bribes he received.
U.S. Attorney Markenzy Lapointe for the Southern District of Florida, Special Agent in Charge Jeffrey B. Veltri of the FBI, Miami Field Office, and Special Agent in Charge James Boyersmith, Department of Justice Office of Inspector General (DOJ-OIG), Miami Field Office, announced the sentence imposed by U.S. District Judge Jose E. Martinez.
U.S. Attorney Lapointe commended the investigative efforts of the FBI’s Miami Area Corruption Task Force and DOJ-OIG in this case. Assistant U.S. Attorney Edward N. Stamm prosecuted it.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov under case number 23-cr-20051.
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Drug Smuggler Sentenced to 10 Years PrisonRead the Press Release
COEUR D'ALENE – Dalila Miller, 39, of San Diego, California, was sentenced to 10 years in federal prison for conspiracy to distribute methamphetamine and cocaine, U.S. Attorney Josh Hurwit announced today.
According to court records, on October 23, 2020, U.S. Border Patrol agents spotted Miller’s vehicle in a remote area in North Idaho near the U.S. and Canadian Border. Agents from both the U.S. and Canada responded to the area. When U.S. Border Patrol arrived at the location Miller’s vehicle was initially seen, they located two men standing near bags containing 227 pounds of methamphetamine and cocaine. The two men immediately fled into Canada leaving the bags behind. U.S. Border Patrol agents eventually tracked down and stopped Miller in her vehicle leaving the area and Royal Canadian Mounted Police (RCMP) tracked down and arrested the two men who had fled into Canada after running from U.S. Border Patrol. The men arrested by the RCMP were identified as Lawrence Edward Dwyer of Cranbrook, British Columbia, and Jason Cyrus Arkinstall, of Mission City, British Columbia. Arkinstall is a member of the Mission City chapter of the Hells Angels Motorcycle Club. Both Arkinstall and Dwyer were prosecuted in Canada for their involvement in the incident.
Miller was indicted in federal court in the District of Idaho for her role in the offense. She pleaded guilty in December 2022 to conspiracy to distribute methamphetamine and cocaine. Law enforcement’s investigation showed that Miller had traveled from the Seattle, Washington area with the bags containing methamphetamine and cocaine and dropped them off at the border where it was to be packed across into Canada.
Miller was sentenced by Chief District Judge David C. Nye on Wednesday June 28, 2023, in
Coeur d’Alene, Idaho. Upon completion of her prison time, Miller was also ordered to serve an additional five years of supervised release.
U.S. Attorney Hurwit, of the District of Idaho, credited the cooperative efforts of the Drug Enforcement Administration, the U.S. Border Patrol, Boundary County Sheriff’s Office, Idaho State Police, and the Royal Canadian Mounted Police, which led to the charges.
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Deputy U.S. Marshal Pleads Guilty to Obtaining Cell Phone Location Information UnlawfullyRead the Press Release
A deputy U.S. Marshal pleaded guilty today to misusing a law enforcement service to obtain cell phone location information for personal use.
According to court documents, Adrian Pena, 49, of Del Rio, Texas, used a law enforcement service to locate individuals with whom Pena had personal relationships and their spouses. Pena obtained the cell phone data by uploading blank and random documents to a system operated by Securus Technologies exclusively for authorized law enforcement purposes. Pena falsely certified that those documents were official and that they granted Pena permission to obtain the individuals’ data.
“Adrian Pena abused his position as a deputy U.S. Marshal when he used a law enforcement service to locate the cell phones of personal associates and their spouses, and then lied to cover up his illegal actions,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “As this prosecution demonstrates, the Justice Department and our partners are committed to holding accountable any official who violates the public’s trust and misuses sensitive law enforcement capabilities for personal ends.”
Pena also lied to law enforcement during the investigation. When Pena was asked, “Other than yourself, have you ever pinged anybody using the system? You know, family members, friends, ex-girlfriend?,” Pena falsely responded, “No.” After the interview, Pena attempted to cover up his illegal actions by asking one of the individuals for a notarized letter. Pena then drafted a statement in the individual’s name and caused the individual to sign it. The statement falsely stated that the individual granted Pena unlimited access to the individual’s social media and cell phone data, including call history, text messages, and cell phone location data.
“We trust law enforcement officers to act with integrity. Instead, Pena abused his access to sensitive information for personal gain,” said Special Agent in Charge Cloey C. Pierce of the Department of Justice Office of the Inspector General (DOJ-OIG) Dallas Field Office. “The DOJ-OIG is committed to rooting out those who abuse their power and bringing them to justice.”
Pena pleaded guilty to unlawfully obtaining confidential phone records. He faces a maximum penalty of 10 years in prison. A sentencing date has not yet been set. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The DOJ-OIG is investigating the case.
Deputy Chief Robert Heberle and Trial Attorney Nicole Lockhart of the Criminal Division’s Public Integrity Section (PIN) are prosecuting the case, with substantial assistance from PIN Trial Attorney Alexander Gottfried.
Denton Man Sentenced to 15 Years for Conspiracy to Distribute DrugsRead the Press Release
United States Attorney Steven Russell announced that Steven Michael Luedtke, 47, of Denton, Nebraska, was sentenced on June 29, 2023, to 15 years of imprisonment for his involvement in a conspiracy to distribute and possession with intent to distribute 500 grams or more of methamphetamine mixture, five kilograms or more of cocaine and 100 kilograms or more of marijuana, with a prior serious drug felony conviction, by Senior United States District Judge John M. Gerrard. Following his release from prison, Luedtke will serve 10 years on supervised release. There is no parole in the federal system.
Information provided to law enforcement indicated between January of 2020 and June of 2021, Luedtke was a member of a conspiracy to obtain methamphetamine and other drugs in Mexico, Texas, Colorado, and Alabama for transport to the Lincoln, Nebraska area for resale. Luedtke provided other members of the conspiracy with cash to buy drugs, made trips to obtain drugs, and sold firearms to another member of the conspiracy.
In March of 2021, Luedtke was contacted by law enforcement and was found in possession of approximately ¼ ounce of methamphetamine, ¼ ounce of marijuana and a digital scale. He admitted having purchased more than 70 ounces of methamphetamine for resale over the prior year. In June of 2021, Luedtke was contacted again and was found in possession of approximately 1 ¼ ounces of methamphetamine, 1 ½ ounces of marijuana, another digital scale and packaging materials. He admitted he had just purchased an ounce of methamphetamine before being contacted by officers.
Luedtke had a prior conviction for conspiracy to distribute methamphetamine in the District of Nebraska. He was sentenced to 180 months in prison in that case in March of 2006.
This case was investigated by the Lincoln/Lancaster County Narcotics Task Force.
Denton County Sex Offender Sentenced for Child Exploitation ViolationsRead the Press Release
SHERMAN, Texas – A Denton man has been sentenced to six years in federal prison for child exploitation violations in the Eastern District of Texas, announced U.S. Attorney Damien M. Diggs today.
Michael Ray Guillory, 67, pleaded guilty to child exploitation violations and was sentenced to 72 months in federal prison by U.S. District Judge Amos L. Mazzant.
According to information presented in court, Guillory came to the attention of law enforcement when it was discovered that he was chatting with a 13-year-old child on an online social media platform. The messages from Guillory were sexually charged and included descriptions of the sex acts Guillory wanted to perform on the child when they met in person. In support of his interest, Guillory sent the child a number of pornographic images and videos, depicting the sex acts he described. Through investigation, law enforcement determined that Guillory had been engaging in similar chats with other suspected minors. Officers also discovered that Guillory is a registered sex offender in Denton County due to prior convictions for solicitation of a minor to commit sexual assault and possession of child pornography.
Guillory pleaded guilty to two counts of transferring obscene material to minors and was sentenced to 6 years of imprisonment on each count, to be served concurrently.
“Through social media platforms, predators like this defendant have access to our children’s bedrooms from anywhere in the country,” said U.S. Attorney Damien M. Diggs. “Repeat offenders like Mr. Guillory demonstrate an unwillingness or inability to stop committing these crimes, further contributing to the trauma already inflicted on child victims. Today’s sentence demonstrates the commitment of both state and federal law enforcement to make our children safer by ensuring that dangerous repeat offenders like Mr. Guillory are in prison where they belong.”
“This defendant preyed on innocent children without regard for the long-lasting harm his actions would cause,” said Lester R. Hayes Jr., Special Agent in Charge HSI Dallas. “HSI will never relent in our commitment to identifying and prosecuting those who exploit and victimize children.”
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (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.
This case was investigated by Homeland Security Investigations, Denton Police Department, and West Jordan, Utah Police Department and prosecuted by Assistant U.S. Attorneys Marisa J. Miller.
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Couple Charged with COVID-19 Loan Fraud SchemeRead the Press Release
NEWARK N.J. – A New Jersey and Texas man and woman were arrested in Texas on charges related to fraudulently obtaining Economic Injury Disaster Loans (EIDL) totaling approximately $790,000, U.S. Attorney Philip R. Sellinger announced today.
Diana Valteri, 40, and Edmond Haxhillari, 42, of Sparta, New Jersey, and Cypress, Texas, are charged by complaint with one count of wire fraud and one count of money laundering. Both are scheduled to appear before U.S. Magistrate Judge Jessica S. Allen in Newark federal court on July 7, 2023.
According to documents filed in this case and statements made in court:
Valteri and Haxhillari are a married couple who from June through August 2020, participated in a fraudulent scheme to receive $790,000 in COVID-19 emergency relief loans and cash advances meant for distressed small businesses under the EIDL program. Valteri and Haxhillari submitted fraudulent loan applications on behalf of several businesses that purported to have employees and revenue, but were actually shell companies with no actual business operations. After receiving the EIDL funds based on their fraud, Valteri and Haxhillari diverted the proceeds for their own personal gain.
The wire fraud charge carries a maximum penalty of 20 years in prison, and the money laundering charge carries a maximum penalty of 10 years in prison. Each charge also carries a maximum fine of $250,000, or twice the gross gain to the defendants or gross loss to the victim, whichever is greatest.
U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy; special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Tammy Tomlins; special agents of the Social Security Administration, Office of the Inspector General, under the direction of Special Agent in Charge Sharon MacDermott, and special agents from the Small Business Administration, Office of the Inspector General, under the direction of Special Agent in Charge Amaleka McCall-Brathwaite, Eastern Regional Office, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney Fatime Meka Cano of the Economic Crimes Unit in Newark.
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 Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
The charges and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
valteri.complaint.pdfConvicted Felon Pleads Guilty to Trying to Buy Two FirearmsRead the Press Release
Jacksonville, FL – United States Attorney Roger B. Handberg announces that Byron Jones, Jr. (34, Jacksonville) has pleaded guilty to making a false statement to a federally licensed firearms dealer during the attempted purchase of two firearms. Jones faces a maximum penalty of five years in federal prison.
According to court documents, Jones completed an ATF Form 4473 during his attempted purchase of two 9mm pistols from Academy Sports and Outdoors, a federally licensed firearms dealer. Jones indicated on the required paperwork that he was not a convicted felon despite having felony convictions from 2015 and 2018 for illegal drug possession and carrying a concealed firearm.
This is another case uncovered through the FBI’s National Instant Criminal Background Check System (NICS). All NICS denials are reported to federal law enforcement and reviewed daily for potential criminal prosecution. Federal law makes it a felony offense to make a false statement to a firearms dealer when trying to buy a firearm.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives. It is being prosecuted by Assistant United States Attorney Frank Talbot.
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.
Cartel-Linked Meth Trafficker Sentenced to Life in Prison Following Threats to Inmates, AgentRead the Press Release
A major Dallas drug trafficker was sentenced yesterday to life in prison for trafficking methamphetamine out of his car dealership, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
In December 2021, after four days of trial, a federal jury convicted Marco Antonio Gonzalez, 45, of one count of conspiracy to possess with intent to distribute a controlled substance, two counts of possession with intent to distribute a controlled substance, and one count of possession of a firearm by a convicted felon. He was sentenced Thursday by U.S. District Judge Brantley Starr.
According to evidence presented at trial, Mr. Gonzalez, an associate of the Jalisco New Generation Cartel (CJNG) who called himself “Speedy,” dealt methamphetamine out of Hampton Motors, a car dealership he owned. He and several coconspirators stored large quantities of narcotics at the dealership and used proceeds of drug sales to purchase vehicles in order to disguise the source of the funds.
The defendants used homes in Dallas and DeSoto to serve as laboratories for the recrystallization of methamphetamine, and often carried firearms on those premises. Agents testified at trial that members of the cartel trafficked thousands of kilograms of methamphetamine this way.
During trial, prosecutors discovered that Mr. Gonzalez threatened to kill one of his co-conspirators, who was slated to testify against him. The threatened man went on to testify anyway, saying that Mr. Gonzalez used his dealership as a front for large-scale drug deals. In another instance, Mr. Gonzalez attacked another inmate who Mr. Gonzales believed would be testifying during his trial. And during trial, Mr. Gonzalez passed a note to federal agents that was believed to represent a threat against the agents.
During sentencing, these facts were discussed at length and Judge Starr stated that the life sentence for Gonzales was based, in part, on these egregious acts.
Ten of his co-conspirators entered guilty pleas prior to trial.
The Drug Enforcement Administration’s Dallas Field Division and the Dallas Police Department conducted the investigation with the assistance of the Garland Police Department and the Ellis County Sheriff’s Office. Assistant U.S. Attorneys P.J. Meitl and John Kull prosecuted the case.
Cantina owner admits to forcing young girl to engage in commercial sexRead the Press Release
McALLEN, Texas – A 65-year-old Mexican woman who legally resided in Mission has admitted to forcing a young girl to engage in commercial sex.
Rita Martinez compelled the underage victim to engage in commercial sex work in a cantina she owned and operated in Mission known as Perez Lounge, Rita’s Lounge and Rita’s Sports Bar.
“Using her cantina as a front, Rita Martinez forced a young migrant girl into sexual acts with Rita’s male patrons,” said U.S. Attorney Alamdar S. Hamdani. “No one should have to endure that kind of treatment. Sometimes it takes time, but we will not give up. We will make sure people like Martinez answer for violating the laws of the United States by preying on the weak and vulnerable members of our society.”
“Human trafficking – particularly trafficking of children – is a reprehensible crime with far reaching consequences. Traffickers degrade human dignity and decimate individual rights while at the same time undermining public safety, border security, economic opportunity, and the rule of law,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Justice Department remains committed to prosecuting human traffickers for this heartless exploitation of vulnerable young people and to obtaining restitution on behalf of victims.”
As part of the plea, she acknowledged from the spring of 2005 to the fall of 2006, the 16-year-old Mexican minor lived in Martinez’ home and worked at her bar. Martinez arranged for male patrons of the cantina to take this minor girl from the cantina in order to engage in commercial sex. Martinez profited financially by accepting money from those male patrons. Martinez kept the money and applied it to the cost of the minor victim’s fee for the transportation from Mexico into the United States.
“This case is a reminder of the need for aggressive pursuit of all those who would take advantage of anyone in vulnerable or desperate circumstances,” said FBI Special Agent in Charge Oliver E. Rich Jr. “The FBI and our law enforcement partners are dedicated to protecting people from these horrible predators and will do everything we can to bring these perpetrators to justice. We would like to thank the Texas Alcoholic and Beverage Commission (TABC) for their outstanding assistance in this case.”
Genaro Fuentes, 41, Martinez’s son, pleaded guilty Jan. 26 and admitted his role working at the bar and helping to facilitate the commercial sex.
Chief U.S. District Judge Randy Crane will impose sentencing for Martinez and Fuentes Sept. 7 and July 6, respectively. Martinez faces a minimum of 10 years and up to life in prison, while Fuentes could receive a 20-year maximum sentence.
Martinez and Fuentes have been and will remain in custody pending sentencing.
The FBI has led the investigation with assistance from the TABC. Assistant U.S. Attorneys Laura Garcia and Sherri Zack are prosecuting the case along with Trial Attorney Kate Hill of the Department of Justice’s Human Trafficking Prosecution Unit.
Boston Man Sentenced to 10 Years in Prison for Drug Trafficking Following Two-Kilogram Cocaine DealRead the Press Release
BOSTON – A Boston man was sentenced yesterday for selling two kilograms of cocaine and possessing nearly one kilogram of heroin as well as a high-powered rifle in East Boston.
Carlos Acosta Estrella, 33, was sentenced by U.S. District Court Judge Leo T. Sorokin to 10 years in prison and eight years of supervised release. In September 2022, Estrella pleaded guilty to one count of possession with intent to distribute 500 grams or more of cocaine, one count of possession with intent to distribute 100 grams or more of heroin and one count of possession of a firearm during a drug trafficking offense. Estrella was indicted along with his mother, Ana Guadalupe Acosta Grajeda, in October 2019.Estrella and Grajeda were arrested after they were videotaped selling two kilograms of cocaine to a cooperating witness in East Boston. A search of Estrella and Grajeda’s apartment in East Boston resulted in the seizure of nearly one kilogram of heroin, an additional kilogram of cocaine, numerous cellphones, a high-powered tactical shotgun with a laser sight and a box of ammunition for the shotgun.
Grajeda was sentenced in June 2022 after previously pleading guilty to possession with intent to distribute 500 grams or more of cocaine and has since been deported to Mexico.
Acting United States Attorney Joshua S. Levy; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division; and Boston Police Commissioner Michael A. Cox made the announcement. Assistant U.S. Attorney Christopher Pohl of Levy’s Narcotics & Money Laundering Unit prosecuted the case.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
Bogue Chitto Man Pleads Guilty to Shooting at a Law Enforcement OfficerRead the Press Release
Jackson, Miss. – A Bogue Chittto man pled guilty to shooting at a law enforcement officer, announced U.S. Attorney Darren J. LaMarca and Acting Special Agent in Charge Anthony Spotswood of the Bureau of Alcohol, Tobacco, Firearms and Explosives.
According to court records, on March 17, 2020, in the Bogue Chitto Community of the Choctaw Indian Reservation, Shane Alexander Bell, Jr., 27, assaulted a law enforcement officer by firing a handgun at him, resulting in damage to the officer’s home. Fortunately, the officer was unharmed. In November of 2022, a federal grand jury indicted Bell for using a firearm in furtherance of a crime of violence.
Bell faces a penalty of not less than ten years in prison. A federal district judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The case was investigated by the Choctaw Police Department of the Mississippi Band of Choctaw Indians, and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
The case was prosecuted by Assistant United States Attorney Kevin J. Payne and Special Assistant United States Attorney Brian K. Burns.
Armed Drug Trafficker Sentenced to 24 Months in PrisonRead the Press Release
Burlington, Vermont – The Office of the United States Attorney for the District of Vermont announced today that Edgar Correa, aka “Joker,” 35, of Springfield, Massachusetts was sentenced today to serve 24 months of imprisonment after his conviction for possession with intent to distribute cocaine and cocaine base, to be followed by a three-year term of supervised release. Correa pleaded guilty to the drug trafficking crime on March 17, 2023. Correa’s co-defendant, Jose Luis Maldonado, Jr., aka “Peeto,” remains pending trial, which has not yet been scheduled.
According to court records, on October 12, 2022, law enforcement was monitoring electronic video surveillance of a house on Robbins Street in Rutland, Vermont where drug trafficking activity was suspected. On the video, officers noted a man, later identified as Maldonado, carrying a black shotgun with a pistol grip and walking with another man, later identified as Correa, toward a white Honda Civic. The two put bags in the trunk and left the premises. Rutland Police officers located the vehicle and conducted a traffic stop. Four firearms were in the vehicle, including the shotgun in the trunk, a .380 caliber pistol beneath Correa’s seat, a .38 Special revolver between Correa’s seat and the center console, and a .22 caliber pistol between Maldonado’s seat and the center console. A search of the vehicle revealed two bags, found to contain approximately 24 grams of cocaine base, approximately 7 grams of cocaine, and over 550 bags of fentanyl. When Correa was searched incident to arrest, he was found in possession of a firearm magazine loaded with .380 caliber ammunition and a digital scale commonly used to weigh drugs for the purposes of selling a particular quantity.
United States Attorney Nikolas P. Kerest commended the coordinated investigatory efforts of the Vermont State Police’s Drug Task Force, the Rutland Police Department, Homeland Security Investigations, and the Federal Bureau of Investigation.The prosecutor was Assistant United States Attorney Jonathan Ophardt. Correa was represented by Federal Public Defender Michael Desautels, Esq.
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. For more information about Project Safe Neighborhoods, please visit https://www.justice.gov/psn.
Arkansas Man Pleads Not Guilty to Charge of Enticement of a Minor to Engage in Unlawful Sexual ActivityRead the Press Release
Burlington, Vermont – The Office of the United States Attorney for the District of Vermont stated that on June 30, 2023, Nicholas Shelton, 24, of Hope, Arkansas, pleaded not guilty to a single-count indictment that charges him with using a facility of interstate and foreign commerce to entice, persuade, and coerce a minor to engage in sexual activity for which a person could be held criminally liable. United States Magistrate Judge Kevin J. Doyle had previously ordered that Shelton remain in custody until trial, which has not been scheduled.
According to court records and proceedings, in approximately March 2023, Shelton began communicating with a 15-year old minor female victim from Essex, Vermont, using various social media platforms, telephone conversations, and text messaging. The communications between Shelton and the minor victim included sexually explicit content. Shelton traveled to Vermont in early April and met with the minor victim, who hid him in the garage of her family’s home. After her parents discovered Shelton, they instructed him to leave and to leave their daughter alone. Instead, Shelton and the minor victim left together, which triggered the filing by the parents of a missing persons report with the Essex Police Department. Three days later, Shelton and the minor victim were discovered camping in a wooded area near Sand Hill Park in Essex, Vermont. Shelton was taken into custody. Shelton gave consent for law enforcement to search his cell phone, which is where his communications with the minor victim were discovered.
U.S. Attorney Nikolas P. Kerest commended the efforts of the Essex Police Department, Homeland Security Investigations, and the Vermont Internet Crimes Against Children Task Force.
Assistant U.S. Attorney Barbara A. Masterson is handling the prosecution of Shelton. Shelton is represented by Assistant Federal Public Defender Steven L. Barth.
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 Child Exploitation Obscenity Section, Criminal Division (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.justice.gov/psc.
Thursday 29 June 2023
Wyoming man admits traveling to Bozeman with intent to engage in sex with minorRead the Press Release
MISSOULA — A Wyoming man today admitted to a crime accusing him of traveling to Montana with the intent to engage in sex with a minor, U.S. Attorney Jesse Laslovich said.
Jeremy George Lusk, 38, of Crowley, Wyoming, pleaded guilty to travel with intent to engage in illicit sexual conduct. Lusk faces a maximum of 30 years imprisonment, a $250,000 fine and a minimum of five years to life of supervised release.
U.S. Magistrate Judge Kathleen L. DeSoto presided. Sentencing was set for Oct. 30 before U.S. District Judge Dana L. Christensen. The court will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Lusk was released pending further proceedings.
The government alleged in court documents that in January, a Bozeman Police Department officer was working undercover and observed an ad on a social media application asking if anyone wanted to engage in sexual relations with a 38-year-old from Bridger, Montana. The ad stated the individual was looking for someone between the ages of 18 and 68. The undercover responded that she was 14 years old and lived in Bozeman. Lusk told the undercover to contact him when she turned 18, and the undercover responded telling Lusk to contact her if he changed his mind. Luck re-initiated contact the same day, and the conversation turned sexual. The communications led to Lusk sending a nude photo of himself. On Feb. 22 and through the morning of Feb. 23, Lusk wrote messages indicating his intent to travel to Bozeman and that he was on his way. Law enforcement determined Lusk lived and worked in Wyoming. After being directed to a specific location by the undercover, officers arrested Lusk when he arrived. Lusk admitted to having online sexually explicit discussions with a 14-year-old and had come to Bozeman with the intent to meet her for a sexual encounter.
Assistant U.S. Attorney Zeno B. Baucus is prosecuting the case. The Bozeman Police Department and Homeland Security Investigations conducted the investigation.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
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Woodland Hills Brothers Found Guilty of Fraudulently Obtaining Federal Tax Refunds and Laundering Proceeds Through U.K. BanksRead the Press Release
LOS ANGELES – Two San Fernando Valley brothers have been found guilty by a jury of nearly a dozen felonies for fraudulently obtaining hundreds of thousands of dollars in federal income tax refunds, some of which they then laundered through bank accounts held in the United Kingdom, the Justice Department announced today.
Victor A. Ohiri, 55, and Stephen O. Danielson-Ohiri, 54, both of Woodland Hills, were found guilty late Wednesday of one count of conspiracy and 10 counts of theft of government property.
According to evidence presented at their two-day trial, from March 2014 to March 2015, Victor and Stephen Ohiri, together with others in the United Kingdom, conspired to use the Ohiris’ U.S.-based bank accounts to fraudulently obtain hundreds of thousands of dollars of federal income tax refunds.
The co-conspirators filed nearly 20 fraudulent federal income tax returns with the IRS in the names of victim-taxpayers whose identities they had stolen. The co-conspirators used fake documents, such as bogus Forms W-2, to file the fraudulent returns, which requested large tax refunds, often between $8,000 and $10,000.
Based on the fraudulent returns, the IRS issued tax refunds, which were electronically transmitted not to the victim-taxpayers whose identities had been stolen, but instead to bank accounts controlled by Victor and Stephen Ohiri. The Ohiris then wired the majority of those refund proceeds to co-conspirators in the United Kingdom, and they withdrew the rest in cash for themselves.
During the conspiracy, approximately $340,000 in federal income tax refunds was deposited into accounts controlled by the Ohiris.
During the investigation, IRS investigators seized approximately $181,000 from two of Stephen Ohiri’s bank accounts – money that came from just one of the fraudulently obtained tax refunds.
United States District Judge Stephen V. Wilson has scheduled an October 2 sentencing hearing, at which time Victor Ohiri and Stephen Ohiri will face statutory maximum sentences, respectively, of 115 years and 60 years in federal prison.
IRS Criminal Investigation and Homeland Security Investigations investigated this matter.
Assistant United States Attorney Morgan J. Cohen of the Major Frauds Section is prosecuting this case.
West Richland Resident Sentenced to 15 Months in Federal Prison for Fraudulently Obtaining $337,267 in COVID-19 Relief FundsRead the Press Release
Richland, Washington – Vanessa R. Waldref, the United States Attorney for the Eastern District of Washington, announced today that Jimia Rae Cain, age 52, of West Richland, Washington, was sentenced to 15 months in federal prison for fraudulently obtaining $337,267 in COVID-19 relief funds. United States District Judge Mary K. Dimke announced the sentence, the most recent obtained by the COVID-19 Relief Fraud Strike Force Strike Force.
On March 27, 2020, the President signed into law the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act. The CARES Act provided a number of programs through which eligible small businesses could request and obtain relief funding intended to mitigate the economic impacts of the pandemic for small and local businesses. One such program, the Paycheck Protection Program (PPP), provided government-backed funding to small businesses which could be forgiven so long as the proceeds were used for payroll and other eligible expenses. Another program, the Economic Injury Disaster Loan (EIDL) program, provided low interest loans that could be deferred until the conclusion of the pandemic to provide “bridge” funding for small businesses to maintain their operations during shutdowns and other economic circumstances caused by the pandemic. The PPP and EIDL programs have provided billions of dollars in aid, the vast majority of which have not been paid back, including hundreds of millions of dollars disbursed within Eastern Washington.
“COVID-19 relief programs were designed to lift up our community during crisis, and because of the number of people and businesses that requested funding, deserving small businesses were not able to obtain desperately needed funding,” said U.S. Attorney Waldref. “We created the Eastern Washington COVID-19 Fraud Strike Force because combatting pandemic-related fraud and holding those accountable who abused these programs is critical to the strength and safety of our community in Eastern Washington. The Strike Force works to ensure that limited resources are used to protect our local small businesses and the critical jobs and services that they provide for the community.”
In February 2022, U.S. Attorney Waldref and the U.S. Attorney’s Office (USAO) began working with federal law enforcement agencies to create and launch a COVID-19 Fraud Strike Force that would leverage partnerships between different agencies to aggressively investigate and prosecute fraud against COVID-19 relief programs in Eastern Washington. The Strike Force consists of agency representatives from the USAO, Small Business Administration (SBA) Office of Inspector General (OIG), Federal Bureau of Investigation (FBI), U.S. Department of the Treasury Inspector General for Tax Administration (TIGTA), U.S. Secret Service, U.S. Homeland Security Investigations, U.S. Department of Veterans Affairs OIG, General Services Administration OIG, Department of Homeland Security (DHS) OIG, Internal Revenue Service, Department of Energy OIG, and others.
According to court documents and information disclosed during court proceedings, Cain fraudulently obtained $337,267 in CARES Act funding – a $71,900 EIDL and a $265,267 PPP – in July and August of 2020 in the name of her purported business Americore Construction. According to court documents, Cain used false statements and fictitious tax and payroll documentation in order to obtain the funds. In truth, Americore was not an active business during the relevant time period, did not have any employees, and was not eligible for any federal funding.
In addition to the 15-month prison sentence, Cain was sentenced to 3 years of federal supervision following her release, and is required to repay full restitution of $337,267.
“This sentence demonstrates that falsifying information to gain access to taxpayer dollars will not be overlooked and wrongdoers will be brought to justice,” said SBA OIG’s Western Region Acting Special Agent in Charge Keven Standley. “I want to thank the U.S. Attorney’s Office and our law enforcement partners for their dedication and pursuit of justice.
“I commend the stellar investigative work on these cases performed by the Strike Force and especially in this case by SBA OIG and TIGTA” said U.S. Attorney Waldref. “We will continue to work together with our law enforcement partners to vigorously prosecute those who abuse and misuse COVID-19 relief funding, and to strengthen our communities by protecting our small and local businesses.”
This case was investigated by the Eastern District of Washington COVID-19 Fraud Strike Force and by the SBA OIG and TIGTA. Assistant United States Attorneys Dan Fruchter and Tyler Tornabene prosecuted this case on behalf of the United States.
Case No. 4:22-CR-6042-MKD
Waco Woman Sentenced to 10 Years in Federal Prison for Identity Theft and Credit Card Fraud in Eastern District of TexasRead the Press Release
SHERMAN, Texas – A Waco woman has been sentenced to 10 years in federal prison for identity theft and credit card fraud in the Eastern District of Texas, announced U.S. Attorney Damien M. Diggs today.
Ashley Renee Cagle, 43, pleaded guilty to aggravated identity theft and access device fraud and was sentenced to 120 months in federal prison by U.S. District Judge Amos Mazzant.
According to information presented in court, Cagle was arrested by McKinney Police Department officers in May of 2021 when she was found to be in possession of stolen United States mail along with multiple credit and debit cards. Further investigation showed that Cagle engaged in wire fraud when she passed a check using another person’s driver license number at a Wal Mart in the Eastern District of Texas. According to information presented during the sentencing hearing, six businesses suffered financial losses as a result of Cagle’s fraudulent check passing scheme. During the sentencing hearing, Judge Mazzant noted Cagle’s extensive criminal history and the need for protection of the public when he sentenced Cagle to a term of ten years in federal prison.
“This case is an example of the hard work of the U.S. Postal Inspection Service and the U.S. Secret Service investigating identity theft, wire fraud, and mail theft and bringing these cases to prosecution by the U.S. Attorney's Office,” said U.S. Attorney Damien M. Diggs. “Identity theft causes harm not only to businesses who are defrauded, but to those individuals whose private information is used to carry out the crime. The U.S. Attorney's Office will continue to partner with federal and local law enforcement to investigate and vigorously prosecute these offenses.”
This case was investigated by the U.S. Postal Inspection Service, the U.S. Secret Service and the McKinney Police Department.
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Virginia Sheriff, Three Others Indicted on Federal Bribery ChargesRead the Press Release
CHARLOTTESVILLE, Va. – An indictment was unsealed today charging the Sheriff of Culpeper County, Virginia, and three other Virginia men with a conspiracy to exchange bribes for law enforcement badges and credentials, federal programs bribery, and honest services fraud.
According to the indictment, from at least April 2019, Culpeper County Sheriff Scott Howard Jenkins, 51, accepted cash bribes and bribes in the form of campaign contributions totaling at least $72,500 from Rick Tariq Rahim, 55, of Great Falls, Virginia, Fredric Gumbinner, 64, of Fairfax, Virginia, James Metcalf, 60, of Manassas, Virginia, and at least five others, including two FBI undercover agents. In return, Jenkins appointed each of the bribe payors as auxiliary deputy sheriffs, a sworn law-enforcement position, and issued them Culpeper County Sheriff’s Office badges and identification cards. Jenkins told or caused others to tell the bribe payors that those law-enforcement credentials authorized them to carry concealed firearms in all fifty states without obtaining a permit. In addition, Jenkins assisted Rahim in gaining approval for a petition to restore his firearms rights filed in Culpeper County Circuit Court that falsely stated that Rahim resided in Culpeper County.
“Scott Jenkins not only violated federal law but also violated the faith and trust placed in him by the citizens of Culpeper County by accepting cash bribes in exchange for auxiliary deputy badges and other benefits,” United States Attorney Christopher R. Kavanaugh said today. “Our elected officials are expected to uphold the rule of law, not abuse their power for their own personal, financial gain.”
"As law enforcement officers, we are sworn to protect and serve our communities. We do that by upholding the law - equally, and not abusing the powers that are entrusted to us,” Special Agent in Charge Stanley M. Meador of the FBI’s Richmond Division said today. “With today's announcement, FBI Richmond re-enforces our commitment - to the community - of ensuring abuses of public trust will not be tolerated and those responsible will be held accountable.”
Jenkins is charged with one count of conspiracy, four counts of honest-services mail and wire fraud, and eight counts of federal programs bribery. Rahim is charged with one count of conspiracy, three counts of honest-services mail and wire fraud, and three counts of federal programs bribery. Gumbinner is charged with one count of conspiracy, one count of honest-services wire fraud, and two counts of federal programs bribery. Metcalf is charged with one count of conspiracy, one count of honest-services wire fraud, and two counts of federal programs bribery.
If convicted, each defendant faces up to 5 years in prison on the conspiracy count, up to 20 years in prison on each of the honest-services mail and wire fraud counts, and up to 10 years in prison on each of the federal programs bribery counts. A federal district court judge will determine any sentence for all four defendants after considering the U.S. Sentencing Guidelines and other statutory factors.
The defendants are scheduled to make their initial court appearances today in U.S. District Court for the Western District of Virginia.
The FBI’s Richmond Field Office, Charlottesville Resident Agency is investigating the case. Trial Attorney Celia Choy of the Justice Department’s Public Integrity Section and Assistant U.S. Attorneys Heather Carlton and Melanie Smith of the Western District of Virginia are prosecuting the case.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
University of Oklahoma Professor and Wife Sentenced to Prison for Federal Grant FraudRead the Press Release
OKLAHOMA CITY – SHAORONG LIU, 60, and JUAN LU, 60, both of Norman, were sentenced to serve more than three years collectively in federal prison and ordered to pay $2.1 million in restitution for making false statements involving a Department of Energy grant, announced United States Attorney Robert J. Troester.
On February 18, 2021, a federal grand jury returned a 16-count Superseding Indictment against Liu and Lu. On April 21, 2021, Liu pleaded guilty to making a materially false statement regarding a matter pertaining to the United States Department of Energy. On May 24, 2021, Lu pleaded guilty to using documents containing materially false statements regarding a matter pertaining to the Department of Energy.
Public records reflect that Liu served since 2008 as a professor at the University of Oklahoma in its Department of Chemistry and Biochemistry. In approximately 2001, Liu and his wife Lu formed and controlled a company called MicroChem Solutions (MCS). Through MCS, they applied for and received federal grant monies from the Small Business Technology Transfer Program of the Department of Energy. The mission of the grant program was to support scientific excellence and technological innovation through the investment of federal research funds in critical American priorities to build a strong national economy. However, Liu and Lu spent this grant money on matters unrelated to the purpose of the grant funding, including on personal expenses. Liu and Lu also made false statements and submitted altered documents to the Department of Energy regarding how they spent grant money.
At recent sentencing hearings, United States District Judge Scott L. Palk sentenced the defendants as follows:
- Shaorong Liu was sentenced on June 21, 2023, to 27 months in federal prison and a $10,000.00 fine. This term of imprisonment will be followed by two years of supervised release.
- Juan Lu was sentenced on June 28, 2023, to 14 months in federal prison and a $10,000.00 fine. This term of imprisonment will be followed by two years of supervised release.
In addition to the prison sentences and fine, the Court ordered the defendants to pay $2,100,000.00 in restitution to the United States Department of Energy. In fashioning the sentences, Judge Palk found that Liu and Lu were unintended recipients of the grant due to their false statements and noted the seriousness of the offense and the need to deter others from engaging in similar conduct.
This case is the result of an investigation by the Department of Energy Office of Inspector General, the National Science Foundation Office of Inspector General, and the FBI Oklahoma City Field Office. The case was prosecuted by Assistant U.S. Attorneys Will Farrior and Matt Dillon.
Reference is made to public filings for more information.
United States Settles False Claims Allegations Against Evergreen Hospice, LLC for $48,830Read the Press Release
TULSA, Okla. – United States Attorney Clinton J. Johnson announces that Evergreen Hospice, LLC (Evergreen), a hospice company located in Tulsa, Oklahoma, has agreed to pay $48,830.70 to resolve allegations that it violated the False Claims Act by knowingly submitting false claims to Medicare for hospice care provided to beneficiaries who did not qualify for the services. The claims resolved by the settlement are allegations only; there has been no determination of liability.
“Unfortunately, some healthcare providers seek to defraud Medicare by billing unnecessary hospice services,” stated U.S. Attorney Clinton Johnson. “Left unchecked, this misconduct would deplete funds available for terminally ill patients desperately in need of the relief that hospice care provides. This settlement should serve as notice to others who consider similar practices that we will vigorously pursue them.”
Hospice care is special end-of-life care for terminally ill patients intended to comfort the dying. Patients admitted to hospice care generally stop receiving coverage for traditional medical care intended to cure their illnesses and instead receive medical care focused on providing them with relief from the symptoms, pain, and stress of a terminal illness. Medicare patients are hospice eligible when they are considered terminally ill and have a life expectancy of six months or less, if their illness runs its normal course.
This settlement resolves allegations that Evergreen knowingly submitted false claims to Medicare for hospice services provided to patients who were not terminally ill and for services that were not medically necessary. According to the settlement agreement, the United States alleged that Evergreen knowingly submitted false claims from Sept. 1, 2017, to May 31, 2020, to Medicare for hospice services that were provided to beneficiaries who did not qualify under the Medicare guidelines for routine hospice care because they were improperly certified as terminally ill.
The government’s action in this matter illustrates the emphasis on combating health care fraud, and one of the most powerful tools in this effort is the False Claims Act. Tips from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).
Assistant U.S. Attorney Marianne Hardcastle prosecuted this case.
The Office of Inspector General for the U.S. Department of Health & Human investigated this case.
U.S. Attorney’s Office for the Southern District of Mississippi Launches United Against Hate ProgramRead the Press Release
Jackson, Miss. - The U.S. Attorney’s Office for the Southern District of Mississippi launched United Against Hate, an outreach program focusing on preventing, identifying, and reporting hate crimes and incidents, announced U.S. Attorney Darren J. LaMarca.
United Against Hate connects community groups to federal, state, and local law enforcement to increase community understanding and reporting of hate crimes, build trust between law enforcement and communities, and create and strengthen alliances between law enforcement and other government partners and community groups to combat unlawful acts of hate.
In May of 2021, Attorney General Merrick Garland announced steps towards the Department of Justice’s enhanced efforts to combat and confront hate crimes. He stated, “Hate crimes and other bias-related incidents instill fear across entire communities and undermine the principles upon which our democracy stands. All people in this country should be able to live without fear of being attacked or harassed because of where they are from, what they look like, whom they love, or how they worship.”
On June 29, 2023, Assistant U.S. Attorneys Mitzi Dease Paige, Glenda Haynes, Tabitha Kingma and Angela Givens Williams, along with colleagues in their office and law enforcement partners who investigate hate crimes, hosted a presentation called “United Against Hate: Identifying, Reporting and Preventing Acts of Hate” at Pearl A.M.E. Church, 2519 Robinson Street in Jackson, Mississippi. This event gave the U.S. Attorney’s Office an opportunity to connect with faith-based leaders to help effect positive change within our community. Faith-based leaders are usually the first person of contact when individuals or families face these types of hateful behavior. Often hate crimes and incidents go underreported, allowing offenders to continue to spread their hate, fear, and intimidation. This event assisted faith-based leaders in the Jackson area to identify hate crimes, understand the importance of reporting these crimes and most importantly, to discuss strategies to prevent acts of hate.
The U.S. Attorney’s Office’s online complaint form is available at https://www.justice.gov/usao-sdms/civil-division webpage. The form can be emailed [email protected] , or concerns can be shared by leaving a voice mail for our Civil Rights Division at (601) 973-2825.
U.S. Attorney’s Office Participates in Coordinated National Health Care Fraud Enforcement ActionRead the Press Release
BOISE – U.S. Attorney Josh Hurwit announced criminal charges against two defendants today as part of the Department of Justice’s 2023 National Health Care Fraud Enforcement Action. This two-week nationwide law enforcement action resulted in criminal charges against 78 defendants for their alleged participation in health care fraud and opioid abuse schemes that included over $2.5 billion in alleged fraud.
In the Idaho case, a federal grand jury in Boise returned an indictment charging nurse practitioner Angela Kathryn Hughes, 49, of Boise, and Sydney L. Neal, 37, of Boise with conspiracy to distribute controlled substances. Hughes was also charged with distribution of controlled substances. The indictment alleges that from January 2022 through March 2023, Hughes and Neal conspired to distribute oxycodone, oxycodone acetaminophen, and hydrocodone acetaminophen outside the scope of professional practice and not for a legitimate medical purpose. In addition, the indictment alleges that Hughes distributed hydrocodone acetaminophen to Neal on two occasions and oxycodone to another person on a third occasion.
The trial is scheduled for August 28, 2023, before Senior U.S. District Court Judge B. Lynn Winmill of the U.S. District Court for the District of Idaho. If convicted, the defendants face a maximum of 20 years in federal prison. A federal district court judge would determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
“These enforcement actions, including against one of the largest health care fraud schemes ever prosecuted by the Justice Department, represent our intensified efforts to combat fraud and prosecute the individuals who profit from it,” said Attorney General Merrick B. Garland. “The Justice Department will find and bring to justice criminals who seek to defraud Americans and steal from taxpayer-funded programs.”
“This nationwide enforcement action demonstrates that the Criminal Division is committed to fighting health care fraud and opioid abuse by prosecuting those who allegedly exploit patients and health care benefit programs for personal gain,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “Today’s announcement includes some of the largest and most complex cases that the Department has prosecuted, and demonstrates the Department’s commitment to seeking justice for those at all levels of the healthcare industry who put profits above patient care, from professionals in doctors’ offices to executives in corporate boardrooms.”
“Unlawful prescription schemes not only steal taxpayer dollars, but they also can cause addiction and physical harm to patients and the community,” said U.S. Attorney Hurwit. “Health care providers should never start down the path of fraud and unlawful prescription drug distribution. We won’t tolerate it, and I’m grateful for the Boise Police Department’s collaboration with our federal law enforcement partners to investigate the case we announced today.”
“Medical professionals who take advantage of their credentials to illegitimately prescribe controlled substances violate the principles of their profession and put the health and safety of others at risk,” said Steven J. Ryan, Special Agent in Charge at the Department of Health and Human Services, Office of Inspector General (HHS-OIG). “HHS-OIG remains steadfast in our commitment to protecting the health and safety of American communities and holding accountable those who undermine efforts to curb the opioid crisis.”
“The DEA, in partnership with Health and Human Services-Office of the Inspector General (HHS-OIG) and the Boise Police Department (BPD), remain steadfast in our commitment to ensure prescription drugs are not illegally diverted from the supply chain in an effort to continue the fight to reduce the overwhelming drug poisonings occurring across the United States,” said David F. Reames, Special Agent in Charge, DEA Seattle Field Division. “These indictments and subsequent arrests are part of that effort to curb this drug poisoning epidemic and bring those to justice who knowingly and intentionally misuse their DEA registrations.”
U.S. Attorney Hurwit credited the cooperative efforts of the Boise Police Department, Health & Human Services, Office of Inspector General, and Drug Enforcement Administration which led to the charges.
Idaho patients impacted by this service disruption experiencing a behavioral health crises can contact the 988 telephone hotline. Additionally, Idaho patients can contact 211 for questions regarding access to treatment services, primary care, and where to obtain naloxone.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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U.S. Attorney Announces Charges in Four Separate Insider Trading Cases Against 10 Individuals, Including Drug Company Employees, Investment Firm Executive Director, and SPAC InvestorsRead the Press Release
Pfizer Employee and Associate Charged with Insider Trading Based on Non-Public Drug Trial Results for COVID-19 Treatment
Investment Firm Executive Director Charged with Insider Trading Based on Information Stolen from a Major Investment Bank
SPAC Investors Charged with Insider Trading by Exploiting Their Privileged Access to Information to Engage in Illegal Open Market Trades
Network of Individuals, Including Police Chief, Charged with Insider Trading Based on Inside Information About an Impending Merger
Damian Williams, the United States Attorney for the Southern District of New York, and Michael J. Driscoll, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced charges in four separate insider trading cases, collectively charging 10 defendants with securities fraud and other related charges. These cases involve trading based on confidential information misappropriated from entities and individuals in a variety of industries and reflect the U.S. Attorney’s Office for the Southern District of New York’s broad investigative reach and continued resolve to root out corruption in our financial markets. The defendants in these cases collectively generated more than $30 million dollars from illegal securities trading based on material, non-public information (“MNPI”) that was stolen from numerous sources.
U.S. Attorney Damian Williams said: “Insider trading is not a quick buck. It’s not easy money. It’s not a sure thing. It’s cheating. It’s a bad bet. It’s a ticket to prison. Because my Office, the Southern District of New York, is watching. And we’re working quickly to investigate and prosecute anyone who corrupts our financial markets. And we’ll keep at it as long as it takes. You can bet on that.”
FBI Assistant Director in Charge Michael J. Driscoll said: “The charges announced today center on the defendants’ alleged participation in illegal securities trading based on material, non-public information. Insider trading schemes not only yield ill-gotten gains for those directly involved but also damage the public’s faith in the fairness of our financial markets. Today’s announcement serves as a reminder to anyone attempting to tilt the balance in their direction using insider trading, investigating this illegal behavior is a top priority of the FBI.”
According to the allegations contained in the Indictments filed in federal court and other publicly available information:[1]
United States v. Amit Dagar and Atul Bhiwapurkar
In or about November 2021, AMIT DAGAR and ATUL BHIWAPURKAR participated in an insider trading scheme to reap illicit profits from options trading based on inside information about the results of clinical trials of Paxlovid, a medicine used to treat COVID-19. DAGAR was an employee of Pfizer Inc. (“Pfizer”) and assisted in managing the data analysis in certain clinical drug trials.
On or about November 4, 2021, DAGAR learned that a Pfizer trial of the drug Paxlovid, a medicine designed to treat mild to severe COVID‑19 infection, had produced positive results. The results were confidential and meant to remain so until Pfizer publicized them on or about November 5, 2021.
Later that same day, and while those results remained confidential, DAGAR purchased short-dated, out-of-the-money call options in Pfizer stock. DAGAR also tipped his close friend, ATUL BHIWAPURKAR, about the coming drug results and BHIWAPURKAR also purchased short-dated, out-of-the-money Pfizer call options that expired approximately two weeks later. BHIWAPURKAR also tipped another friend (“Individual-1”), who similarly purchased short-dated, out-of-the-money Pfizer call options that expired approximately three weeks later.
The next day, on or about November 5, 2021, and before the market opened, Pfizer publicly released results of its Paxlovid study. That same day, following the publication of the positive results, Pfizer’s stock price increased substantially, opening — and eventually closing — more than 10% higher than the prior day’s closing price. In the coming weeks, DAGAR, BHIWAPURKAR, and Individual-1 sold their Pfizer call options at significant profits, totaling approximately more than $350,000.
DAGAR, 44, of Hillsborough, New Jersey, who was arrested this morning, has been charged with four counts of securities fraud, each of which carries a maximum sentence of 20 years in prison, and one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years in prison.
BHIWAPURKAR, 45, of Milpitas, California, who was arrested this morning, has been charged with two counts of securities fraud, each of which carries a maximum sentence of 20 years in prison, and one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years in prison.
United States v. Jordan Meadow
From at least in or about March 2021 through in or about May 2022, JORDAN MEADOW, a registered broker at a brokerage firm based in New York, New York, used inside information stolen from a major investment bank in New York City (“the Investment Bank”) to make millions of dollars in illegal profits trading stock on behalf of himself and his clients. In or about late 2020, MEADOW offered and agreed to provide items of value, such as Rolex watches, to a friend, Steven Teixeira, in exchange MNPI that Teixeira obtained by secretly accessing confidential work documents on a personal laptop computer (the “Laptop”) belonging to Teixeira’s then-girlfriend, an executive assistant at the Investment Bank. The documents on the Laptop contained MNPI about planned corporate acquisitions in which the Investment Bank served as an advisor.
In or around late July 2021, Teixeira secretly accessed confidential work information on the Laptop and learned that in less than a week, Penn National Gaming, Inc. (“Penn National”), was going to acquire Score Media and Gaming Inc. (“Score”), a Canadian digital media company, for approximately $2.2 billion. Teixeira shared this MNPI with a friend, who in turn shared it with MEADOW. MEADOW then purchased more than 769 call option contracts in Score between August 2, 2021, and August 3, 2021, based on the MNPI and also advised a colleague at the brokerage firm where he worked, their clients, and a friend to purchase Score securities. After Penn National’s acquisition of Score was announced publicly on August 5, 2021, MEADOW, his colleague, their clients at the brokerage firm, and MEADOW’s friend sold their holdings in Score for a combined profit exceeding $5 million.
Later, in or around early March 2022, Teixeira secretly accessed confidential work information on his then-girlfriend’s laptop and learned about a planned corporate acquisition of VMWare, an enterprise software company, for approximately $65 billion. Teixeira shared this MNPI with his friend, who in turn shared it with MEADOW. MEADOW purchased over 5,000 shares of VMWare stock, as well as call options contracts in VMWare, between May 9, 2022, and May 18, 2022, and advised his colleague at the brokerage firm to purchase VMWare securities. After there was public reporting that Broadcom was in talks to acquire VMWare, the VMWare holdings of MEADOW and his colleague increased significantly, and they began to sell their VMWare holdings for a combined profit exceeding $100,000.
MEADOW, 34, of Warren, New Jersey, who was arrested this morning, has been charged with six counts of securities fraud under Title 15, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy, which carries a maximum sentence of five years in prison.
Also unsealed today were charges against Steven Teixeira, who has pled guilty pursuant to a cooperation agreement.
United States v. Michael Shvartsman, Gerald Shvartsman, and Bruce Garelick
In October 2021, MICHAEL SHVARTSMAN, GERALD SHVARTSMAN, and BRUCE GARELICK together made more than $22 million dollars in illegal profits by trading in securities of Digital World Acquisition Corporation (“DWAC”) based on MNPI about DWAC’s planned but not yet public business combination with a media company founded by former President Donald J. Trump.
As sophisticated investors, MICHAEL SHVARTSMAN, GERALD SHVARTSMAN, and BRUCE GARELICK were invited to invest in DWAC and another special purpose acquisition company (“SPAC”), and after signing non-disclosure agreements, they were provided confidential information about the SPACs, including that a potential target of the SPACs was Trump Media & Technology Group (“Trump Media”). As a condition of receiving this information, the defendants were prohibited by the non-disclosure agreements from disclosing the confidential information they learned or using it to buy and sell securities on the open market. After making initial investments into DWAC through the initial public offering process, GARELICK was given a seat on DWAC’s board of directors, which gave him access to valuable MNPI about DWAC’s plans to merge with Trump Media. After learning MNPI through his role on DWAC’s board, GARELICK provided updates to his alleged co-conspirators — which he called “intelligence” — about the status of the merger negotiations and the timing of a public merger announcement.
In violation of the non-disclosure agreements that they had signed, and in contravention of GARELICK’s duties and responsibilities as a board member, the defendants bought millions of dollars of DWAC securities on the open market before the news of the Trump Media business combination was public. In addition to their own purchases, the defendants also passed DWAC’s confidential information to their friends on a trip to Las Vegas, to MICHAEL SHVARTSMAN’s neighbors, and to GERALD SHVARTSMAN’s employees at a furniture supply store. After DWAC’s merger with Trump Media was announced publicly, the stock and warrant holdings of MICHAEL SHVARTSMAN, GERALD SHVARTSMAN, and BRUCE GARELICK, and those they tipped, significantly increased in value. The defendants and the individuals they tipped then sold their DWAC securities for a significant profit.
MICHAEL SHVARTSMAN, 52, of Sunny Isles Beach, Florida, who was arrested this morning, has been charged with five counts of securities fraud under Title 15, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy, which carries a maximum sentence of five years in prison.
GERALD SHVARTSMAN, 45, of Aventura, Florida, who was arrested this morning, has been charged with three counts of securities fraud under Title 15, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy, which carries a maximum sentence of five years in prison.
BRUCE GARELICK, 53, of Fort Lauderdale, Florida, who was arrested this morning, has been charged with five counts of securities fraud under Title 15, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy, which carries a maximum sentence of five years in prison.
United States v. Joseph Dupont, Shawn Cronin, Slava Kaplan, and Paul Feldman
In 2020, JOSEPH DUPONT, SHAWN CRONIN, SLAVA KAPLAN, a/k/a “Stanley Kaplan,” and PAUL FELDMAN engaged in an insider trading scheme surrounding the announcement of one pharmaceutical company’s acquisition of another. CRONIN, KAPLAN, and FELDMAN collectively made more than $2.2 million dollars in illegal profits by trading in stocks and options based on MNPI that DUPONT misappropriated from his employer.
DUPONT was a vice president at Alexion Pharmaceuticals, Inc. (“Alexion”) and, on January 31, 2020, was informed of Alexion’s upcoming acquisition of Portola Pharmaceuticals, Inc. (“Portola”). Before that acquisition was publicly announced, in April 2020, DUPONT provided MNPI about the acquisition to his childhood friend, CRONIN. Not only were CRONIN and DUPONT childhood friends, but also CRONIN — who, at the time, was a sergeant in the police department of Dighton, Massachusetts, and later served as the chief of police — supervised DUPONT in DUPONT’s capacity as a reserve officer in that police department. Based on the MNPI that DUPONT provided CRONIN, CRONIN purchased shares of Portola stock as well as out-of-the-money call options for Portola stock.
In turn, CRONIN shared MNPI about Portola’s pending acquisition with Jarett Mendoza, another childhood friend of both CRONIN’s and DUPONT’s. CRONIN also assisted Mendoza in purchasing Portola stock in the days before the acquisition was publicly announced.
CRONIN shared MNPI about Portola’s pending acquisition not only with Mendoza, but also with KAPLAN, a friend of CRONIN’s, who was also known to DUPONT. CRONIN shared the MNPI with KAPLAN both so that KAPLAN could trade in advance of the acquisition and so that KAPLAN would assist CRONIN in formulating trading strategies to maximize CRONIN’s own insider trading profits. Based on the MNPI that CRONIN gave to KAPLAN, KAPLAN bought Portola shares and options.
KAPLAN, in turn, shared MNPI about the upcoming acquisition with, among others, FELDMAN, a friend and colleague of KAPLAN’s. Based on the MNPI that KAPLAN gave FELDMAN, FELDMAN aggressively bought Portola call options.
FELDMAN, for his part, shared MNPI about the Portola acquisition with others, including a work colleague.
Alexion’s acquisition of Portola was publicly announced on the morning of May 5, 2020. Portola’s stock increased significantly in value. CRONIN, KAPLAN, FELDMAN, and their tippees sold their shares of Portola and call options for Portola stock, reaping millions of dollars of illegally obtained trading profits.
DUPONT, 44, of Rehoboth, Massachusetts, who surrendered to authorities today, has been charged with one count of Title 15 securities fraud and one count of tender offer fraud, each of which carries a maximum sentence of 20 years in prison, and one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison.
CRONIN, 43, of Dighton, Massachusetts, who surrendered to authorities today, has been charged with three counts of securities fraud under Title 15 and three counts of tender offer fraud, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy to commit securities fraud and tender offer fraud, which carries a maximum sentence of five years in prison;.
KAPLAN, 45, of Hopewell Junction, New York, who was arrested today, has been charged with three counts of securities fraud under Title 15 and three counts of tender offer fraud, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy to commit securities fraud and tender offer fraud, which carries a maximum sentence of five years in prison.
FELDMAN, 48, of Poughquag, New York, who was arrested today, has been charged with six counts of securities fraud under Title 15 and six counts of tender offer fraud, each of which carries a maximum sentence of 20 years in prison; one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison; and one count of conspiracy to commit securities fraud and tender offer fraud, which carries a maximum sentence of five years in prison.
Also unsealed today were charges against Jarett Mendoza, who has pled guilty pursuant to a cooperation agreement.
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The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as the sentencing of the defendants will be determined by the judge.
Mr. Williams praised the outstanding investigative work of the FBI’s New York and Philadelphia Field Offices. He also thanked the Miami Field Office of the U.S. Department of Homeland Security, Homeland Security Investigations, for its assistance in the investigation in United States v. Michael Shvartsman, Gerald Shvartsman, and Bruce Garelick. He further thanked the Securities and Exchange Commission for its cooperation and assistance across these investigations.
These cases are being handled by the Office’s Securities and Commodities Fraud Task Force. United States v. Dagar and Bhiwapurkar is in the charge of Assistant U.S. Attorney Alex Rossmiller. United States v. Meadow is in the charge of Assistant U.S. Attorney Nicholas Folly. United States v. Michael Shvartsman, Gerald Shvartsman, and Bruce Garelick is in the charge of Assistant U.S. Attorneys Elizabeth Hanft, Nicolas Roos, and Matthew Shahabian. United States v. Dupont, Cronin, Kaplan, and Feldman is in the charge of Assistant U.S. Attorneys Samuel P. Rothschild, Sarah Mortazavi, and Margaret Graham.
The charges contained in the Indictments are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictments and the description of the Indictments set forth below constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Dagar and Bhiwapurkar Indictment U.S. v. Meadow Indictment U.S. v. Shvartsman et al Indictment U.S. v. Dupont et al Indictment