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19 July 2023
Long Beach Man Found Guilty of Federal Charges for Bombing of Aliso Viejo Spa That Killed Ex-Girlfriend and Severely Injured 2 OthersRead the Press Release
LOS ANGELES – A federal jury today found a Long Beach man guilty of building and planting a package bomb that detonated inside an Aliso Viejo day spa in May 2018, killing his ex-girlfriend, causing serious injuries to two spa clients, and damaging a commercial office building.
Stephen William Beal, 64, was found guilty of four felony counts: use of a weapon of mass destruction resulting in death, malicious destruction of a building resulting in death, use of a destructive device during and in relation to a crime of violence, and possession of an unregistered destructive device.
United States District Judge Josephine L. Staton scheduled a November 17 sentencing hearing, at which time Beal will face a statutory maximum sentence of life imprisonment, and a mandatory minimum sentence of 30 years in federal prison.
“Using his expertise in explosives, Mr. Beal cowardly murdered his former girlfriend, permanently injured two other victims who were her customers, and risked the safety of many others in the area, including a day-care center across the street” said United States Attorney Martin Estrada. “Thanks to the thorough investigation by the FBI, Orange County Sheriff’s Department, Orange County Fire Department, and other law enforcement partners, I am pleased the jury saw through Mr. Beal’s efforts to avoid responsibility for his deplorable actions.”
“Hard work and a commitment to finding the truth about this despicable act paid off today,” said Donald Alway, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “We are gratified that the jury’s verdict led to justice for Ildiko Krajnyak and Beal’s two surviving victims, who will endure the horror and pain of that awful day for the rest of their lives. This day is for them, their families and for the Aliso Viejo community.”
“I am thankful for the painstaking work of our investigators, hazardous devices team, and our federal partners working together to provide justice for Ms. Krajnyak’s family,” said Orange County Sheriff Don Barnes. “While a verdict will not lessen the pain of their loss, nor take away the suffering of the two additional victims inside the spa when the bomb exploded, we hope they know that we never stopped investigating this shocking act of violence. Rest assured, the community is safer with today’s decision.”
According to the evidence presented at a three-week trial, a bomb exploded at a commercial office building in Aliso Viejo at approximately 1:05 p.m. on May 15, 2018. The explosion instantly killed 48-year-old Ildiko Krajnyak – who owned Magyar Kozmetika, a day spa located in the office building – and permanently injured two of her clients, a mother and her daughter.
One of the surviving victims testified at trial that she saw Krajnyak standing behind her desk opening a cardboard box immediately before the massive explosion. The surviving victim pulled her mother from the rubble and together they escaped the burning building through a blown-out wall.
The evidence at trial showed that Beal became obsessed with Krajnyak after she attempted to distance herself from him following an 18-month romantic relationship. Krajnyak’s family and associates testified that Beal was controlling and possessive, and some said they feared for her safety.
During a search of Beal’s residence the day after the explosion, law enforcement found more than 130 pounds of explosive precursor chemicals and completed explosive mixtures, as well as electric matches and wires. Beal had years of experience building high-powered model rockets and homemade pyrotechnics, and laboratory testing determined that the explosive mixture Beal used in the bomb came from the same chemicals he had at his home,
The FBI’s Evidence Response Team spent more than two weeks collecting and processing evidence from the scene of the bombing. The FBI recovered parts of a 9-volt battery and wire fragments that were embedded in the ceiling above the blast site. The wires used in the bomb’s fusing system were of the same unique type as electric matches and wires found at Beal’s home.
Beal purchased the remaining items he needed to complete the bomb just days before the bombing. Store security camera footage showed Beal using cash to buy a single 9-volt battery six days before the bombing. Beal also purchased three cardboard boxes that matched the particular size and shape of the box the surviving victim testified Krajnyak opened at the moment the bomb exploded.
Beal kept tabs on Krajnyak before the bombing, checking her online schedule and social media accounts, according to evidence presented to the jury. Security camera footage and cellular locational data showed that Beal, who had a key to the business, visited the spa on multiple occasions before the bombing while Krajnyak was out of the country. Beal left the package bomb for Krajnyak to open upon her return.
In a separate case, Beal is scheduled to go on trial on November 14 on federal fraud charges alleging he failed to report in a bankruptcy proceeding $350,000 he received from his late wife’s estate. Beal also allegedly schemed to fraudulently obtain insurance benefits and Social Security payments.
The FBI’s Joint Terrorism Task Force, which includes special agents with the FBI and deputies with the Orange County Sheriff’s Department, investigated this matter. Task Force members who participated in the investigation included IRS Criminal Investigation; the Bureau of Alcohol, Tobacco, Firearms and Explosives; Homeland Security Investigations; the Los Angeles Police Department; the Irvine Police Department; the Anaheim Police Department; and the Orange County Fire Authority. The Los Angeles County Sheriff’s Department, the California Highway Patrol, the Naval Criminal Investigative Service, the Santa Ana Police Department, the Newport Beach Police Department and the Orange County Intelligence Assessment Center provided assistance.
The Justice Department’s National Security Division’s Counterterrorism Section, the Justice Department’s Office of International Affairs, the FBI Legal Attaché in Thailand, the United States Department of State, and the U.S. Consulate in Vietnam provided valuable assistance. United States Customs and Border Protection and Homeland Security Investigations provided substantial assistance.
Assistant United States Attorney Annamartine Salick, Chief of the National Security Division, along with Assistant United States Attorneys Mark Takla, Solomon Kim and Sarah Gerdes, all of the Terrorism and Export Crimes Section, are prosecuting this case.
Livingston County Men Sentenced for Methamphetamine DistributionRead the Press Release
Paducah, KY – Two Livingston County men have been sentenced for their roles in a local drug and firearms investigation.
U.S. Attorney Michael A. Bennett of the Western District of Kentucky and Special Agent in Charge R. Shawn Morrow of the ATF Louisville Field Division made the announcement.
According to court documents, on July 19, 2023, Richard Middleton, 41, of Tiline, Kentucky, was sentenced to 7 years and 6 months in prison, followed by a 5-year term of supervised release, for distributing methamphetamine and possessing firearms after having been convicted of felony offenses. On May 23, 2023, Bobby Copeland, 52, also of Tiline, Kentucky, was sentenced to 6 years and 5 months in prison, followed by a 5-year term of supervised release, for aiding and abetting the distribution of methamphetamine. There is no parole in the federal system.
The case was investigated by the ATF Paducah Post of Duty, with assistance from Homeland Security Investigations, the United States Fish and Wildlife Service, the Western Kentucky Violent Crimes Task Force, the Lyon County Sheriff’s Office, the Livingston County Sheriff’s Office, and the Kentucky State Police.
Assistant U.S. Attorney Leigh Ann Dycus, of the U.S. Attorney’s Paducah Branch Office, prosecuted the case.
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Lawrence Man Sentenced for Conspiracy to Steal Firearms from New Hampshire Gun StoresRead the Press Release
CONCORD – A Lawrence man was sentenced in federal court in Concord for conspiring to steal firearms from three different New Hampshire gun stores, U.S. Attorney Jane E. Young announces.
William Mejia, 20, was sentenced by U.S. District Court Judge Samantha Elliot to 30 months in prison and 2 years of supervised release. Mejia was also ordered to pay $23,915.02 in restitution. Mejia and his two co-defendants, Johariel Quezada and Ethan Ayala, were indicted on June 13, 2022. On March 29, 2023, Mejia pleaded guilty to conspiring to steal firearms from a federal firearms licensee.
“The defendant and his confederates traveled to New Hampshire multiple times for one purpose – to steal 43 firearms. Such brazen behavior poses risks to our communities and will simply not be tolerated,” said U.S. Attorney Jane E. Young. “As is apparent from this investigation, law enforcement will continue to work together to ensure that those who target federal firearm licensees will be caught, prosecuted, and incarcerated for lengthy periods upon conviction.”
“ATF works closely with our law enforcement partners as well as Federal Firearms Licensees to ensure firearms that are stolen and diverted into the community to further criminal activity, are held accountable for their actions. This sentence illustrates ATF’s abiding commitment to justice,” said ATF Special Agent in Charge James Ferguson.
Between August 29, 2021 and October 4, 2021, Mejia conspired with others to steal firearms from three New Hampshire Federal Firearms Licensees. Throughout the conspiracy, 43 firearms were stolen from Milford Firearms in Milford, Second Amendment Arms in Windham, and MacPherson Firearms in Brentwood. Multiple stolen firearms were recovered from a co-defendant’s residence, including one with Mejia’s fingerprints on it. Videos recovered from a co-defendant’s phone as well as from social media showed numerous stolen firearms and admissions of Mejia’s involvement in the conspiracy.
Mejia’s codefendant, Johariel Quezada, was sentenced to 24 months in prison and 3 years of supervised release on May 12, 2023. Ethan Ayala is scheduled to be sentenced on April 15, 2024.
The Bureau of Alcohol, Tobacco, Firearms and Explosives led the investigation. Valuable assistance was provided by the Andover Police Department, the Brentwood Police Department, the Haverhill Police Department, the Lawrence Police Department, the Massachusetts State Police, the Rockingham County Sheriff’s Office, the Salem Police Department, the Somersworth Police Department, the Saugus Police Department, the Wellesley Police Department, and the Windham Police Department. Assistant U.S. Attorney John J. Kennedy prosecuted 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.
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La Crosse Felon Sentenced to 46 Months for Illegal Gun PossessionRead the Press Release
MADISON, WIS. – Timothy M. O’Shea, United States Attorney for the Western District of Wisconsin, announced that Kareem Nellem, 30, La Crosse, Wisconsin was sentenced today by Chief U.S. District Judge James D. Peterson to 46 months in federal prison for possessing a firearm as a felon. This prison term will be followed by a 3-year term of supervised release. Nellem pleaded guilty to this charge on April 12, 2023.
On March 30, 2022, the La Crosse Police Department conducted a search of Nellem’s residence in connection to a drug investigation. During the search, officers located a 9mm firearm in a dresser. The investigation revealed that on the same date his residence was searched, Nellem had posted to his publicly accessible Snapchat account a video of himself holding two firearms. The firearm recovered from his residence appeared consistent with one of those firearms. Nellem’s DNA was also later recovered from that firearm.
Nellem is prohibited from legally possessing a firearm as a result of a 2012 conviction for armed robbery with a firearm.
At sentencing, Judge Peterson stated that an aggravating factor in this case was that Nellem committed the offense while under supervision. Judge Petersen also stated that while the defendant had the potential to succeed, his criminal history also demonstrated a potential for violence.
This case has been brought as part of Project Safe Neighborhoods (PSN), the U.S. Justice Department’s program to reduce violent crime. The PSN approach involves collaboration by federal, state, and local law enforcement agencies, prosecutors, and communities to prevent and deter gun violence.
The charge against Nellem was the result of an investigation conducted by the La Crosse Police Department and Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Taylor L. Kraus prosecuted this case.
Justice Department Finds that Arizona Prisons Discriminate Against People with Vision DisabilitiesRead the Press Release
The Justice Department announced today its finding that the Arizona Department of Corrections, Rehabilitation and Reentry (ADCRR) violated the Americans with Disabilities Act (ADA) by discriminating against individuals with vision disabilities, including those who are blind or have low vision. In a public letter issued to ADCRR, the department detailed its findings following its investigation of multiple complaints by incarcerated individuals and asked ADCRR to work with the department to resolve the civil rights violations identified.
The department’s investigation found that ADCRR violated the ADA in several ways. First, ADCRR failed to reasonably modify its policies or provide auxiliary aids and services, such as brailled materials and displays, audio recordings and screen reader software, to ensure that people with vision disabilities could communicate effectively while incarcerated. Second, ADCRR failed to provide accessible processes for people with vision disabilities to request accommodations or file disability-related complaints. Third, ADCRR over relied on other incarcerated people to help individuals with vision disabilities without properly training or supervising those providing help. Based on these findings, the department determined that ADCRR denied individuals with vision disabilities an equal opportunity to participate in and benefit from its services, programs and activities.
“People with disabilities do not surrender their civil rights at the prison gate,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Justice Department is committed to ensuring that people with disabilities held in jails and prisons, including those with vision impairments, have an equal opportunity to participate in and benefit from prison programs and to work towards rehabilitation. Ensuring that our jails and prisons are accessible for people with disabilities is part of our overall work to address the conditions of confinement in our country.”
“Incarcerated Arizonans with disabilities are entitled to the same rights as all other inmates,” said U.S. Attorney Gary M. Restaino for the District of Arizona. “This is important. Access to services and programming while incarcerated helps one succeed upon reentry into society. We appreciate the dialogue to date with the Arizona Department of Corrections and look forward to collaborative solutions to overcome barriers to equality.”
The department’s letter provides ADCRR with written notice of its findings and details the minimum remedial measures necessary to address them.
This matter is being handled by the Civil Rights Division’s Disability Rights Section and the U.S. Attorney’s Office for the District of Arizona.
The Justice Department plays a central role in advancing the ADA’s goals of equal opportunity, full participation, independent living and economic self-sufficiency for people with disabilities, including people who are incarcerated. For more information on the Civil Rights Division, please visit www.justice.gov/crt. For more information on the ADA, please call the department’s toll-free ADA Information Line at 1-800-514-0301 (TDD 800-514-0383) or visit www.ada.gov. For more information on the Civil Rights Division, please visit www.justice.gov/crt.
The letter can be viewed here.
Justice Department and FTC Seek Comment on Draft Merger GuidelinesRead the Press Release
The Justice Department and the Federal Trade Commission (FTC) are releasing a draft update of the Merger Guidelines (Draft Guidelines), which describe and guide the agencies’ review of mergers and acquisitions to determine compliance with federal antitrust laws. The goal of this update is to better reflect how the agencies determine a merger’s effect on competition in the modern economy and evaluate proposed mergers under the law. Both agencies encourage the public to review the draft and provide feedback through a public comment period that will last 60 days.
“Unchecked consolidation threatens the free and fair markets upon which our economy is based,” said Attorney General Merrick B. Garland. “These updated Merger Guidelines respond to modern market realities and will enable the Justice Department to transparently and effectively protect the American people from the damage that anticompetitive mergers cause.”
“Competitive markets and economic opportunity go hand in hand. Today, we are issuing draft guidelines that are faithful to the law, which prevents mergers that threaten competition or tend to create monopolies. As markets and commercial realities change, it is vital that we adapt our law enforcement tools to keep pace so that we can protect competition in a manner that reflects the intricacies of our modern economy. Simply put, competition today looks different than it did 50 — or even 15 — years ago,” said Assistant Attorney General Jonathan Kanter of the Antitrust Division. “There will be a substantial process for the public to review and provide comments before we finalize these guidelines.”
“Open, competitive, resilient markets have been a bedrock of America’s economic success and dynamism throughout our nation’s history. Faithful and vigorous enforcement of the antitrust laws is key to maintaining that success,” said FTC Chair Lina M. Khan. “With these draft Merger Guidelines, we are updating our enforcement manual to reflect the realities of how firms do business in the modern economy. Informed by thousands of public comments — spanning healthcare workers, farmers, patient advocates, musicians, and entrepreneurs — these guidelines contain critical updates while ensuring fidelity to the mandate Congress has given us and the legal precedent on the books.”
The Justice Department and FTC protect competition through enforcement of the antitrust laws and other federal competition statutes. Since 1968, the agencies have issued and revised Merger Guidelines to enhance transparency and promote awareness of how the agencies carry out that charge with respect to mergers and acquisitions.
The Draft Guidelines build upon, expand, and clarify frameworks set out in previous versions. At the outset, the Guidelines give an overview of 13 principles, or “guidelines,” that the agencies may use when determining whether a merger is unlawfully anticompetitive under the antitrust laws. These guidelines are not mutually exclusive, and a given merger may implicate multiple guidelines. The document then describes in greater depth the frameworks and tools that may be used when analyzing a merger with respect to each guideline.
The 13 Guidelines are:
- Mergers should not significantly increase concentration in highly concentrated markets;
- Mergers should not eliminate substantial competition between firms;
- Mergers should not increase the risk of coordination;
- Mergers should not eliminate a potential entrant in a concentrated market;
- Mergers should not substantially lessen competition by creating a firm that controls products or services that its rivals may use to compete;
- Vertical mergers should not create market structures that foreclose competition;
- Mergers should not entrench or extend a dominant position;
- Mergers should not further a trend toward concentration;
- When a merger is part of a series of multiple acquisitions, the agencies may examine the whole series;
- When a merger involves a multi-sided platform, the agencies examine competition between platforms, on a platform, or to displace a platform;
- When a merger involves competing buyers, the agencies examine whether it may substantially lessen competition for workers or other sellers;
- When an acquisition involves partial ownership or minority interests, the agencies examine its impact on competition; and
- Mergers should not otherwise substantially lessen competition or tend to create a monopoly;
The agencies have amended the Merger Guidelines several times since the first Merger Guidelines were released in 1968, including in 1982, 1984, 1992, 1997, 2010, and 2020. In January 2022, the agencies announced a broad initiative to evaluate potential updates and revisions to the Horizontal Merger Guidelines, issued in 2010, and the Vertical Merger Guidelines issued in 2020.
Following a public comment period, which included a request for information, more than 5,000 members of the public — including consumers, workers, state attorneys general, academics, businesses, trade associations, practitioners, and entrepreneurs — contributed feedback. The agencies also conducted four listening sessions that highlighted the potential for mergers and acquisitions to undermine open, vibrant, and competitive markets in industries ranging from food and agriculture to health care.
In revising the Merger Guidelines, the agencies focused on three core goals. First, the Draft Guidelines should reflect the law as written by Congress and interpreted by the highest courts. The Guidelines are built around statutory text and relevant case precedent, citing cases in order to clarify the connection between the law and the analytic frameworks described. The Draft Guidelines also make clear that they are not a substitute for the law itself, and do not create new rights or obligations. Second, the Draft Guidelines should be accessible, increasing transparency and awareness. Third, the Draft Guidelines should provide frameworks that reflect the realities of our modern economy and the best of modern economics and other analytical tools.
The public is invited to provide comments to the Draft Guidelines at www.regulations.gov/docket/FTC-2023-0043 for a period of 60 days. The deadline is Sept. 18. The agencies will use the public comments to evaluate and update the draft before finalizing the Guidelines. For a detailed fact sheet on the Draft Guidelines, please visit www.justice.gov/atr/d9/2023-draft-merger-guidelines.
Jury Finds Founder of South Carolina Construction Firm Guilty of Charges Related to Kickback Payments, Wire Fraud, and Money LaunderingRead the Press Release
COVINGTON, Ky. – The founder of Berenyi, Inc., headquartered in Charleston, SC, Antoine “Tony” Berenyi, 63, was found guilty late Tuesday, by a federal jury sitting in Covington, following a six-day trial, of one count of conspiracy to commit honest services wire fraud, 14 counts of wire fraud, and 10 counts of money laundering.
According to the evidence at trial, beginning in late 2017, Berenyi entered into an illegal kickback agreement with Jaymin Vinson, an employee of Nucor Steel Gallatin, to deprive Nucor of money and Vinson’s honest services as an employee. Berenyi and Vinson agreed that Vinson would help steer a $14,950,000 construction management contract for a $650 million Nucor mill expansion project to Berenyi’s company and provide other services on behalf of Berenyi within Nucor, in exchange for Berenyi paying Vinson a 15% kickback on the contract, all without Nucor’s knowledge or approval. Berenyi’s secret kickback payments continued into 2019, totaling over $452,000 kicked back to Vinson.
Berenyi was indicted in October 2022.
Carlton S. Shier, IV, United States Attorney for the Eastern District of Kentucky, and Jodi Cohen, Special Agent in Charge, FBI, Louisville Field Office, jointly announced the guilty verdict.
The investigation was conducted by the FBI. The United States was represented in the case by Assistant U.S. Attorneys James Chapman and Kyle Winslow.
Berenyi is scheduled to appear for sentencing on December 13, 2023. He faces up to 20 years in prison on the conspiracy to commit honest services wire fraud count; up to 20 years in prison on each of the wire fraud counts, and not more than 10 years in prison on each count of money laundering. However, the Court must consider the U.S. Sentencing Guidelines and the applicable federal sentencing statutes before imposing a sentence. Berenyi also faces potential fines, a forfeiture money judgment, and a judgment of restitution, as ordered by the Court.
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Indiana Man, Anchorage Woman Plead Guilty to Child Pornography ChargesRead the Press Release
ANCHORAGE, Alaska – An Indiana man and Anchorage woman pleaded guilty to conspiracy to produce child pornography.
According to court documents, Darin Schilmiller, 25, and Denali Brehmer, 22, conspired to murder Cynthia Hoffman on or about June 2, 2019, while Schilmiller was residing in Indiana. While they were conspiring to murder Hoffman, they also conspired to coerce a minor victim to produce sexually explicit images, which Brehmer took and sent to Schilmiller via text message.
Schilmiller and Brehmer’s sentencing hearings will be scheduled by the court at a later date. The defendants face a mandatory-minimum 15-year term of incarceration on the child pornography charges. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
“This case shows that our U.S. Attorney’s Office will continue to pursue justice on behalf of the victims of child pornography,” said U.S. Attorney S. Lane Tucker of the District of Alaska. “Our attorneys will prosecute offenders who are a danger to the children of our Alaskan communities.”
“In our pursuit of justice, Mr. Schilmiller and Ms. Brehmer now stand convicted for the multitude of crimes they’ve committed and the immeasurable trauma they’ve inflicted,” said Special Agent in Charge Antony Jung of the FBI Anchorage Field Office. “The FBI will aggressively continue to identify, investigate, and hold accountable those who exploit and abuse our most vulnerable.”
The FBI’s Anchorage Field Office and Anchorage Police Department investigated the case as part of the FBI's Child Exploitation and Human Trafficking Task Force.
Assistant U.S. Attorney Adam Alexander is prosecuting the case.
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Hartford Man Sentenced to More Than 6 Years in Prison for Drug Offense, Possessing Gun and Distributing Drugs While Awaiting SentencingRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, today announced that PEDRO GOMEZ, also known as “Nito,” 42, of Hartford, was sentenced yesterday by U.S. District Judge Alvin W. Thompson in Hartford to 76 months of imprisonment, followed by three years of supervised release, for distributing narcotics, and for possessing a firearm and distributing drugs while awaiting sentencing in his federal case.
According to court documents and statements made in court, in March 2016, law enforcement made multiple controlled purchases of heroin/fentanyl from Gomez. On April 20, 2017, Gomez pleaded guilty in Hartford federal court to possession with intent to distribute heroin.
On May 6, 2022, Gomez, who was awaiting sentencing and released on bond, was arrested after he was found in possession of a stolen handgun and distribution quantities of fentanyl, cocaine, and marijuana.
Gomez’s criminal history includes felony convictions. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
Gomez has been detained since his arrest. On February 14, 2023, he pleaded guilty to unlawful possession of a firearm by a felon.
Judge Thompson sentenced Gomez to 30 months of imprisonment for his original narcotics offense, and a consecutive 46 months of imprisonment for the firearm offense.
The investigation was conducted by the FBI’s Northern Connecticut Gang Task Force and the Hartford Police Department. The FBI Task Force includes members of the Hartford Police Department, East Hartford Police Department, New Britain Police Department, West Hartford Police Department, Connecticut State Police and Connecticut Department of Correction.
The case was prosecuted by Assistant United States Attorney Patricia Stolfi Collins through Project Safe Neighborhoods (PSN). PSN, the centerpiece of the Department of Justice’s violent crime reduction efforts, is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally-based prevention and reentry programs for lasting reductions in crime.
Grand Jury Returns Two IndictmentsRead the Press Release
MADISON, WIS. - A federal grand jury in the Western District of Wisconsin, sitting in Madison, returned the following indictments today. You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
Janesville Man Charged with Drug, Gun & Child Pornography Crimes
Kyle Richards, 34, Janesville, Wisconsin, is charged with distributing cocaine, possessing cocaine for distribution, maintaining a drug house, being a felon in possession of firearms, and producing child pornography. The indictment alleges that from April 2023 to May 5, 2023, Richards used and maintained an apartment in Janesville for the purpose of distributing and using cocaine. The indictment further alleges that he distributed cocaine on October 9, 2022, and that on May 4, 2023, he possessed cocaine with the intent to distribute.
The indictment also charges Richards with being a felon in possession of firearms. The indictment alleges that on May 4, 2023, he possessed four handguns. The final count of the indictment charges that on January 13, 2023, he used a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of the conduct.
If convicted, Richards faces a maximum penalty of 20 years in federal prison on the charges of distributing cocaine and possessing cocaine for distribution, 5 years on the charge of maintaining a drug house, and 15 years on the charge of being a felon in possession of firearms. The production of child pornography charge has a mandatory minimum penalty of 15 years and a maximum of 30 years.
The charges against Richards are the result of an investigation by the Janesville Police Department, the Wisconsin Department of Justice Division of Criminal Investigation, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Taylor Kraus is handling the prosecution. This case has been brought as part of Project Safe Neighborhoods (PSN), the U.S. Justice Department’s program to reduce violent crime. The PSN approach emphasizes coordination between state and federal prosecutors and all levels of law enforcement to address gun crime, especially felons illegally possessing firearms and ammunition and violent and drug crimes that involve the use of firearms.
Wood County Man Charged with Producing Child Pornography
Brian McDowell, 64, Hewitt, Wisconsin, is charged with two counts of producing child pornography. The indictment alleges that on two occasions between November 2021 and April 2023, McDowell used a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of the conduct.
If convicted, McDowell faces a mandatory minimum penalty of 25 years and a maximum of 50 years in federal prison on each count. The charges against him are the result of an investigation by the Wood County Sheriff’s Office and the Wisconsin Department of Justice Division of Criminal Investigation. Assistant U.S. Attorney Taylor Kraus is handling the prosecution.
Gloucester County Man Convicted of Drug Conspiracy and Firearms OffensesRead the Press Release
NEWARK, N.J. – A federal jury convicted a Gloucester County, New Jersey, man for narcotics trafficking and firearms offenses, U.S. Attorney Philip R. Sellinger announced today.
Javier Osorio, 43, of Deptford, New Jersey, was convicted following a one-week trial before U.S. District Judge Brian R. Martinotti in Newark federal court. Osorio was convicted of conspiracy to distribute and possess with the intent to distribute heroin and cocaine, possession with the intent to distribute heroin, possession of a firearm in furtherance of a drug trafficking crime, and unlawful possession of a firearm by a convicted felon.
According to documents in this case and the evidence at trial:
Osorio conspired with others to distribute cocaine and over one kilogram of heroin, which was recovered from his apartment. Osorio was arrested while driving with his conspirators from New Jersey to Brooklyn to sell an additional quantity of heroin, which was recovered from the vehicle. In addition to the drugs recovered from his apartment, law enforcement also recovered a loaded stolen firearm from under Osorio’s mattress.
At sentencing, Osorio faces a maximum potential penalty of 20 years on each count of conspiracy to distribute heroin and cocaine and possession with the intent to distribute heroin is punishable by a maximum penalty of life in prison. The count of possession of a firearm in furtherance of a drug trafficking crime carries a mandatory minimum penalty of five years in prison, which must be served consecutively to any other prison term; the count of unlawful possession of a firearm by a convicted felon carries a maximum potential penalty of 10 years in prison. Each count also carries a potential $250,000 fine.
U.S. Attorney Sellinger credited special agents with the Drug Enforcement Administration, under the direction of Special Agent in Charge Cheryl Ortiz, with the investigation leading to these charges. He also credited the Hudson County Prosecutor’s Office, under the direction of Prosecutor Esther Suarez for its assistance.
The government is represented by Assistant U.S. Attorney George L. Brandley of the Office’s Health Care Fraud Unit in Newark, and Assistant U.S. Attorney Kendall Randolph of the Office’s Organized Crime/Gangs Unit in Newark.
This case 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.
Gangster Disciples Member Pleads Guilty to Federal Gun ChargeRead the Press Release
COLUMBUS, Ga. – A confirmed member of the Gangster Disciples faces up to life in prison after he pleaded guilty to a federal gun charge; the firearm was linked to a domestic violence assault through ATF’s National Integrated Ballistic Information Network (NIBIN).
Megail Thirkield, 33, of Columbus, Georgia, pleaded guilty to possession of a firearm by a convicted felon before U.S. District Judge Clay Land on July 18. Thirkield potentially faces a mandatory minimum of 15 years up to a maximum sentence of life in prison to be followed by five years of supervised release and a $250,000 fine. Sentencing is scheduled for Oct. 26. There is no parole in the federal system.
“Law enforcement efforts in Columbus remain focused on reducing crime and holding the most violent repeat offenders accountable for choosing to illegally arm themselves,” said U.S. Attorney Peter D. Leary. “This case demonstrates the strong collaboration between law enforcement at every level in Columbus by taking advantage of available technology like the National Integrated Ballistic Information Network (NIBIN) to hold the most violent repeat offenders accountable.”
“ATF’s mission and priority are to deny criminals access to firearms and protect the rights of law-abiding citizens. When offenders illegally possess firearms that can be used against our citizens, our children and our community, ATF takes this very seriously,” said ATF Assistant Special Agent in Charge Beau Kolodka.
“Guns, gangs and acts of violence create a combination that yields a bad outcome,” said Muscogee County Sheriff Greg Countryman. “The Muscogee County Sheriff’s Office will continue to work hand-in-hand with our federal partners to alleviate all threats that may impose any type of harm to the citizens of our county. We will continue to use the proven scientific technology of NIBIN as an investigative tool for crimes involving guns.”
According to court documents, a Muscogee County Sheriff’s Office investigator observed Thirkield—who was wanted on domestic violence charges—walking in the middle of Colorado Street in Columbus at approximately 12:30 p.m. on June 9, 2022. Multiple arrest warrants had been issued for Thirkield related to several domestic violence assaults between Feb. 2022 and May 2022. Police reports detail Thirkield stalking and harassing the same victim; he allegedly threatened the victim while brandishing a firearm—including pointing the weapon at her head and firing several shots into the air—and also allegedly violently attacked the victim, sometimes in the presence of the victim’s children.
While awaiting backup, the investigator watched Thirkield enter a house. The owner consented to law enforcement entering the residence where they found Thirkield hiding under a pile of clothes in a back bedroom. Thirkield was taken into custody in possession of a semi-automatic Glock pistol with 20 rounds of ammunition. The firearm was linked to the domestic violence incidents through NIBIN.
Thirkield is a confirmed member of the Gangster Disciples with a lengthy criminal history to include multiple felony drug distribution convictions, theft by receiving stolen property and illegal possession of a firearm in Muscogee County, Georgia, Superior Court. It is a federal crime for a convicted felon to possess a firearm.
This case is being prosecuted as part of the joint federal, state, and local Project Safe Neighborhoods (PSN) Program, the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
NIBIN, run by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), is the only interstate automated ballistic imaging network in the United States, making it possible for local law enforcement to search against evidence from across the country, improving the outcomes of criminal investigations. The NIBIN technology is considered a valuable tool by law enforcement in the effort to reduce gun crimes across the Middle District of Georgia.
The case was investigated by the Muscogee Co. Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF).
Assistant U.S. Attorney Christopher Williams is prosecuting the case for the government.
Four Men Charged with Targeting and Robbing Victims Selling Apple Products on Popular Online MarketplaceRead the Press Release
MIAMI – A South Florida federal grand jury has charged four men in their early 20s with targeting and robbing people who sold electronic items on a popular online marketplace and using guns during some of the robberies.
The indictment, unsealed today, charges Palm Beach residents Jordan Denzel Lewis, 23, Tyrell Brion Bouie, 21, Anthony Christopher Diggs Jr., 20, and Broward resident Johntaevious Henry Johnson, 23, with conspiracy to commit robbery, robbery, conspiracy to use and carry a firearm during a crime of violence, and brandishing a firearm during a crime of violence. It also charges Lewis, a prior convicted felon, with illegal possession of a firearm.
It is alleged that the defendants targeted victims on a national online marketplace that allows users to list items for sale on its website and mobile application. Once users post items for sale, other users across the United States can view, bid on, and purchase items. According to the charges, from about June to October 2022, Lewis, Bouie, Diggs, and Johnson conspired to rob, and robbed, people who posted Apple products for sale on the online marketplace. The indictment also alleges that they used firearms in some of the robberies.
Johnson and Diggs have made their initial appearances in federal magistrate court in Fort Lauderdale. Initial appearances for Lewis and Bouie will be set later.
U.S. Attorney Markenzy Lapointe for the Southern District of Florida and Special Agent in Charge Jeffrey B. Veltri of the FBI, Miami Field Office, made the announcement.
FBI Miami investigated the case, with assistance from the Plantation Police Department. Assistant U.S. Attorneys Deric Zacca and Ajay Alexander are prosecuting it. Assistant U.S. Attorney Jorge Delgado is handling asset forfeiture.
An indictment contains mere allegations, and all defendants are presumed innocent unless and until proven guilty in a court of law.
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-60138.
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Former Wayne County Employee Pleads Guilty to Stealing over $1.7 Million in County FundsRead the Press Release
DETROIT – A former Wayne County Roads Division employee pleaded guilty today to conspiring to steal over $1.7 million in county funds, United States Attorney Dawn N. Ison and Wayne County Prosecutor Kym Worthy announced.
Ison and Worthy were joined in the announcement by Devin Kowalski, Acting Special Agent-in-Charge of the Detroit Field Office of the Federal Bureau of Investigation and Wayne County Sheriff Raphael Washington.
John Gibson, 54, of Detroit, pleaded guilty to defrauding Wayne County out of nearly $2 million in taxpayer funds. Gibson and his supervisor, fellow Wayne County employee Kevin Gunn, 64, of West Bloomfield, engaged in a scheme to use taxpayer dollars to make unauthorized purchases of generators and other power equipment from retailers in southeast Michigan which they sold for personal profit. Gunn pleaded guilty to these charges in January and is awaiting sentence.
In March of 2021, the Wayne County Sheriff’s Department began an investigation into the misuse of taxpayer dollars. The Sheriff’s Department then solicited the assistance of the FBI to investigate the criminal actions of Gunn and Gibson. At the beginning of the investigation, the Wayne County Prosecutor’s Office secured a search warrant which led to the uncovering of the embezzlement scheme. Investigators with the Wayne County Prosecutor’s Office have played an ongoing and important role in the investigation.
The investigation determined that between January 2019 and August 2021, Gunn and Gibson solicited vendors to purchase generators and other power equipment from local retailers on behalf of Wayne County. The vendors then submitted invoices for these items to Wayne County. To conceal the scheme to defraud, Gunn instructed the vendors to falsify the invoices they submitted to the Roads Division by listing items the vendors were authorized to sell to the county under their contracts, rather than the generators and power equipment they were unlawfully acquiring at Gunn’s and Gibson’s direction. Roads Division employees then approved and paid each vendor’s invoice with taxpayer funds. Next, Gibson took possession of the equipment, paid Gunn for the items, and resold the generators and other items for personal profit.
A review of invoices from Wayne County vendors revealed that between January 16, 2019 and August 3, 2021, Wayne County vendors purchased 596 generators and a variety of other power equipment including lawnmowers, chainsaws, and backpack blowers. The purchase of these items was not authorized under any vendor contract with Wayne County nor were the items ever provided to or used by Wayne County. The total value of equipment purchased as part of the scheme was approximately $1.7 million. Gibson and Gunn were arrested in May 2022 by FBI agents, Wayne County Prosecutor’s Office Investigators, and Wayne County Sheriff’s Deputies.
Conspiracy to commit federal program theft carries a maximum sentence of up to 5 years’ imprisonment and a fine of up to $250,000. Pursuant to the terms of his plea agreement, Gibson faces an advisory sentencing guideline range of 18 to 24 months in prison.
United States Attorney Dawn Ison said, “Today’s guilty plea is the culmination of months of collaboration between local, state, and federal law enforcement agencies. We thank Wayne County Prosecutor Kym Worthy for her uncompromising efforts to seek justice for the hardworking taxpayers of Wayne County as we work together to root out corruption at all levels of government.”
“The brazen scheme to defraud Wayne County of nearly $2 million for personal gain is an affront to all Wayne County taxpayers. The guilty plea today represents the combined investigative efforts that involved my office, and the offices of the Wayne County Executive, the Wayne County Sheriff, and the FBI. We can all be proud of the work that we have done to root out corruption and bring justice in this case,” said Prosecutor Kym Worthy.
“Public officials are entrusted to use taxpayer money for its intended purpose, not for their personal gain. Today, Mr. Gibson is being held accountable for violating that trust,” said Devin J. Kowalski, Acting Special Agent in Charge of the FBI’s Detroit Field Office. “I commend the early work of our partners at the Wayne County Prosecutor's Office, Wayne County Executive, and Wayne County Sheriff’s Office and for their continued commitment to holding Mr. Gibson and his co-conspirators accountable for their federal crimes.”
“The alleged actions of these individuals are nothing short of disgraceful,” said Sheriff Raphael Washington. “To brazenly steal from hardworking taxpayers and fraudulently line their own pockets while holding positions of public trust make these crimes all the more deplorable. This case is another example of our strong commitment to working together.”
The investigation was conducted by the Wayne County Prosecutor’s Office, the Wayne County Sheriff’s Department, and the Federal Bureau of Investigation's Public Corruption Task Force which includes the Michigan Attorney General's Office, Detroit Police Department, Customs and Border Protection, the U.S. Postal Inspection Service and the U.S. Department of Homeland Security. In addition, Wayne County Executive Warren Evans and his administration have been assisting and cooperating with the investigation since they first learned of fraudulent activity within their organization. The case is being prosecuted by Assistant U.S. Attorney Eaton P. Brown.
Former Venezuelan Official Hugo Armando Carvajal Barrios Extradited to the United States on Narco-Terrorism, Firearms, and Drug Trafficking ChargesRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Anne Milgram, the Administrator of the U.S. Drug Enforcement Administration (“DEA”), announced that former Venezuelan official HUGO ARMANDO CARVAJAL BARRIOS, a/k/a “El Pollo,” was extradited today from Spain to the United States based on an Indictment filed in the Southern District of New York charging CARVAJAL BARRIOS with narco-terrorism conspiracy, conspiracy to import cocaine into the United States, and related firearms offenses. CARVAJAL BARRIOS will be presented tomorrow before U.S. Magistrate Judge Stewart D. Aaron. CARVAJAL BARRIOS was arrested in Spain on September 9, 2021.
U.S. Attorney Damian Williams said: “After many years as a fugitive following a more than decade-long criminal career, Hugo Armando Carvajal Barrios arrived in the United States today to face justice for his alleged crimes, which were committed with the intent to ‘flood’ the United States with tons of potentially deadly drugs. As alleged, Carvajal Barrios exploited his authority as the director of Venezuela’s military intelligence agency to corrupt Venezuelan institutions, abuse the Venezuelan people, and to import poison to the United States. His alleged leadership of the Cártel de Los Soles inflicted immeasurable pain and suffering on many Venezuelans, Americans, and others who were affected by the cartel’s violence and drug trafficking activities. I commend the prosecutors of this Office and our law enforcement partners for their tireless work on this important case.”
DEA Administrator Anne Milgram said: “Corrupt government officials like Carvajal, who allegedly use their position to accept bribes and further drug trafficking activities, should be held accountable to the fullest extent of the law. As alleged, Carvajal abandoned his responsibility to the people of Venezuela and exploited his position for personal gain. DEA and our partners stand united to bring to justice anyone, in any position, who endangers the safety and health of the American people.”
According to the allegations contained in the Indictments, other court filings, and statements made during court proceedings:1
Beginning in at least 1999, CARVAJAL BARRIOS, a Venezuelan citizen and the former director of Venezuela’s military intelligence agency, which was known as the Dirección de Inteligencia Militar (“DIM”), along with other high-ranking Venezuelan officials, acted as leaders and managers of the Cártel de Los Soles, or “Cartel of the Suns.” The Cartel’s name refers to the sun insignias affixed to the uniforms of high-ranking Venezuelan military officials. CARVAJAL BARRIOS and other Cartel members abused the Venezuelan people and corrupted the legitimate institutions of Venezuela — including parts of the military, intelligence apparatus, legislature, and judiciary — to facilitate the importation of tons of cocaine into the United States. The Cártel de Los Soles sought not only to enrich its members and enhance their power but also to “flood” the United States with cocaine and inflict the drug’s harmful and addictive effects on users in the United States. To accomplish these goals, the leaders of the Cártel de Los Soles partnered with leaders of the Fuerzas Armadas Revolucionarias de Colombia (“FARC”), who controlled cocaine production in vast areas of Colombia and Venezuela.
CARVAJAL BARRIOS held multiple positions of public trust in Venezuela that he exploited to benefit the Cártel de Los Soles, including as director of DIM between approximately 2004 and 2011. CARVAJAL BARRIOS took advantage of that position to illegally traffic narcotics and support his drug trafficking partners, the FARC. In or about 2006, for example, CARVAJAL BARRIOS coordinated with other members of the Cártel de Los Soles to dispatch a 5.6-ton cocaine shipment from Venezuela on a private jet bearing a United States registration number. The jet departed Venezuela and landed in Mexico, where Mexican authorities seized the 5.6 tons of cocaine upon arrival. In or about 2008, CARVAJAL BARRIOS attended a meeting with a FARC representative at which it was agreed that the Cártel de Los Soles would provide the FARC with cash and weapons in exchange for increased cocaine production.
* * *
CARVAJAL BARRIOS, 63, a Venezuelan national, is charged with: (i) participating in a narco-terrorism conspiracy, which carries a mandatory minimum sentence of 20 years in prison and a maximum sentence of life in prison; (ii) conspiring to import cocaine into the United States, which carries a mandatory minimum sentence of 10 years in prison and a maximum sentence of life in prison; (iii) using, carrying, and possessing machineguns and destructive devices in connection with the narco-terrorism and cocaine importation conspiracies, which carries a mandatory minimum sentence of 30 years in prison and a maximum sentence of life in prison; and (iv) conspiring to use, carry, and possess machineguns and destructive devices in connection with the narco-terrorism and cocaine importation conspiracies, which carries a maximum sentence of life in prison.
The mandatory minimum and maximum potential sentences in this case are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Williams praised the outstanding efforts of the DEA’s Special Operations Division Bilateral Investigations Unit, Miami Field Division, and Madrid Country Office; Homeland Security Investigations; the U.S. Treasury Department, Office of Foreign Assets Control; the Counterterrorism Section of the Department of Justice’s National Security Division; and the U.S. Attorney’s Office for the Southern District of Florida. The Department of Justice’s Office of International Affairs and U.S. Embassy Madrid worked with law enforcement partners in Spain, including the Spanish National Police, Spain’s Antidrug Special Prosecutor’s Office, Spain’s Ministry of Justice, and Spain’s Ministry of Interior, to secure the arrest and extradition of CARVAJAL BARRIOS.
This prosecution is being handled by the Office’s National Security and International Narcotics Unit. Assistant U.S. Attorneys Jason A. Richman, Kaylan E. Lasky, and Kyle A. Wirshba are in charge of the prosecution, with assistance from Trial Attorney Kevin C. Nunnally of the Counterterrorism Section.
The charges contained in the Indictments are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
1 As the introductory phrase signifies, the entirety of the text of the Indictments and the description of the Indictments set forth herein constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Carvajal Barrios IndictmentsFormer Schenectady Nightclub Owners Admit Defrauding COVID-19 Relief ProgramsRead the Press Release
ALBANY, NEW YORK – Deborah Budhraj, age 52, and her husband Adesh Budhraj, age 53, of Ballston Lake, New York, pled guilty today to conspiring with each other to defraud loan programs meant for businesses struggling with the financial effects of the coronavirus pandemic.
United States Attorney Carla B. Freedman and Janeen DiGuiseppi, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI), made the announcement.
Deborah and Adesh Budhraj had co-owned a combination restaurant, bar and nightclub in Schenectady, New York (called “Establishment A” in court documents). In February 2020, they contractually agreed to sell this business to another couple (“Couple A”), and received most of the purchase money – $265,720 – from Couple A the following month. Although the sale was not finalized until August 2021, Couple A became the managers of Establishment A as of about March 2020, and assumed day-to-day responsibility for its payroll and other ordinary expenses, such as lease and utilities payments.
In pleading guilty, Deborah and Adesh Budhraj admitted that without Couple A’s knowledge, they applied for two Paycheck Protection Program (PPP) loans issued by banks and one Economic Injury Disaster Loan (EIDL) issued by the U.S. Small Business Administration (SBA), between April 2020 and June 2021; the loans totaled $558,514 and were meant to support Establishment A and its employees during the pandemic.
Deborah and Adesh Budhraj each admitted that they never intended to use the loans for Establishment A’s expenses, and to instead using the loaned funds for impermissible purposes, including on real estate transactions and personal expenses. Deborah also fraudulently obtained forgiveness of the two PPP loans by falsely certifying that the loaned funds were spent in accordance with PPP rules, including on payroll.
Deborah and Adesh Budhraj each pled guilty to bank fraud conspiracy and to wire fraud conspiracy. They face up to 30 years in prison for bank fraud conspiracy, and up to 20 years in prison for wire fraud conspiracy, when they are sentenced on November 16, 2023 by Senior United States District Judge Lawrence E. Kahn. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors. Each defendant has also agreed to pay $558,514 in restitution to the SBA, and to forfeit that same amount as proceeds of their crimes.
The FBI investigated this case, and Assistant U.S. Attorney Michael Barnett is prosecuting this 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.
Former City of Richmond Official and Wife Plead Guilty to FraudRead the Press Release
RICHMOND, Va. – A former senior manager at the City of Richmond Department of Public Works (DPW), who previously served as the Deputy Director of Operations at DPW, and his wife pleaded guilty today to defrauding the city.
According to court documents, Michael Evins, 67, used his position within DPW, a governmental entity responsible for providing engineering, technical, and administrative services to Richmond residents, to steer governmental contracts towards himself and his co-conspirators, including his wife, Samaria Evins, 52.
From at least 2016 through 2021, Michael Evins and Samaria Evins took steps to defraud the DPW. First, Samaria Evins and other co-conspirators created and operated straw companies to bid on DPW work. Second, Michael Evins designated and approved DPW work to be performed by these straw companies using his position at DPW, circumventing Virginia law and City of Richmond rules against self-dealing by public employees. In some instances, the work to be performed was completely fabricated and no such work was ever needed. In other instances, the work was actually performed by DPW employees, not by contracted vendors. Sometimes, Samaria Evins and other co-conspirators subcontracted the work out for profit upon winning the DPW work. Third, where procurement amounts exceeded $5,000, a DPW approval threshold requiring that work be competitively bid, Michael Evins and his co-conspirators manufactured fictitious straw bids on behalf of competitor companies to engineer the preferred company winning the work. Finally, upon receiving DPW funds, Samaria Evins and other co-conspirators paid Michael Evins a portion of the proceeds.
As an example, in early 2019, DPW sought to have overgrown foliage at Parker Field, an area in Richmond, cleared in advance of Fourth of July celebrations that same year. Though Michael Evins knew mowing of the field was being performed by DPW employees, he nevertheless approved a requisition in the DPW purchase order system for a company owned by Samaria Evins to mow the entire area 16 times in four days, at a total cost of $4,800. In all, Michael Evins, Samaria Evins, and their co-conspirators fraudulently caused DPW to disburse at least $603,701 in funds to companies owned by Samaria Evins and her co-conspirators, causing approximately $226,767 in loss to DPW.Michael Evins is scheduled to be sentenced on November 7. He faces a maximum penalty of 20 years in prison. Samaria Evins is also scheduled to be sentenced on November 7. She faces a maximum penalty of 5 years in prison. Another co-conspirator, Shaun Lindsey, a senior administrative technician at DPW, previously pled guilty in the same scheme on May 9. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Stanley M. Meador, Special Agent in Charge of the FBI’s Richmond Field Office; and James Osuna, Inspector General, City of Richmond Office of the Inspector General, made the announcement after U.S. District Judge M. Hannah Lauck accepted the plea.
Assistant U.S. Attorney Avi Panth is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case Nos. 3:23-cr-81 and 3:23-cr-87.
Florida woman charged with defrauding elderly West Virginia manRead the Press Release
MARTINSBURG, WEST VIRGINIA – A Florida woman has been charged in a scheme to steal from an elderly West Virginia man who suffered from dementia.
Wendy Renee Bunner, age 47, of Spring Hill, Florida, was indicted today for money laundering and lying to a federal agent. Bunner is alleged to have aided and abetted her husband, Samuel Bunner, in obtaining a $280,318.73 cashier’s check from a United Bank account belonging to the victim in order to purchase real property in Charles Town, West Virginia. Wendy Bunner is also charged with lying to a federal agent about the sale of a condominium in Hawaii that once belonged to the victim.
Samuel Bunner was originally charged in May with wire fraud, bank fraud, identity theft, and money laundering. He is now joined by his wife in a superseding indictment which alleges that together they befriended the victim when all three were living in Charles Town. Samuel Bunner obtained a power of attorney from the victim and then he and Wendy Bunner used it to enrich themselves by selling the victim’s real estate, emptying his investment and bank accounts, and opening a credit card in his name, causing a total alleged loss to the victim of more than two million dollars.
The investigation was conducted by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation.
Assistant U.S. Attorney Eleanor Hurney is prosecuting the case on behalf of the government.
The Jefferson County Prosecutor’s Office, the U.S. Attorney’s Office in the Middle District of Florida and FBI-Tampa assisted with the matter.
An indictment is merely an allegation, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Five Sentenced to Prison on Federal Drug ChargesRead the Press Release
BENTON, Ill. – A U.S. District judge sentenced the final defendant of five total co-conspirators for his involvement in a large-scale methamphetamine operation in southern Illinois.
Robert Smith, 42, of Los Angeles, California, was sentenced to 27 years in federal prison. Smith pled guilty to one count of conspiracy to distribute methamphetamine and one count of conspiracy to launder money.
The case involved more than 100 pounds of methamphetamine distributed in the Southern District of Illinois.
Co-conspirator William Moore, 39, of East St. Louis, pled guilty to five counts of distributing methamphetamine, one count of attempted possession with the intent to distribute methamphetamine, one count of conspiracy to distribute methamphetamine, and one count of conspiracy to launder money. He received a 30-year federal prison sentence on April 20, 2022, and he will serve five years of supervised release.
Michael Huffman, 37, of Salem, Illinois, pled guilty to one count of distributing methamphetamine, one count of attempted possession with the intent to distribute methamphetamine, and one count of conspiracy to distribute methamphetamine. He received an 8-year federal prison sentence on Oct. 27, 2022, and he will serve three years of supervised release.
Stacey Barkley, 36 of Caseyville, Illinois, pled guilty to one count of conspiracy to distribute methamphetamine. She was sentenced to 87 months in federal prison on Sept. 15, 2021, and she will serve three years of supervised release.
Michael Greene, 54, of St. Louis, pled guilty to one count of possession with the intent to distribute methamphetamine and one count of conspiracy to distribute methamphetamine. He received a 25-month federal prison sentence on Feb. 9, 2023, and he will serve four years of supervised release.
“Trafficking dangerous and addictive drugs into and around southern Illinois will earn conspirators time in federal prison,” said U.S. Attorney Rachelle Aud Crowe. “Thanks to this collaborative effort by law enforcement, more criminals are behind bars.”
"Despite the attention given to fentanyl, methamphetamine remains the top drug seized by quantity in Southern Illinois and is still responsible for destroying many lives," said Special Agent in Charge Michael A. Davis, head of the Drug Enforcement Administration division that leads DEA investigations in Southern Illinois, as well as Missouri and Kansas. "DEA and our federal, state and local partners are dedicated to stopping drug distribution and money laundering operations like this one to protect our citizen's lives and health from the menace of illicit drugs."
“Whenever someone involved in drug trafficking is sentenced to prison, it’s a victory for local communities,” said Special Agent in Charge Thomas F. Murdock, IRS Criminal Investigation’s St. Louis Field Office. “Drug traffickers are in business to make money and they don’t care who they hurt to achieve that objective. The special agents of IRS-CI are proud to use their financial expertise to help find and disrupt drug trafficking networks and put a stop to the harm they do to communities.”
According to court documents, DEA agents investigated the defendants for distributing methamphetamine in St. Clair County from February to October 2019. In recorded buys, confidential sources purchased more than 750 grams of methamphetamine from Moore on five occasions at a restaurant in East St. Louis.
On July 9, 2019, Greene received more than 58 grams of methamphetamine from Moore with intent to distribute. On July 10, 2019, agents seized a package of 6,310 grams of methamphetamine before Huffman could retrieve at Moore’s request. On Aug. 19, 2019, agents arrested Barkley in possession of more than 100 grams of methamphetamine from Moore.
In court proceedings, Smith was held responsible for supplying more than 100 pounds of methamphetamine from California in the drug operation led by Moore. In furtherance of the financial crime conspiracy, Moore laundered drug proceeds for Smith to facilitate the trafficking operation.
DEA led the investigation with support from the IRS. Assistant U.S. Attorney Amanda Fischer prosecuted the case.
This case was part of an Organized Crime Drug Enforcement Task Forces 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.
Five Members of Drug Trafficking Organization Plead Guilty to Federal Drug CrimesRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Ricky Edward Hall, 29, of Covington, Oklahoma, Christopher Adam Banschbach, 37, an inmate at the Davis Correctional Facility in Holdenville, Oklahoma, Brittany Marie Cagle, 34, of Wagoner, Oklahoma, Christina Gail Pool, 42, of Muskogee, Oklahoma, and Joshua Levi Kendrick, 41, of Muskogee, Oklahoma, all entered guilty pleas in relation to drug trafficking methamphetamine in Eastern Oklahoma.
Banschbach entered a guilty plea to one count of Drug Conspiracy on July 13, 2023.
Kendrick entered a guilty plea to one count of Drug Conspiracy and one count of Possession with Intent to Distribute Methamphetamine on July 10, 2023.
Hall entered a guilty plea to one count of Drug Conspiracy and one count of Possession with Intent to Distribute Methamphetamine on June 28, 2023.
Pool entered a guilty plea to one count of Drug Conspiracy and one count of Possession with Intent to Distribute Methamphetamine on May 16, 2023.
Cagle entered a guilty plea to one count of Drug Conspiracy and one count of Possession with Intent to Distribute Methamphetamine on May 4, 2023.
The indictment alleged that from March of 2022 until November of 2022, Hall, Banschbach, Cagle, Pool, and Kendrick actively participated in a drug trafficking organization partially comprised of members and affiliates of the Universal Aryan Brotherhood, a prison gang. The defendants conspired to distribute methamphetamine in the Eastern District of Oklahoma and elsewhere. During the conspiracy, Banschbach was an inmate at the Davis Correctional Facility in Holdenville, Oklahoma.
The charges arose from an investigation by the Muskogee Police Department, the Tulsa County Sheriff’s Department, and the Oklahoma Bureau of Narcotics.
The Honorable Gerald L. Jackson, U.S. Magistrate Judge in the United States District Court for the Eastern District of Oklahoma in Muskogee, accepted the pleas and ordered the completion of presentence investigation reports. Hall, Banschbach, Cagle, Pool, and Kendrick will remain in custody of the U.S. Marshal pending sentencing.
Assistant United States Attorney Zachary W. Parsons and Assistant United States Attorney Ryan E. Bondura represented the United States.
Five Individuals Charged in Multi-State COVID-19 Relief Program Fraud SchemeRead the Press Release
riveraetal.complaint.pdfCAMDEN, N.J. – Five individuals were charged for their roles in fraudulently obtaining federal Paycheck Protection Program (PPP) loans and Economic Injury Disaster Loans (EIDL) and for laundering the loan proceeds, U.S. Attorney Philip R. Sellinger announced today. Two other individuals pleaded guilty to fraudulently obtaining PPP and EIDL loans.
Eric Rivera, 43, of Norcross, Georgia, is charged by complaint with one count of conspiracy to commit bank fraud, one count of conspiracy to commit wire fraud, and one count of conspiracy to commit money laundering. He made is initial appearance in federal court in the Northern District of Georgia and was released on $10,000 unsecured bond. Lisa Smith, 60, of Cornelius, North Carolina, and Sieff Robert Sargeant, 43, of Island Park, New York, are charged by complaint with one count of conspiracy to commit bank fraud and one count of conspiracy to commit money laundering. Smith had her initial appearance in the Western District of North Carolina and was released on $25,000 unsecured bond. Sargeant is scheduled to make his initial appearance today before Magistrate Judge Ann Marie Donio in Camden federal court.
Adrienne Ponzo, 48, of Bear, Delaware, is charged by complaint with one count of conspiracy to commit wire fraud, and remains at-large. James Wessels, 53, of Middletown, Delaware, is charged by complaint with one count of conspiracy to commit money laundering. He made his initial appearance before Judge Donio and was released on $100,000 unsecured bond.
According to the criminal complaints:
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted in March 2020 and was 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 hundreds of billions of dollars in forgivable loans to small businesses for job retention and certain other expenses, through a program referred to as the Paycheck Protection Program (PPP). The CARES Act also authorized the Small Business Administration to provide Economic Injury Disaster Loans (EIDLs) of up to $2 million to eligible small businesses that were experiencing substantial financial disruption due to the COVID-19 pandemic.
To obtain a PPP or EIDL loan, a qualifying small business was required to apply and provide information on its operations, including the number of employees and expenses. In addition, businesses generally had to provide supporting documentation.
According to documents filed in these cases and statements made in court:
In one conspiracy, Rivera conspired with Smith, Sargeant, and others to defraud the PPP loan program. Rivera recruited individuals – including Sargeant – who owned businesses with minimal operations, employees, revenues, and profits, and introduced them to Smith. Smith prepared fraudulent PPP applications for these businesses and created false tax returns that were created solely for purposes of applying for the PPP and EIDL loans and were never submitted to the IRS. The applicants, including Sargeant, electronically signed the applications, which were then submitted to lenders. Rivera received payments of 15 to 50 percent of the loan proceeds for his role in orchestrating this scheme.
In the second conspiracy, Rivera conspired with Ponzo and others to defraud the EIDL loan program. He recruited individuals who owned businesses with minimal operations, employees, revenues, and profits and introduced them to Ponzo, who prepared fraudulent EIDL applications for these businesses and caused them to be electronically submitted to the Small Business Administration. Rivera received payments of 15 to 50 percent of the loan proceeds for his role in orchestrating this scheme.
In the third conspiracy, Rivera conspired with Smith, Wessels, and Sargeant to structure the PPP loan proceeds and paperwork to conceal that the proceeds actually were being spent on non-payroll expenses. Rivera and Smith introduced Sargeant to Wessels, who created fake payroll checks and provided them to Sargeant. Sargeant distributed the fake payroll checks to friends and family members, who cashed the checks and returned the majority of the cash to Sargeant. Smith then used the fake payroll documentation to submit a loan forgiveness application for Sargeant’s business that falsely stated that Sargeant spent 66 percent of the loan amount on payroll expenses.
The counts of conspiracy to commit bank fraud are each punishable by a maximum of 30 years in prison and a $1 million fine. The counts of conspiracy to commit wire fraud are each punishable by a maximum of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greatest. The count of conspiracy to commit money laundering is punishable by a maximum of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greatest.
Earlier this month, Yasha Barjona, 67, and William Ingram, 43, each pleaded guilty before U.S. District Judge Karen Williams to one count of bank fraud conspiracy.
According to documents filed in these cases and statements made in court:
Ingram and Barjona owned businesses with minimal operations, employees, revenues, and profits. Rivera introduced Ingram and Barjona to Ponzo and Smith. Ponzo prepared fraudulent EIDL applications for Ingram’s and Barjona’s businesses and Smith prepared fraudulent PPP applications for Ingram’s and Barjona’s businesses. Ingram and Barjona electronically signed and submitted these applications, which contained materially false and fraudulent information about the businesses and included false tax returns that were created solely for purposes of applying for the PPP and EIDL loans and were never submitted to the IRS. Ponzo and Smith also prepared fraudulent EIDL and PPP applications for businesses controlled by associates of Barjona.
Barjona and his associates received approximately $724,300 in PPP and EIDL proceeds and paid kickbacks to Rivera of approximately 50 percent of the loan amounts. Ingram received approximately $551,600 in PPP and EIDL proceeds and paid kickbacks to Rivera of approximately 15 percent of the loan amounts. After Ingram received the PPP loans, Rivera and Smith introduced Ingram to Wessels, who prepared fake payroll documents to conceal that the proceeds were being spent on non-payroll expenses. Sentencing for Ingram’s sentencing is scheduled for Nov. 7, 2023, and for Barjona, Nov. 15, 2023.
U.S. Attorney Sellinger credited special agents of the Federal Deposit Insurance Corporation – Office of the Inspector General, under the direction of Patricia Tarasca, Special Agent-in-Charge, New York Regional Office; special agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge Jacqueline Maguire in Philadelphia; special agents of the Social Security Administration, Office of the Inspector General, New York Field Division, under the direction of Special Agent in Charge Sharon MacDermott; and special agents of the U.S. Department of Labor, Office of the Inspector General, Northeast Region, under the direction of Special Agent in Charge Jonathan Mellone, with the investigation leading to the charges and guilty pleas.
The government is represented by Assistant U.S. Attorney Daniel A. Friedman and Attorney-in-Charge Jason M. Richardson of the U.S. Attorney’s Office’s Criminal Division in Camden.
The charges and allegations contained in the complaints are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
barjona.information.pdf riveraetal.complaint.pdf
ingram.information.pdfFirearms Trafficker from Chicago Suburb Sentenced to Four Years in Federal PrisonRead the Press Release
CHICAGO — A suburban Chicago man has been sentenced to four years in federal prison for assisting in the illegal sales of two firearms.
JEFFREY GREER, 57, of North Aurora, Ill., assisted a relative in selling a shotgun and a revolver to an individual in the fall of 2019. Unbeknownst to Greer, the buyer was cooperating with law enforcement. Greer helped negotiate the terms of the deal during a meeting in his relative’s home in North Aurora, Ill., and then transported the guns to the cooperating individual’s truck.
Greer pleaded guilty earlier this year to a federal charge of dealing firearms without a license. U.S. District Judge Sara L. Ellis imposed the sentence after a hearing July 13, 2023, in federal court in Chicago.
The sentence was announced by Morris Pasqual, Acting United States Attorney for the Northern District of Illinois; and Robert W. “Wes” Wheeler, Jr., Special Agent-in-Charge of the Chicago Field Office of the FBI. The U.S. Bureau of Alcohol, Tobacco, Firearms & Explosives and the Addison, Ill., Police Department provided valuable assistance. The government was represented by Assistant U.S. Attorney Patrick Mott.
Disrupting illegal firearms trafficking is a centerpiece of the Chicago Firearms Trafficking Strike Force, the Department of Justice’s cross-jurisdictional strike force aimed at reducing gun violence. As part of the Chicago Strike Force, the U.S. Attorney’s Office collaborates with FBI, ATF, and other federal, state, and local law enforcement partners in the Northern District of Illinois and across the country to help stem the supply of illegally trafficked firearms and identify patterns, leads, and potential suspects in violent gun crimes.
Holding illegal firearm dealers accountable through federal prosecution is also a centerpiece of Project Safe Neighborhoods, the Department of Justice’s violent crime reduction strategy. In the Northern District of Illinois, the U.S. Attorney’s Office has deployed the PSN program to attack a broad range of violent crime issues facing the district, particularly firearm offenses.
Final Defendant Sentenced to 51 Months in Federal Prison for a Racketeering Conspiracy to Smuggle Contraband into the Chesapeake Detention FacilityRead the Press Release
Baltimore, Maryland – U.S. District Judge George L. Russell, III, sentenced Bernard Bay, age 53, of Baltimore, to 51 months in federal prison, followed by three years of supervised release, for a racketeering conspiracy at the Chesapeake Detention Facility (CDF), in Baltimore, Maryland. Judge Russell ordered that Bey’s federal sentence be served consecutive to the 10 year sentence that Bey is currently serving for possession of a stolen firearm. Bey, who was a leader in the conspiracy, is the final defendant in the conspiracy to be sentenced. Three former correctional officers (COs), three other detainees, and two outside “facilitators” pleaded guilty or were convicted after trial for their roles in the conspiracy, which involved paying bribes to correctional officers to smuggle contraband, including narcotics, tobacco, and cell phones, into the prison. Bey’s co-defendants were sentenced to between 18 and 51 months in federal prison.
The sentence was announced by United States Attorney for the District of Maryland Erek L. Barron; Special Agent in Charge Thomas J. Sobocinski of the Federal Bureau of Investigation, Baltimore Field Office; and Secretary Carolyn J. Scruggs of the Maryland Department of Public Safety and Correctional Services.
According to court documents and the evidence presented at trial, CDF is run by the Maryland Department of Public Safety and Correctional Services (DPSCS) pursuant to a contract with the United States Marshals Service (USMS) and is used for the housing of federal pretrial detainees.
According to his plea agreement, from at least 2018 through June 2020, Bey conspired with other detainees, employees and associates of CDF to smuggle contraband into CDF, including narcotics, cell phones, and tobacco, in exchange for bribe payments. Bey had a romantic relationship with CO Talaia Youngblood and she met with outside facilitators at Bey’s direction to receive contraband and bribe payments, as well as the cellular telephone that she used to communicate with Bey. For example, in March 2020 Bey sent a note to CO Youngblood telling her that an outside facilitator would be providing her with marijuana and CDs and DVDs to smuggle into CDF. Bey also told Youngblood to contact a second outside facilitator, whom Bey called “Fatman,” so that Fatman could provide her with a pair of designer sunglasses as a bribe.
As detailed in his plea agreement, during the Spring of 2020, Bey made a $500 bribe payment to another CO through an outside facilitator after CO Youngblood stopped showing up to work. In August 2018, Bey paid a bribe to a third CO, Andre Davis, who then smuggled a smart watch and a package containing tobacco into CDF for Bey.
United States Attorney Erek L. Barron commended the FBI and DPSCS for their work in the investigation. Mr. Barron thanked Assistant U.S. Attorneys Peter J. Martinez and Robert I. Goldaris, who prosecuted the case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.
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Federal Jury Convicts Adair County Resident of Four Counts of Aggravated Sexual AbuseRead the Press Release
MUSKOGEE, OKLAHOMA - The United States Attorney’s Office for the Eastern District of Oklahoma announced that Daniel Wayne Bayless, age 26, of Adair County, Oklahoma, was found guilty by a federal jury of four counts of Aggravated Sexual Abuse in Indian Country.
The jury trial began with testimony on July17, 2023, and concluded on July 18, 2023, with the guilty verdicts.
During the trial, the United States presented evidence that in 2020 Bayless sexually assaulted a minor victim under the age of 12 on multiple occasions. The Government also presented evidence Bayless victimized another child ten years prior. The crimes occurred in Adair County, within the boundaries of the Cherokee Nation Reservation of Oklahoma, in the Eastern District of Oklahoma.
The guilty verdicts were the result of investigations by the Adair County Sheriff’s Office and the Federal Bureau of Investigation.
The Honorable Ronald A. White, Chief Judge in the United States District Court for the Eastern District of Oklahoma, presided over the trial in Muskogee and ordered the completion of a presentence report. The sentencing will be scheduled following completion of the report. Bayless will remain in custody of the United States Marshal until sentencing.
Assistant United States Attorneys Nicole Paladino and Morgan Muzljakovich represented the United States.
Federal Grand Jury Returns Charges for Covid-19 FraudRead the Press Release
DENVER – The U.S. Attorney’s Office for the District of Colorado announces Ikponmwosa Pero Erhinmwinrose has been indicted by a federal grand jury on charges of conspiracy to commit wire fraud, conspiracy to commit money laundering, wire fraud, and aggravated identity theft. The defendant made his initial appearance in front of U.S. District Court Magistrate Judge N. Reid Neureiter on July 17, 2023. Three other defendants—Victor Henshaw Tobore, Nyerhovwo Presley Agbure, and Oreoluwa Abdul-Jabbar Elegba—were indicted in the same case and made their initial appearances in federal court earlier in July 2023.
According to the information contained in the indictment, Erhinmwinrose and his co-conspirators—referred to as the Fraud Ring—fraudulently obtained more than $7,700,000 in loans and grants under names other than their own from programs authorized by Congress in the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The CARES Act was intended to provide emergency financial assistance for millions of American small businesses suffering economic harm caused by the COVID-19 pandemic. These programs included the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) program. The United States Small Business Administration (SBA) directly paid EIDLs and grants (EIDGs) to eligible small businesses experiencing substantial financial disruptions from the COVID-19 pandemic. PPP loan applications were processed by participating lenders. Lenders funded PPP loans using their own funds, which were guaranteed by the SBA.
The alleged conspiracy involved Erhinmwinrose and other Fraud Ring participants—using the names and identifying information of others—registering fraudulent corporate entities with state governments, obtaining fraudulent employer tax identification numbers from the Internal Revenue Service (IRS), creating fraudulent bank accounts at financial institutions, falsifying payroll and employment data, and fabricating tax and bank documents. These actions were taken to mislead lenders so that Fraud Ring participants could then fraudulently obtain loans and grants while hiding their own involvement in the conspiracy and scheme to defraud. After PPP and EIDL fraud funds—as well as fraudulently obtained federal tax refunds from the IRS and benefits from unemployment programs run by states including Colorado, Illinois, New Jersey, New York, and Ohio—were deposited in fraudulent bank accounts, the indictment further alleges that Fraud Ring participants conspired to launder the money.
This case is being investigated by the Treasury Inspector General for Tax Administration; the SBA Office of the Inspector General, the Federal Deposit Insurance Corporation Office of the Inspector General, and the U.S. Postal Inspection Service. This case is being prosecuted by Assistant United States Attorney Craig Fansler.
The charges contained in the indictment are allegations and the defendants are presumed innocent unless and until proven guilty.
CASE NUMBER: 23-cr-00300-CNS
Executive Pastor Sentenced for Stealing Approximately $130,000 from Journey Baptist Church in BarringtonRead the Press Release
CONCORD – A Barrington man was sentenced in federal court for defrauding the church where he worked, Journey Baptist Church in Barrington, out of approximately $130,000, U.S. Attorney Jane E. Young announces.
Gregory Neal of Barrington, age 45, was sentenced by U.S. District Court Judge Samantha Elliott to 18 months in prison and 2 years of supervised release. Neal was also ordered to pay $129,960.13 in restitution to the victims of the fraud, including the church and the insurance company that covered a portion of the losses incurred by the fraudulent activity. On April 12, 2023, Neal pleaded guilty to a one-count information charging him with wire fraud.
“Today, a man who abused his position of trust- as a leader of his church- and stole from his congregation to support his gambling habit has been brought to justice,” United States Attorney Jane Young stated. “Criminals like the defendant who defraud organizations and public institutions in our community will be prosecuted by this office to the full extent of the law.”
Between January 2017 to March 2020, as the Executive Pastor of the Journey Baptist Church, Neal made unauthorized withdrawals of the church’s funds to pay off his gambling debts. He also made unauthorized purchases with the church’s credit cards for his own benefit, including items from various vendors and retail stores. These unauthorized transactions amounted to $129,960.13.
The United States Secret Service led the investigation. Assistant U.S. Attorney Aaron Gingrande prosecuted the case.
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Ex Funcionario Venezolano Hugo Armando Carvajal Barrios Extraditado A Estados Unidos Acusado Por Narcoterrorismo, Armas Y NarcotráficoRead the Press Release
Damian Williams, Fiscal Federal para el Distrito Sur de Nueva York, y Anne Milgram, Administradora de la Drug Enforcement Administration («DEA») de Estados Unidos, anunciaron que al ex funcionario de gobierno de Venezuela HUGO ARMANDO CARVAJAL BARRIOS, alias «El Pollo», se le extraditó hoy de España a Estados Unidos bajo Acusación Formal, radicada en el Distrito Sur de Nueva York, que le imputa a CARVAJAL BARRIOS concierto para delinquir con actos de narcoterrorismo e importación de cocaína a Estados Unidos, y cargos afines por armas. CARVAJAL BARRIOS comparecerá mañana ante el Juez de Instrucción Stewart D. Aaron. A CARVAJAL BARRIOS lo arrestaron en España el 9 de septiembre de 2021.
El Fiscal Federal Damian Williams declaró: «Después de muchos años de prófugo que le siguieron a una carrera de diez años en el mundo criminal, Hugo Armando Carvajal llegó hoy a Estados Unidos a enfrentar justicia por los crímenes que se alega cometió, los cuales se cometieron con intención de ‘inundar’ Estados Unidos con toneladas de drogas potencialmente mortíferas. Según se alega, Carvajal Barrios explotó su autoridad como director de la agencia de inteligencia militar de Venezuela para corromper instituciones venezolanas, abusar del pueblo venezolano e importar veneno a Estados Unidos. El papel de mando que se le atribuye en el Cártel de Los Soles le infirió angustia y sufrimiento incomensurables a muchos venezolanos, estadounidenses y otros que se vieron afectados por la violencia y actividades de narcotráfico del cártel. Mis encomios para los fiscales de este despacho y nuestros aliados en las agencias del orden público por su incansable labor en este caso importante».
La Administradora de la DEA Anne Milgram declaró: «A los funcionarios corruptos como Carvajal, de quienes se alega que se valen de su puesto para aceptar sobornos e impulsar actividades de narcotráfico, se les debe aplicar toda la fuerza de la ley. Según se alega, Carvajal abandonó su responsabilidad para con el pueblo venezolano y explotó su puesto para beneficio personal. La DEA y nuestros aliados estamos unidos para traer ante la justicia a cualquier persona, irrespectivamente de su puesto, que pone en peligro la seguridad y salud del pueblo de Estados Unidos».
Según los alegatos plasmados en las Acusaciones Formales, otros radicados y declaraciones vertidas durante trámites judiciales:1
A partir de 1999 sino antes, CARVAJAL BARRIOS, ciudadano venezolano y ex director de la agencia de inteligencia militar de Venezuela, llamada la Dirección de Inteligencia Militar («DIM»), junto a otros funcionarios venezolanos de alto rango, obraron en calidad de cabecillas y gerentes del Cártel de Los Soles, nombre que alude a los emblemas del sol que adornan los uniformes de oficiales militares venezolanos de alto rango. CARVAJAL BARRIOS y otros miembros del cártel abusaron del pueblo venezolano y corrompieron las instituciones legítimas de Venezuela — entre ellas sectores del ejército, el aparato de inteligencia, la legislatura y el sistema judicial — para facilitar la importación de toneladas de cocaína a Estados Unidos. El Cártel de Los Soles procuró no solo enriquecer a sus miembros y acrecentarles el poder sino también ‘inundar” Estados Unidos con cocaína para inferirle los efectos dañinos y adictivos a los consumidores en Estados Unidos. Para lograr estas metas, los cabecillas del Cártel de Los Soles se mancomunaron con altos mandos de las Fuerzas Armadas Revolucionarias de Colombia (FARC), que controlaba la producción de cocaína en extensas regiones de Colombia y Venezuela.
CARVAJAL BARRIOS ostentó varios puestos de alta responsabilidad pública en Venezuela que explotó para beneficio del Cártel de Los Soles, incluido el de director de DIM entre 2004 y 2011, aproximadamente. CARVAJAL BARRIOS aprovechó ese puesto para traficar ilegalmente con sustancias narcóticas y proteger a sus socios narcotraficantes, las FARC. En 2006 aproximadamente, por ejemplo, CARVAJAL BARRIOS coordinó con otros miembros del Cártel de Los Soles para enviar una carga de 5,6 toneladas de cocaína desde Venezuela abordo de un jet privado con registro en Estados Unidos. El jet salió de Venezuela y aterrizó en México, donde las autoridades mexicanas se incautaron de las 5,6 toneladas de cocaína en el momento de su llegada. En 2008 aproximadamente, CARVAJAL BARRIOS asistió a una reunión con un representante de las FARC en la cual se acordó que el Cártel de Los Soles le daría efectivo y armas a las FARC a cambio de un alza en la producción de cocaína.
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A CARVAJAL BARRIOS, de 63 años y ciudadano venezolano, se le acusa de: (i) participar en concierto para delinquir con narcoterrorismo, que conlleva sentencia mínima compulsoria de 20 años de prisión y máxima de cadena perpetua; (ii) concierto para delinquir importando cocaína a Estados Unidos, que conlleva sentencia mínima compulsoria de 10 años de prisión y máxima de cadena perpetua; (iii) usar, portar y poseer ametralladoras y artilugios destructivos vinculados al narcoterrorismo y a un concierto para delinquir con la importación de cocaína, que conlleva sentencia mínima compulsoria de 30 años de prisión y máxima de cadena perpetua; y (iv) concierto para delinquir usando, portando y poseyendo ametralladoras y artilugios destructivos vinculados al narcoterrorismo y a un concierto para delinquir con la importación de cocaína, que conlleva sentencia máxima de cadena perpetua.
Las sentencias compulsorias mínimas y máximas en el caso presente están establecidas por el Congreso, y se incluyen aquí para fines informativos únicamente, puesto que la sentencia de todo acusado la determina el juez.
El Sr. Williams elogió los esfuerzos notables de la Unidad de Investigaciones Bilaterales de la División de Operaciones Especiales de la DEA, División de Campo de Miami, y el Despacho de Ultramar Madrid; las investigaciones del Departamento de Seguridad Interior; el Despacho de Control de Activos Extranjeros del Departamento del Tesoro de E.U.A.; la Sección Contraterrorismo, División de Seguridad Nacional del Departamento de Justicia; y la Fiscalía Federal para el Distrito Sur de la Florida. El Despacho de Asuntos Internacionales del Departamento de Justicia y la Embajada de EUA en Madrid trabajaron con aliados de las agencias del orden público en España, incluidas la Policía Nacional de España, el Despacho de la Fiscalía Especial Antidroga de España, el Ministerio de Justicia de España, y el Ministerio del Interior de España, para garantizar el arresto y la extradición de CARVAJAL BARRIOS.
Esta causa judicial está asentada en la Unidad de Seguridad Nacional y Narcotráfico Internacional del ya citado Despacho. Los Fiscales Federales Auxiliares Jason A. Richman, Kaylan E. Lasky y Kyle A. Wirshba llevarán el caso con la asistencia del Abogado Litigador Kevin C. Nunnally de la Sección Contraterrorismo.
Las acusaciones contenidas en las Acusaciones Formales son sencillamente acusaciones, y se presume del acusado que es inocente a no ser, y hasta que, se demuestre que es culpable.
1 Conforme el significado de la frase preliminar, el texto entero de las Acusaciones Formales y descripciones de las mismas aquí contenidas constituyen solamente alegatos, y todo acto descrito debo tratarse como alegato.
U.S. v. Carvajal Barrios Acusaciones FormalesErie Resident Indicted on Sex Trafficking ChargesRead the Press Release
ERIE, Pa. - A resident of Erie, Pennsylvania has been indicted by a federal grand jury in Erie on a charge of sex trafficking of a child and attempted sex trafficking of a child, United States Attorney Eric G. Olshan announced today.
The one-count Indictment named Ali Matthew McCoy, 20, 615 Payne Avenue, 1st Floor, Erie, Pennsylvania, as the sole defendant.
According to the Indictment presented to the court, from May 2022 through July 2022, McCoy is alleged to have sex trafficked and attempted to sex traffic a child.
The law provides for a maximum total sentence of life in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation and the Millcreek Police Department conducted the investigation leading to the Indictment in this 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 (CEOS), 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.justice.gov/psc.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
- Driver indicted for possession of a machinegun
Downtown Los Angeles ‘SIM Swapper’ Pleads Guilty to Hacking into Instagram Users’ Accounts to Fraudulently Obtain MoneyRead the Press Release
LOS ANGELES – A Downtown Los Angeles man pleaded guilty today to three felony charges, including that he defrauded victims, one of them a social media influencer, by engaging in “SIM swapping” to hijack their Instagram accounts to unlawfully obtain money.
Amir Hossein Golshan, 24, pleaded guilty to one count of unauthorized access to a protected computer to obtain information, one count of wire fraud, and one count of accessing a computer to defraud and obtain value.
Golshan has been in federal custody since last month after he was found to have violated the terms of his pretrial release.
According to his plea agreement, from at least April 2019 to February 2023, Golshan knowingly executed multiple online schemes to defraud hundreds of victims through various online scams and unauthorized intrusions into victims’ digital accounts, including social media account takeovers, Zelle payment fraud, and impersonating Apple support. In total, Golshan’s entire scheme caused approximately $740,000 in losses to hundreds of victims over several years.
SIM swapping and social media account takeovers
“SIM swapping” is the process of fraudulently inducing a carrier to reassign a cell phone number from the legitimate subscriber’s SIM card to a SIM card controlled by another without the legitimate subscriber’s authorization. This allows the fraudster to take control of the victim’s various accounts through two-step authentication text messages sent to a victim’s cell phone.
Golshan’s SIM swapping and social media account takeovers targeted both the account owners and their online friends, duping them into sending him money.
For example, in December 2021, a Los Angeles-based model and influencer with more than 100,000 followers on social media, received a direct message on Instagram from her friend’s account, stating, “Can you do me a favor? What’s your number?” The victim provided her phone number to the person whom she believed was her friend, but who really was Golshan.
Golshan then logged into the victim’s Instagram account without authorization, impersonated the victim to her friends, and requested the victim’s friends send him money through Zelle, PayPal, and other online payment platforms. Several of the victim’s friends sent Golshan money, totaling thousands of dollars, believing they were sending money to the victim.
During the time that Golshan locked the victim out of her accounts, he sent her messages demanding $2,000 for the return of her accounts and threatening to delete her accounts if she did not pay him.
Golshan further admitted to SIM swapping two additional victims in January 2022. For one of these victims, Golshan fraudulently caused the victim’s cell phone number to be SIM swapped to a new cell phone that he controlled. Golshan then reset the passwords to the victim’s social media accounts which allowed him to gain access to the victim’s accounts. He then accessed the victim’s social media accounts – which had her personal photos and videos saved on them. Golshan contacted the victim and demanded that she pay him $5,000 or else he would post her personal videos online.
Zelle merchant fraud
Golshan also fraudulently advertised fake and non-existent Instagram services to individual victims for several hundred dollars each. In August 2019, for example, Golshan falsely represented on Instagram that he could provide a verified Instagram badge for one victim’s teenage daughter in exchange for $300. Golshan knew this statement was false and that only Instagram could provide such a badge. Nevertheless, Golshan induced the victim to send an electronic payment of $300 to him, which he deposited in his bank account.
During Golshan’s SIM swapping and Zelle fraud schemes, Golshan fraudulently received approximately $82,000 in payments from approximately 500 victims, usually in increments of $300 to $500 per victim.
Apple Support fraud and NFT/cryptocurrency theft
Golshan also started to impersonate Apple Support personnel to gain unauthorized access to several victims’ Apple iCloud accounts to steal NFTs, cryptocurrency, and other valuable digital property. Through this conduct, Golshan defrauded five victims of amounts between $2,000 and $389,000 each.
For example, in August 2022, Golshan called a victim from Apple Support’s official telephone number and pretended to be an Apple Support employee. Golshan told the victim that Apple Support wanted to give the victim an advanced security protocol to protect the victim’s iCloud account. Golshan then caused a two-step authentication code to be sent to the victim’s phone.
Through these misrepresentations, Golshan fraudulently induced the victim to tell him this six-digit security code, which allowed Golshan to gain access to the victim’s iCloud account. Golshan then changed the email address on the victim’s iCloud account to an email address that he controlled. Golshan then stole valuable digital property from the victim, including an NFT valued at approximately $319,000 and approximately $70,000 worth of cryptocurrency. Later that same day, defendant sold the stolen NFT for $130,000 in cryptocurrency on a NFT marketplace.
United States District Judge Otis D. Wright II scheduled a November 27 sentencing hearing, at which time Golshan will face a statutory maximum sentence of 20 years in federal prison for the wire fraud count, and up to five years in federal prison for each of the computer access counts.
The FBI investigated this matter.
Assistant United States Attorney Andrew M. Roach of the Cyber and Intellectual Property Crimes Section is prosecuting this case.
Derby Man Charged with Distributing MethRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, and Robert Fuller, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that ANDRE MESSAM, 46, of Derby, was arrested today on a federal criminal complaint charging him with possession with intent to distribute, and distribution of, 50 grams or more of methamphetamine.
As alleged in the complaint, on May 10, 2023, the FBI’s Transnational Organized Crime Task Force conducted a controlled purchase of approximately 55 grams of methamphetamine from Messam. Laboratory analysis of the methamphetamine determined that it was 100 percent pure.
This morning, Messam fled from law enforcement officers who attempted to stop his car in North Haven. He was located and arrested at a rental car agency on the Berlin Turnpike in Newington. Messam possessed approximately $7,200 in cash at the time of his arrest.
Following his arrest, Messam appeared before U.S. Magistrate Judge Maria E. Garcia in New Haven and was ordered detained.
If convicted of the charge in the complaint, Messam faces a mandatory minimum term of imprisonment of 10 years and a maximum term of imprisonment of life.
U.S. Attorney Avery stressed that a criminal complaint is not evidence of guilt. Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This investigation is being conducted by the FBI’s Transnational Organized Crime Task Force, which includes members from the Internal Revenue Service – Criminal Investigation Division, and the Brookfield and New Milford Police Departments. The case is being prosecuted by Assistant U.S. Attorney Nathaniel J. Gentile.
Dark Web Drug Trafficker Pleads Guilty to Charges Arising out of a Clandestine Drug Lab in a Detroit ResidenceRead the Press Release
DETROIT – Carolyn Hernandez-Taylor pleaded guilty today to conspiring to distribute millions of illicit and counterfeit pills, United States Attorney Dawn N. Ison announced.
Ison was joined in the announcement by Special Agent in Charge Angie M. Salazar, Homeland Security Investigations (HSI), Detroit, and Special Agent in Charge Orville Greene, Drug Enforcement Administration, Detroit Field Division.
Carolyn Hernandez-Taylor, 29, of Detroit, admitted her involvement in a conspiracy to distribute illicit substances, a conspiracy to launder monetary instruments, and distribution of counterfeit pills before United States District Judge Linda V. Parker.
According to court records, investigators identified a dark web marketplace that went by the name “opiateconnect.” Over a months-long investigation, investigators worked to locate the distribution hub for illicit drugs including cocaine and counterfeit drugs. The counterfeit drugs, made to look like alprazolam, were in fact uncontrolled research chemicals not scheduled for human consumption.
Investigators determined that “opiateconnect” was operated from a residence in Detroit, Michigan. A subsequent search warrant revealed a clandestine drug lab. The search resulted in the seizure of approximately $1,000,000 in cryptocurrency, more than $300,000 in U.S. currency, multiple firearms, an industrial size pill press, industrial mixer, and controlled substances including cocaine and counterfeit drugs.
Hernandez-Taylor pleaded guilty pursuant to a plea agreement to three counts: (1) conspiracy to possess with intent to distribute a controlled substance, which carries a statutory mandatory minimum sentence of 5 years and a maximum of 40 years; (2) conspiracy to launder monetary instruments, which carries a maximum sentence of 20 years; and (3) dispensing a counterfeit drug, which carries a maximum sentence of 10 years.
“Counterfeit pills pose a unique danger to this community, especially ones that have the appearance of a drug that is so regularly prescribed, stated U.S. Attorney Dawn Ison. “We will continue to investigate and aggressively prosecute instances where those counterfeit pills are manufactured illegally and distributed in our district to keep our community safe.”
“Drug traffickers will go to any length to sell their poison,” said HSI Detroit Special Agent in Charge Angie M. Salazar. “As their efforts evolve so do ours. The best way that we as law enforcement professionals can continue to dismantle drug trafficking organizations is by working together at the federal, state and local level. I’m incredibly proud of the work of our HSI agents, partners and all the members of the Detroit Dark Web Task Force for their commitment to bring offenders to justice.”
“The DEA, in collaboration with HSI, continues our commitment to safeguard communities from individuals who sell fake pills and other illicit substances. This case proves that there is no place to hide in the dark web when it comes to law enforcement’s efforts to protect the people we serve,” said Special Agent in Charge Greene.
The investigation was conducted by the Detroit Dark Web Task Force, which consists of HSI, Postal Inspection Service Office of the Inspector General (USPIS-OIG), Secret Service (USSS), Internal Revenue Service-Criminal Investigation (IRS-CI), Michigan State Police (MSP), and Customs and Border Protection (CBP). The task force investigates criminal organizations, including drug vendors, that operate within dark web marketplaces. The task force has disrupted and dismantled numerous drug trafficking organizations through criminal arrests and the seizure of proceeds from criminal activity.
This case is being prosecuted by Assistant U.S. Attorneys Robert Jerome White and John N. O’Brien.
Convicted Ponzi Schemer, Four Other Men, Charged with Multimillion-Dollar Fraud Scheme and Obstructing JusticeRead the Press Release
NEWARK, N.J. – A New Jersey man whose 24-year federal prison sentence was commuted after being twice convicted of defrauding investors of a total of $230 million was charged today with four other men for committing additional crimes, including conspiring to defraud investors of more than $35 million, and with conspiracy to obstruct justice, U.S. Attorney Philip R. Sellinger announced.
A criminal complaint was unsealed today charging each of the five defendants with one count of wire fraud conspiracy and one count of conspiracy to obstruct justice. The defendants are: Eliyahu “Eli” Weinstein, aka Mike Konig, 48, Aryeh “Ari” Bromberg, 49, and Joel Wittels, 57, all of Lakewood, New Jersey, along with Shlomo Erez, 55, a citizen and resident of Israel, and Alaa Hattab, 34, of Otttowa, Canada. The three defendants who were arrested are scheduled to make their initial appearances today before U.S. Magistrate Judge Tonianne Bongiovanni in Trenton federal court; Wittels and Hattab remain at large.
U.S. Attorney Philip R. Sellinger“As alleged in the complaint, Weinstein, along with four other individuals, has once again perpetrated a sophisticated fraud scheme causing losses of millions of dollars. He did so by using a fake name and falsely promising access to deals involving scarce medical supplies, baby formula, and first-aid kits supposedly destined for wartime Ukraine. These were brazen and sophisticated crimes that involved multiple conspirators and drew right from Weinstein’s playbook of fraud. No matter how many times someone attempts to prey on innocent investors, my office will dedicate whatever resources are necessary to root out and punish fraudsters.”
“We allege Mr. Weinstein took part in a new scheme to rip off investors by hiding his real identity,” Special in Charge James E. Dennehy of the Newark FBI said. “He was aware his actions were against the terms of his release on a previous investment fraud conviction, and we allege he engaged in criminal activity anyway. I want to commend everyone who worked on this investigation. Cases like this can be tedious, and at times very frustrating, but the investigative team does the work to prevent more people from being victimized and to ensure career criminals face the justice they deserve."
According to documents filed in this case and statements made in court:
Weinstein was convicted two times in New Jersey federal court for defrauding investors. His first case involved a real estate Ponzi scheme, and his second case stemmed from additional fraud Weinstein committed while on pretrial release. For these crimes, which resulted in combined losses to investors of approximately $230 million, Weinstein was sentenced to serve 24 years in prison, followed by three years of supervised release. On Jan. 19, 2021, after Weinstein had served less than eight years, the President of the United States at that time commuted Weinstein’s term to time served, leaving intact the rest of his sentence.
Soon after being released from prison, Weinstein began orchestrating a new scheme to solicit money from investors through a company called Optimus Investments Inc. (Optimus). Using the fake name “Mike Konig,” Weinstein ran Optimus with Bromberg and Wittels. They kept Weinstein’s true name and identity hidden because, as Weinstein acknowledged in a secretly recorded conversation, investors wouldn’t give them “a penny” if they learned of Weinstein’s involvement.
Weinstein, Bromberg, and Wittels received the bulk of investor money through a second company, Tryon Management Group LLC, which was owned and controlled by two other conspirators. Tryon promised these individual investors – consisting mostly of friends and family – lucrative opportunities to invest in deals involving COVID-19 masks, scarce baby formula, and first-aid kits supposedly bound for wartime Ukraine. Posing as Mike Konig, Weinstein provided the information for these supposed deals. Based on that information, investors gave money to Tryon, believing the deals were legitimate and not knowing about Weinstein’s involvement. In turn, Tryon transferred those funds to Weinstein, through Optimus.
In February 2022, almost immediately after Tryon and Optimus started receiving investor money, Tryon was unable to pay its investors. Rather than reveal this information to investors, Weinstein, Bromberg, and Wittels agreed with Tryon’s owners to pool money from existing investors of both Optimus and Tryon and use it to make monthly payments to other investors in a Ponzi-like fashion. Bromberg, Wittels, and the Tryon owners concealed this arrangement from investors by falsely telling investors that the payments derived from legitimate investment returns, not other investors’ money.
In late August 2022, Weinstein revealed his true identity to the Tryon owners, admitting in a secretly recorded meeting, “I am Eli Weinstein.” In another recorded August 2022 meeting, Weinstein admitted to misappropriating Tryon investor money and making various false statements about the purported Optimus deals. Weinstein acknowledged that he was conducting a Ponzi scheme, stating, “I finagled, and Ponzied, and lied to people to cover us.”
Erez claimed to be Weinstein’s attorney and helped conceal Weinstein’s true identity by, among other things, receiving and managing money on Weinstein’s behalf.. Hattab served as a broker for Optimus and helped conceal Weinstein’s involvement from investors and his business activities from the United States Probation Office.
Once the Tryon owners learned that Mike Konig was actually Weinstein, they agreed with the defendants to continue concealing Weinstein’s identity from investors and to raise additional money to pay off existing Tryon investors, all in an effort to stop the Ponzi scheme from falling apart and to cover up the fraud.
In addition to defrauding investors, the defendants also conspired to obstruct justice. They helped hide Weinstein’s assets that should have been used to pay over $200 million in restitution that he still owes his previous victims. The defendants also concealed Weinstein’s myriad business activities, which he was required to disclose to the court and which were expressly prohibited by the terms of his supervised release. In multiple secretly recorded conversations, Weinstein discussed his intent to conceal his various assets from the government. In one such conversation, Weinstein referenced hidden assets that he “can’t touch” while on supervised release because he’d otherwise “go to jail.” Weinstein then boasted, “I just told you something that no one in the world knows because I hid money. Get it?”
The wire fraud conspiracy charge is punishable by a maximum of 20 years in prison. The obstruction conspiracy charge is punishable by a maximum of five years in prison. Each count is also punishable by a maximum fine of either $250,000 or twice the gain or loss from the offense, whichever is greatest.
The U.S. Securities and Exchange Commission (SEC) also filed a civil complaint against Weinstein, Bromberg, Wittels, Hattab, and two other individuals based on the same and additional conduct.
U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge Dennehy, with the investigation leading to the charges in this case. He also expressed appreciation for the Securities and Exchange Commission, under the direction of Antonia Apps, Director of the SEC’s New York Regional Office.
The government is represented by Assistant U.S. Attorneys Jonathan Fayer and Emma Spiro of the Economic Crimes Unit in Newark.
The charges and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
weinstein_et_al_revised_remarks.pdf weinsteinetal.complaint.pdfConvicted Felon on Federal Supervised Release Is Sentenced to Prison for Illegal Gun PossessionRead the Press Release
CHARLOTTE, N.C. – Jermaine Whitaker, 44, of Charlotte, was sentenced today to 92 months in prison followed by three years of supervised release for illegal possession of a firearm, announced Dena J. King, U.S. Attorney for the Western District of North Carolina.
Bennie Mims, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division, and Chief Johnny Jennings of the Charlotte Mecklenburg Police Department (CMPD) join U.S. Attorney King in making today’s announcement.
According to court documents and today’s court proceedings, in 2015, Whitaker was convicted of drug and firearm offenses in the Western District of North Carolina and was ordered to serve 84 months in prison followed by a term of supervised release. In June 2021, CMPD officers executed an arrest warrant for the defendant for violating the terms of his supervised release. While executing the arrest warrant at a residence in Charlotte, CMPD officers located a loaded firearm and ammunition. Law enforcement determined that the firearm belonged to Whitaker and was reported stolen. Court records show that Whitaker paid $80 to purchase the firearm.
In announcing today’s sentence U.S. Attorney King said, “Whitaker violated federal gun laws that prohibit convicted felons from possessing firearms. He further broke the law by obtaining a stolen gun from an illegal source. We will continue to work with our law enforcement partners to remove illegal firearms from our communities and hold illegal gun possessors accountable for their actions,” said U.S. Attorney King.
“Possession of a firearm by a felon is illegal and jeopardizes the safety of the community,” said Special Agent in Charge Mims. “Recovering stolen firearms and keeping guns out of the hands of prohibited individuals plays an important role in reducing violent crime and better protecting our neighborhoods.”
On June 24, 2022, Whitaker pleaded guilty to possession of firearm by a convicted felon. He is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement, U.S. Attorney King thanked the ATF and CMPD for their investigation of the case.
Assistant United States Attorney Christopher Hess, of the U.S. Attorney’s Office in Asheville, prosecuted 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.
Cleveland Man Found Guilty of Drug Trafficking and Firearms PossessionRead the Press Release
CLEVELAND – William Sims, 45, of Cleveland, Ohio, was found guilty on Monday of all seven drug trafficking and firearms charges against him after a five-day trial by jury before U.S. District Court Judge Dan Aaron Polster. The charges included possession with the intent to distribute methamphetamine, crack, fentanyl, fluorofentanyl, cocaine, and heroin, as well as being a felon in possession of firearms and ammunition and possession of firearms in furtherance of a drug trafficking crime.
According to court documents and testimony, on November 26, 2021, after completing controlled purchases of crack cocaine from William Sims during the prior week, Cleveland Police detectives executed a search warrant on Sims’ home. During the search, detectives found Sims in possession of approximately 154.5 grams of methamphetamine, approximately 124.51 grams of crack cocaine, approximately 78.59 grams of fluorofentanyl and fentanyl, as well as numerous mixtures containing other narcotics like cocaine and heroin. The majority of the drugs were found in Sims’ bedroom, in close proximity with two loaded firearms and ammunition found under Sims’ bed.
Sims is prohibited from possessing firearms due to prior felony convictions.Sentencing is scheduled for November 2, 2023. Sims faces a mandatory minimum sentence of ten years in prison, although his sentence will be determined by many factors and may be higher than the mandatory minimum. The judge will determine the appropriate sentence after considering the sentencing guidelines and other factors.
This case was investigated by the Cleveland Police Department, and First District Detective Ryan McNamara and was prosecuted by Assistant U.S. Attorneys Payum Doroodian and Alejandro Abreu.
Chinese National Real Estate Developer Appears in Court to Face Charges of Bribing A Prominent San Francisco Public OfficialRead the Press Release
SAN FRANCISCO - Zhang Li, founder and chief executive officer of a Chinese real estate development company appeared last night in U.S. District Court on charges that he bribed former head of the San Francisco Department of Public Works Mohammed Nuru, announced First Assistant United States Attorney Patrick Robbins, Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp, and Internal Revenue Service-Criminal Investigation Special Agent in Charge Darren Lian. A U.S. company that Zhang controls, Z&L Properties, Inc., was also charged with honest services wire fraud for providing bribes and gifts to Nuru in exchange for favorable city treatment of Z&L Properties’ mixed-use project at 555 Fulton Street in San Francisco, Calif. As part of a negotiated disposition both Zhang and Z&L Properties will waive the right to indictment and admit that they engaged in certain conduct.
Zhang, 70, of Guangzhou, China, has been charged by Information with one count of conspiracy to commit honest services fraud. According to the Information, Zhang bribed Nuru by providing him with food, drinks, luxury lodging, and transportation during a trip Nuru took to China in 2018. The Information alleges the purpose of the bribe was to influence Nuru so that he would provide favorable treatment on decisions and city approvals needed during the construction and development of a mixed-use property at 555 Fulton Street in San Francisco being developed by Zhang and a company Zhang controlled.
Z&L Properties Inc., a U.S. company formerly based in Fremont, Calif., and controlled by Zhang, was also charged in a separate Information with conspiracy to commit honest services fraud and honest services wire fraud for its participation in the bribery scheme. Z&L Properties managed the development of the 555 Fulton Street project and the company facilitated the payment of bribes to Nuru in exchange for favorable treatment regarding the 555 Fulton project, according to the allegations in the criminal Information.
“Zhang Li and Z&L Properties have admitted that they bribed a top San Francisco public official. The criminal charges and resolutions announced today send a clear message that this office will not tolerate the corruption of public officials in the District by anyone, including individuals acting from outside of the United States,” said First Assistant U.S. Attorney Patrick Robbins. “To those who seek to corrupt public officials in the United States, wherever they are, we will use the powers at our disposal to bring them to justice and hold them accountable to the rule of law.”
“Zhang Li, who earned his profits through bribery of a San Francisco public official, is yet another individual charged in connection to our ongoing public corruption case,” said FBI Special Agent in Charge Robert Tripp. “Public corruption erodes public confidence and strikes at the very foundation of our government. The citizens of San Francisco deserve better, and we stand firmly committed to investigating both corrupt officials and private citizens who attempt to bribe them, no matter where they reside.”
“IRS-Criminal Investigation’s priority is to ensure a fair and level playing field for all taxpayers,” said Special Agent in Charge Darren Lian of the Oakland Field Office. “Mr. Li’s conduct shows that greed and financial crimes have no borders, and we will continue to pursue those who take advantage of our system and taxpayers by following the money worldwide. We are proud to have worked alongside our federal law enforcement partners and the U.S. Attorney’s Office in bringing this case a step closer to closure.”
Zhang originally was charged by criminal complaint in May of 2021. At the request of the United States, Zhang was arrested when he arrived in the United Kingdom in December 2022 and the United States pursued extradition. After approximately six months, Zhang consented to extradition and was subsequently surrendered to U.S. authorities. The charges against Zhang now are set forth in an Information filed by the government.
Zhang appeared yesterday before U.S. Magistrate Judge Alex Tse in the Northern District of California. Magistrate Judge Tse released Zhang on a bond pending further proceedings.
According to the documents filed in Zhang’s case, the defendant and the U.S. Attorney’s Office have entered a deferred prosecution agreement. Under that agreement filed today, Zhang admitted to the conduct that forms the basis of the charge in the Information, and, if Zhang abides by the terms of the deferred prosecution agreement, the charge will be dismissed in three years.
According to filed documents, Z&L Properties also will plead guilty to charges set out in the Information filed against it; Z&L also will agree to a comprehensive compliance and remediation program designed to prevent bribery and corruption in connection with Z&L Properties’ real estate development work. Z&L Properties has agreed to plead guilty to one count of conspiracy to commit honest services wire fraud and one count of honest services wire fraud, will pay a fine of $1,000,000, and will enter into a corporate compliance program acceptable to the Office of the U.S. Attorney. Z&L Properties appeared before U.S. Magistrate Judge Alex Tse today, and the court set a further hearing before U.S. District Judge William H. Orrick, on August 10, 2023, at 1:30 p.m.
The charges against Zhang and Z&L Properties arose from an investigation into bribery and public corruption in San Francisco city government led by the U.S. Attorney’s Office, the FBI, and IRS-CI. To date, more than 14 individuals and entities have been charged in connection that larger set of investigations, including Mohammed Nuru, former director of the San Francisco Public Works department; Harlan Kelly, the former general manager of the San Francisco Public Utilities Commission; and multiple city contractors and other facilitators of bribes and corruption.
Nuru was charged in January 2020, pleaded guilty in January 2022, and on August 25, 2022, Nuru was sentenced to 84 months in federal prison. A separate defendant charged in the investigation, Walter Wong, was charged in June 2020 with conspiracy to defraud the public of its right to honest services and with conspiracy to engage in money laundering, both involving Nuru. Wong entered a guilty plea and agreed to cooperate with the government’s San Francisco City Hall corruption investigation.
An Information merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the defendant Zhang faces a maximum sentence of 20 years imprisonment, a maximum fine of $250,000, plus restitution if appropriate. Z&L Properties faces a maximum fine of $500,000 per count, plus restitution if appropriate. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
The case is being prosecuted by the Corporate and Securities Fraud Section of the U.S. Attorney’s Office for the Northern District of California. Assistant U.S. Attorneys David Ward and Robert Leach are prosecuting the case. The prosecution is the result of an investigation by the FBI and the Internal Revenue Service-Criminal Investigations (IRS-CI). First Assistant U.S. Attorney Patrick Robbins thanked the Department of Justice’s Office of International Affairs and United Kingdom authorities for their assistance in the extradition.
2023-07-18_information_zhang_li.pdf 2023-07-18_information_zl_properties.pdfCharlotte Business Owner and Disaster Relief Loan “Consultant” Is Indicted for $1.2 Million COVID-19 Fraud SchemeRead the Press Release
CHARLOTTE, N.C. – A federal grand jury in Charlotte has returned a criminal indictment charging Glynn Paul Hubbard, Jr., 45, of Charlotte, with wire fraud and money laundering, for allegedly obtaining more than $1.2 million in fraudulent Paycheck Protection Program (PPP) and Economic Injury Relief Disaster Loan (EIDL) Program loans for himself and his customers, announced Dena J. King, U.S. Attorney for the Western District of North Carolina.
Karen Wingerd, Acting Special Agent in Charge of IRS Criminal Investigation (IRS CI), Charlotte Field Office, joins U.S. Attorney King in making today’s announcement.
According to allegations in the indictment, from March 31, 2020, to August 1, 2020, Hubbard, Jr. submitted fraudulent PPP loan and EIDL applications to the U.S. Small Business Administration (SBA) and SBA-approved lenders, seeking to obtain relief funds for his businesses, Borrow My Ride, Balanced Society Corporation, The Regins Corporation, and GGGAB, Inc. To obtain the relief funds, the indictment alleges that Hubbard, Jr. falsified information in loan applications and supporting documentation, and provided false financial information, fake employment data, and fraudulent tax returns for his businesses. As a result of the scheme, the indictment alleges that Hubbard, Jr. received more than $570,000 in fraudulently obtained relief funds.
The indictment further alleges that Hubbard, Jr. also executed the scheme by submitting false and fraudulent applications for PPP and EIDL funds on behalf of customers, causing more than $660,000 in relief funds to be disbursed to his customers. Hubbard, Jr. allegedly promoted the fraudulent scheme through personal referrals and in social media posts where he advertised that he was a PPP loan/EIDL consultant. Over the course of the scheme, Hubbard, Jr. allegedly received improper loan preparer fees for his services totaling more than $150,000, and, to avoid detection, he allegedly required customers to pay the loan preparation fees in cash, via cashier’s checks, or wire transfers.
“Safeguarding taxpayer dollars and protecting disaster relief programs from fraud is a priority for my office,” said U.S. Attorney King. “Federal prosecutors are working side-by-side with investigators dedicated to identifying pandemic-related schemes and holding accountable individuals who sought to exploit COVID-19 economic relief programs put in place to help small businesses in a time of grave need.”
“During the pandemic, the defendant allegedly took advantage of a program intended to provide critical relief for businesses impacted by the COVID-19 outbreak,” said Acting Special Agent in Charge Wingerd. “IRS Cl is committed to bringing to justice to those who have exploited the pandemic for personal gain and have stolen from America’s taxpayers.”
The charges in the indictment are allegations and the defendant is presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law.
The wire fraud charge carries a maximum prison sentence of 20 years and a $250,000 fine. The maximum statutory penalty for the money laundering offense is 10 years in prison and a $2500,000 fine.
In making today’s announcement, U.S. Attorney King credited IRS CI for the investigation which led to the charges.
Assistant U.S. Attorneys Caryn Finley and Cassye Cole with the U.S. Attorney’s Office in Charlotte are in charge of the prosecution.
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 U.S. Attorneys’ Offices and 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 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 www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Career Offender Is Sentenced to 12+ Years on Drug and Gun ChargesRead the Press Release
CHARLOTTE, N.C. – Today, U.S. District Judge Max O. Cogburn, Jr. sentenced Allen Shunte Plowden, 38, of Charlotte, to 151 months in prison followed by six years of supervised release for cocaine distribution and illegal firearm possession, announced Dena J. King, U.S. Attorney for the Western District of North Carolina.
Ronnie Martinez, Special Agent in Charge of Homeland Security Investigations (HSI) in North Carolina and South Carolina, and Chief Johnny Jennings of the Charlotte Mecklenburg Police Department (CMPD) join U.S. Attorney King in making today’s announcement.
According to filed documents and court proceedings, in May 2020, law enforcement initiated an investigation into Plowden, after receiving information that the defendant was distributing narcotics in the Charlotte area. On September 27, 2020, law enforcement executed a search warrant at Plowden’s residence, seizing cocaine, drug paraphernalia, digital scales, and other items consistent with drug distribution. Law enforcement also seized $40,000 in drug proceeds and 16 illegal firearms, some of which had been reported stolen.
On October 25, 2021, Plowden pleaded guilty to possession with intent to distribute cocaine and possession of a firearm by a convicted felon. At today’s court hearing, Plowden’s sentence was enhanced due to his classification as a “Career Offender” based on multiple prior convictions, including Robbery and Distribution/Manufacture of Cocaine Base and Distribution of a Controlled Substance Near a School.
In making today’s announcement, U.S. Attorney King commended HSI and CMPD for their investigation of the case.
Assistant United States Attorney Christopher Hess of the U.S. Attorney’s Office in Asheville prosecuted 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.
Businessman Sentenced for Bribery Scheme and Tax EvasionRead the Press Release
The former executive vice president of an Atlanta engineering firm was sentenced today to five years in prison for paying bribes to two City of Atlanta officials in exchange for steering city business worth millions of dollars to his company, paying bribes to a former DeKalb County, Georgia, official in an attempt to obtain county contracts, and evading over $1.5 million in taxes.
According to court documents, Lohrasb “Jeff” Jafari, 72, of Alpharetta, Georgia, was the executive vice president of PRAD Group, an architectural, design, and construction management firm headquartered in Atlanta that performed services for the City of Atlanta and DeKalb County. Jafari also oversaw PRAD Group’s finances. From January 2003 to February 2017, Adam Smith served as the chief procurement officer (CPO) for the City of Atlanta and supervised the city’s purchasing activities and its expenditure of billions of dollars of public money. From April 2011 to May 2016, Jo Ann Macrina served as the City of Atlanta’s Commissioner of the Department of Watershed Management, a cabinet-level position from which she managed the city’s drinking water and wastewater systems and was responsible for an annual budget exceeding $500 million.
Jafari gave Smith and Macrina cash and other items of value to obtain business with the City of Atlanta. In exchange for those payments, Smith and Macrina conspired with Jafari to ensure that PRAD Group received city business worth millions of dollars, including by agreeing to replace two evaluators on the selection team for the city’s Architectural and Engineering contract and re-scoring an evaluation so that the city would award the contract to Jafari’s company.
During Smith’s tenure as the CPO, the City of Atlanta awarded contracts worth millions of dollars to PRAD Group and joint venture projects of which PRAD Group was a partner. For years, Jafari met privately with Smith on multiple occasions, frequently at local restaurants. During these meetings, Jafari and Smith discussed City of Atlanta procurement projects, bids, and solicitations. Often at the time of these meetings, Jafari was actively seeking additional work and assistance with ongoing city projects. Jafari paid Smith $1,000 in cash in the bathroom of the restaurant after most of the meetings. In return for these bribe payments, Jafari expected Smith to use his position and power to assist Jafari with contracting and procurement with the City of Atlanta. From at least 2014 to January 2017, Jafari paid Smith more than $40,000 in cash with the intent to influence Smith in his role as the city’s CPO.
In February 2017, Jafari became aware of the federal investigation into his bribe payments to Smith and confronted Smith at Atlanta City Hall. Jafari insisted that Smith lie to the FBI by denying that Smith took bribe money from him.
From at least 2013 through May 2016, Macrina met with Jafari to discuss City of Atlanta procurement projects, bids, and solicitations. Often when they met, Jafari was actively seeking contracts, projects, and work with the City of Atlanta. To obtain city work, Jafari promised Macrina a lucrative job with PRAD Group and, directly or through a PRAD Group employee, gave Macrina $10,000 in cash, jewelry, a room at a luxury hotel in Dubai, a luxury shopping trip in Dubai, and landscaping work at her home. Shortly after the City of Atlanta fired her, Macrina began working for Jafari and PRAD Group. Between June and September 2016, Jafari and/or PRAD Group paid Macrina $30,000 in four separate payments.
In April and August 2014, the FBI conducted two undercover operations using a confidential source. During two secretly recorded meetings, the confidential source met with Jafari at local restaurants, where Jafari sought assistance from the source to obtain work in DeKalb County. After the meetings, Jafari directed the source to the bathroom of the restaurants where Jafari made cash payments of $1,000 and $1,500.
In addition, from 2014 to 2016, Jafari neither filed personal tax returns, nor paid any income taxes to the IRS. During those years, Jafari withdrew large amounts of cash from corporate bank accounts and used money from the PRAD Group’s corporate accounts to pay for various personal expenses, including several luxury vehicles. Jafari evaded the payment of at least $1.5 million in taxes.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division, U.S. Attorney Ryan K. Buchanan for the Northern District of Georgia, Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division, and Acting Special Agent in Charge Demetrius Hardeman of the IRS Criminal Investigation (IRS-CI) Atlanta Field Office made the announcement.
The FBI Atlanta Field Office and IRS-CI investigated the case.
Trial Attorney Jolee Porter of the Criminal Division’s Public Integrity Section, Trial Attorney Todd Ellinwood of the Justice Department’s Tax Division, and Assistant U.S. Attorneys Jeffrey W. Davis and Nathan P. Kitchens for the Northern District of Georgia prosecuted the case.
Businessman Jeff Jafari sentenced to five years in federal prison for bribing City of Atlanta and DeKalb County officials to obtain contractsRead the Press Release
ATLANTA - Lohrasb “Jeff” Jafari, the former Executive Vice President of Atlanta engineering firm, PRAD Group, Inc., has been sentenced for paying bribes to two City of Atlanta officials in exchange for steering city business worth millions of dollars to his company, paying bribes to a former DeKalb County, Georgia, official in an attempt to obtain county contracts, and evading over $1.5 million in taxes.
“Jeff Jafari paid bribe after bribe to high-ranking government officials in the City of Atlanta and DeKalb County over several years and thereby obtained lucrative city contracts worth tens of millions of dollars,” said U.S. Attorney Ryan K. Buchanan. “The public paid a heavy price from every project unfairly awarded to Jafari’s companies through corruption, and he then compounded his harm by never paying any tax on his substantial personal income. His greed delivered a hard blow to public trust in honest and fair government, but this sentence underscores our commitment to prosecuting corruption in any form.”
"Circumventing the process to hire contractors for the city by accepting bribes to profit personally is one of the highest forms of public corruption," said Keri Farley, Special Agent in Charge of FBI Atlanta. "As this sentencing shows, the FBI and the City of Atlanta will not tolerate anyone who takes advantage of city funds and abuses their position of trust.”
“Residents expect fair and open competition for city contracts,” said Demetrius Hardeman, Acting Special Agent in Charge, IRS Criminal Investigation, Atlanta Field Office. “City officials who accept bribes undermine the contracting process and diminish trust in the government. IRS Criminal Investigation and our partners will continue investigating and holding those accountable who take the public trust for granted to enrich themselves.”
According to the charges and other information presented in court: From 1984 to 2018, PRAD Group was an architectural, design, and construction management firm headquartered in Atlanta, Georgia, that performed services for the City of Atlanta and DeKalb County, Georgia. Jafari served as PRAD Group’s Executive Vice President and oversaw PRAD Group’s finances.
From January 2003 to February 2017, Adam Smith served as the Chief Procurement Officer (CPO) for the City of Atlanta and supervised the city’s purchasing activities and its expenditure of billions of dollars of public money. From April 2011 to May 2016, Jo Ann Macrina served as the City of Atlanta’s Commissioner of the Department of Watershed Management, a cabinet-level position from which she managed the City’s drinking water and wastewater systems and was responsible for an annual budget exceeding $500 million.
Jafari gave Smith and Macrina cash and other items of value to obtain business with the City of Atlanta. In exchange for those payments, Smith and Macrina conspired with Jafari to ensure that PRAD Group received city business worth millions of dollars, including by agreeing to replace two evaluators on the selection team for the city’s Architectural and Engineering contract and to re-score an evaluation so that Jafari’s company would be awarded a contract.
During Smith’s tenure as the CPO, the City of Atlanta awarded contracts worth millions of dollars to PRAD Group and joint venture projects of which PRAD Group was a partner. For years, Jafari met privately with Smith on multiple occasions, frequently at local restaurants. During these meetings, Jafari and Smith discussed City of Atlanta procurement projects, bids, and solicitations. Often at the time of these meetings Jafari was actively seeking additional work and/or assistance with ongoing city projects. Jafari paid Smith $1,000 in cash in the bathroom of the restaurant after most of the meetings. In return for these bribe payments, Jafari expected Smith to use his position and power to assist Jafari with contracting and procurement with the City of Atlanta. From at least 2014 to January 2017, Jafari paid Smith more than $40,000 in cash with the intent to influence Smith in his role as the city’s CPO.
In February 2017, Jafari became aware of the federal investigation into his bribe payments to Smith and confronted Smith at Atlanta City Hall. Jafari insisted that Smith lie to the FBI by denying that Smith took bribe money from him.
From at least 2013 through May 2016, Macrina met with Jafari to discuss City of Atlanta procurement projects, bids, and solicitations. Often at the time of these meetings, Jafari was actively seeking contracts, projects, and work with the City of Atlanta. To obtain city work, Jafari promised Macrina a lucrative job with PRAD Group and, directly or through a PRAD Group employee, gave Macrina $10,000 in cash, jewelry, a room at a luxury hotel in Dubai, a luxury shopping trip in Dubai, and landscaping work at her home. Shortly after the City of Atlanta fired her, Macrina began working for Jafari and PRAD Group. Between June and September 2016, Jafari and/or PRAD Group paid Macrina $30,000 in four separate payments.
On April 8 and August 21, 2014, the FBI conducted two undercover operations using a confidential source (who at the time, was a high-ranking DeKalb County official). During two surreptitiously recorded meetings, the confidential source met with Jafari at local restaurants, where Jafari sought assistance from the confidential source to obtain work in DeKalb County. After the meetings, Jafari directed the confidential source to the bathroom of the restaurants where Jafari paid the confidential source cash payments of $1,000 and $1,500.
From 2014 to 2016, Jafari neither filed personal tax returns, nor paid any income taxes to the IRS. During those years, Jafari withdrew large amounts of cash from corporate bank accounts and used money from the PRAD Group’s corporate accounts to pay for various personal expenses, including several luxury vehicles. Jafari evaded the payment of at least $1.5 million in taxes.
Lohrasb “Jeff” Jafari, 72, of Alpharetta, Georgia, was sentenced before U.S. District Judge Steve C. Jones to five years in prison, three years supervised release, a $300 special assessment, and $909,674 in restitution. In April 2023, Jafari pleaded guilty to one count each of conspiratorial bribery, substantive bribery, and tax evasion.
The Federal Bureau of Investigation and Internal Revenue Service Criminal Investigation investigated the case.
Assistant U.S. Attorneys Jeffrey W. Davis and Nathan P. Kitchens, Trial Attorney Jolee Porter of the Justice Department’s Public Integrity Section, and Trial Attorney Todd Ellinwood of the Justice Department’s Tax Division prosecuted the case.
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.
Browning man charged with first degree murder, sexual abuse in death of woman on Blackfeet Indian ReservationRead the Press Release
GREAT FALLS — A Browning man suspected in the death of a woman on the Blackfeet Indian Reservation appeared on July 18 on murder and sexual abuse charges, U.S. Attorney Jesse Laslovich said today.
Paul Andrew Vielle, 58, pleaded not guilty to an indictment charging him with first degree felony murder, second degree murder and aggravated sexual abuse. Vielle faces a mandatory term of life imprisonment and a $250,000 fine if convicted of first degree felony murder.
U.S. Magistrate Judge John T. Johnston presided. Vielle was detained pending further proceedings.
The indictment alleges that on April 22, near Cut Bank John Coulee, in the Meriwether area on the Blackfeet Indian Reservation, Vielle killed the victim, identified as Jane Doe, by cold exposure and that he engaged in a sexual act by force against Jane Doe.
Assistant U.S. Attorney Kalah A. Paisley is prosecuting the case. The Bureau of Indian Affairs, FBI, Blackfeet Law Enforcement Services, Glacier County Sheriff’s Office and Montana Highway Patrol conducted the investigation.
An indictment is merely an accusation, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.
PACER case reference. 23-67.
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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Brookline Man Pleads Guilty to Possessing Machine GunsRead the Press Release
BOSTON – A Brookline man pleaded guilty in federal court today to illegally possessing two machine guns.
Stewart Silvestri, 24, pleaded guilty to one count of unlawful possession of machine guns. U.S. District Court Judge Denise J. Casper scheduled sentencing for Oct. 12, 2023. Silvestri was charged by criminal complaint on Nov. 16, 2022.
On Oct. 15, 2022, law enforcement responded to multiple calls for an erratic driver on Route 95 in Rowley, Mass., who had pulled into a weigh station. Upon arriving at the weigh station, law enforcement approached the driver – Silvestri – who stated he had just come from an armory in New Hampshire. While asking for his license and registration, law enforcement observed Silvestri sitting on what appeared to be firearms. A subsequent search of the vehicle recovered 14 privately made firearms (also known as ghost guns), hundreds of rounds of ammunition and numerous firearm parts. Two of the firearms were fully automatic pistols, classified as machine guns.
The charging statute provides for a sentence of up to 10 years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
Acting United States Attorney Joshua S. Levy; James M. Ferguson, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, Boston Field Division; John E. Mawn Jr., Interim Colonel of the Massachusetts State Police; and Essex County District Attorney Paul F. Tucker made the announcement today. Assistant U.S. Attorney Philip C. Cheng of the Organized Crime & Gang Unit 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.
Bozeman man charged with interfering with flight crew, abusive sexual contact on aircraftRead the Press Release
MISSOULA — A Bozeman man who is accused of interfering with a flight crew and engaging in abusive sexual contact with another person while a passenger on a flight from Salt Lake City, Utah, to Bozeman was arraigned on charges on July 18, U.S. Attorney Jesse Laslovich said today.
Hunter Andrew Dietrich, 42, pleaded not guilty to an indictment charging him with interference with flight crew members and attendants and one count of abusive sexual contact in special aircraft jurisdiction of the United States. Dietrich faces a maximum of 20 years imprisonment, a $250,000 fine and three years of supervised release on the interference charge. He faces a maximum of two years imprisonment, a $250,000 fine and one year of supervised release on the abusive sexual contact charge.
U.S. District Magistrate Judge Kathleen L. DeSoto presided. Dietrich was released pending further proceedings.
As alleged in the indictment, on Feb. 11, while aboard Delta Airlines Flight 3789 from Salt Lake City, Utah, to Bozeman, Dietrich assaulted and intimidated flight crew members and attendants, interfered with the performance of their duties and lessened their ability to perform their duties. Additionally, the indictment alleges that while on the flight, Dietrich knowingly engaged in sexual contact with another person without that person’s permission.
An indictment is merely an accusation, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.
Assistant U.S. Attorney Zeno B. Baucus is prosecuting the case. The FBI and Bozeman Airport Police conducted the investigation.
PACER case reference. 23-55.
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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Boston Woman Sentenced for Physical Therapy Clinic Fraud SchemeRead the Press Release
BOSTON – A Boston woman was sentenced today in federal court in Boston in connection with a scheme to defraud multiple insurance providers for physical therapy services that were not provided to patients.
Raya Bagardi, 38, was sentenced by U.S. District Court Judge Richard G. Stearns to time served (one day) and two years of supervised release, with the first year to be spent in home confinement. Bagardi was also ordered to pay restitution in the amount of $2,301,645. In March 2023, Bagardi pleaded guilty to one count of conspiracy to commit mail fraud. Bagardi was indicted in February 2021 along with co-defendants Gyulnara Bayryshova, Anna Barenboym and Slava Pride.
Bagardi was a licensed physical therapy assistant at Brighton Physical Therapy (BPT), a Brighton-based physical therapy clinic owned by Bayryshova. From October 2018 through June 2020, Bayryshova, Bagardi and their co-defendants conspired to be reimbursed by multiple insurance companies for physical therapy services that were not actually provided and/or were not medically necessary and, in some cases, were provided by individuals not licensed to provide the services. Specifically, Bagardi and her co-defendants falsely billed for services purportedly rendered to patients injured in automobile accidents when the services were not actually provided. Further, BPT paid patients for referrals and referred patients to attorneys to assist with patients’ insurance settlements.
All three of Bagardi’s co-defendants have pleaded guilty to their roles in the conspiracy. On July 12, 2023, Pride was sentenced to two years in prison and two years of supervised release. Pride was also ordered to pay restitution of $2,301,645. Bayryshova and Barenboym are scheduled to be sentenced on July 26, 2023 and September 2023, respectively.
Acting United States Attorney Joshua S. Levy; Christopher DiMenna, Acting Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; Anthony DiPaolo, Chief of Investigations of the Insurance Fraud Bureau of Massachusetts; Boston Police Commissioner Michael Cox; and Quincy Police Chief Mark Kennedy made the announcement today. Assistant U.S. Attorney Laura J. Kaplan of the Criminal Division prosecuted the case.
Billings felon admits illegal possession of firearmRead the Press Release
BILLNGS — A Billings man with two prior federal felony convictions admitted today to illegally possessing a firearm, U.S. Attorney Jesse Laslovich said.
Robert John Bigback, 28, pleaded guilty to prohibited person in possession of a firearm or ammunition. Bigback faces a maximum of 15 years in prison, a $250,000 fine and three years of supervised release.
U.S. District Judge Susan P. Watters presided. The court will determine any sentence after considering the U.S. Sentencing Guidelines and other sentencing factors. Sentencing was set for Nov. 15. Bigback was detained pending further proceedings.
The government alleged in court documents that on March 9, Bigback’s mother found him sleeping in her house with a gun next to his head. His father brought the firearm, a Smith and Wesson 9mm pistol, to the United States Federal Probation Office. When Bigback woke up, his mother saw him frantically looking for something where the gun had been. Bigback told his mother he had been using methamphetamine, was paranoid and thought people were after him. Bigback had prior felony federal convictions for being a felon in possession of a firearm and for distribution of meth, and he was prohibited from possessing firearms.
Assistant U.S. Attorney Timothy J. Racicot is prosecuting the case. The Bureau of Alcohol, Tobacco, Firearms and Explosives, United States Probation Office and Montana Division of Criminal Investigation conducted the investigation.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
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Belle Fourche Man Sentenced to ProbationRead the Press Release
RAPID CITY - United States Attorney Alison J. Ramsdell announced today that U.S. District Judge Jeffrey L. Viken has sentenced a Belle Fourche, South Dakota, man convicted of Concealment of an Event Affecting Title II Disability Entitlement. The sentencing took place on July 17, 2023.
Kevin Dodd Eisele, 60, was sentenced to one year of probation, ordered to pay $1,652.90 in restitution, and a $100 special assessment to the Federal Crime Victims Fund.
Eisele was indicted for Theft of Government Funds and Concealment of an Event Affecting Title II Disability Entitlement by a federal grand jury in March of 2022. He pleaded guilty on March 3, 2023.
The conviction stemmed from between July of 2020 and June of 2021, when Eisele knowingly failed to disclose a change in his household resources in order to continue receiving and spending his SSI benefits.
This case was investigated by the Social Security Administration, Office of the Inspector General. Assistant U.S. Attorney Anna Lindrooth prosecuted the case.
Arizona Man Sentenced After Pleading Guilty to Violating the Federal Controlled Substances ActRead the Press Release
NEW ORLEANS, LOUISIANA – KABIEN CORTES, age 34, a resident of Phoenix, Arizona, was sentenced by United States District Judge Jane Triche Milazzo to seventy (70) months’ imprisonment, three (3) years of supervised release, and a $100.00 mandatory special assessment fee after pleading guilty to a superseding bill of information charging him with one count of conspiracy to distribute and possess with intent to distribute a quantity of a mixture or substance containing a detectable amount of methamphetamine, in violation of Title 21, United States Code, Sections 841(a)(1), 841(b)(1)(C), and 846, announced U.S. Attorney Duane A. Evans.
According to court documents, on March 16, 2020 during a DEA investigation, a drug supplier arranged the delivery of methamphetamine to the New Orleans area. On March 19, 2020, the DEA determined that a driver, later identified as Joanna Manzano, was travelling from Phoenix, Arizona to New Orleans with the methamphetamine and would need money for expenses. The DEA also determined that the methamphetamine was in liquid form and that another individual would arrive in New Orleans at a later date to convert the liquid methamphetamine into a solid form.
The investigation disclosed that Manzano, accompanied by Cortes, traveled to New Orleans. After Manzano and Cortes arrived in Louisiana, law enforcement officers identified their vehicle and maintained surveillance on them until they arrived in Metairie. On March 20, 2020, at approximately 11:50 p.m., Louisiana State Troopers conducted a traffic stop of Manzano and Cortes. After obtaining consent to search the vehicle, troopers noticed that the bed-liner of the truck had been removed and was being held in place by a rubber cord. A continued search of the vehicle resulted in the discovery of approximately 4,576 grams of liquid methamphetamine in the gas tank of the vehicle.
This case was investigated by the Drug Enforcement Administration and the Louisiana State Police. The prosecution was handled by Assistant United States Attorney André Jones of the Narcotics Unit.
American man who sexually abused multiple Filipino girls sentenced to 50 yearsRead the Press Release
ATLANTA - Stephen Gordon Grimes has been sentenced for producing child pornography overseas and transporting the material to the United States. Over the course of three years, he recorded videos of his sexual abuse of girls as young as four years old.
“Grimes exploited poverty in the Philippines to gain access to multiple young girls,” said U.S. Attorney Ryan K. Buchanan. “He sexually abused these children for multiple years and recorded the crimes. His sentence rightly reflects the harm that he inflicted on these children.”
“I’m thankful for the successful resolution of and I’m happy that the victims can begin the healing process knowing that this predator will no longer be able to prey upon them,” said Acting Special Agent in Charge Travis Pickard, who oversees Homeland Security Investigations (HSI) operations in Georgia and Alabama. “HSI and its law enforcement partners around the globe work tirelessly to protect the most vulnerable population and hold those who seek to prey upon them, accountable.”
According to U.S. Attorney Buchanan, the charges and other information presented in court: around 2009, Grimes met two Filipino women in an online chat room. These women, who were sisters, agreed to arrange for Grimes to sexually exploit young girls in the Philippines, including the children of one of the women. Grimes worked as a civilian contractor on a Navy ship and often traveled to the Philippines at the end of each contract. He paid one of the women $500 a month to gain exclusive access to his child victims while he was in the Philippines.
Beginning no later than February 2016 and continuing until May 2019, Grimes used a GoPro device to record his sexual abuse of Filipino girls between the ages of four and 13 years. He also used a cell phone camera to record his sexual assault of the girls.
When Grimes traveled from South Korea to Hartsfield-Jackson International Airport in Atlanta on September 29, 2020, special agents with Homeland Security Investigations (HSI) confiscated his computers, cell phone and other electronic devices. A subsequent analysis of these items revealed that he had produced 340 videos and 650 images of his abuse of Filipino girls. The analysis of his computer also showed that he downloaded 523 videos and 4,470 images of child pornography from the internet.
Following Grimes’ arrest, HSI special agents undertook an operation that led to the rescue of the girls whom he had exploited and resulted in the local prosecution of the two women who conspired with Grimes.
Stephen Gordon Grimes, 51, of Lompoc, California, has been sentenced to 50 years in prison to be followed by a lifetime term of supervised release. Grimes was found guilty by a jury on April 7, 2023, of multiple counts of producing child pornography outside the United States, attempting to transport child pornography, and possessing child pornography. Parole does not exist in the federal prison system.
This case was investigated by Homeland Security Investigations.
Assistant U.S. Attorneys Paul R. Jones and Amy M. Palumbo prosecuted the case.
This case is being brought as part of Project Safe Childhood. In February 2006, the Attorney General launched Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorney’s Offices around the country, Project Safe Childhood marshals federal, state and local resources to apprehend and prosecute individuals who exploit children. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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.
Amazon Agrees to Injunctive Relief and $25 Million Civil Penalty for Alleged Violations of Children’s Privacy Law Relating to AlexaRead the Press Release
The Justice Department, together with the Federal Trade Commission (FTC), today announced that Amazon.com Inc. and its wholly-owned subsidiary Amazon.com Services LLC (collectively Amazon), have agreed to a permanent injunction and a $25 million civil penalty as part of a settlement to resolve alleged violations of the Children’s Online Privacy Protection Act (COPPA), the Children’s Online Privacy Protection Rule (COPPA Rule) and the Federal Trade Commission Act (FTC Act) relating to Amazon’s voice assistant service Alexa.
Alexa is a proprietary voice-activated service that Amazon provides through its Echo smart speakers, its “Alexa App” mobile application, and other devices and applications. Since May 2018, Amazon’s Alexa-related offerings have included voice-activated products and services directed toward children under 13 years of age. When a user makes a verbal request of an Alexa-enabled device, Amazon saves the voice recording of the request and creates a written transcript of it.
In a complaint filed in the U.S. District Court for the Western District of Washington, the government alleges that, since at least May 2018, Amazon violated the FTC Act, COPPA and the COPPA Rule with respect to Alexa and Alexa’s child-directed offerings. The complaint alleges that Amazon retained children’s voice recordings indefinitely by default, in violation of COPPA’s requirement that these recordings be retained only as long as reasonably necessary to fulfill the purposes for which they were collected. Other alleged violations include making deceptive representations that Alexa app users could delete their or their children’s voice recordings, including audio files and transcripts and their geolocation information, when in fact Amazon on some occasions failed to delete all such information at users’ request. The complaint also alleges that Amazon engaged in unfair privacy practices with respect to Alexa users’ geolocation information and voice recordings, including (in some instances) by failing to honor users’ deletion requests and failing to notify consumers that it had not done so.
The stipulated order entered today by the federal district court requires Amazon to pay $25 million in civil penalties. The order imposes injunctive relief that requires Amazon to identify and delete inactive child profiles (profiles that have not been used for 18 months) unless a parent requests that they be retained. Amazon also will notify parents whose children have accounts of this change to its policies. The order further prohibits Amazon from making misrepresentations about Amazon’s retention, access to or deletion of geolocation information or voice information, including children’s voice information, and mandates deletion of geolocation information, voice information, and children’s personal information upon the request of the user or parent, respectively. Finally, the order requires Amazon to make disclosures to consumers relating to its retention and deletion practices regarding Alexa App geolocation information and voice information.
“Today’s settlement reflects the department’s dedication to protecting children online,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department and the FTC are committed to working together to ensure that companies do not misrepresent to parents how children’s personal information is handled, retained, or deleted, and do not retain that information for longer than reasonably necessary.”
“Amazon’s history of misleading parents, keeping children’s recordings indefinitely, and flouting parents’ deletion requests violated COPPA and sacrificed privacy for profits,” said Director Samuel Levine of the FTC’s Bureau of Consumer Protection. “COPPA does not allow companies to keep children’s data forever for any reason, and certainly not to train their algorithms.”
“Parents want and deserve to have control over data related to their young children – this includes recordings of the child’s voice, the child’s location, and the questions the child asks an Alexa device,” said Acting U.S. Attorney Tessa M. Gorman for the Western District of Washington. “Some may be delighted to have those recordings saved for sentimental reasons – but that needs to be the parent’s choice – not a decision made by Amazon. This settlement requires Amazon to provide notice to parents with ways they can select whether and how that data is retained.”
This matter was handled by Senior Trial Attorney James T. Nelson and Assistant Directors Lisa Hsiao and Rachael Doud of the Civil Division’s Consumer Protection Branch, Assistant U.S. Attorney Kayla Stahman for the Western District of Washington and Elisa Jillson, Andrew Hasty and Julia Horowitz of the FTC.
For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at www.justice.gov/civil/consumer-protection-branch. For more information about the FTC, visit its website at www.FTC.gov.
Accountant Indicted for Embezzling More than $715,000 from Spokane Medical PracticeRead the Press Release
Spokane, Washington – Today, Vanessa R. Waldref, the United States Attorney for the Eastern District of Washington, announced that a grand jury returned an Indictment charging Carol Casilla, age 25, of Spokane, Washington, with forty-six counts of fraud in connection with Casilla’s theft of more than $715,000 from a Spokane medical practice at which she was employed between 2020 and 2023.
Between May 2020 and March 2023, Casilla was employed as an accountant by Spokane Dermatology Clinic (SDC), a dermatological practice located in Spokane. The Indictment alleges that, while employed at SDC, Casilla used her position to fraudulently issue company checks to herself and deposit them into her own personal accounts, and to make electronic funds transfers using company funds toward her personal credit cards. The Indictment alleges that some of the transfers were made to a fictitious company that Casilla created in order to make it appear as though the transfers were for legitimate company expenditures. According to the Indictment, Casilla made hundreds of fraudulent transfers in this manner, stealing more than $715,000 in total.
“Accountants, bookkeepers, and financial professionals have access to funds and sensitive financial information,” said United States Attorney Waldref. “When they abuse that access in order to line their own pockets, they devastate our communities. We will continue to work hand-in-glove with our law enforcement partners and with the community to hold accountable those individuals who abuse their positions of trust.”
The fraud charges carry maximum sentences of up to 30 years in federal prison. This case was investigated by the Federal Bureau of Investigation, Spokane Resident Agency. Assistant United States Attorneys Dan Fruchter and Tyler H.L. Tornabene are prosecuting the case on behalf of the United States.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
United States v. Casilla, Case No: 2-23-CR-00085-TOR